REA Final - 22 Dec 20 - eBook - 1682 pages

PO Box 575 Fort Montgomery, NY 10922

January 31, 2020 John Dolan, Project Executive Skanska Walsh Design-Build JV LaGuardia Airport Hangar 5A Runway Drive Flushiing, New York 11371 Re:

Notice of Reduced Scope Bridge B

Project: Subcontract No. 620-027 Mr. Dolan: We are responding to your notice dated, January 27, 2020.

During our conversation on Friday, January 24 th , we discussed several aspects of the PBB/BOH project. We agreed that the three (3) month delayed start, compressed schedule, congested work areas, and mismanagement by the onsite SWJV Project Manager and Assistant Project Manager (SWJV PM/APM) contributed to SWJV’s need to recover its schedule by accelerating the work. Absent from our discussion were specific scope areas for removal and Spearhead being responsible for cost and schedule impacts caused by the delayed start. 1. Delayed Start leads to unclear end date Spearhead’s Contract Project Schedule is April 2019 through November 2019, or eight (8) months duration. Spearhead’s official start date was August 14, 2019, a delay of three (3) months. Spearhead was never formally informed of a revised end date nor was Spearhead’s contract modified by an extension of time or by payment terms to compensate for acceleration costs associated with a compressed schedule. 2. Compressed Schedule creates cashflow burden When asked to add more manpower to accelerate our work, Spearhead’s reply has been consistent. Spearhead needed relief to its cashflow burden if the end date remained unchanged and we took on more manpower. Spearhead outlined this solution for the SWJV PM, Frank Corallo, saying, “If Spearhead could submit weekly pay applications (draws) and receive weekly reimbursement, Spearhead could take on more workers.” The SWJV PM would only commit to reimbursing SWAC applications, conditioned upon Spearhead adding a 3 rd shift. To mitigate the financial burden of running two (2) shifts plus overtime, the Finance team has worked diligently with Spearhead to release funds for approved draw submissions as soon as possible. They have often stepped in to remind the SWJV PM and SWJV APM, Brian Mock, to approve Spearhead’s pay applications that languished without attention. No effort was made to amend Spearhead’s contract payment terms. 3. Congestion - Spearhead request to work 2 nd shift work denied, coordination and access In mid-September, Spearhead requested a move to work 2 nd shift due to severe congestion on the bridge and delays getting materials to work areas during the day shift. The SWJV PM denied Spearhead’s request stating, "Andee, working the 2 nd shift for Spearhead is not necessary at this