MOUND CITY – Linn County Counselor Gary Thompson said on Thursday that, in talks since the Linn County Commission meeting on Monday, June 27, the county and KwiKom Communications have agreed to the terms that were discussed at that meeting.
Following the acceptance last month by commission of KwiKom’s proposal to bring broad band Internet to the west side of the county for $580,000, commissioners balked at the company’s proposed contract that required full payment of the money up front.
Instead of Kwikom getting all of the money, which the county received under the American Rescue Plan Act (ARPA), at the beginning, commissioners at first wanted 20 percent held back until the project was complete.
Kwikom officials, Eric Vogel and John Terry met with the Linn County Commissioners on Monday to discuss the changes the commissioners wanted in the contract.
Vogel explained to the commissioners that in order to get their project completed in two years, they had already started ordering materials for the installation. Vogel said that for some items they were ordering, the delivery time was 52 weeks out and he was concerned it might be farther out the longer they wait.
Vogel said that they wanted to get as many materials purchased right now as they could to prevent the project from dragging on. That was their justification to get the money up front.
Commissioner Rick James asked Vogel if the company had a cash-flow problem.
Vogel pointed out that the agreement with the county was for only half the cost of the project with the other half coming from KwiKom. He said it was obvious that KwiKom had a large investment in this project, and there was no cash-flow issue.
Commission Chair Jim Johnson said he did not like paying everything up front.
Vogel said he understood that, but the company added very aggressive language on its requirements to finish the project. The company will pay everything back to the county if the project is not finished in two years.
Commissioner Danny McCullough asked what if their lead time in getting materials turned into 70 weeks. If there is no retainage, there is no way of the county pushing you to be more aggressive with your suppliers.
It’s just normal for big contracts, to have some kind of retainage, said McCullough.
Terry told the commissioners the way this was set up was that Kwikom would be taking the risk on overruns and things like that.
McCullough said he would like to hold some money back.
James asked whether the company wouldn’t do the project if the county wanted to retain a portion of the money. He suggested that if that was the case, the county wasn’t interested in having KwiKom do the project.
Vogel said he could not make any commitments without talking to his administrative office to see if they were willing to take that risk. He said the company does not want to put itself in a position to not meet a deadline.
Vogel pointed out they would have a lot of investment in the project through labor and replacing rock teeth for the trencher.
Thompson asked the commissioners if 10 percent retainage would work. They agreed and made a motion to approve the agreement with KwiKom contingent to them agreeing on a 10 percent retainage.
Vogel said that if his company would not accept that, he would come back next Tuesday to see what they could work out.
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