Turnkey completion of the Devine Golf Course clubhouse remains months away, and numerous issues with the work completed thus far, including raw sewage backing up into the building, were raised during the Devine City Council meeting last Tuesday, November 16.
Mayor Cory Thompson shared a video recorded inside the clubhouse on October 22, the night of a concert held at the course, that showed standing sewer water in various rooms of the building, including the kitchen and bar areas.
Thompson said that the issue was discovered in August and that Greco Construction, the company who remodeled the clubhouse, is aware of the problem.
“Now [Greco Construction] are claiming, somehow in all that remodel, that there is still this piece of pipe, this four-inch sanitary sewer line between the building grease traps in the outside, that needs to be changed out,” Thompson said.
Thompson added that Greco Construction thinks the work done inside the clubhouse is fine, and quoted the City $7,810 to replace the exterior cast iron pipe they claim is the problem.
“I know that it had been previously told to us that when it was asked about back in August that this was just simply because it was new, this was the first time using it, whatever, had to work through the line,” Thompson said. “That is not true.”
Scott Grego of SG Golf Management, who oversees the course’s daily operations, said the clubhouse has been in use since former City Administrator John Vidaurri granted verbal permission to do so According to Thompson, Greco Construction was issued a substantial completion certificate in August.
Substantial completion means that a project has been completed at least to the point that the owner can occupy and use the property as intended. Final payment is typically made at that time.
Grego explained that once the clubhouse flooding was noticed, the building’s restrooms were blocked off and that it took two to three hours for the sewage to recede. Four cameras, a television, and some beer was ruined and thrown out.
Public Works Director Rob Flores said the City hired a company to run cameras into the sewer lines and cleared out a t-shirt that had been stuffed into the pipe, noting that that is typically done in order to keep gasses from backing up.
“If we pull that cast iron [pipe] out will it back up again?” Flores asked. “I don’t know.”
District 2 Councilwoman Angela Pichardo asked if damage could have been done since the clubhouse is now in use, and said that the City needed to fix the problem and protect its asset.
“Again, like I’ve talked with Cory and Debbie [Randall, District 5 Councilwoman] and even Rob, this isn’t an issue that we have created,” Grego said. “This is an issue, whether it’s this cast iron [pipe], we don’t know.
“One of my concerns is [Greco Construction] brought in a crane and drove over the pipe to bring in the hood in the back side. Did the crane collapse something? I don’t know.”
District 3 Councilman David Espinosa asked if the problems were limited to the area of the exterior cast iron pipe as Greco claimed, and Flores said he thought it would be best to explore further down the line.
“How about tile, foundation, anything?” Espinosa asked.
“The tile appeared good,” Grego replied. “We’ve not checked the walls, but again, I would assume that that wall had three to four inches of water has to have some type of water damage.”
Thompson asked City Attorney Tom Cate what the City’s next step would be if replacing the exterior cast iron pipe doesn’t solve the problem.
“We’re going to have to fix it,” Cate said. “We may have a claim against [Greco Construction]. This is the first time that I’ve heard that they drove their equipment out there.”
Cate expressed concern that if another company is hired to try and fix the drainage issues and there are problems later on that Greco Construction will blame all the issues on the other company.
“Right now we’ve got a one-year warranty on the work,” Cate said. “So we just need to get it fixed.”
After additional discussion about the terms of Greco Construction’s contract, a Randall-Espinosa motion to approve the $7,810 cast iron pipe replacement, pending review of verbiage in the change orders approved by Council, and amend the budget passed unanimously with support from Pichardo, Espinosa, District 4 Councilwoman Kathy Lawler, and District 1 Councilman Rufino “Flipper” Vega.
“Do we have to amend [the budget] on this item or is it still coming out of the loan?” Thompson asked.
“I think we’ve used the loan,” Randall said, which Interim City Administrator Dora Rodriguez confirmed.
Council approved an Ordinance authorizing a three-year, $450,000 tax note in Sept. 2020 to pay for the clubhouse renovation (see “Devine authorizes $450k tax note for golf course clubhouse renovation” in the Sept. 30, 2020 edition of The Devine News). The total cost of the tax note, including $25,000 for the cost of issuance and $14,891.14 in interest, is $489,891.14.
Council initially awarded a $336,000 construction contract to Greco Construction in January, then approved a request by SG Golf Management and Charlie’s Daughter restaurant to expand the scope of the project to include a full-service kitchen, ultimately approving $39,552 in change orders in April and May (see “$336k clubhouse construction contract awarded” in the February 3 ed. and “Council takes mulligan, approves additional change orders for clubhouse renovation” in the May 19 ed.).
The August approval of a $105,052.44 contract with 1st Choice Restaurant Equipment & Supply to purchase and install the kitchen equipment, and an estimated $3,000 to purchase flatware and dishes, brought the estimated cost of the clubhouse renovation to $483,351 at that time (see “Golf course clubhouse renovation price tag nears $500k after equipment contract awarded” in the Aug. 18 ed.).
Punch list items
Council then reviewed a list of smaller issues that Greco Construction still needs to correct, ranging from lack of weather stripping around doors to air conditioning ducts left open to a restroom door that is not compliant with the Americans with Disabilities Act.
Thompson said the items were discussed during walkthroughs.
“I did a walkthrough, actually two walkthroughs, with the contractor and John, and one of them the architect was there as well,” Thompson said.
Espinosa pointed out that the clubhouse was supposed to be a turnkey project and that Greco should be held responsible for the work that still needs to be completed.
“If they don’t feel they should, then maybe we’ll withhold some money from them,” Espinosa said.
Rodriguez confirmed that the construction project included a 10 percent retention, but that Vidaurri had authorized the final payment to Greco Construction after the company had been issued a certificate of substantial completion.
“So they got paid and they’re never going to come fix this stuff,” Randall said.
Pichardo questioned why Council hadn’t been informed earlier about issues with the clubhouse, and Thompson said that was Vidaurri’s responsibility.
“John was informed and he was the City Administrator,” Thompson said. “He’s the one who handles the project. When you have projects like this, they go to the City Administrator. Council cannot be involved the way you’re thinking Council can be involved in this issue. Council only gets involved when we’re at this point in the project because we already have dedicated that project to John to handle.”
“And you being mayor, though, shouldn’t that have been brought up in September?” Pichardo asked. “August, September, October, November? Like today? Now we’re just hearing about it today.”
Thompson and Pichardo spoke over and interrupted each other repeatedly before Thompson kept up a prolonged bout of gaveling that prompted Espinosa to announce that Council needed to take a break, a suggestion that Thompson followed.
When Council reconvened 10 minutes later, Thompson announced that Vidaurri authorized a final payment to Greco Construction of $37,555.38 on Sept. 22.
“He had the permission and the ability, basically, to pay it out?” Lawler asked.
Thompson explained that City Administrators are empowered to approve spending up to $50,000 without getting express consent from Council, and that Council had delegated handling to the project to Vidaurri.
“We’re very grateful that Dora does what she does, because Dora actually brings a lot of stuff to us that doesn’t ever have to be brought to us,” Thompson said.
Flores explained that the current plan is to install a small transformer inside the clubhouse and run electricity out to Charlie’s Daughter and the trailer being used as the temporary clubhouse.
“Once the three-phase transformer comes in, we will install a secondary transformer inside the clubhouse that will push power in opposite directions,” Grego added.
The contract between SG Golf Management and the City calls for SG Golf to maintain accounting records according to generally accepted accounting practices, as well as provide copies of its Employers Quarterly Report, Texas Workforce Commission Quarterly Report, Federal Unemployment Tax Report, and Income Tax Returns; a financial statement showing in reasonably accurate detail the financial activities of the golf course for the preceding calendar month and the calendar year to date; and an annual statement within 60 days of the close of each calendar year showing the financial activities of the golf course for the calendar year.
A copy of the contract can be viewed on the News website at devinenews.com/devine-golf-course-contract/.
At the Regular Council meeting on June 15, Grego admitted to not submitting the required financial reports to the City and declined to do so. Instead, he requested that the City amend the contract to remove the requirements altogether. A Randall-Espinosa motion to not declare SG Golf Management in breach of the contract, and to amend the contract if SG Golf Management desired, passed 4-1 over Pichardo’s dissent (see “Grego refuses to comply with City-golf course contract; no audit ordered on how half-million dollars was spent” in the June 23 ed.)
“These revisions are in line with what Council had discussed back in June,” Thompson said
Pichardo made a motion to table action on the contract revisions.
“We just received the contract and we haven’t really had a chance to fully read it,” Pichardo said. “I’d like to make sure that we make an informed decision and we see what needs to be discussed and changed, because we just received it as we were sitting down at this meeting.”
“There’s three paragraphs,” Randall said.
Lawler seconded Pichardo’s motion.
“I think we need more time,” Lawler said, and Espinosa voiced his agreement.
The Pichardo-Lawler motion to postpone action and discuss the issue at the next Council meeting passed 4-1 over Randall’s objection.
The News had not received a copy of the proposed contract revisions as of press day on Nov. 23.
During the informational items portion of the meeting, Thompson said that most of the kitchen equipment ordered for the clubhouse was currently scheduled to arrive in late December, meaning installation won’t happen until January 2022 at the earliest.
Absent from the Dec. ETA is the walk-in refrigerator/freezer, which became part of the plan when Council approved a request from SG Golf Management and Charlie’s Daughter to expand the scope of the restaurant inside the clubhouse.
“I actually talked to them about this, about the walk-in not coming until March,” Randall said. “But if all those other things are installed, let’s say January, the restaurant can bring in their own refrigerator/freezers to work until the walk-in comes.
“So they could actually, the whole clubhouse could utilized, kitchen and clubhouse, if all this gets put in – let’s say January, or February, whatever the real date is it’s all installed – they can function if we can get a certificate of occupancy cleared with the codes and all of that. And then they just wait until the actual freezer/refrigerator, the walk-in, comes and that can be then installed when it’s available.”
Lawler asked if allowing Charlie’s Daughter to move their own equipment into the clubhouse kitchen needed to be an actionable agenda item, and Cate said Rodriguez could handle it administratively. Lawler followed up by asking what that means for the clause in the contract that states the City must pay SG Golf Management $32,536 a month until the turnkey renovation of the clubhouse is complete.
“I don’t have a big problem with that, Kathy, because it’s not involving construction, it’s involving appliances,” Cate said.
“So how does that work?” Lawler asked. “When do we stop paying [SG Golf Management] a management fee?”
“We would not stop paying that until we comply with the terms of the contract that we’ve actually provided, whatever it is, a refrigerator,” Cate said. “Turnkey.”
“So basically they can use it and go about business and we’re still paying them to do it?” Lawler asked.
“That’s correct,” Cate replied.
The City has paid SG Golf Management $748,328 in management fees since the company took over day-to-day operations of the City-owned golf course in Jan. 2020.
The archived live stream of this meeting is available on the City website at cityofdevine.org/live-council-meetings/.
The next Regular Council meeting is scheduled for Tuesday, December 14.
By Marly Davis