Kearney Construction, now seeking bankruptcy, sues Pasco over troubled utility work on U.S. 41 project

LAND O'LAKES — Two days before filing for Chapter 11 bankruptcy, Kearney Construction Co. sued Pasco County over its dismissal from a $5.3 million utility job on U.S. 41.

The utility work is a crucial precursor to the widening of U.S. 41 between Tower Road and Connerton Boulevard, a long-awaited project that got jump-started with federal stimulus money and is scheduled to break ground next week.

County officials say Kearney workers damaged a reclaimed water line multiple times, incorrectly installed new pipelines so that they were prone to leaks, and had gotten at least six weeks behind schedule, thus risking delays to the road work.

But Tampa-based Kearney alleges in its lawsuit, filed Monday in Hillsborough County, that the delays are the fault of Pasco County and the county-paid project engineer, Parsons Water and Infrastructure, which is also named as a defendant.

The lawsuit was filed two days before the longtime Tampa construction business filed for Chapter 11 bankruptcy reorganization. Kearney has suffered from postponed and canceled projects, including the delayed Cypress Creek Town Center in Wesley Chapel.

Its bankruptcy filing listed debts of more than $10 million spread among hundreds of creditors.

Kearney's lawsuit against the county says Pasco provided incomplete drawings of the locations of existing utilities, rejected acceptable piping installation and did not provide timely responses to the company's nearly 50 questions seeking clarification.

"This case involves Pasco County and its co-conspirator Parsons' attempt to find a scapegoat for its political and public blunders," the lawsuit says. "From the beginning, Pasco County knew that the delay of (the) project would be publicly and politically embarrassing to Pasco County and the state of Florida."

Impossible dates

The lawsuit, which asks for unspecified monetary damages, makes six claims, including wrongful termination and fraudulent misrepresentation.

Kearney says in the lawsuit that the utility work — which includes the construction of a 30-inch water main and the relocation of other utilities — was "doomed from inception from being completed on time."

County records show problems dating to late May, when county and state officials say they first began talking about their concerns that the utility work would not meet critical milestones necessary for the road work.

Peter Porebski, Pasco's utility program administrator, said Kearney had dropped the ball on a time-sensitive project. He said that the drawings did show a relatively small portion of an existing water main — about 300 feet, as compared to the entire 31,000-foot-long pipeline project — a couple of feet from where it actually lies.

But he said Kearney could have worked around it, possibly even chosen to ask the county for reimbursement for the additional work required. But it did not.

Instead, he said, Parsons agreed to revise the plans to reflect the location, thus triggering additional review by state transportation officials. Kearney says in its lawsuit that it couldn't continue the work related to those revisions until that review is complete.

Porebski said that was a "moot point" because Kearney had "unilaterally" halted some of that work anyway.

"We have nothing to hide here. The problem has been their lack of performance," Porebski said in an earlier interview. "We couldn't afford to sit around and fiddle. What am I going to do, stop the stimulus project?"

The dismissal from the job clearly stung Kearney, a three-generation firm now run by Bing Kearney, a politically connected Republican fundraiser.

"We've never been terminated for being late on a project before," Kearney told the Times the day after the commission's Aug. 11 vote.

Insurer blamed

Kearney Construction is also going after its bonding company on the project, Travelers Casualty & Insurance.

Travelers had requested Pasco send all future payments to it instead of Kearney, citing financial difficulties on Kearney's part. It is Travelers' responsibility to hire a new contractor to finish the utility work.

One day after Pasco commissioners terminated Kearney, the construction firm filed a lawsuit in Hillsborough against Travelers, saying it had wrongly interfered and cost Kearney its clients.

The Department of Transportation's contractor on the road-widening project will get started next week on some work that doesn't depend on the completion of the utility work, spokeswoman Kris Carson said.

The hope, she said, is that within the next month or so, a new utility contractor will get enough work accomplished so that the road construction can proceed.

"We're just going to have to take it one step at a time," she said.

Times staff writer James Thorner contributed to this report. Jodie Tillman can be reached at jtillman@sptimes.com or (727) 869-6247.

Kearney Construction, now seeking bankruptcy, sues Pasco over troubled utility work on U.S. 41 project 08/27/09 [Last modified: Thursday, August 27, 2009 9:18pm]

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