Below is the agenda item, word for word, from the City of Lake Worth's website. This issue may get resolved prior to the meeting; or not. This concerns the Casino building that has many problems that need to be addressed mostly concerning substandard construction and water intrusion. For more insight, Andrew Ruiz at NBC5/WPTV did a news segment at the Casino building. This isn't a new issue by any means; this all began many years ago and still remains unresolved. Without any further commentary from Yours Truly (with an informational link added) is the information from next Tuesday's agenda:
AGENDA:
CITY OF LAKE WORTH COMMISSION MEETING
CITY HALL COMMISSION CHAMBERS: TUESDAY, MARCH 01, 2016 (6:00 PM)
Forward to page 169:
TITLE: Declare REG Architects, Inc., The Morganti Group, Inc., and The Insurance Company of the State of Pennsylvania in default
SUMMARY: This item seeks to declare the design and construction firms and the construction firm’s surety in default of their respective contracts with the City regarding the Casino Building.
BACKGROUND AND JUSTIFICATION: In June 2010, the City entered a professional services agreement with REG Architects, Inc. (REG) to design the new Casino Building. In November 2010 (and as amended in June 2011), the City entered into a construction agreement with The Morganti Group, Inc. (Morganti) to construct the new Casino Building. Morganti secured a Public Construction Bond for its work with The Insurance Company of the State of Pennsylvania (Surety).
During construction, the City notified REG and Morganti of various issues occurring at the Casino Building including, but not limited to, water intrusion through and/or around the doors on the second story (east elevation); water pooling on the second story deck; and, rusting surfaces. While some efforts were made to correct these issues, the City continued to experience the same and additional issues at the Casino.
In 2013, after both REG and Morganti applied for final payment (which was withheld), the City retained construction attorney Michael Kennedy of Ciklin, Lubitz, Martens & O’Connell, P.A., to assist in resolving the issues. After further attempts to resolve some of the issues failed, in November 2013, Mr. Kennedy notified REG, Morganti and the Surety of the continued issues.
After a request by Morganti for more time, the City, REG and Morganti again attempted to amicably resolve the issues. The City met with representatives of REG and Morganti in August 2014 at the Casino to discuss solutions to the continued issues and some new issues.
In September 2014, the City put REG and Morganti on notice that their proposed solutions to-date were unacceptable. In another effort to amicably resolve the issues, the City attended pre-suit mediation with representatives of REG and Morganti in May 2015. The mediation resulted in a Tolling Agreement to stay any applicable statute of limitations and to allow the parties one more attempt to resolve the issues without litigation.
In late 2015, the parties again discussed resolution of the issues. When the City (and two hired consultants) pushed back on the latest proposed solutions, the City received little response from representatives of REG and Morganti. At this time, the issues at the Casino Building include, but are not be limited to:
- Water intrusion through the windows and operable doors along the east elevation;
- Failure of the second floor deck to drain;
- Water intrusion behind the stucco on the elevations of the building;
- Improper drainage design or construction which allows water to cascade off of the roof causing hazardous conditions on the paver deck below or mold growth on canopies;
- Rusting on arch supports; and
- Premature degradation of external surfaces.
The City Attorney concurs with this recommendation.
If REG, Morganti and the Surety are declared in default, Mr. Kennedy and the City Attorney will notify them of the same and immediately proceed with filing a lawsuit.
On February 16, 2016, the City Commission took action to table this item for two weeks.
MOTION: I move to declare REG Architects, Inc., The Morganti Group, Inc., and The Insurance Company of the State of Pennsylvania in default.
Update—Select minutes from the City of Lake Worth City Commission meeting on February 16th, 2016; Item 12A. New Business: Declare REG Architects, Inc., The Morganti Group, Inc., and The Insurance Company of the State of Pennsylvania in default:
"Michael Olenick, The Morganti Group (TMG), said that as of 4 PM today he did not know that this item was on the agenda. To his knowledge, TMG had never been in this situation and understood the seriousness of this issue. He explained that TMG built the Casino Building based on REG Architects’ (REG) specifications. He said correspondence to find a solution was still going on. He requested the Commission not make a decision to default on their bonding company for a couple of weeks and pledged to push REG. He asked the Commission for forgiveness and time."
"Assistant City Attorney Goddeau advised that, until the City declared them in default, a closed door attorney-client session could not be scheduled. If the time was extended then the Tolling Agreement also needed to be extended because of the Statute of Limitation."
"Vice Mayor Maxwell commented that there was no legal requirement to notify the parties that this item was on the agenda and that a notice would be sent to them after the City declared them in default. Assistant City Attorney Goddeau responded that REG and TMG knew about the issues."
"Commissioner Maier commented that the Casino Building issues had gone on too long and the parties would have known what was going on. This was a public forum and anyone could listen to the meeting from their home. There were two attorneys present representing the City. He said action needed to be taken without taking on any more damage to itself while giving TMG time to have legal representation."
"Commissioner Amoroso commented that the City retained Attorney Kennedy two years ago, which was a financial burden to the taxpayers. He said this burden concerned him. If one party knew, then all of the parties knew."
"Mayor Triolo commented that she was comfortable giving them a two week extension. She said the City needed to be taken seriously. Mr. Olenick replied that the City hired REG, but TMG built the Casino Building based on their specifications. He said he was angry with REG for putting TMG in the position of default."
"Vice Mayor Maxwell said both REG and TMG were asked about their experience with coastal construction as part of the contract selection. If TMG had the experience then they should have advised the City. The City was losing money."
![Dr. W. H. Cotton’s ode: “Oh, My Lake Worth, Florida!” [circa 1920].](http://1.bp.blogspot.com/-yhHyCn84ZIQ/WezjlEL-0tI/AAAAAAAAPZ4/CzkhriK6zpEJJ3d9Je1495d49gIhnMlxACK4BGAYYCw/s1600/LakeWorthPioneers.JPG)
