Union Construction: 13 Months Overdue

The Union was originally scheduled to be completed on June 13, 2001, but because of numerous delays, the completion date has been pushed back to July 12 -- more than one year behind schedule.

Due to the delays, the original calculations for both construction and design labor might be considerably undervalued. In addition, delays resulting from faulty construction may unexpectedly increase material costs.

Don Luse, director of the Union, said the contract for the Union consists of three phases. The first phase is the construction of the new Union building, and the second and third phases involve the renovation of the old Union building.

Luse said that if there are additional costs to the Union, it will not have any impact on the appropriations that the University receives from the state. "We won't know any of the additional costs until after the end of the project," Luse said. "We do know that those costs are not going to affect the state's budget situation because the Union project is student-funded."

The University received bids from numerous general, mechanical, electrical and plumbing contractors, from which it chose the best available bids. The original construction cost for the Union project was $10.4 million dollars.

Bruce Runberg, associate vice chancellor for planning and construction, said N.C. law stipulated -- at the time of the contract -- that all state contracts must be multi-prime contracts.

This means the state had to receive bids from a variety of companies in each of the four contracting areas. In a single-prime contract, the state would simply receive bids from a variety of general contractors. These general contractors would then be responsible for subcontracting the mechanical, electrical and plumbing contractors.

Runberg said he believes the multi-prime contract might have created some problems that led to the construction delay. "It creates a difficult contractual process," Runberg said. "The four contractors often have trouble communicating, and therefore they have problems scheduling."

Runberg said these scheduling problems can lead to delays and, subsequently, to extra cost, which must then be resolved through claims negotiations. "It is likely that there will be both claims negotiation between the contractors, as well as between the state and the contractors," he said.

"As of now we do not know who is responsible for what delays," Runberg said. "Therefore we don't know what additional cost we might incur."

Runberg said there are changes and complications that occur in a project that are acceptable. The contract is altered during the construction process to account for these changes. Out of the 13 months the Union project is overdue, 10 of those months have been unadjusted for.

"There will likely be some claims out of these unadjusted months," Runberg said. "These claims may lead to unforeseen costs for the project, but as of right now we really don't know."

The University Editor can be reached at udesk@unc.edu.