Palo Alto’s new police headquarters project is facing a legal battle over $3.5 million in change orders due to cost overruns. The dispute primarily involves the city’s main contractor, Swinerton Builders, and its subcontractor, Pacific Structures. The contractors claim that incomplete plans and unexpected requirements caused the additional work and expenses.
The disagreement between the city and the contractors revolves around 15 change orders and claims related to various aspects of the construction, including electrical wire sleeves and door installations. Swinerton Builders and its subcontractors, such as Commercial Controls Corporation and Walters & Wolf, are among the companies involved.
The City Council, which has designated the police headquarters project as its top priority for over a decade, discussed the claims and potential litigation in a closed session. However, no formal action was taken during the meeting.
The new police headquarters, located at 250 Sherman Ave., will accommodate the Police Department, the Office of Emergency Services, and the administration of the Fire Department. The construction is expected to be completed later this year, with staff planning to move into the building in 2024.
The legal battle began in November when the city rejected some of the contractors’ requests for additional compensation. Pacific Structures filed a claim for $1.49 million in connection with the construction of pre-cast stairs. The city denied the change order, citing Pacific Structures’ failure to comply with a contract provision regarding the submission of change orders within a specified timeframe.
Pacific Structures argued that the additional work was caused by the city’s requirements and cited a court case where a contractor recovered damages for extra work necessitated by incorrect plans and specifications. The company maintained that the cost impact was discovered after completing the work, making it impossible to meet the 10-day requirement for submitting change orders.
The dispute involves other claims as well. Pacific Structures claimed an additional $205,403 for extended on-site presence, while Swinerton filed a claim for $257,338 related to audiovisual system work. Swinerton also claimed $142,592 due to delays caused by the city’s testing requirements for building components.
The contractors expressed frustration with the city, highlighting errors, omissions, conflicts, and ambiguities in the plans provided. They argued that the volume of changes on the project was significantly higher than industry norms, resulting in unplanned staffing needs and increased scope.
According to a report from City Manager Ed Shikada, the legal process does not appear to impact the city’s plans to complete the building and make it operational in 2024. The city and contractors will follow the contractual dispute resolution process for the unresolved claims.
To ensure fairness and balance, it is important to consider different perspectives and opinions on this matter. The legal battle underscores the challenges of managing large-scale construction projects, with both the contractors and the city experiencing difficulties and claiming responsibility for the cost overruns.
