Reluctant council OKs dispute settlement

Published 5:57 am Wednesday, February 18, 2004

By By JAN GRIFFEY / Niles Daily Star
NILES -- Niles City Council has agreed to accept an offer of a $35,000 to settle a financial dispute with Mark 1 Restoration of Howell, whose workers have been removing the aluminum storefronts in downtown Niles.
Last week, a frustrated city council told officials at Mark 1 to finish up the building it was working on in the 200 block of East Main Street, after which its work on the project would be ended.
Niles City Administrator Terry Eull said the council made that decision only after trying for months to come to an agreement with Mark 1 over what the city owed it for the removal of additional board found under the aluminum siding, unanticipated at the start of the project.
Eull said Mark 1 wanted $52,000 for that work. However, those involved with the project, using generous calculation methods, calculated that work was worth only about $18,000, which the city suggested it pay Mark 1.
Because the two sides could not come to an agreement, each agreed to let an arbitrator settle the dispute. However, when turning in claims to the arbitrator, officials at Mark 1 tacked on an additional $52,000, saying the city created extra costs for Mark 1 by interfering with the way it chose to do the work on the project.
Eull, last week, said city and downtown officials involved with the restoration project knew nothing of Mark 1's second claim and said, because of it, the council felt it could not go forward with arbitration. He said the contract is very clear on how disputed issues are to be handled, and that Mark 1 at no time followed any of those courses of action.
However, Eull said Steve Evett, president and CEO of Mark 1, contacted him later, offering to settle the dispute for $35,000 if the city would allow the company to continue its work of removing the aluminum storefronts on as many of the buildings in the 200 block of East Main Street as it can for the $150,000 the city has remaining to spend on the project.
Members of the city council showed concern Tuesday night about continuing an agreement with Mark 1.
Legal fees along, if the two groups entered into binding arbitration or went forward with dual lawsuits, could easily top the $35,000 mark, all agreed.
McCauslin recommended accepting Mark 1's settlement offer, as long as the city's attorney, Robert Landgraf, is successful in negotiating safeguard in any extension of a contract with Mark 1 that would shield the city from similar, unforeseen claims in the future.
Landgraf indicated he could work to do that.
Niles City Councilmember Dan Vanden Heede asked Tim Batton, executive director of the Greater Niles Community Development Corp., and Lisa Croteau, Main Street Initiative project manager, their opinion on the settlement issue.
Croteau said she feels the same as Batton.
At the end of the discussion, all council members present -- Patricia Gallagher, Dan Vanden Heede, Robert Durm, Robert Chute and Bill Weimer -- agreed to accept the Mark 1 settlement offer and to allow Mark 1 to finish the project for the remaining $150,000, as long as Landgraf is successful in negotiation contract extension terms that safeguard the city from similar claims in the future.
Mark 1's Evett did not immediately return a telephone message left for him this morning.