TIP OF THE ICE BERG – WHERE’S THE MONEY?

Bridgework at park has its price

As the builders of the new Interstate 35W bridge raced this spring to get the project completed, one unexpected obstacle appeared: a dispute with the Minneapolis Park and Recreation Board.

Flatiron Constructors Inc., the Colorado-based builder, had gotten permission from the state to use a site just downstream from the bridge as an assembly point for the structure’s major components.

But the Park Board, which owns the property and had already given the state a permit to use it, insisted that Flatiron obtain a separate permit and pay a fee — of $153,340.

When Flatiron moved its equipment to the site after receiving state permission, the Park Board ordered the company to vacate the property, known as Bohemian Flats, and notified the park police about what Flatiron had done.

With the most closely watched construction project in Minnesota hanging in the balance, Flatiron agreed to pay what it considered the excessive fee in order to avoid major delays.

“Let’s say it was a business proposition, just like the Mafia does,” said Peter Sanderson, Flatiron’s project manager. “They threatened to [take] our equipment and [arrest] our operators.”

As the new $234 million bridge is readied for its opening next week, the little-known showdown conflicts with the claims of public officials that a uniform spirit of cooperation has ruled since the 35W bridge’s collapse last summer.

Park Board officials bristle at being cast as obstacles to the project. They say they were trying to use the fee to retrieve losses suffered when the collapse interrupted business for Paradise Charter Cruises and SkipperLiner Industries. The cruise operation paid the board a percentage of its revenue to operate a dinner cruise boat at Bohemian Flats.

Tom Nordyke, the Park Board’s president, said the board had acquiesced to having the Minnesota Department of Transportation use the property in the “emotionalism of the moment” after the collapse. But the board balked, he said, at simply extending its use to Flatiron, a large, private company that had financial incentives to finish the bridge early.

“[Flatiron] may be upset about it, but it’s pretty clear. It’s our responsibility to take care of that public trust, and that public trust doesn’t allow for-profit companies to operate on public land without an agreement,” said Nordyke. “You can’t just have them doing that — you just can’t.”

Nordyke also said that Flatiron being cast as a victim in the episode was “somewhat amusing, because I know them as a company.” He added that “they’re big boys. They know how to do their own deals.”

BUILDER TO ABSORB COST

In the weeks and months after last year’s disaster, MnDOT used Bohemian Flats to store pieces of the collapsed bridge, and National Transportation Safety Board officials were on the site as they conducted the official investigation into the accident.

The impasse between the Park Board and Flatiron came to a head in March, according to Park Board e-mails.

“I have observed that Flatiron Manson has equipment and personnel located on Bohemian Flats Park. We do not have a signed agreement with you,” Nick Eoloff, a Park Board project manager, wrote on March 21 to Flatiron official Bob Edwards. “This e-mail is official notice to you to vacate the premises immediately.

“This e-mail is copied to our chief of police,” Eoloff added.

A week earlier, Edwards had complained that the bridge’s builder should not have to pay because a cruise line was losing money as a result of the collapse. “I understand the hope to compensate [the cruise line], but we are the ones that are making it possible” for the bridge to reopen “not the ones to pay extra to help them,” Edwards told Eoloff.

In a later interview, Edwards said park police arrived on the property and informed Flatiron “about stopping all work and moving away from the site.”

Nordyke said this week that he was unaware of police being sent to the property, while a Park Board spokesperson said police had gone there to photograph Flatiron’s equipment.

DISCUSSIONS ACCELERATED

When Flatiron agreed to obtain a permit, according to e-mail exchanges, the company complained that the $153,000 fee was based on a yearlong lease. Edwards said Flatiron needed the property for less than six months and should be charged accordingly.

Jon Chiglo, MnDOT’s project manager for the bridge, said he also became involved in the dispute. “Obviously, when that happened [the order to vacate], it kind of accelerated the discussions,” he said. Chiglo said he “encouraged Flatiron to get the issue resolved.”

A MnDOT spokesman said Flatiron’s contract with the department allowed the company to charge the permit’s cost to the project, meaning that it would be paid with state and federal taxpayer funds.

A Flatiron official, however, said the company would simply absorb the cost.

FINANCIAL STRESS BLAMED

As for the cruise boats, since the collapse, they’ve operated from Boom Island, upstream from the bridge. Dave Lawrence of Paradise Charter said his company was hurt financially immediately after the bridge collapse last year but has since rebounded. “It hasn’t affected us at all this year,” he said.

Park Board President Nordyke says the firm may not return to Bohemian Flats once the new bridge opens because of a variety of issues, including the perception that the area is too isolated.

Scott Vreeland, a Park Board member whose district borders the Mississippi River near the bridge site, said that Flatiron was dealt with fairly and that too often the Park Board is criticized for simply doing its job.

“Flatiron needed to build the bridge. They needed our land. We came to an agreement. Can you give me some issue?” he said. “We’re trying to keep a [park] system [that’s] under a great financial stress viable.”

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PARK WATCH POSTSCRIPT–October 17, 2015:  When the Minnesota State Auditor learned of this egregious staff-driven incident, it ruled that the Park Board Commissioners have to approve all temporary access permits; and the temporary access permits can not exceed $50,000.  Also of note is that the two staff members responsible for the excessive fee for Flatiron’s temporary access permit and the order to vacate Bohemian Flats are no longer with the Park Board