MINUTES OF THE

BAY COUNTY LIBRARY SYSTEM

BOARD OF TRUSTEES

Joint Meeting with Building Authority

February 8, 2006

Ella Jane Martini, Chairperson, called the meeting of the Bay County Library System Board of Trustees to order at 12:06 p.m. on January 11, 2006 in the County Commission Chambers, Bay County Building. 

Present:                        Derald Adcock, James Davison, Mark Kaplenski, Ella Jane Martini and Howard Wetters

Building Authority:        Richard Bukowski, Rich Charbeneau, Don Goulet, Jim Helminiak,

John Pflueger, Gary Phillips and Tom Ryder

Others:                        Kevin Ayala, Stephanie Corona, Tom Haag, Steve List, Louis Long,

                                   Fred Martini, Fred Paffhausen, Mark Paulus, Bob Redmond, Eileen Schulz,

                                   and Deb Stone

MINUTES

Motion by J. Davison, seconded by D. Adcock, to approve the minutes from the January 11, 2006 Joint Building Authority/Library Board meeting subject to the corrections made.  Motion carried.

OPEN TO THE PUBLIC

There was no public input.

LIBRARY IMPROVEMENT PROJECT

Construction Manager, Mark Paulus- Skanska –Monthly report #36– Mark Paulus offered an update to the information included in the packet.  On the first and second floors of the Wirt Library, the doors and hardware are at 95% completion; sheet vinyl flooring has all been laid, except for the vestibule.  The final inspection for HVAC, plumbing and electrical has been completed with the final fire inspection of the building scheduled for tomorrow morning.  There are minor painting touch ups continuing throughout the building along with some millwork being completed.

Howard Wetters asked about the doors in the program room as he is aware that they have been shortened in order to make them fit the opening.  Tom Haag, site manager, responded that although it was not visible, there was a sag in the center of the door frame.  He said that often times there is an adjustment for this in the hinge pins of a door, however these doors did not come with this option so the decision was made to take the adjustment at the bottom of the door.  H. Wetters asked why this has happened and should the Library expect that the weight of the doors will continue to pull downward and add to the problem.  T. Haag responded they would not as these doors are secure with pivot pins in the floor and the alignment of the doors at the top are consistent.  H. Wetters is concerned that with the consideration of the size of the opening whether there is a structural problem with the opening, header, etc.  T. Haag responded that when he became aware of this problem, he first checked to be certain it was built to the details and specifications for the area; he confirmed that it was; that the detail does not call for a header for this particular doorway.  An effort was made to try and push the frame back up to accommodate the door but when it was realized this could not be done, the decision was made to take the adjustment from the doors.  H. Wetters asked what assurance the Library has that without any header built into the opening; it will not continue to sag.  T. Haag responded that he was not aware of why it sagged in the first place but as he was not able to move it back, does not anticipate it will sag further.  He understands that the doors are now fixed to the framing and are secure.  James Davison added that after he and H. Wetters discussed this yesterday, he reviewed the blueprints for the project then spoke with the carpenters who were working on hanging the doors to determine how much was being cut off and found it to be minimal.  Carpenters also assured him that because of the style of doors they are, there would not be any downward bearing weight to cause the frame to sag further.  H. Wetters asked for confirmation from Skanska if they agree that the fix that was put in place is adequate and from their perspective there would not be any further deterioration or problems in the future.  M. Paulus responded that he believes this to be true as T. Haag pointed out it was built to the specifications. 

CHANGE ORDERS WIRT LIBRARY

Change Order #0011 Revised $32,467 – J. Davison asked what the amount was before the revised total of $32,467 for change order #0011.  Stephanie Corona responded originally this change order started at $34,506, after her initial review of the quotes, it was reduced to $32,718; then on January 31, she and Steve List reviewed again noting one additional item they both believed should be removed bringing the total for this change order to $32,467.  She verified the total amount shown for the project’s contingency takes this change order into consideration. 

H. Wetters asked if this is the change order that contains the submissions by WPM for the removal of the dirt where they physically altered the sheets from what Skanska signed.  S. Corona confirmed that they are; that in November, the initial amount submitted to the board for approval was for $32,718.  S. Corona shared that this amount was after her review of the tickets from WPM.  H. Wetters noted that after his review of the packet he has found dozens of incidents where WPM had crossed the original amount submitted for payment and increased the amount of dirt after the on site manager had signed them.  He gave as one example where they crossed out 2 yards of dirt and changed it to 10 yards.  S. Corona confirmed this.  Steve List verified that WPM has done work on all of the projects for the Library.  S. Corona added that she had seen this practice happen on occasion on other tickets submitted which is why she reviews all tickets and compares them to the invoices.  H. Wetters stated that given the demonstrated capacity to attempt to defraud the Library project out of money for services that were never rendered, it would be prudent to do a forensic audit of all the billings received from this company.  They have repeatedly altered documents to obtain money from this project for work that was never performed. 

Motion by J. Davison, seconded by D. Adcock, to approve change order #0011 Revised for $32,467.  Roll call:  D. Adcock – yes; H. Wetters – no; M. Kaplenski – yes; J. Davison – no; E. J. Martini – yes.  Motion carried.

Change Order #0021 – Revised $102,550.43 – J. Davison asked why the Library is paying late charges included in change order #0021.  M. Paulus responded that was an accounting error and assured the board it would be deducted from the total.  Those charges total $36.  H. Wetters asked S. List for the total amount that was inappropriately claimed by the contractor.  S. List responded that when he first received this change order #0021 in November of 2005, he found $5,732 for double billing.  He noted that there were three entries exactly for the same amount, and on the same day, only the year was different.  S. Corona explained that in reviewing the billings she put together an Excel spread sheet and inadvertently duplicated 4 lines in a row.  After realizing the error, which equaled between $400-$500, she corrected it and reissued the change order on December 14, 2005 at a total of $103,845.  She explained that because of how the cells were formatted in the Excel spreadsheet, when copying cells the program will advance to the next number.  The only other additional charge on this change order was a back charge to the mason, which she mistakenly added but then removed.  She explained that both she and S. List met and discussed the discrepancies that was found and corrected them. H. Wetters asked what other charges were included besides the double billing.  S. List responded there was a back charge between contractors for approximately $870.  In addition to this, Spence Brothers’ portion was submitted for $31,000 of which they submitted the detail on an Excel spreadsheet that S. List reviewed and checked against each invoice for accuracy.  It was during this review that he found discrepancies.  The actual invoice listed $162 for screws but the spreadsheet showed a charge for $800 for the same item.  Another invoice listed $57 for screws but the spreadsheet listed them for $546.  S. Corona stated the total amount she found that was inappropriately billed to the Library was approximately $700. 

It was confirmed the invoices did not contain double billings; the error was made when the spreadsheet was created.  The over charge on the screws, previously discussed, did appear on the invoices from Spence Brothers.

H. Wetters stated that this change order is mostly for winter condition costs.  He explained there is a process for the approval of the expenditure of funds for this project.  He pointed out the contract Skanska has, states they must seek authorization for expending funds outside of the GMP.  S. Corona confirmed that but stated this charge is within the project’s GMP.  H. Wetters question how this could be as the GMP lists a budget of $60,000 for winter conditions, but there has been $172,000 in expenses submitted.  She concurred, but stated there is a contingency line item within the GMP to cover if there are any overages, field issues, etc. H. Wetters asked that what she is stating is that Skanska has the right to spend this contingency anyway they deem necessary.  S. Corona responded that this expense has been discussed several times, in many different meetings noting that both boards were aware of the expenses.  H. Wetters stated that in minutes from these meetings, S. Corona had indicated there was no more than $15,000 to $20,000 over the allotment of the $60,000 originally budgeted for the winter condition expenses, noting that this statement was made in August, months past the time these bills were submitted.  S. Corona responded she had not received all the pricing yet and it was still unclear what was being accurately submitted from WPM. She pointed out there are times when budgets are set based on what is anticipated for costs, only to find that when the actual cost is submitted, exceed the estimated cost.  H. Wetters pointed out there have always been a process in place that calls for someone to sign off on the change, even as little as $500; he asked who signed for this change, which S. Corona responded that no one had.  He pointed out that with all the past projects there have been a submittal and a request to reduce the contingency line item.  He stated the Board has approved nearly all of these requests prior to the expenditure of funds unless they were in the $5,000 limit that S. List has, in which case he would sign and approve.  He pointed out that no one has approved the expenditure of these funds presented today.  S. Corona replied that there are times that the work needs to be completed right away in order to keep the project moving forward, but that the change order is submitted afterward.  Bob Redmond asked Skanska if any of the work that was billed on these invoices was not necessary.  Skanska responded there was not.  B. Redmond confirmed that although the procedure was not followed, the work that was done was necessary. 

In response to M. Kaplenski’s question whether there is a written or verbal procedure for approving change orders, H. Wetters confirmed there is a written procedure in place to approve change orders.  S. List has the authority to approve $5,000 or less, anything above this amount needs to be brought before the board. 

After further discussion Skanska offered to waive their 1.8% in administration costs which were charged on both change orders, #0011 and #0021.  He assured the board this is the total cost for the winter conditions.  H. Wetters offered a motion to approve change order #0021 - $102,550.43 but to withhold $15,000 equal to the 15% that it costs the Library for these changes.  J. Davison’s concern with deducting the $15,000 that the Library would have to pay additional late fee charge from the contractors.  H. Wetters responded that based on the fact the invoices submitted had inappropriate billings, the board would have some latitude to retain some of the money for a reasonable period of time while discussing the remaining charges.  Trustees discussed the amount to be deducted for administrative cost and suggested that two motions should be made; one to approve the reimbursement amount and the other to approve the change order. 

Motion by H. Wetters, to request Skanska to reimburse the Library for $2,638 from Change Order #11; $1,836 from Change Order #21 and an additional $836 penalty fee for not following the process for change orders.  This equals a total reimbursement to the Library for both change orders of $6,310, which two of these items, a total of $4,474, Skanska has agreed too.

There was no second for this motion.

M. Kaplenski asked for a point of clarification whether there was admission by Skanska to reimburse the Library for the administration costs of $1,836 for change order #0021.  M. Paulus confirmed Skanska agreed to the reimbursements for both change orders, a total of $2,638.  M. Kaplenski disagreed stating the administrative costs for change order #0011 is $1,319; administrative cost for change order #0021 is $1,319, a combined total of $2,638.  H. Wetters commented that because there was no second to his motion, he offered that the $2,638 should be doubled for a total of $5,276.

Motion by J. Davison, seconded by M. Kaplenski, to approve change order #0021 in the amount of $102,550.43, minus $1,836 and $2,638 plus $36 in late charges.  

Roll call:  D. Adcock - yes; H. Wetters – no; M. Kaplenski - yes; J. Davison – yes; E. J. Martini – yes.  Motion carried.

Change Order #28E - $1,667

Change Order #109 Revised

Change Order #134 - $2,793

Motion by J. Davison, seconded by D. Adcock, to receive change orders:  #0028E, #109 and #134.  Motion carried.

Environmental Clean Up of Old Jail property – E. J. Martini asked for a motion to approve the cost for the environmental clean up of the Old Jail Property.  She stated this was approved at last night’s County Commission meeting.  The cost is in the amount of $74,031.39. 

H. Wetters asked E. J. Martini if any inquiry was made to lease parking from the County as part of the process.  E. J. Martini responded there was not.  He asked if it is then the recommendation of the chair to give the money to the County without seeking some compensation or other value for the money the Library is giving them.  He pointed out that this would be outside of the recommendation the Library’s legal counsel recommended.  He asked if the Library’s Counsel was present during the conclusion of the negotiations.  E. J. Martini responded he was not; however the Library’s Business Manager was present.  She confirmed she was the one who negotiated this transaction.  J. Davison shared that it is his understanding that the Library either take the offer of splitting the payment in half, a total of $74,031.39 or accept the $6,000 that was offered by the County’s legal counsel.  If the Library were to move forward with presenting the case in court, the Library would be spending nearly $60,000 in legal fees.  He is of the opinion this is a fair offer and as the County Commissioners have approved it, believes the Library Board should as well.  

Motion by J. Davison, seconded by D. Adcock to approve the cost for the environmental clean up of the Old Jail property in the amount of $74,031.39.  Roll Call: D. Adcock – yes; H. Wetters – abstain; M. Kaplenski – yes; J. Davison – yes; and E. J. Martini – yes.  Motion carried.

Teen Carpeting – M. Paulus explained the original carpeting planned for the teen area was not ordered in a timely fashion and will not be available to install before the Library opens.  Skanska elected to install a temporary carpet while awaiting the arrival of the carpeting previously approved for this area.  The cost for this special order and installation will be completely covered by Skanska with no cost to the project.  He has assured S. List the carpeting will be installed after the Library closes for the day and that all furniture will be moved and returned to its original location at the cost to the contractor.

H. Wetters left at 1:20 p.m.

CONSTRUCTION INVOICES

Construction Invoices and Transfer of Monies to the County – K. Ayala explained he had highlighted the $50 charge on the invoice from Braun Kendrick Finkbeiner as this work was construction related and the balance is for general operating. 

Motion by J. Davison, seconded by D. Adcock, to approve certificate #44 for $654,688.74.  Motion carried.

Transfer monies to the County to pay invoices - $281,720.00

Motion by J. Davison, seconded by D. Adcock, to approve the transfer of $281,720.00 to the County to pay invoices.  Motion carried.

PROJECT FINANCIAL REPORTS

Construction Project Expense Summary

Construction Budget, Estimates and GMP Summary

Capital Campaign Summary Report

Motion by M. Kaplenski, seconded by J. Davison, to receive the Construction Project Expense Summary; Construction Budget, Estimates and GMP Summary and the Capital Campaign Report.  Motion carried. 

UNFINISHED BUSINESS

Sage Branch Library Steps – SME report Mark Paulus – M. Paulus shared Skanska has received an opinion from Curt Welch, Fishbeck, Thompson, Carr and Huber, on the condition of the Sage Branch Library steps.  Skanska has forwarded this letter to SME, the testing company for the project and have asked for their opinion as to what has caused the cracks to appear in the steps.  In the mean time, Jim Cole, Executive Vice President of Skanksa, B. Redmond, S. List and M. Paulus was made aware of a potential repair solution for this problem at last week’s construction project meeting.  M. Paulus has been assured by SME he will have their report by early next week. 

Auction/Sale of old furniture – K. Ayala has spoken with the auctioneer to determine a price for his services and also with Stevens Van Lines as well, to determine a cost for moving the Sage Branch furniture stored at their facility.  Stevens Van Lines would charge $1,900 to move this furniture and the cost for the auction would be equal to 20% of the gross proceeds of the sale.  K. Ayala is seeking board approval to hold this auction on March 11, 2006 at the Bay City Branch. 

Motion by J. Davison, seconded by D. Adcock, to approve the Auction of old furniture to be held on March 11, 2006.  Motion carried.

NEW BUSINESS

Coffee Shop Vendor – K. Ayala shared that he received seven inquiries on the coffee shop, with two businesses responding with a proposal.  He has brought these proposals to the meeting for trustees to review in the next week and to call him with any questions or comments. 

OTHER

Interior Signage for Alice and Jack Wirt Public Library – Fred Paffhausen shared that as the interior signage had not been planned for prior to moving into Wirt Library, it needs to now be addressed once all locations are identified.  He shared there has been two styles of sign systems presented to him from Chris DeBear, Library Design and once it is determined which will be used, ordering can take place.  In the mean time, it was decided to use some of the signage from the Bay City Branch to be hung in the interim.

INFORMATION ITEMS

Picture Hanging Systems - This agenda item is deferred to the next Library board meeting.

Motion by M. Kaplenski, seconded by J. Davison, to refer the Picture Hanging System to the next meeting.  Motion carried.

ANNOUNCEMENT

Sneak Preview – The Sneak Preview is scheduled for February 12, 2006 from

3:00 p.m. – 6:00 p.m.

Amended Board Agenda meeting – The regular February 22, 2006 scheduled board meeting’s location has changed and will be held in the Alice & Jack Wirt Public Library Community Room.

Motion by J. Davison, seconded by D. Adcock, to adjourn the meeting at 1:37 p.m.  Motion carried.

Respectfully submitted,

____________________________________                        ___________________________

Derald Adcock                                                             Eileen Schulz

Secretary/Treasurer                                                                  Recording Secretary