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Contractor Cries Foul After Termination by DOT

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After being removed from an Alabama state parkway section that was more than 80% complete, the contractor says the root of the problem was design errors that couldn’t be resolved with the state department of transportation.
“The state’s description was we were behind schedule. We differ on why we were behind schedule,” says Dan Cordell, general manager of Hernando, Miss.-based L&T Construction. "When all things are considered—we presented the state with some scheduling changes we wanted them to consider—we were ahead of schedule.”
The Alabama Dept. of Transportation removed L&T on Mar. 21. The work involved completing a section of the Veterans Memorial Parkway in Calhoun County and ALDOT has apparently reached agreement with L&T's surety to bring another contractor in to finish.
According to Cordell, L&T is still owed $2.5 million by the state for work it did on the project in December and January. That work was done after a 3-month shutdown of the job by the state last year, from June 26 through Oct. 23. On Dec. 8, ALDOT sent L & T Construction a notice warning the company it was in default, giving the company 10 days to explain what was going on.

L&T had been in discussions with the state regarding problems on the job.
One of the major issues concerned a drainage channel which in June 2011 was reclassified by the state, according to Cordell. At that time the Alabama Department of Environmental Management, the state arm of the DEP, reclassified the channel as a protected stream. In addition to the reclassification of the channel as a protected stream, the top bank of which was within the fill area of the road, the project had other issues, including installation of an industrial fence.
The stream’s reclassification meant that its realignment had to stop. “We were in the middle of it when they changed the stream’s designation,” Cordell says.
On Jan. 17, ALDOT sent L&T a termination notice, but "we refused to leave [the jobsite]. We thought there was a mistake,” Cordell says.
Then on Jan. 22, L&T got a letter from ALDOT telling the company it would have to leave the jobsite.
L & T Construction had never worked for ALDOT before this project. ALDOT officials could not be reached for comment, but ALDOT apparently reached an agreement with L&T's surety, F&D, about the terms of replacing the contractor.

According to a March 21 takeover agreement between ALDOT and Fidelity and Deposit Co. of Maryland, L&T directed the surety to hire a completion contractor to finish the work remaining under the original $29.4-million contract. The agreement states that the surety will hire W.G. Yates & Sons Construction Co. for the work.

ALDOT had paid L&T $24.3 million, and the "contract balance" would be defined as $5.03 million, the agreement says. As of Jan. 28, ALDOT had assessed L&T 77 days of liquidated damages, for a total of $308,000, the agreement states. L&T had paid ALDOT for 41 days of accrued liquidated damages, totaling $164,000, leaving $144,000 in liquidated damages still owed, or disputed.


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