On Tuesday, Sept 3, the Garretson City Council held a special meeting. All council members were in attendance, as well as Doug Hoy with Sayre Associates.
Most of the meeting was spent in closed session, quoting SDCL 1-25-2 (3), which states, “Consulting with legal counsel or reviewing communications from legal counsel about proposed or pending litigation or contractual matters” in SD Codified Law.
However, at the end of the meeting, open session again resumed with council members taking a public vote on three actions; 1) That the City declare that Haarsma Construction is in default of the April 20, 2018 contract for the Third Street and Truck Route improvement construction project with the City of Garretson and formally terminate Haarsma Construction’s right to complete the existing contract and related addendums; 2) that the City surrender completion of the project to Hudson Insurance Company and that the City pay the balance of the contract price remaining to the City in accordance with the terms of the April 20, 2018 contract and work with the surety to take all steps required of it to complete the project; and 3) that the city allow Haarsma Construction, with supervision from Sayre Associates, to complete the remainder of the work on 3rd Street, which includes final asphalt and related work by September 9, 2019.
With each of these three actions, the council voted unanimously to approve, which formally terminates the contract with Haarsma Construction. Haarsma is being allowed to finish the work on Third Street, as asphalt was scheduled to begin on Wednesday, Sept 4 and be completed by Friday, Sept 6. If it is not completed, the City can take further action on Monday, Sept 9 at the monthly City Council meeting. If Haarsma Construction does not finish the project and abandons it upon hearing of the council’s decisions, a contractor will be found and it will be finished prior to winter.
Haarsma Construction was hired in April of 2018 to complete Third Street, Main Avenue from 2nd to 4th Street, and the Truck Route consisting of Granite Ave, Essex St, and Railroad Ave. While weather delays caused many issues with completion of Phase 1, which was to be Third Street and Main Avenue, problems continued in 2019, resulting in Third Street not being completed until Sept 2019, Main not being finished, and the Truck Route not even begun. There have also been structural issues, such as a water main break under Main Avenue in front of O So Good, which flooded the basement and caused thousands of dollars in damages, and issues with boulevard replacement along Third Street.
The City lawyer was expected to alert Haarsma Construction of the decisions by late afternoon on Wednesday, Sept 4.
With this decision, the City is turning over the rest of the project to the bond company, who will now be responsible to find a contractor to finish the project. Any fees above and beyond the initial contracted price will be billed to Haarsma Construction, who will be held responsible for payment. The caveat is from here on out, there will be many things the City no longer has any control over, as it is controlled by the city lawyer, the bond company, and Sayre Associates.
