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LPCiminelli warns Buffalo schools it may sue for final payment

The long simmering dispute over the billion dollar project to reconstruct Buffalo’s schools is likely headed to court after project manager LPCiminelli took the first significant legal step this week toward suing the school district.

LPCiminelli claims the school district and the Joint Schools Construction Board breached their agreements by withholding the final $3.1 million payment.

The district wants the company to produce more financial documentation about the $1.3 billion project.

LPCiminelli filed a legal notice of claim this week, setting up a potential lawsuit over an issue that has pitted Louis Ciminelli against School Board members who want more financial details revealed about the reconstruction of 48 schools.

The project has been at the center of controversy since School Board members Carl Paladino and Larry Quinn began raising questions about how much profit LPCiminelli made. Since then, attorneys have been wrangling over what documentation LPCiminelli must produce to show how public money was spent on the project.

Those School Board members want the district to pursue its own court challenge in an effort to force LPCiminelli to hand over more documents.

“It’s likely we’ll be filing our own claim,” said Quinn, who also serves on the board overseeing the construction project.

LPCiminelli claims its contracts for the project do not require it to reveal additional financial details about the school construction beyond documents the company has already made available. It contends that “the ultimate costs of the program” are its sole province and that the district has no right to inquire or audit the company’s “overhead, profit and administrative costs,” according to the notice of claim.

The company also notes that the school district repeatedly approved project invoices for years without incident and that the construction work has been widely praised.

“But recently, the JSCB and the District’s Board of Education broke with more than 10 years of precedent and began refusing to process LPC’s invoices for completed portions of the program even though the district has already accepted the work in question, began utilizing the affected schools and certified the work as complete,” the notice of claim filed by LPCiminelli Executive Vice President Eugene T. Partridge states.

The Joint Schools Construction Board and the school district have sought a wide range of documents from LPCiminelli, including details about construction costs that school officials say have never been given to the district despite the fact that the $1.3 billion project was paid for with public funds.

“This scrutiny is warranted and appropriate for a public board entrusted with safeguarding and overseeing a public school construction program of unprecedented magnitude in this community,” Carol Heckman, an attorney for the Joint Schools Construction Board, wrote in a May 12 letter to LPCiminelli.

In early October, LPCiminelli withdrew its requisitions seeking payment for the final $3.1 million owed to the company, but then resubmitted those invoices in December.

LPCiminelli Senior Vice President Kevin Schuler said several dozen subcontractors and suppliers still need to be paid. Despite the holdup on the final payments, the company has begun paying the subs directly “as they completed their obligations to the program and the district is fully utilizing the renovated schools,” he said.

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