Ill winds in wind-towers’ payment dispute hit home 

Fairfield, N.Y. – It’s ironic that an outspoken opponent of the Hardscrabble Wind Farm Project learned last week that a mechanic’s lien had been filed against his family’s property in connection with a dispute between two of the companies involved with the project.

Davis Road residents James and June Salamone, who have neither a contract with the company nor a wind tower on their 11.4-acre parcel, are upset that they have been caught up in the nonpayment dispute between Saunders Concrete Co., of Nedrow, and Iberdrola Renewables’ general project manager, M.A. Mortenson Co.

James Salamone said, “I am no participant, and I have a lien on my home.”

The Salamones are not the only parties affected by the companies’ disagreement, however.

The legal notice the couple received by certified mail last Wednesday detailed 33 additional individual or municipal property owners and companies – including the city of Little Falls and at least two other land owners who have no ties or connections to the wind power company – who have had claims filed against their properties.

The mechanic’s lien was filed in the Herkimer County Clerk’s Office.

As defined on law.com, a mechanic’s lien allows a person or company that has made “improvements or delivered materials to a particular parcel of real estate (either as an employee of the owner or as a sub-contractor to a general contractor) to place a lien on that real property for the value of the services and/or materials if not paid.”

As detailed in the notice the Salamones received, Saunders Concrete Co. was hired by Minneapolis-based general contractor M.A. Mortenson Co. to provide construction services for the 37-tower wind turbine project in the towns of Fairfield and Norway.

In addition to performing labor or providing materials, Saunders manufactured concrete bases for the 37 generators – and subsequently demolished two concrete pedestals.

In the lien notice, the concrete company claimed the agreed-upon value of the work performed for Mortenson was about $2.16 million, with work beginning on June 28.

Oct. 28 was the date of the last work performed or materials furnished, Saunders claimed.

According to the lien notice, the unpaid amount owed to the company is $1.95 million, which Saunders is seeking with interest.

As noted in the March 7 Telegram, construction of the wind turbines began last summer after representatives from the Herkimer County Industrial Development Agency and Atlantic Wind, a subsidiary of Iberdrola, signed the closing documents for the Hardscrabble wind project in May.
In November, construction was temporarily halted because some of the concrete foundations did not meet company standards. Paul Copleman, a spokesman for Iberdrola Renewables, said the foundations were modified and engineered to retrofit the concrete foundation. At that time, he said 15 foundations needing modification met and exceeded strength criteria.

Copleman on Monday said the company has a commitment to the property owners affected by the mechanic’s lien. In a letter to affected property owners, the company apologized and said, “While mechanic’s liens are not uncommon in construction contracts, we believe that Saunders had other avenues available to resolve their dispute with Mortenson; and by pursuing a mechanic’s lien they have unnecessarily involved the landowners involved in this project as well as several that are not even part of [it].”

Additionally, Copleman released a statement prepared by Mortenson alleging Saunders “is not entitled to additional payment for work, labor or services provided at the project.”

On March 31, the general contractor started a binding arbitration against the concrete company, which is expected to result in a ruling on the disputes between the two companies.

In response to the mechanic’s lien, Mortenson company officials said they were “disappointed that Saunders decided to lien the project and involve the individual property owners instead of proceeding to resolve disputes with [the company] through the required binding arbitration.”

According to Mortenson, state law permits them to file a lien-discharge bond in the county clerk’s office, “which discharges the Saunders’ mechanic’s lien from the real property and transfers the Saunders mechanic’s lien to the [bond]. The [bond] must be in an amount equal to 110 percent of the mechanic’s lien and served upon Saunders.”

Mortenson has started the process and anticipates its completion the week of April 18.

With regard to the Salamones, the Millington family, one of the Crossett families and the city of Little Falls, each of whom was erroneously included in the concrete company’s mechanic’s lien, Fairfield Town Supervisor Richard Sousa said the attorneys representing Saunders “didn’t do due diligence.”

“The problem is the law firm for Saunders didn’t do their job,” he said.

Additionally, he faulted the concrete company for involving the property owners in their dispute with Mortenson in the first place.

He said, “You don’t know how games are being played. It’s disingenuous.”

A Saunders company official and attorney Brenda Colella, a representative from the Syracuse firm Gilberti Stinziano Heintz & Smith that represents them, declined to comment on the lien or the dispute with Mortenson; however Colella suggested those erroneously named in the lien should “contact an attorney and have their attorney contact us.”

James Salamone said he and his wife can not afford an attorney to fight the mechanic’s lien. He’s hopeful a local attorney might represent them on a pro bono basis.

In reference to a Common Council decision last year not to let the wind-power company cross the city’s watershed property, Little Falls Mayor Robert Peters said, “We are not in a contract” with the wind power company. He said city Attorney Ed Rose will be handling the matter for the city.

Mark Feane, executive director of the county IDA, said, “We’re not actually a property owner. We’re listed, but we have a PILOT [payment-in-lieu-of-taxes agreement] with the wind company.”

While there have likely been contractual issues between project managers and contractors on projects with which the IDA has had involvement in prior years, Feane said the mechanic’s lien with the property owners is “new. It’s something we haven’t been involved with in the past.”

Feane said IDA officials have been in contact with Iberdrola and are confident, based on their correspondence and discussions, the matter will be resolved in a timely manner.

He did not want to speculate about the potential ramifications of the lien on the IDA’s future business prospects; however a spokesman for the state Division of Consumer Protection said the lien could have a potential impact on those against whom claims have been filed.

He suggested, for instance, that Iberdrola “might not get as good a deal on investments.”

Salamone was also concerned about the lien’s affect on his credit rating.
Feane said the IDA’s attorney has been apprised of the situation. Additionally, Sousa said Fairfield’s attorney has also been in contact with Saunders’ attorneys.