An extra $695,000 was spent for Event Center renovation issues, design errors and omissions before the Central Michigan University Board of Trustees allocated $750,000.

The original budget of $21.5 million included $695,000 in contingency funds, but the board approved an additional $750,000 for the project at its Sept. 23 meeting. Additional funds were needed because the design plans, provided by Smith Group Inc., allegedly included costly errors, said Steve Lawrence, associate vice president of facilities management.

“In this particular project, the number of these items and the cost to correct them exceeded our percent of (original) contingency dollars available,” Lawrence said.

He said CMU will attempt to recoup money from the design firm.

Smith Group was not available for comment.

The mediation process will start if the two parties cannot come to an agreement, Lawrence said. Negotiations could be compromised if the list of design errors was published. He said negotiations will be tough, but Smith Group has been cooperative.

“They’ve been putting in a (great) amount of time to make sure the project will meet its completion day,” he said.

The exact amount of money CMU will look to recoup from Smith Group for the alleged errors has yet to be determined. Lawrence said there’s no telling how long the potential mediation process could take.

He said the university will have a better idea of what it will try to recover after construction is complete.

“We haven’t finished the project so we don’t have a real firm number yet,” Lawrence said.

Not all the funds

Lawrence said CMU will not try to recoup all the contingency funds spent in the Events Center project because some costs were because of legitimately unforeseen conditions, or owner requests by CMU.

“We’re not going to try and recoup all that money (from Smith Group) because it’s not appropriate,” he said.

Stan Shingles, assistant vice president of University Recreation, events and conferences, said outdated building codes from the 1970s and unknown structural issues with the existing facility contributed to the design problems.

“When we started talking about blending the old with the new, there were so many unknown factors that just popped up,” he said in a previous interview with CM Life.

Lawrence said the original building blueprints didn’t depict what was actually behind the walls or underground, in some cases, which required contingency dollars to fix.

Manuel Rupe, CMU’s general counsel, said the university supports mediation as an alternative dispute resolution process because it often leads to an agreement in a more timely and less costly manner than litigation.

Rupe didn’t know the ratio of mediated disputes versus litigation cases CMU has undergone in its history. But he said nearly every construction related dispute typically goes to mediation first.

“Many engineering, design and construction contracts provide for mediation as a first step in resolving disputes that the parties to a contract cannot resolve themselves,” Rupe said. “Mediation allows a third party, the mediator, who has expertise in dealing with such disputes to work with the parties to seek a fair resolution.”