One of the companies bidding to rebuild Simon Sanchez High School owes millions of dollars of liquidated damages to the Department of Public Works and received a notice of default with DPW last month. However the company in question - CoreTech International - is now claiming that notice of default is retaliation for recent protests and appeals.

Over $2.5 million in liquidated damages are under dispute in recent projects contracted to CoreTech International. The company was contracted to conduct the Route 8/Route 1 intersection improvements project and Agana Bridge replacement project more than four years ago. However, according to documents KUAM obtained from DPW, the projects had a history of issues that continued through 2016.

For example, in a letter dated April 28, 2016 from DPW to the Law Offices of Arriola Cowan & Arriola, DPW noted numerous deficiencies with the project, including that 3 of 4 tests for friction course production paving were out of specifications, with DPW noting it could not waive non-compliance for Federal Highway Administration projects. Errors were also pointed out with inaccurate documents submitted to DPW, including a CTI "certified" payroll that showed one employee working 32 hours on a Sunday. Other issues included the need to replace a lengthy portion of sidewalk, driveways and ramps that failed to comply with the American with Disabilities Act. In fact, an assessment conducted by CTI found that 58.2% of sidewalk panels installed were noncompliant, with a separate assessment by Parsons Transportation Group indicating that 83% were noncompliant.

In numerous letters to CTI, DPW indicated that liquidated damages for the project began to be assessed on April17, 2014, the day after the project was supposed to be completed. However, CTI did not achieve substantial completion until August 25, 2016 - more than two years later. Three months after substantial completion was achieved, in a letter dated December 7, 2016 from CTI president Eun Ho to DPW, then deputy director Felix Benavente noted that sidewalks, driveways and pedestrian ramps along Route 1 and Route 8 continued to be noncompliant with the ADA. He added that during the course of installation of a traffic loop sensor, it was also discovered that CTI did not complete underground conduits for the homerun cable, adding "CTI had inexplicably paved over the incomplete work". A back and forth between CTI and DPW also went on after CTI manager Robert Marks accused DPW of harassment, with Benavente calling the allegations incorrect and unsubstantiated.

However the amount of liquidated damages is under dispute. A September letter from CTI to DPW stated, "CTI disagrees with the liquidated damages charged and reserves the right to claim and recover amounts deducted for liquidated damages." In December 2016, DPW acknowledged CTI's disagreement, noting the agency is required to assess liquidated damages until a time extension can be validated and the contract amended. DPW received CTI's completed request for time extension in November 2016.

According to a recent protest from CTI in a separate procurement for Simon Sanchez High School, CTI raised issue with a notice of default/termination for the Route 1/Route 8 Agana Bridge project that was issued to CTI last month. The protest argues that the bridges were accepted in 2014 and 2016 and opened for public use, arguing that the timing of the notice of default served as retaliation against CTI for successful protests and appeals with the SSHS project to the OPA. CTI also argued that a notice of default should not be considered a record of default when there has not been final adjudication through the Guam courts. A record of default could prevent CTI from successfully bidding on the $100 million SSHS project.

We should note the protest also argued that contractual documents were missing from the solicitation package. The protest was submitted to DPW earlier this month, and DPW has yet to answer the protest.