The construction manager of the new U.S. Bank Stadium isn’t owed $15 million for extra work at the new Minnesota Vikings facility, according to a legal document released Friday by the Minnesota Sports Facilities Authority.
The 22-page document is the MSFA’s answer to M.A. Mortenson Co.’s Aug. 5 request to enter mediation over $15 million the company claims it is owed for work on the stadium because of changes to the original designs.
For example, Mortenson’s initial filing, also released Friday, said that in November 2013, when Mortenson set the guaranteed maximum price for the project, the MSFA’s stadium design called for two main electrical feeders into the building. In the final construction document of May 2014, that was still the plan, but in August last year, the MSFA ordered a third electrical feeder.
Mortenson has thus far unsuccessfully sought a $1 million payment for that change. The company says it required a subcontractor to rip out existing work to lay the third feeder. In response, the MSFA says that paying the money would cause the cost to exceed the “guaranteed maximum price” set by Mortenson in its bid.
MSFA Chair Michele Kelm-Helgen said at Friday’s regularly scheduled board meeting that she hoped for a speedy resolution to the dispute. Both she and Mortenson Senior Vice President John Wood said at the meeting that the process has been cordial despite the disagreement. Wood emphasized that the $1.1 billion building is precisely on schedule to be completed in 10 months.
Part of the authority’s argument against paying the claims is that Mortenson didn’t properly submit documents or follow prescribed procedures.
The MSFA issued a statement regarding its filing saying cost disputes on such a large project are common and it remains “committed to building the best facility.”
Wood said in an interview, “What we’re dealing with is a fundamental difference of opinion about the interpretation of the contract with regard to changes.”
After more than a year of closed-door negotiations over the cost changes, “we got to a point where we just couldn’t continue that anymore,” he said.
Now a mediator will step in and try to resolve the dispute. If that doesn’t work, the next step would be binding arbitration.
At issue are changes to the design by the MSFA’s architect. Wood said the MSFA is contractually responsible for costs related to the changes.
The issue isn’t with the Vikings.
Of the disputed costs, $14 million are for work done by subcontractors. “They’ve been waiting and waiting for these issues to be resolved,” Wood said, adding that Mortenson paid several subcontractors because they were in financial jeopardy from not being paid.
Some of the subcontractors had written directly to the MSFA seeking payment but were told payments were the responsibility of Mortenson.
While the dollar amount isn’t a huge part of the project, the move is significant because Wood said Mortenson has never filed for mediation on a Minnesota or a sports-related project.
The Golden Valley-based company runs big projects throughout the country and listed 3,800 employees and $3 billion in revenue last year. Wood said the stadium project has never been about making money for Mortenson. “It was about building the largest building for our home city, our home state, our hometown family,” he said.
In other actions Friday, the MSFA approved an additional $600,000 from the Vikings for various enhancements to signage, video boards and countertops, among others.
The meeting was the first for Tony Sertich, who was named by Gov. Mark Dayton as the successor to treasurer Duane Benson, who resigned in protest. The board selected Bill McCarthy to take on Benson’s duties as treasurer.