Site in July 2019

Concrete is poured at Fire Station Two site in July. The project is currently more than $290,000 over budget.

“It’s been a mess ... I think we can all agree upon that,” Leadville/Lake County Fire-Chief Dan Dailey said of station two’s construction at a meeting last week.

The station, which is under construction on a 45-acre lot off County Road 10 between Leadville and Twin Lakes, was recently red-tagged by Lake County Building and Land Use. The project is also expected to be more than $290,000 over budget.

Concrete is the primary reason for the red-tag. The site’s concrete pour failed quality-control testing earlier this month, falling below the 3,000 PSI specification identified by the project’s structural engineer.

“We don’t know the reason for the error at this point,” Commissioner Kayla Marcella told the Herald. “But it doesn’t look like we will meet the spec we were hoping for.”

The concrete will be tested for a third time on Nov. 6. The test will determine whether the project’s general contractor, Peak 360 Services & Home Crafters, will be required to remove and redo the pour at their own cost.

The stem walls were also poured seven inches higher than planned. Lake County must now redesign the driveway permit and add backfill to the driveway to correct for the slope change.

Overage amounts are in question due to change-orders, unbudgeted infrastructure costs and accounting discrepancies.

About $200,000 of the overages are due to change orders relating to ADA accessibility, increased concrete costs and a communication tower that is set to improve cell reception along U.S. 24. The tower will also serve as a high-angle training facility for firefighters.

At this point, the project is also about $90,000 over budget on infrastructure costs.

Earlier this summer, stakeholders learned that Lake County must build a regulator station on site to connect with Xcel Energy’s high-pressure gas line on C.R. 10. According to Marcella, about $30,000 was originally budgeted for the project’s energy costs. Infrastructure for gas and electric service is now set to cost the county over $125,000. The station’s septic system and well are also yet to be installed.

Financial questions also abound as Lake County attempts to sort through pay applications with Peak 360.

In October, the BOCC hired Colleen Kaneda, who has previously managed Lake County School District construction projects, to audit the project’s financials.

“It’s gotten to the point where it’s necessary to have a third party look at it ... someone who speaks the language of general contracting,” Marcella said.

The areas for further investigation identified in Kaneda’s preliminary audit include possible accounting errors, instances where change orders might not have been approved by the owner, and pay applications where billing may not match work in place. Peak 360 is currently attempting to resolve the issues highlighted in the audit.

Site work has continued intermittently, amidst failed inspections and bad weather, since Twin Lakes resident Jeff Johnson resigned from station two’s project manager role this summer.

Since Johnson resigned, the BOCC has attempted to hire three different project-management firms to take over the project. None of the firms were willing to take on the challenge; Marcella and Dailey currently split management responsibilities.

“Many of the issues here are due to the inability of the board to properly plan,” Marcella told the Herald. The BOCC signed the contract with Peak 360 last October, before Marcella was in office.

At this point, the county’s goal is to rectify financial discrepancies, pinpoint precise overage numbers and identify the remaining scope of work. Clarity is particularly timely as Lake County and the City of Leadville work to finalize 2020 budgets.

Though Lake County Government is the leading agency behind the station two project, both the county and city fund LLCFR each year. The county is responsible for 70% of the agency’s funding; the city for 30%.

No one knows how much money the taxing districts will have to fork out in 2020 to cover overages. And if the question is not resolved soon, the taxing districts will have to prepare supplemental budgets to fund the project in 2020.

“Until we have a structure I’m not willing to spend another dime,” Mayor Greg Labbe said of the city’s potential donation. “We have to deal with the people’s money the best way we know how.”

The BOCC and City Council will meet at City Hall on Nov. 5 at 5 p.m. to discuss Kaneda’s audit and how to move forward. The meeting is open to the public.

One silver lining is the newfound longevity of a $655,086 Department of Local Affairs grant awarded to county in 2018 for station two’s construction. Lake County now has up to five years to use the funding and complete the station, if needed.

“It’s better for us to have a quality product rather than have one super quickly that will need warranty work in the near future,” Marcella said.

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