A contract dispute between the Peralta Community College District and a San Jose construction inspection firm over the Vista College construction project have left district and company officials squabbling over why the firm stopped work in July and whether Peralta will pay the firm $130,000.
It also has the company threatening legal action if it doesn’t get paid.
At the June 14 trustee meeting, trustees were asked to approve close to $300,000 in extra costs billed by HP Inspections of San Jose, hired to provided federally mandated inspections of steel used in the Vista construction project. The additional cost was equal to the amount of the original contract.
Peralta General Counsel Thuy Nguyen said at the time that the HP work was in violation of the firm’s contract with Peralta, which required prior approval for extra work. General Services Director Sadiq Ikharo said that the overtime work was necessary because Peralta had requested that the steel be delivered early.
Ikharo told trustees last June that the early delivery had cut two months off the projected completion date of the Vista project, translating into a savings of between $2 million and $4 million to the district.
That did not mollify Peralta Trustee Nicky González Yuen, the only trustee to vote against the quarter of a million dollar request last June. “I don’t want to send a message to contractors that they can go out of budget and we’ll cover it,” Yuen said.
But a little more than a month after that June trustee meeting, Swinerton Management & Consulting, the project managers for the Vista College construction project, recommended to Peralta officials that “it was prudent to discontinue the services of HP Inspections” and appoint another inspection company in their place.
In an Oct. 14 letter to Ikharo, Swinerton Senior Project Manager K.V.S. Raman wrote, “Swinterton … [is] of the opinion that HP Inspections has not demonstrated due diligence in achieving the anticipated economies in executing the required services to the project. Continued engagement of HP Inspections would have resulted in major cost overruns.”
In his report to trustees for the Nov. 15 trustee meeting, Ikharo wrote that trustees had approved the contract increase in June “with the understanding that HP Inspections would exercise due diligence in controlling the cost of the inspection work from that point to project completion… This did not occur, and, in fact, HP Inspections submitted invoices in excess of the approved additional services amount.”
The only part of that account that HP Inspections President David Pinkham agrees with is that HP Inspections was told by Peralta officials not to exceed the agreed upon contract amounts.
In a telephone interview, Pinkham blamed the problem on confusion within Peralta itself.
“It’s my understanding that one project manager was let go and another was hired in the middle of the project, and that created the lack of a paperwork trail for some of this work,” Pinkham said.
He added that the Vista project “was one of the biggest construction projects undertaken by the district in a number of years. It’s something that they were not quite set up to handle when the project started.”
He said it was HP who “ended our services in July” after his company and the district “couldn’t come to a contractural arrangement.”
Pinkham said he was in negotiations with Swinerton and Peralta officials over his company’s final, unpaid $130,000 bill.
At the trustee meeting this month, Ikharo seemed to indicate that the district has no intention of paying HP Inspections for the outstanding bill, saying that he would use the disputed amount to pay the new contractors who have been hired to complete the Vista steel inspection work.
Trustees approved the $80,000 contract with Consolidated Engineering Laboratories of San Ramon at the Nov. 15 trustee meeting.