A dispute between Narragansett Improvement Co. and the City of Warwick is headed towards possible litigation after the Warwick City Council Finance Committee recommended unfavorable action on allotting the Department of Public Works (DPW) an additional $18,000 to pay for a cost overrun charge that occurred during the company’s work on the Suburban Parkway stormwater management project in Oakland Beach.

According to DPW director Richard Crenca, Narragansett Improvement went over the allotted $222,098.59 budget for the project – which sought to dig swales on the sides of Suburban Parkway to help drain stormwater into the ground and prevent it from running into the Bay – due to planting the wrong plants within the swales and needing to re-excavate the ground and re-seed and re-loam the area.

In total, this overrun cost around $22,500 to the city, but DPW managed to negotiate to get a $4,500 credit from Narragansett Improvement “in good faith,” according to a notice from Narragansett Improvement’s superintendent Jon Trakas. DPW requested the council allocate the remaining $18,000 from Community Block Development grant funds, but the council voted down the request.

“Both sides seemed to think it was a fair number, and obviously the finance committee didn’t,” Crenca said on Tuesday.

As a result, Narragansett Improvement filed a dispute with the city to retrieve what it believes is a payment rightfully owed to them for work that has been completed.

Also as a result, when DPW went to Narragansett Improvement – which is reportedly the only company in Rhode Island that is currently producing and selling hot patch, material used to fill potholes in a much more efficient and lasting way than using cold patch – Warwick was turned away due to the outstanding invoice.

“This is prime pothole season, and now we can't get anything until next Monday,” Crenca said, meaning that other companies would be selling hot patch eventually, but for now the city can do nothing to seriously address its potholes.

However City Council finance chair and Ward 5 Councilman Ed Ladouceur said there was good reason not to approve the bid and pay the cost overrun to Narragansett, as they went over budget on the project as the result of an error on their end and then did not properly alert the city of its change in procedures through any documentation.

“There was never any written agreement, never any change orders, nothing done in writing about additional charges that may apply,” Ladouceur said on Wednesday. “The engineering company [Crossman Engineering] is on the record stating, based upon their engineering work, that they did not agree with the position of the vendor [Narragansett Improvement].”

According to that letter from Crossman senior project director Brian King, Narragansett Improvement did not use mulch for the project as was proposed in the city’s bid package, opting to use loam (a type of soil) instead. This would not cause a discrepancy in cost on its own, King writes, however the contractor took loam off site from the project area, screened it at their facility in Providence, and then transported it back to the site and charged for the loam as though it came from off-site, which did add significantly to the costs.

According to King, Narragansett Improvements would have been required to request and receive approval for this procedure. “To our knowledge, no advance request or approval was issued,” King wrote.

Further, Narragansett Improvement reported a higher cost for excavation than was called for in the bid. According to King, this stemmed from several areas at the site where the company excavated deeper than was necessary. Again, King writes that Crossman was “unaware of authorization or need for over-excavation.”

Lastly, according to King, Narragansett Improvement also exceeded the amount of paving as opposed to what was outlined in the bid, further adding to costs.

“In addition to the above findings and as stated in the Contract Documents, any discrepancy discovered by the Contractor or change in work (change order) requested by the Contractor was required to be on a written form by the Contractor and approved by the owner (City) prior to the work being conducted,” King concludes in the letter. “We are unaware of this procedure being completed prior to the contractor performing any work.”

To Ladouceur, these reasons were more than significant enough to deny the bid to pay for the overcharge.

“I'm not paying for something that wasn’t approved and wasn’t agreed to,” he said. “It didn’t appear DPW had any knowledge of these accumulating numbers until the job was done… It's our responsibility to make decisions in the best interest of the taxpayers.”

In response to an inquiry about Warwick being unable to acquire hot patch as a result of the denial of the payment, Ladouceur wasn’t fazed.

“If that's what they want to do, if that’s the way they want to run their business then that’s fine,” he said. “They're certainly not the only company in the state that sells asphalt. That’s why competition is a good thing…If we have to wait a week, we’ll wait a week if that’s the relationship they want to have with their clients.”

There was no update on the status of the dispute by Narragansett Improvements other than that the city solicitor’s office was aware of it.