In the months before Mortenson Construction sought mediation over payment for work at the new Minnesota Vikings stadium, at least two subcontractors reached out in distress to the Minnesota Sports Facilities Authority (MSFA).
In written responses, the MSFA brushed the concerns aside. The subcontractors’ letters, sent in early June and late May, presaged what has become a $15 million dispute between the MSFA and Mortenson over costs at the $1.1 billion stadium. In July, the sides revealed that months of closed-door negotiations had failed to bridge the divide over costs related to change orders at U.S. Bank Stadium.
On June 1, Custom Drywall operations manager Kevin Halvorson said the St. Paul company was on the verge of leaving the project because it had “exhausted all our financial resources.” Halvorson said the company was having cash flow problems and had installed $3 million worth of work it had been unable to bill for. The company has the contracts for the exterior enclosure, the interior framing and drywall and the spray-applied fireproofing.
“As we are sure you are aware, the stadium is an incredibly challenging and fast-paced project requiring the finest people in our industry,” he said.
Derr & Isbell vice president Brian Isbell said the company from Euless, Texas, hadn’t been paid for $2.4 million in work. Despite 50 years in business and roles in building new stadiums in Indianapolis, Dallas, Houston and Atlanta, Isbell said he had not “had to resort to this level of ‘chasing down’ an owner to review and approve” charges, he wrote.
The letters received almost identical three-paragraph responses signed by MSFA “CEO/Executive director” Ted Mondale, saying, “Mortenson is required to manage issues with its subcontractors.”
But Mortenson didn’t see it that way. Mortenson executive John Wood said the Golden Valley-based company itself paid subcontractors who were in danger of going bankrupt. Now Mortenson wants to be paid by the MSFA.