Early in September, the Saratoga County Water Authority saw two developments in its effort to construct a water pipeline one promising for the project, the other troubling.
Gloversville-based the Delaney Group, Inc. sued the water authority in an effort to terminate its contract due to late payment, filing papers with the county court on Tuesday, Sept. 9. According to the lawsuit, the company submitted a $393,381.74 bill to the county water authority but did not receive payment until Aug. 29. Now they’re looking to terminate their contract.
At almost the same time, Standard and Poor’s, a financial research company, gave bonds on the county waterline project a rating of AA, just short of the highest rating possible.
If news of the Delaney summons unsettled potential buyers, it didn’t have a great effect. According to Jack Lawler, Waterford supervisor and water authority chairman, the bonds for the project were sold last week for $45 million.
Financially, we’re in the best shape we’ve been in since the project started,` said Lawler.
The county waterline is designed to stretch 28 miles from Moreau to the Luther Forest Technology Campus in Malta, supplying several municipalities along the way. AMD has plans to build a microchip fabrication plant there that would require 3 million gallons of water per day at the onset of operations, though no commitment to build in Malta has been made by the chipmaker. The entire cost of the project is pegged at $67 million.
The Delaney Group was one of many contractors working on the actual construction of the pipeline, having been awarded a $5.6 million contract with the authority. Lawler said that much of Delaney’s work has been completed already, with approximately $2 million of the contracted work remaining.
`The Delaney issue is unfortunate, but on a project this size, I don’t think it’s totally unexpected that we’d have a problem with a contractor,` said Lawler.
According to Lawler, having the Delaney Group out of the project will not affect the timeline.
`It won’t have any meaningful impact on the project,` he said. `We’re very confident that we’ll be able to find an alternate contractor to do the work.`
Whether another contractor already working on the waterline will be enlisted or the work will go out to bid has yet to be determined.
The status of the contract between the SCWA and Delaney will have to be decided in court. The plaintiff asserts that the contract requires payment by the water authority within 30 days of submission, otherwise the contractor can terminate the agreement. They will also be seeking interest on the late payment.
Both a Delaney Group representative and Laurence Fox, attorney for Delaney, declined to comment on the nature and status of the case.
The water authority is still aiming to turn on the tap in fall 2009.“