The Board held its regular meeting and two special meetings in March. The main topic was payment of retainage to Milo construction, the contractor for our building renovation. Retainage consists of 10% of each invoice that Milo submits. We withhold this amount until the project is substantially completed.
At its regular meeting on March 19, the Board considered a proposal to pay much of the retainage due to Milo. However, the Board tabled this proposal and requested further information. Then, at a special meeting held on March 25, the Board unanimously approved a revised proposal, which specified that we will:
- Pay the March invoice, which is about $85,000 minus the 10% retainage.
- Pay $175,000, approximately half of the outstanding retainage, now.
- In the next 1-2 weeks, pay incoming invoices immediately rather than waiting until the end of the month.
The proposal was submitted to the Board primarily because of item 2, which departs from the terms of the contract, which states that retainage will be paid when the project is substantially completed. However, project completion has been significantly delayed by weather and other factors.
The contractor has completed all required work except for the landscaping and has discussed most inspections with the city. Some inspections have already been done and approved. However, because of the COVID-19 pandemic, city inspection offices are shorthanded and wish to conduct all remaining inspections at once. This means that “substantial project completion,” which the contract links to getting a certificate of occupancy, could be delayed even further.
It is industry practice for subcontractors to be paid only after the client makes the retainage payment. Thus, some subcontractors who finished work months ago are still waiting to be paid. Paying 50% of the retainage earlier than required will allow Milo, our contractor, to pay some of these subs. The Board felt that this payment was in line with our principles, would enhance our relationship with the contractor, and would not jeopardize the work that remains to be done.
In addition, at a very short special meeting convened during a joint Board-Building Committee meeting on March 21, the Board accepted a Building Committee consultant’s offer to install energy use monitoring equipment in the new building at no cost to the Fellowship. This gift is valued at approximately $13,000. The aim of the monitoring is to reduce our energy use and costs.
During the month, the Board also took action to identify potential nominees for Trustee positions for the 2020-2021 Fellowship year, reviewed progress on this year’s Board goals, and discussed possible implications of the COVID-19 pandemic on Fellowship activities, budgets, and staffing.
The next regular Board meeting will be held via Zoom on April 16, 2020, from 6 to 8:30 PM.
For more information about any of these items, please contact Gloria Pearlstein at email@example.com.