FARRELL Expenses mount in dispute over bill from contractor

Officials said the contractor wants more than the original disputed amount.
By HAROLD GWIN
VINDICATOR SHARON BUREAU
FARRELL, Pa. -- A 5-year-old dispute over a $22,000 contractor's bill has cost the city four times that much in legal expenses and will likely cost more before it is resolved.
The issue goes back to a 1998 $1.4 million contract awarded to the Conti Corp. of Lowellville to upgrade the city's sewage treatment plant.
The job was to be finished at the end of April 1999 but because of poor weather and other factors, wasn't completed until around the end of August.
The city did grant some additional time for the work but announced in July 1999 that the project was behind and that Conti would be assessed a $500-a-day penalty.
In the end, the city withheld $22,000 from the contract, the equivalent of 44 days of penalty.
"We decided not to pay after consultation with the project engineer and legal counsel," Mayor William Morocco said.
Conti challenged the city's action, and efforts to settle the dispute have been unsuccessful ever since.
Disputed amount has grown
City officials said the amount now being requested by Conti has grown considerably larger than the original disputed amount, with the company asserting that extensive additional work was done for the job.
The amount now totals much more than the nearly $80,000 the city has paid out in legal fees to fight the case.
Officials declined to be specific about the exact amount Conti is seeking, and calls to the Conti Corp. seeking comment on the case weren't returned.
The city hired the Pittsburgh legal firm of Reed Smith LLP to help with the dispute and has been paying almost monthly legal fees to the firm since late 2002.
Those payments reached a total of $79,333 earlier this month.
Farrell has also shelled out an additional $7,150 to the American Arbitration Association for an arbitration of the case that has yet to occur.
All of that money has come out of the general fund, not the sewer fund, said City Manager LaVon Saternow.
It's money that the city, rated as financially distressed by the state, can ill afford to spend, she said.
Arbitration delayed
Arbitration was scheduled for September 2003, but the arbiter assigned to the case suggested he might have a conflict of interest, delaying the case, said Saternow.
That matter has been cleared up and the arbitration will be rescheduled, said Atty. Steve Mirizio, city solicitor.
In the meantime, the city is trying to negotiate a settlement, Saternow said.
Morocco said the situation is frustrating.
The city finds itself in a situation that is beyond ironic, he said, adding that it can't go back to the original disputed amount because that is no longer on the table.
The company's demands have gone far beyond that amount, Morocco said.