Kevin J. Gallagher, Caldwell’s Vice President of Sales sent the district a letter, dated June 19, said, “The steel price increase announcements since the time of bid, January 31, total $549 per ton, or $167,994. Mire increases are expected. Additionally, we are experiencing unprecedented price increases from other material suppliers, freight costs, etc.”
Caldwell proposed what it termed as a “successful, yet equitable” solution, by “absorbing a majority of the costs,” and that the project owner, the Barkley Lake Water District, split the cost of the steel by half. Caldwell attached a change order to the letter reflecting the $83,997 increase in the steel.
Goins said that he recommended no changes in the project, and said that Caldwell placed $150,000 on the project as a security deposit.
Commissioner Mike Hyde said that contractors estimate the cost of steel when making bids.
“When they won the bid, the cost was locked in,” said Commissioner Stanley Brimmer.
“They bid today’s prices. Tomorrow it could be different,” said Commissioner David Kyler. “We have a contract. They agreed to build the tank at a price and furnish the steel.”
Engineering Consultant Jim Hilborn of GRW Engineering said that bids are held for 90 days before the orders are submitted, a routine practice. “I haven’t seen this before, but they are probably hurting. Still, you have no reason to give them more money, especially for a letter. If they have a legitimate concern, they can come to your meeting.”
Hyde made a motion to reject the letter, with a second from Brimmer. The motion passed without opposition.
For more actions by the Barkley Lake Water Commission, see this week's Cadiz Record.