Floyd County suing architect over law enforcement center, courthouse project costs and fee
By Bob Steenson, firstname.lastname@example.org
The Floyd County Board of Supervisors voted Tuesday to file a court action against the architectural firm that designed the new county law enforcement center and courthouse updates project, alleging that the firm breached its contract and exhibited professional negligence.
The lawsuit seeks a jury trial and asks that the county be awarded damages consisting of the amount the construction project has exceeded initial projections, or at the least that the county be held to owe Prochaska no more for its services than an amount based on those initial projections.
The motion, filed in Floyd County District Court on Tuesday, alleges that the project architect, Prochaska & Associates of Omaha, designed a project that went over the “not to exceed” budget figure, and omitted more than 30 items from the original designs and specifications that caused change orders to be necessary, most of which increased the cost of the project.
Prochaska has 20 days to respond to the lawsuit. As of Thursday evening no response was listed as having been filed in district court.
The county’s action says that Floyd County and Prochaska had a contract requiring Prochaska to design the law enforcement center and courthouse update project “not to exceed the construction budget figure of $10,898,700.”
Based on that construction cost and other costs totaling $12.7 million, Floyd County held a referendum asking voters to approve issuing a total of not more than $13.5 million in general obligation bonds. In May 2018, voters passed that referendum by almost a 69% majority.
In the spring of 2019, Prochaska submitted corrected budget worksheets estimating the cost of the project at $13.7 million, but the cost has risen even more since then.
“Defendant breached its contract with the plaintiff because defendant did not design a project within the not-to-exceed construction budget figure of $10,898,700,” the motion says.
Floyd County is the plaintiff in the action and Prochaska is the defendant.
“Plaintiff’s damages resulting from defendant’s breaches of the agreement include without limitation, the amount due to plaintiff for costs exceeding the construction budget figure” of $10,898,700, the lawsuit alleges.
“Defendant’s breach of the agreement also … entitles plaintiff to a declaration that no fee is owed to defendant other than the fee that it would have earned had it not breached … the agreement,” the lawsuit says.
Prochaska’s contract called for the company to be paid 10% of the construction cost of the project. Based on the cost estimate listed in the contract, that would be about $1.09 million.
But the cost of the project has increased dramatically, and Prochaska says since its fee is based on a percentage of that cost, the amount it is owed has also increased.
When a construction management company, The Samuels Group, released its own estimate of the cost based on Prochaska’s designs, it estimated the cost of the project at several million dollars more than Prochaska had estimated.
When the bids on the project were opened in September 2019, the total of the lowest bids was $14.4 million for construction, plus millions in other costs. The Board of Supervisors voted to go ahead with the project anyway, cutting costs where possible and using other sources of financing to make up the difference.
“The final contract sum to date was approximately $16,074,469,” the lawsuit says.
The eventual total cost is going to be more than $18 million, the county has said.
Because the agreement between the county and Prochaska calls for the architectural firm to be paid 10% of construction costs, Prochaska says it is now owed a total of more than $1.6 million.
So far the county has paid Prochaska about $1.06 million.
The county Board of Supervisors on Tuesday again went into closed session to discuss the litigation with Roger Stone, a managing partner with Simmons Perrine Moyer Bergman PLC law firm in Cedar Rapids, who the board hired to represent the county.
When the board returned to open session, it passed a motion authorizing Stone to file the action against Prochaska.
Information about Stone on the company’s website says he has experience litigating construction and environmental cases and has represented “corporations, contractors, cities, counties, engineers and architects.”