Serving Northern St. Louis County, Minnesota


JCI seeks $350,000 from school district

District plans to withhold some payment to ensure resolution of problems

Tom Klein
Posted 11/13/13

REGIONAL – Johnson Controls Inc. has requested payment of $350,284 that the St. Louis County School District still owes on its contract with the consultant.

Although the district doesn’t …

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JCI seeks $350,000 from school district

District plans to withhold some payment to ensure resolution of problems


REGIONAL – Johnson Controls Inc. has requested payment of $350,284 that the St. Louis County School District still owes on its contract with the consultant.

Although the district doesn’t dispute the bill, it plans to withhold a portion of the funds until some of the work on schools meets the district’s satisfaction.

According to Business Manager Kim Johnson, the district has bond funds in reserve to pay the outstanding balance to JCI, although the board was told in May 2012 that spending commitments for the project exceeded the bond proceeds by nearly $400,000.

School Board Chairman Bob Larson said the district should determine how much it will cost to complete that work and deduct only that amount from the final payment He said the district can’t just arbitrarily withhold funds from JCI; it needs to justify any deductions it makes.

Board members agreed to leave that up to Superintendent Teresa Knife Chief, who will get estimates on the work that still needs to be completed or fixed.

Some of the key issues include cracks on the concrete walkways outside at the North Woods School and the control panels for the water tower at the school.

Although the same contractors were used on the water towers at South Ridge and North Woods, the control panels appear to be different. South Ridge’s tower can be operated automatically, but North Woods’ tower has to be run manually.

Some had suggested that the district may have substituted less expensive parts at North Woods as the district tried to stay within budget on its projects. But that explanation doesn’t hold up because the district actually spent $40,000 more on the North Woods tower.

It’s a similar story with the concrete walkways. While some minor cracks appeared in the concrete at South Ridge, the cracks are much more pronounced on the North Woods walkway. Board members speculate that the contractor did not dig deep enough or failed to put in expansion joints when installing the walkway at North Woods.

There are several other minor issues that also need to be addressed before the final payment is made, according to the board.

Board member Nancy Wall Glowaski said the board needs to either have the work repaired or completed or deduct an amount that would cover the district’s costs in having the work done by another contractor.

Board members also said they were told some final bills by other contractors on the project had yet to be submitted. They were concerned whether the district had enough of the bond proceeds in reserve to cover all the remaining bills.

In May 2012, the board learned at a study session that spending commitments totaled nearly $400,000 more than the $78.8 million in bond proceeds that voters approved to pay for the construction of two new schools and remodeling of three existing buildings.

In all, construction costs rose more than $8.1 million (about 10 percent) above the project’s original estimate, according to Randy Anderson, who helped oversee the project for ISD 2142’s consultant Johnson Controls Inc.

The biggest share of that cost — more than $4.88 million — resulted from the expansion of square footage from the original plan. Both South Ridge and North Woods schools added 14,500 square feet. Those expansions together cost $4.29 million while a 4,000-square-foot expansion at Cherry raised the tally another $592,000.

Remodeling the Cherry School, which cost $1.04 million more than its revised budget projection of $10 million, presented numerous challenges. The original bid packages came in high, requiring a redesign of the project and prompting the board to add $700,000 to the school’s construction budget. Later, the discovery of contaminated soils at the site further delayed work and incurred more costs. In all, delays on the Cherry School added $720,000, Anderson estimated.

Anderson also cited numerous expenses that added to the cost of remodeling the three existing schools, singling out the demolition and reconstruction of a wall in the Tower-Soudan School as an example. The need to replace the school’s north wall, which was made necessary by the board’s decision to demolish the 1917 portion of the building, had been overlooked by the project’s architect and was not included in the original budget. Wall construction added $157,651 to the project budget, helping drive the cost of remodeling $177,706 over the $5 million originally allotted.

Asked in an email about the outstanding bills and whether the district had bond proceeds to cover them, Johnson responded that she did not have time to answer the questions now, but said when she supplies a report to the board, the Timberjay would receive a copy. She provided no timetable for when the report might be available.

In related business, the board postponed a discussion on the Cherry School expansion until it hears from the state on whether the project can proceed. Although the report to the state called for an addition of eight classrooms, the board indicated it could modify the request and reduce the size of the expansion project if board members desired.

Board members agreed to hire a consultant to help with the expansion project. Although Bob Larson had recommended using JCI, several other board members objected, suggesting that the consultant contract be put out for bids.

Board members Glowaski, Lynette Zupetz and Jody Feist all said they had heard numerous complaints about JCI’s management of the school’s restructuring project. Board member Troy Swanson also voiced the need for someone in the district, such as Tom Cundy, to look out for the district’s interest to avoid cost overruns or other problems.

Board member Chet Larson said this project didn’t have the same scale as the other project, but agreed that the district had lacked adequate oversight over the restructuring project. He blamed that failure on former Superintendent Charles Rick and cited, as an example, JCI’s acting on more than $3 million worth of change orders without consulting the board beforehand.

“Until the Timberjay got on their butt,” the district didn’t know that JCI had a contractual obligation to bring change orders to the board for review before proceeding, Larson said.


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Do we need to even comment on this story? Or, maybe it's a trap!

Friday, November 15, 2013

Steve: Most of us knew this was going to happen. Problem was, when we went to the school board, repeatedly, to alert them, board chairman Bob Larson told us all to shut up and sit down.

Albertson took the route of personal destruction and called (calls) us all troublemakers.

Meanwhile, we all pay more and some of us no longer have a school anymore. So what's wrong with this picture?

Friday, November 15, 2013


Tom Cundy is not the answere here. Please re-think your suggestion. Tom has utilized JCI for much of the school district's day to day major maintenance. He most likely has a very close personal relationship with them. Again, he won't be very impartial. Maybe even get a competitor to JCI. One of the keys to this is to make sure that the contractor follows all the rules and does not get millions of dollars in change orders. To keep contractors on an even playing field you have to make sure they bid to the same specifications. If I had lost a bid to JCI I would love the chance to make sure they properly fulfill their obligations. That way, the next time they bid, they will not be able to "low ball" their bid knowing that they can make it up on change orders.

Friday, November 15, 2013