What Does it Take for a Vendor to Get Paid in T/E School District … GEM Mechanical Services Owed $36K+ for Work Completed in August 2019

About three weeks ago, I was contacted by Sean Gaffney, VP of construction at GEM Mechanical Services regarding TE School District Renovations Project PO 19102724 and an unpaid balance of $36,295 (of a $700K contract). The boiler project work at Devon Elementary School and Beaumont Elementary work was completed in August 2019.

Before reaching out to me, either Sean or other employees of GEM had sent 30+ emails to Heckendorn Shiles Architects and the District during the past nine months seeking payment. To date, the final payment for the work remains unpaid.

As a result, I sent three emails to the District’s business manager Art McDonnell (with copies to the school board and superintendent) inquiring about the final payment due GEM. Mr. McDonnell’s response to the first two emails was dismissive and unsatisfactory.  My third and final email on this subject received no response from the business manager.

I naively assumed that there was a simple explanation – a misunderstanding – and that TESD would send GEM Mechanical Services its final payment.  Unfortunately, promises of the “check is in the mail” remain unfulfilled. Other than for me to publicize the situation, it is unclear what else I can do to move the matter forward although legal options are available to the construction vendor.

From the time last August when GEM completed the boiler project, a punch list was requested and final payment sought.  Months went by and GEM was only very recently presented with a punch list (long past its legal due date), which included installation of gauges. It makes me wonder if this a tactic by the District to delay payment on a project by waiting nine months post-completion and then come up with a punch list?  And for what purpose – what’s the endgame?

Although Heckendorn Shiles placed an associated value of $7500 for the gauges on the punch list (and without explanation increased the value last week to $11,850), it does not explain why the District is withholding the remainder of the $36,295 final payment. It is my understanding that there are legal ramifications for withholding payment to a vendor for services rendered. In addition, the District will owe interest to GEM on the unpaid balance.

GEM Mechanical Services has worked in many neighboring school districts and the Philadelphia School District but this was the company’s first experience in TESD. And, according to Sean Gaffney, it will be the last. What is that saying, the “more you know, the more you wish you didn’t know”? In speaking with him, I have learned a lot about the reputation that the District has with construction vendors.

In an email last week to Heckendorn Shiles Architects and TESD, Sean Gaffney wrote the following,

GEM went above and beyond to complete your project on-time and the job has been completed for nearly a year…There were multiple project delays caused by existing and faulty equipment in Devon Elementary and asbestos in Beaumont that was uncovered and not included in the ACM reports. GEM is also due interest for TESD’s repeated late payments. All said, if HSA and TESD truly want to close out this project then they should consider releasing GEM’s final payment immediately and contact me to schedule one day for GEM to come out and complete the two remaining punch list items.

Have you ever wondered why there are so few vendors bidding the construction jobs in T/E? As Sean Gaffney says, “Some people at TESD want to continue to play by their own set of rules. GEM (and many others) will not bid construction projects for TESD”.

Based on GEM Mechanical Services’ experience, it is no wonder that there is decreasing vendor interest in working in TESD.  The low bidder turnout on TE School District projects compromises the competitive bid process; which is ultimately damaging to TESD taxpayers. For competitive bidding to work successfully, outside vendors need to feel confident that they will be treated fairly if hired by the TE School District.

In the TE School District, all roads lead “to” or “through” the business manager which I believe is a problem and indicative of a far greater issue. This is the same business manager who has yet to satisfactorily explain the $1.2 million accounting error. And these are the folks in charge of the $35 million high school expansion project!

In closing, I would be remiss not to remind TESD residents that the 2020-21 preliminary budget includes a property tax increase of 2.6% – in the midst of high unemployment, small business failures and an uncertain future! For the record, the school board approved the preliminary budget 8-1 (Scott Dorsey was the sole dissenting vote). The final vote on the 2020-21 budget is June 8.

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13 Comments

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  1. #1 School District!!

    What threw me about this and maybe this was well known was the asbestos at Beaumont. Is Mr Gaffney saying that asbestos was found at Beuamont and not reported? Or underreported?

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  2. Wait, what? This entire scenario is highly concerning to me as I have for a long time been concerned about the stewardship of taxpayer money in this District and the behavior of our Business Manager. I find the potential lack of a competitive bidding process for District projects extremely alarming. But I am astounded to learn there may have asbestos uncovered at BES, the school two of my children attend. Can you please provide more detail on that discovery and whether it was remedied and whether parents had a right to be informed it was uncovered?

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    Pattye Reply:

    Thanks for your email. The information about the asbestos in Beaumont Elementary School was a direct quote from Sean Gaffney with GEM from an email which he sent last week to TESD and the District’s architects. In addition to myself, ALL NINE members of the TE School Board were copied on the email. According to Sean Gaffney, there has been no response to his email nor did I receive a response.

    Should you wish to follow-up with the school board, their email address is schoolboard@tesd.net — but I should warn you that the business manager is also the District’s public information officer and receives (and processes) all incoming emails. Frankly I have never understood why the business manager has that additional job description. As I stated all roads lead “to” and “through” Art McDonnell. It has been clear to me for some time that McDonnell has no appreciation that it is the TE taxpayers that pay his salary!

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  3. Amazing how you guys are surprised at the finding of asbestos……every inch of the 8 schools have been searched for asbestos and it was found in ALL of them. It is not hidden from the community, you just never thought to ask. There are maps at each of the schools on where exactly the asbestos is located and if you ask to see them they will be provided. As for the districts “reputation” when it comes to paying, GEM is not the first to have payments withheld and they definitely won’t be the last. I am 100 percent sure that there is a job from 2018 that still has an outstanding balance against the district who has slipped thru the cracks by changing the punch list every time payment is questioned.

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    Keith Reply:

    Observer,
    I am unsure what you meant by the statement, “I am 100 percent sure that there is a job from 2018 that still has an outstanding balance against the district who has slipped thru the cracks by changing the punch list every time payment is questioned.”

    Could you expand on your statement?

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  4. If people are unhappy with the school district or the board you are welcome to move somewhere else!

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    Pattye Reply:

    GEM Mechanical Services is unhappy with the school district and the board for not paying the final balance for 10 months — what is their option? File legal action against the school district?

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    Easttown 3 Reply:

    I am and have been extremely unhappy with the School Board and TESD Business Manager for some time and, no, I will not choose to move elsewhere, but to ensure that the decisions the elected Board members make are in the best interest of MY children and to question them when I feel they are not. If you are fine with accepting taxes that are raised each year due to June “deficits” that regularly become early fall “surpluses” that are then squirreled away only for the process to be repeated the next year, that is great for you, but not me. If you are fine with a Business Manager who fails to correct confirmed accounting errors and who speaks in a completely inappropriate and condescending way to District parents who pay his salary (personal experience of myself and friends of mine), that is great for you, but not me. If you are fine with Pattye’s description of vendors not wanting to bid on TESD school projects due to the treatment they fear receiving in our District, that’s great for you, but not me. So yes, I am unhappy. But no, I won’t move, but will absolutely question and comment and fight for the best representation possible and for what I see as being in the best interests of my family and community.

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    Carl B. Reply:

    Your response is absolutely on point. Where is the oversight in this school district? Art McDonnell is allowed to be dismissive to residents and marginalize their questions with absolutely no push back from the school board. Where is the leadership on the school board that allows this to happen?

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    Doug Anestad Reply:

    Seriously? If I don’t like the way the current administration for the school district lies to the community and poorly handles its business matters, I should move after living here for 20 years? Wow.

    No. I will work to improve the community where I live.

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  5. As a tax payer for 40 years and having 4 children go through the TE school system, this is alarming. ALL of us should be questioning this situation. Thank you, Pattye, and please keep it up. We need your voice!!

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  6. I can guarantee that the school board will not show any real oversight. They will not ask the obvious questions such as:

    Why do we have so few vendors competing for bids compared to other districts?

    How many more millions of dollars are we spending on project due to the low number of bidders?

    Is there an actual pattern of late payments over the past 5 years? What is the purpose of the late payments?

    The school board will probably not bother asking these questions. If they do, they will except any weak answers without any followup answers or seeking outside help to figure out what is really going on.

    If you don’t believe me on the previous paragraph, just look into the accounting scandal where the administration made a $1.2 million error (not the really bad part), lied about it for two years, lied about the ability to fix the error, lied about accounting standards, and then had the law firm lie about accounting options to fixing the error. After all of this, what did the school board do? They gave the administrators who lied salary increases and bonuses to boot! Oh yeah, they also gave the law firm a 5 year contract.

    The school board does not understand what oversight means.

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