Streetcar Damages - CAFUSA Letter
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Transcript of Streetcar Damages - CAFUSA Letter
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CINCINNATIInterdepartment Correspondence Sheet
Date: September 15, 2015
FOR YOUR IN FORMATION MEMO
To: Mayor and Members of City Council
From: Harry Black, City Manager (“4 ~3Subject: Streetcar Damages — CAFUSA Letter
On Aug. 28, CAFUSA (CAF) informed the City that the delivery of the first streetcar is expectedto occur at the end of October, later than the contractual date of Sept.17.
In anticipation of this delay, the City’s Purchasing Department sent the attached letter to CAFclarifying the City’s expectations and informing CAF that the City will be withholding liquidateddamages in accordance with the contract. Per the contract, this amounts to $1000 per day latefor the first car and $500 per day late for each additional car.
The Administration will continue to monitor CAF contract performance to ensure the Streetcarproject comes in on time, and budget, and that the City receives any entitled damages.
Attachment
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CINCINNATI ~
Department of Finance Two Centennial Pla7aPurchasing Division 805 Central Avenue, Suite 234
Cincinnati, Ohio 45202-1947
Patrick A. Duhancychief P,-ocuremc’n! 0/f1 er
September 15, 2015
Virginia VerdejaVice President, SalesCAF USA, Inc.1401 K Street NW, Suite 1003Washington, DC 20005
Dear Ms. Verdeja,
In my previous correspondence to you I underscored the seriousness of the situation and theramifications associated with the delay of vehicle delivery. This letter is in response to yourAugust 28th letter which indicated that streetcar vehicle delivery will be delayed from theContract milestone for delivery, which is September 17, to the end of October. As it appears asthough CAF will not meet its Contract milestone of delivering the streetcar vehicle, it is the City’sintent to exercise the full extent of its remedies under the Contract to force compliance withContract terms and hold CAF accountable for the costs of such delay.
Per Section SP-03 of the Contract, the City may withhold all or part of a payment to the extentdeemed necessary by the City to protect the City from loss. If the delivery of the streetcarvehicle is delayed beyond the Contract milestone, the City will withhold accrued liquidateddamages-from-any-forthcoming-progress payments.
On behalf of the City, I am hopeful that we can continue a productive working relationship.However, it is disheartening that CAF may potentially miss such a major Contract milestone.
Si erely,
Patrick A. DuhaneyChief Procurement Officer
CC: Harry Black, City ManagerSheila Hill Christian, Assistant City ManagerJohn Juech, Assistant City ManagerJohn Deatrick, Cincinnati Streetcar Project ExecutivePaula Boggs-Muething, City SolicitorAndrew Garth, Chief Counsel
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