Star Tribune
Proctor awards garage project to second-lowest bidder, ends up in court
PROCTOR, MINN — A year after this city put out a call for construction bids for a modest Public Works garage, the building sits half-finished — the subject of an unprecedented tangle that at one point landed Proctor in a rare legal position: in contempt of court.
The dispute over the $700,000 garage includes a contested bid process, a court-ordered work stoppage that didn’t immediately stop work and claims of a construction company’s incompetence answered with claims of on-going harassment from members of the carpenters’ union.
Now the garage, which is meant to hold equipment, stands roofless on a dirt plot off Kirkus Street near Proctor’s sand-and-salt operation. And the case between Nordic Underwater Services and the 3-square-mile city of 3,100 adjacent to Duluth is winding its way through the Minnesota Court of Appeals.
“This case never had to get to this point,” said Aaron Dean, Nordic’s Twin Cities-based attorney. “We had to sue them.”
Second-lowest bidder
Proctor put out a call for bids for the Public Works garage in March 2023 and received responses from five construction companies. In Minnesota, cities must follow competitive bidding laws for projects with an estimated cost of more than $175,000, and the “lowest responsible bidder” gets the job.
In this case, the project went to the second-lowest bidder: Ray Riihiluoma Inc. (RRI). The Cloquet-Minn., company said it could build the grarage for $733,000.
The bid from Nordic, which is based in nearby Carlton, Minn., was the lowest — $127,000 less than RRI’s. After discussing the contract in a 45-minute closed-door session last April 17, the City Council gave RRI the job.
City Attorney John Bray, who has since resigned, told Nordic that it had not been picked.
“The City Council determined that you weren’t the lowest responsible bidder and did not afford the city the best value for the project,” he wrote on April 28.
The move was unprecedented. According to court documents, Proctor had never awarded a project to anyone but the lowest bidder.
“Responsible bidder” was the sticking point. Bray included the general criteria for what makes a responsible bidder, including the character of the company, whether it is skilled enough for the job and its history with other projects. He did not immediately indicate where Nordic fell short.
The city offered a “no comment” through Peter Mikhail, the attorney who within recent months replaced Bray on this case.
Nordic pressed the city for more details about why it was passed over and was given a few emails from former employees who cited safety and wage issues at the company.
“Any one instance of that behavior on this project would greatly delay this project and make it more expensive, as well as placing employees at risk for harm,” Proctor Mayor Chad Ward said in documents filed in St. Louis County District Court.
Nordic, in response, described the claims as the grumblings of short-term employees who had left on bad terms. It said the city allowed these character references without investigating the credibility of the former workers.
Nordic said in court filings that those ex-employees all belonged to the North Central States Regional Council of Carpenters, while its workers were members of the independent Christian Labor Association.
The former union’s dislike for the latter “has bled all over its attempts to secure new work,” Nordic told the court.
In its lawsuit, the company asked that work stop on the Public Works garage, which RRI started in May 2023. It also wanted acknowledgement that Proctor had picked the wrong company. And it wanted its bid and legal fees paid.
Nordic secured the work stoppage and was recently awarded about $3,500. But the permanent injunction ordered by District Judge Eric Hylden this past fall didn’t stick. Proctor gave RRI a new contract to winterize what it had built so far, a move that landed the city in contempt of court.
Hylden did not find RRI in contempt, though.
The company is in its final months before dissolving, a planned ending based on the retirement of one of the partners, vice president David Franzen said.
‘A soap opera’
In February, Proctor appealed Hylden’s judgement granting a permanent injunction. Later, it tried to stop the appeal in favor of just getting a clarification on the permanent injunction — but that motion was denied. The next hearing is not yet scheduled, but Dean expects oral arguments will be held this summer.
“It is a soap opera,” said Dean, Nordic’ attorney. “I’ve never seen public officials behave this way.”
On a recent weekday the work area was quiet, though there are still tire grooves in the thick mud at the plot off Kirkus Street. There is a concrete slab of flooring, a frame and some walls — but no roof. It sits open to the elements. Phil Larson, who was once mayor of this city, said most people have noticed that work has stalled.
“People are talking about it,” he said, but just people who closely follow local politics.
Jake Benson, who served a single term as mayor in the 1980s and is publisher of the Proctor Journal, said he has coffee with an eclectic crew of locals who regularly ask for a status update. He sticks to what is in the court documents. Benson serves on the city council, so he has to be careful of what he says.
Serving hundreds more meals each day brings other logistical challenges, too.
Blaine High School is transitioning from a once-a-week food deliveries to a twice-a-week delivery schedule. The school was running out of storage space for the volume of food it was getting to meet demand, said Noah Atlas, Anoka-Hennepin’s director of child nutrition. Such a shift, he said, might soon be needed at Coon Rapids Middle School, where delivery time requires the Tetris-like strategy of fitting boxes of juice and milk into the cold storage room.
Schools also now have to be pushier about asking parents to fill out paperwork that once determined whether a family qualified for free or reduced-price lunch. Those forms are no longer required to get lunch or breakfast, but they are still used to calculate how much state funding districts receive for other programs, including extra support for students learning English, for example.
“Nutrition programs have had to work all through these challenges,” Peterson said. “But in the end, the payoff is that we’re seeing better behavior of the students, and their attention span has increased because they’re not hungry.”
A driver who was speeding and allegedly had been drinking crashed into several vehicles Wednesday night on Lyndale Avenue just outside of downtown Minneapolis, the State Patrol said.
One person died in the pileup and at least seven others were taken to hospitals with injuries, according to a State Patrol incident report. One of those hurt was a 2-year-old, the report said.
Events unfolded about 9:15 p.m. when a 32-year-old St. Paul man driving a Chevrolet Avalanche exited eastbound I-94 onto Lyndale Avenue and struck several vehicles near Ontario Street. The street and ramp were closed for several hours but have since reopened.
The Avalanche driver was not seriously hurt, but a passenger in his vehicle suffered life-threatening injuries, said Lt. Michael Lee with the State Patrol.
The Avalanche struck six other vehicles. A passenger in a Jeep Cherokee died in the wreck. A 2-year-old riding in a different vehicle was among seven people who were hurt and taken to hospitals, Lee said.
Star Tribune
St. Louis County OKs $1.4M for upgrades to Damiano Center, a makeshift shelter, while Chum expands
DULUTH – St. Louis County commissioners were unanimous Tuesday in approving $1.4 million of support to the Damiano Center for upgrades so it can be used as a transitional space while Chum undergoes renovations to nearly double its size.
The project will cost more than $2 million and the county’s part comes from the American Rescue Plan Act, the Public Safety Fund and beyond. Commissioner Annie Harala said she’s had conversations with Duluth city councilors who are excited to find ways to partner on the project.
“I see this as a way to make a big shift in downtown,” Harala said during this week’s meeting in Rice Lake. “This is the first of many steps to really be supporting the work of the many people working on this.”
Churches United in Ministry (Chum) has received $10 million from state and federal grants to make upgrades to the downtown space, the city’s sole homeless shelter. The organization must break ground in the next six to eight months and the project is expected to take up to 18 months to complete. Chum’s headquarters will be closed during this time and the Damiano Center — which offers emergency services including free meals, clothing and programming — will become its temporary home.
Chum currently has 80 beds, and some people end up sleeping in chairs or on the floor, its executive director said in 2023. In 2022, there was a 27% increase in shelter guests.
“We have been bursting at the seams for quite a while now,” John Cole, Chum director, said at the time. “This is what it will take to save lives.”
The Damiano’s third floor, where the remodel will be centered, is more than 15,000 square feet.
Commissioner Ashley Grimm called it one of the most exciting projects to come along for the board and said it was a long time in the making.
