YORK COUNTY — Cherry Hill Construction, the company working on the Mt. Rose Interchange construction project, released a statement Thursday in response to recent reports about new delays in the project, which will push the estimated time for completion to November of next year.
Cherry Hill Construction is reportedly being fined more than $24,000 per day due to delays on the project, which dates back to 2015.
The statement, made in response to an article posted to YDR.com earlier today, reads in full:
“Apparently, the York Daily Record (YDR) has chosen to publish one side of a very dismal story – the reconstruction of an old but well-recognized interstate highway, I-83. The angle that YDR presented was from the viewpoint of PennDOT. Major construction projects are massive efforts by all parties involved: heavy and highway construction contractors, such as Cherry Hill Construction, and public owners, such as PennDOT. Beyond those principal players, there are hundreds of other stakeholders, including engineers (who design), construction consultants (who oversee), suppliers, subcontractors, haulers, and many others. Cherry Hill recognizes that all of our work is being done for the most important stakeholder: the Pennsylvania public. There is no desire by any stakeholder (especially Cherry Hill) to find that its project is not maintaining schedule, and often on projects like this there is no reason to believe that the construction contractor is the one at fault (in whole or in part) for delays in the completion of the project. The I-83 project is a good case in point.
The YDR article refers to correspondence back and forth between Cherry Hill and PennDOT. That is because Cherry Hill has serious disputes with PennDOT and there have been countless times on this project when the design has been “not constructible” as specified in the drawings that were offered to the contractor for bid. For example, sometimes the design anticipates a specific type of material that is anticipated to exist below the surface – AND THAT MATERIAL IS NOT THERE. Sometimes, there are better, more cost-effective alternative means by which drainage piping can be installed, BUT THE OWNER DOES NOT WANT TO PAY THE HIGHER PRICE TO INSTALL THE DRAINAGE THAT WAY. These kinds of problems, along with many others, have arisen during this project, and Cherry Hill has been working mightily to solve them, as well as to be fairly paid for its solutions. We have not been satisfied with our efforts to get paid for our work, and we have found that PennDOT has been penalizing us with the excuse that it is the contractor’s fault. Not so.
In this project, there have been many instances in which PennDOT has simply refused to acknowledge that it has made mistakes, and that is very unfortunate for the contractor and for the public. It is Cherry Hill’s right and duty to call PennDOT to account for those mistakes. Decisions have not been timely made by the engineers representing the public, and Cherry Hill has suffered unnecessarily. Cherry Hill has been forced to advance its labor force (composed of good, hard-working Pennsylvanians) and to reconfigure its work to advance the progress of the job. But that is not easy, and it is costly because a whole variety of inefficiencies arise because of schedule changes that were not originally anticipated. When a contractor is forced to play “catch-up” because of a public owner’s mistakes and decisions (or indecisions), the contractor bears temporarily what are called “acceleration costs,” and Cherry Hill will hold PennDOT to account for these and other damages before an independent state board.
Finally, much was made in the YDR article about one-sided penalties being imposed on Cherry Hill. The reality is that during a recent negotiation meeting between Cherry Hill’s representatives and PennDOT’s District Executive and Resident Engineer, Mike Keiser, Mr. Keiser offered to award Cherry Hill 300 days of compensable time extension and indicated that he could see potentially awarding up to 500 days. Yet, that discussion has not subsequently led to any actual time extension award. Instead, Mr. Keiser has been spearheading attempts at imposing further liquidated damages upon Cherry Hill. Such penalties are not supposed to be imposed under these kind of serious contract disputes, but PennDOT is indeed imposing these one-sided penalties.
Where PennDOT is spending its energies penalizing someone before the problems are solved, it is proper to ask, “What kind of contract management is that?” Cherry Hill does not want the public to suffer any further delay, but it certainly does not find PennDOT’s “big stick” approach to contract management to be proper nor even lawful. PennDOT is failing to follow normal industry practices and administrative protocols regarding changed conditions. The engineering design for this project was the complete responsibility of PennDOT, not Cherry Hill. Cherry Hill will put forth every reasonable effort to perform and to perform well. And it will do this to serve the public, which is the ultimate beneficiary of the newly reconstructed section of I-83.
In response, PennDOT issued a statement of its own, which reads:
“These are points and contentions related to the claim that is currently being addressed by the parties through the procedure required by the contract and the law, and the matter may end up in litigation. We continue to insist that the work is completed according to the parties’ contract, and we will continue to insist on enforcement of the terms of the contract.”