The County entered a contract with Webcor Builders to perform the abatement and demolition of the former Administration Complex at 651 Pine Street in Martinez, CA. As is customary with large construction contracts, five percent of each monthly payment to the general contractor is held in escrow until the end of the project as a surety in case there is unperformed or unfinished work at the end of the contract. This project has three distinct phases: abatement of hazardous materials, demolition and construction. The subcontractors who perform the abatement and demolition are specialists, who once completing their work will not be part of the construction phase. This is distinct from many of the other subcontractors, such as plumbers or electricians, who have scopes of work that last throughout the construction phase. Sterling Environmental Corporation (Sterling), the abatement subcontractor, completed 100% of its assigned work in November 2022. Although the County could legally continue to retain the five percent escrow amounts for the abatement contractor until the end of the project, staff recommends the release of the retention for Sterling now. It would be a hardship for Sterling to have to wait until 2024 for its final payment since its work is complete. This release would not alter Webcor Builders' responsibilities or liabilities under the contract and applicable law, and Webcor has acknowledged that in writing.
Not taking this action would require Sterling to wait up to another 18 months after finishing its portion of work for its final project payment.