Change orders adding up again

Hawaii County Council members thought something just didn’t smell right when reviewing the latest list of change orders for county projects.

During a Finance Committee meeting Tuesday, several expressed alarm at a $274,278 addition to a Hilo sewer outfall repair project.

“It’s hard to swallow something like this,” said Kona Councilman Dru Kanuha, after the issue was raised by Puna Councilwoman Eileen O’Hara.

Change orders are done to correct errors, account for unforeseen circumstances or amend the scope of work.

The explanation for this one didn’t do much to ease concerns.

Environmental Management Director Bill Kucharski told council members the expense was to pay for the construction manager to be on site daily as a result of contractor American Marine Corp. not performing as expected. He said the department covered the expense to ensure the project met a deadline to satisfy federal regulators.

“We had problems with the contractor. Kennedy/Jenks’ oversight was required to have daily reports” he said, referring to the construction manager. “We did not budget for that.”

The pipe, carrying treated wastewater from the Hilo sewer plant, is located east of the Hilo Bay breakwater, near the pump station close to Puhi Bay. The county was under a U.S. Environmental Protection Agency order to fix leaks in the pipe, which also was being undercut by erosion.

Kucharski acknowledged the issue was not the county’s fault, though it was on the hook for the additional cost. He said Wednesday the county could have penalized the contractor only if they didn’t meet the deadline.

The construction contract was for $1.5 million, Kucharski said.

Some questioned why the county didn’t go after the contractor’s bond.

“The contractor we had was less than great,” Kucharski told council members. “And we actually came close to sending contract termination letters. They finally corrected … we also were under a completion order by June 1 (before coral spawning season started).”

Kucharski said the expense was worth it to get the project done on time. He noted his department is short on project managers.

According to the committee’s change order report, the construction management contract with Kennedy/Jenks Consultants included four change orders all together totaling $827,146 during the project. The original contract was for $243,289.

Hilo Council members Aaron Chung and Sue Lee Loy suggested the county needs to be more aggressive in enforcing contracts.

“We need to hold them accountable to the contract,” Lee Loy said. “I don’t want the county to have a reputation it’s real easy to get a change order from us.”

Change orders weren’t limited to that project.

From June 1-15, there were nearly $600,000 in change orders on county contracts, according to the report, which listed some cost reductions in other projects.

The cost additions include a nearly $400,000 change order to the same construction manager for the Kealakehe wastewater treatment plant aeration and sludge removal upgrade project. The report says that is for additional construction management services “due to the default of the general contractor.”

Kucharski said Wednesday the main contractor of the $17.4 million Kealakehe project defaulted, prompting the county to go after the performance bond. A new contractor was supplied by the insurance company, he said, adding the project could be done in the next month or two.

But that transition required more management services, he said, leading to the change order. In total, Kennedy/Jenks has received $823,063 in three change orders for that project, which increased the contract by about 70 percent, according to the report.

The county paid numerous change orders to finish projects prior to the former administration’s departure.

Email Tom Callis at tcallis@hwaiitribune-herland.com