CENTRAL rsxas July 21, 2015 Regional Mobility Authority Ms. Jacqueline Hinman Chief Executive Of?cer CHEM Hill 9191 South Jamaica Street Englewood, CO 80112 Dear Ms. Hinman, I was incredulous upon reading your letter dated July 11, 2016 to Chair Wilkerson. It is abundantly clear that the genesis of the extreme problems that this project has suffered are the result of the fact that CH2M grossly underbid the project (as we questioned CHZM about several times before we accepted its bid) and the wholly inadequate methodologies your ?rm has employed to prosecute thejob. I would expect these facts to be patently clear to any court of law in Texas, as it has been to the independent Dispute Resolution Board to date. That is what makes the posturing, as re?ected in your letter, so stunning. It is apparent that your staff may not have fully informed you about the relevant facts, so please note the following: The contract amendment executed in February, which was intended to avoid defaulting CHZM and terminating the contract, clearly states that liquidated damages shall accrue in the amount of $73,500 per day until the Interim Milestone Work is completed. In the relatively short period of time since that amendment was signed the work has fallen well behind the agreed upon schedule. No signi?cant milestones have been met. In fact, as a further illustration of the inept management that has plagued this project since its inception during a critical three week period in July, no pavement work was executed and the workforce dropped by half (see attachment). While this is disappointing and unfair to the citizens of the region, I cannot say it is a surprise since, as we have discussed and you have acknowledged, this project has been without effective management from the start and still has major management issues (Craig Martel?s attempts notwithstanding). It was a surprise that Terry Ruhl, a member of your Board of Directors sent to discuss settlement terms last week, was wholly unaware that the Interim Milestone deadline had been missed and that the workforce levels had declined significantly. This is just another example of the disconnect between corporate management?s understanding of the Project and the reality we face every day. tare. .. .. .. Jenii; i: .- - 33th Julia, atheist}, .Ec?nf?: 51:33 ?It . .rr' gum?: telephonic. grail. 9 3 .-. as. rats) 53 rt.- )rbe tc-..-.. . .. 7' - .. . its? unites?ssh, {seamen :amcs i-i one. in, ?Karl?iler?? it-Jocr: 1 homes. 2- mantra1-9213?rui i5. I?dJilili {hi Alas-Iii ht??a?t?it' n- t. -: 1.137%sz In your letter you failed to mention that in the past, regardless of extreme schedule de?ciencies, the Mobility Authority has provided consideration and made progress payments. While my Board understands partnering, it is not pleased that the project has come to this stage and continues to be characterized by missed deadlines and broken commitments. In concurring with the staff recommendation to accept the contract amendment dated February 9th, the Board made it clear that any and all agreements and remedies must be tied to the best interests of the citizens of Austin, including the accrual and assessment of liquidated damages. For your information, I have attached a portfolio of scenes which depict the shoddy workmanship being offered as satisfactory from your team, and the construction site atmosphere that has been imposed along the corridor. Weather days we understand, but defective work and poor management are inexcusable for a ?rm with your size and reputation, and no amount of threats and denial of responsibility can change those basic facts. With respect to a possible resolution of disputes, i can assure you that I have full authority and consent of the Board to negotiate in good faith as we have always done. This position will be reaf?rmed at the next Board Meeting, Wednesday, July I consult with the Board members frequently, and the Board has taken report after report from your managers regarding the project?s progress (or lack thereof). The resolution that we arrived at with Terry Rubi was that only when the Interim Milestone is completed {which is already weeks behind schedule) can we discuss a possible global settlement. Furthermore, we stated that it is our intention to assess some level of liquidated damages on the March Draw Request, the amount of which is still under consideration. While I am hopeful your team will complete the project in accordance with the Contract, I can't imagine how your implied threat of litigation can help resolve this situation. If anything, we have taken significant criticism from key public of?cials and media (see attachments) for allowing Cl-l2M to remain on the project as long as it has, while performing as poorly as it has. We have purposely avoided denigrating CliEM?s approach to this project in public as this does no one any good in rectifying the problems. Deliberate actions can only provide the solution. Ms. Hinrnan, notwithstanding the unfounded rhetoric in your July 11 correspondence, I believe in your motivation and commitment to see the project through to the end and never look back with regret on the role you played in resolving a very difficult situation that was thrust upon you. I also trust you can deliver on that commitment and encourage your local team to pursue the completion of this project post haste. Very truly yours, . Mike Executive Director Attachments