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DRA report highlights Abaco dome project issues

Thu, Nov 17th 2022, 07:00 AM
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A COMPANY contracted by the former Minnis administration to construct 213 domes and the needed infrastructure on Abaco in the aftermath of Hurricane Dorian discontinued the project after receiving $4.6m of the total $6.4m required to complete the work, despite only completing about 16 percent of the structures.

Following the 2019 monster hurricane, few homes remained intact on Abaco. Given the imminent need for housing at the time, Sebas Bastian’s Brickell Management Group’s (BMG) $6.4m proposal was accepted and a contract agreed.
#BMG, according to a new Disaster Reconstruction Authority audit report tabled at Parliament yesterday, was contracted to oversee the dome site preparation, electrical power, water supply and sewerage disposal and pathways along with the installation of the 213 domes at a designated site.
#However, after two site changes and a third decision to construct the domes at the site of destroyed homes, BMG said it did not wish to continue, and the DRA did not require a specific performance report. At that time, only 34 of the domes were fully erected at homeowners’ properties, the report said.
#A second contracted company, Precision Design & Construction, BMG’s subcontractor, took over the project, but they too pulled out. It was later determined that they owed the DRA more than $81,000.
#The revelations, which shed more light on how taxpayer funds for the domes were distributed, were in the audited financial statements of the DRA over a 19-month period from December 1, 2019 to June 30, 2021. The independent auditor, LDL Associates, signed its report on the financial statements on September 22, 2022.
#“This contract included the cost of infrastructure installations (site preparation, electrical power, water supply and sewerage disposal and pathways) and the installation of 213 domes at a designated site in Central Abaco,” the report said.
# “After the commencement of work at the site, it was determined that the location did not meet certain environmental criteria and so a second site was chosen, and work commenced in November 2019.
# “Subsequently, the second site was determined to not be the most suitable, as homeowners preferred the erection of the domes on the site of their destroyed homes.
# “On April 30, 2020, BMG determined that they did not wish to continue with the contract to install the domes on private properties. The DRA did not require ‘specific performance’. At the time only 34 of the 213 domes were fully erected on homeowners’ properties.”
# The report continued: “Of the contract sum of $6.4m, $4.6m had already been paid to BMG in the purchase of the domes and the other materials that were to assist in the setup of the ‘Family Relief Centre’ and toward the management of the contract at that stage. The balance of the contract, $1.8m remained in possession of the Bahamas Disaster Relief Fund, under the control of NEMA.”
# Following this, the report said the DRA was charged to manage the completion of dome installations and undertook an exercise to determine the inventory of materials on hand and the value received on the BMG contract, with a view to assessing any liability or recoverable amount that might exist.
# While this exercise is continuing, and following numerous meetings with BMG representatives of various positions, the DRA determined that no further money was owed to the company.
# But this remains under dispute.
# “BMG’s initial position was that they were owed $1,129,182. They were prepared to settle for a sum of $1m, which was further reduced to $600,000.
# “Negotiations are continuing on this matter, but as at June 30, 2021, the DRA has a contingent liability to pay up to $600,000 to settle the claim by BMG. Because of management’s disagreement with the proposed settlement amount and the uncertainty as to what the final settlement amount, if any, will be, no accrual has been made in these accounts for this amount.”
# After BMG discontinued its work, it was decided that BMG’s subcontractor, a trained and certified InterShelter Inc (dome manufacturer) installer – Precision Design & Construction, bid on the construction of 66 domes on timber bases, primarily at homes in and around Marsh Harbour, Dundas and Murphy Towns.
# “The DRA entered into a contract with Precision on July 1, 2020 for $670,505 to fulfil the said scope of work.
# “A number of challenges impacted the Precision contract, including the initial COVID-19 pandemic lockdowns, funding issues from NEMA and the DRA and the vandalisation and theft on the construction site resulted in a longer than forecasted contract duration and additional overhead costs, requiring the DRA to fund a remobilisation of the Precision contract.
# “In January 2021, the balance of the undrawn BMG contract was finally released to the DRA and work on the Precision contract was then able to be resumed. However, at the beginning of April 2021, Precision determined that it did not wish to continue with the contract and ceased the installation of the 66 domes.
# “At the time, 35 domes were deemed completed and 31 domes were yet to be commenced. Again, ‘specific performance’ was not requested by the DRA.
#“The DRA determined that Precision owes the authority $81,106 being the net amount paid to them in excess of the contractual value of work completed at the time they discontinued the contract.
# “This balance due from Precision has not yet been agreed with Precision and has therefore not been accrued as a receivable in these financial statements.”
# DRA Chairman Alex Storr, Mr Bastian and Brickell Management Group did not return calls yesterday.

Following the 2019 monster hurricane, few homes remained intact on Abaco. Given the imminent need for housing at the time, Sebas Bastian’s Brickell Management Group’s (BMG) $6.4m proposal was accepted and a contract agreed.

BMG, according to a new Disaster Reconstruction Authority audit report tabled at Parliament yesterday, was contracted to oversee the dome site preparation, electrical power, water supply and sewerage disposal and pathways along with the installation of the 213 domes at a designated site.

However, after two site changes and a third decision to construct the domes at the site of destroyed homes, BMG said it did not wish to continue, and the DRA did not require a specific performance report. At that time, only 34 of the domes were fully erected at homeowners’ properties, the report said.

A second contracted company, Precision Design & Construction, BMG’s subcontractor, took over the project, but they too pulled out. It was later determined that they owed the DRA more than $81,000.

The revelations, which shed more light on how taxpayer funds for the domes were distributed, were in the audited financial statements of the DRA over a 19-month period from December 1, 2019 to June 30, 2021. The independent auditor, LDL Associates, signed its report on the financial statements on September 22, 2022.

“This contract included the cost of infrastructure installations (site preparation, electrical power, water supply and sewerage disposal and pathways) and the installation of 213 domes at a designated site in Central Abaco,” the report said.

“After the commencement of work at the site, it was determined that the location did not meet certain environmental criteria and so a second site was chosen, and work commenced in November 2019.

“Subsequently, the second site was determined to not be the most suitable, as homeowners preferred the erection of the domes on the site of their destroyed homes.

“On April 30, 2020, BMG determined that they did not wish to continue with the contract to install the domes on private properties. The DRA did not require ‘specific performance’. At the time only 34 of the 213 domes were fully erected on homeowners’ properties.”

The report continued: “Of the contract sum of $6.4m, $4.6m had already been paid to BMG in the purchase of the domes and the other materials that were to assist in the setup of the ‘Family Relief Centre’ and toward the management of the contract at that stage. The balance of the contract, $1.8m remained in possession of the Bahamas Disaster Relief Fund, under the control of NEMA.”

Following this, the report said the DRA was charged to manage the completion of dome installations and undertook an exercise to determine the inventory of materials on hand and the value received on the BMG contract, with a view to assessing any liability or recoverable amount that might exist.

While this exercise is continuing, and following numerous meetings with BMG representatives of various positions, the DRA determined that no further money was owed to the company.

But this remains under dispute.

“BMG’s initial position was that they were owed $1,129,182. They were prepared to settle for a sum of $1m, which was further reduced to $600,000.

“Negotiations are continuing on this matter, but as at June 30, 2021, the DRA has a contingent liability to pay up to $600,000 to settle the claim by BMG. Because of management’s disagreement with the proposed settlement amount and the uncertainty as to what the final settlement amount, if any, will be, no accrual has been made in these accounts for this amount.”

After BMG discontinued its work, it was decided that BMG’s subcontractor, a trained and certified InterShelter Inc (dome manufacturer) installer – Precision Design & Construction, bid on the construction of 66 domes on timber bases, primarily at homes in and around Marsh Harbour, Dundas and Murphy Towns.

“The DRA entered into a contract with Precision on July 1, 2020 for $670,505 to fulfil the said scope of work.

“A number of challenges impacted the Precision contract, including the initial COVID-19 pandemic lockdowns, funding issues from NEMA and the DRA and the vandalisation and theft on the construction site resulted in a longer than forecasted contract duration and additional overhead costs, requiring the DRA to fund a remobilisation of the Precision contract.

“In January 2021, the balance of the undrawn BMG contract was finally released to the DRA and work on the Precision contract was then able to be resumed. However, at the beginning of April 2021, Precision determined that it did not wish to continue with the contract and ceased the installation of the 66 domes.

“At the time, 35 domes were deemed completed and 31 domes were yet to be commenced. Again, ‘specific performance’ was not requested by the DRA.

“The DRA determined that Precision owes the authority $81,106 being the net amount paid to them in excess of the contractual value of work completed at the time they discontinued the contract.

“This balance due from Precision has not yet been agreed with Precision and has therefore not been accrued as a receivable in these financial statements.”

DRA Chairman Alex Storr, Mr Bastian and Brickell Management Group did not return calls yesterday.

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