Jones Bros. disputes claims of instability

Officials with Jones. Bros. Construction, one of Wilson County's largest employers and possibly the state's biggest road contractor, said their company was "solvent" and disputed claims from state officials they are financially struggling.
In a letter obtained by The Lebanon Democrat dated Aug. 6, 2004, Tennessee Department of Transportation Chief Engineer Paul Degges informed Jones Bros. Inc. President M. Dale McCulloch of plans to terminate a pair of contracts held by the company.
Degges explained TDOT elected to terminate the contracts – one for Briley Parkway in Davidson County and the other for State Route 153 in Hamilton County – due to costly delays and an apparent concern regarding Jones Bros. financial stability.
"It has come to our attention," Degges wrote, "that Jones Bros. appears to be suffering financial difficulty. We understand that Jones Bros. is not able to be bonded for additional work due to its financial condition."
Degges added TDOT understood AmSouth Bank, which he said also had concerns about Jones Bros. financial status, had refused to renew a $5 million letter of credit to the company that was serving as security for retainage.
However, despite Degges' comments, Jones Bros. Inc. attorney Jere McCulloch maintained the company is financially sound Wednesday.
"In spite of the allegations contained in the letter from (TDOT), Jones Bros. is solvent and is completing all of the projects it has under contract," McCulloch said.
Referring to the company's work toward widening S.R. 153 as "exceptionally poor," Degges noted TDOT currently holds nearly $800,000 in liquidated damages assessed due to the company's performance on state projects.
Earlier this week, TDOT Public Information Officer Kim Keelor explained the department is currently levying liquidated damages in the amount of $1,400 a day against the company due to problems with the Hamilton County project.
Degges also said the department was concerned with progress on Briley Parkway construction.
"As of July, Jones Bros. has completed 67.9 percent of the work and used 102.4 percent of the time," Degges said of work on Briley Parkway. "We do not disagree that Jones Bros. is entitled to time extensions on this job. However, under any scenario we use to consider granting time, Jones Bros. is behind schedule."
The company does not agree with the liquidated damages levied against it, McCulloch said, and intends to dispute the claims based on its contracts with TDOT.
"While the state is holding sums of money as liquidated damages, Jones Bros. disputes that the state is entitled to charge liquidated damages in these projects," he commented.
McCulloch added the company plans to resolve the dispute through the "normal state claims process."
"(TDOT) has a process to go through, and most of the time they negotiate it out," he said. "In a worst case situation, there's a claims process to go through."
Staff Writer Brian Harville can be reached at 444-3952 ext. 16 or by e-mail at brian.harville@lebanondemocrat.com.