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Bill introduced to protect project contractors, owners
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Posted on Nov 01 2004
To avoid a repeat of the hemodialysis construction fiasco, Vice Speaker Timothy Villagomez introduced yesterday a bill that aims to hold accountable both contractors and project owners.
Villagomez introduced House Bill 14-260 or Works Improvement Act of 2004, which aims to set up a new mechanics lien.
Right now, the lawmaker said the mechanics’ lien provision “is inadequate to protect the interests of contractors and merchants” in the Commonwealth.
Further, he said that existing rules do not provide for safeguards against public entities that fail to comply with the terms of construction contracts.
As a result, he said, qualified contractors and suppliers continue to be discouraged from doing business in the CNMI and participating in the development of projects.
This condition, he said, results in increased cost of construction in the CNMI “because competition is limited.”
“The purpose of this legislation is to strengthen the present mechanics’ lien and to provide for stop notice for private and public works and payment for bond for private and public works,” said Villagomez.
House leadership spokesman Charles Reyes Jr. said the bill comes in the wake of the construction mess surrounding the Commonwealth Health Center’s hemodialysis center project.
“We don’t want to see any repeat of that fiasco. The vice speaker, as you know, introduced a bill reprogramming funds for the hemodialysis project. He was placed in a difficult position but he went ahead to use that fund to help dialysis patients,” said Reyes.
As proposed by Villagomez, the House approved a $5.8 million reprogramming for the hemodialysis project. The funds would be taken from Kagman wastewater project, which has yet to start in 2006. The reprogramming bill is now up for Senate action.
The hemodialysis project was originally allotted over $11 million in Covenant 702 funds.
Its construction contract only amounted to $5.6 million but due to several change orders, the budget was depleted.
The Department of Public Health and Public Works said that the original contract design by Leo Daly was faulty and had to be contracted out to another company, Tanaguchi Ruth. The facility is now being constructed by AIC Marianas.
