Insurance firm says veterans home contractor must stay

Monday, Aug. 27, 2001 | 11:18 a.m.

CARSON CITY -- Another impasse has developed in completing the much-delayed state Veterans Home in Boulder City.

The National Fire Insurance Co. of Hartford, Conn., has notified the state that it wants the original contractor, Addison Inc. of Las Vegas, to return to the job to finish its work. National Fire has written the bond to cover the job's completion.

But state Public Works Manager Dan O'Brien said it is "unacceptable" for Addison to be reinstated. The state kicked the contractor off the project last month for failing to finish the job on time.

The $19.3 million nursing home was supposed to be completed in January and is already about $1 million over budget. The state has withheld $1.4 million in payments to Addison.

Addison has asked District Judge Jeff Sobel for a preliminary injunction to allow the company to return to the project. Sobel earlier refused to issue a temporary restraining order, telling Addison to get off the site or face trespass charges. Addison claims it was wrongfully terminated from the contract.

No hearing has been set on the preliminary injunction.

"It appears the bonding company is holding arms with Addison rather than the state to get the project completed," O'Brien said. The Public Works manager had wanted National Fire Insurance to allow the state to hire another contractor to resume work on the 188-bed facility.

Addison paid an estimated $110,000 for the $25 million bond by National Fire.

O'Brien has already contacted Metcalf Construction Co. of Carson City as the possible contractor to step in and finish the project. He said Metcalf can do some work that is outside the contract dispute, such as installing a water system to ensure there is enough pressure for the fire sprinkler system.

Steve Foster, vice president of operations for Addison, could not be reached for comment. He has blamed delays on the state, saying it asked for an inordinate number of change orders. He has also said he is authorized to work until December to complete the project.

Addison has filed a lawsuit in which it claims the state owes it and its subcontractors more than $6 million. It maintains that design flaws are responsible for structural defects in the project that have led to cracks in the walls, as well as toilets that do not meet federal standards.