School project contractor statement

Editor’s note: This is the full text of a statement released Tuesday by Tom Jones International, the main contractor for the high schools construction project in Grand Cayman.

‘Tom Jones International Ltd. regrets that it was forced to suspend work at the John Gray and Clifton Hunter high school projects on Friday, November 13.

‘Despite numerous efforts over the last six weeks-which included meetings with the Government-appointed project manager as well as correspondence with the Ministry of Education-to resolve the issues surrounding outstanding payments to TJI over the work at the two schools, no solution has been forthcoming.

‘This impasse unfortunately resulted in TJI providing notice to the Ministry last week that work would be halted on the two schools on Friday.

‘At the heart of the issue is Government’s ability-or lack thereof-to pay for the work. While the Government has continually stated that it has budgeted funds to complete the projects, a line item in a budget, in practical financial terms, means nothing.

‘Think of it this way: If you were preparing your family budget and included a line item for a new Ferrari automobile, do you think the Ferrari dealer would accept your budget as proof that you actually had the funds (or would have them when payments were due) and let you drive the Ferrari off the lot that afternoon?

‘Of course not, yet that is precisely the basis that Government is using to ‘guarantee’ to Tom Jones International that it actually has the funds to complete the project. One need only consider recent Cayman Islands budgets to realize how wildly inaccurate its projections, especially on the revenue side, have been.

‘TJI, therefore, exercising its rights under the contract, asked Government to provide assurance, in the form of a trust or a payment bond, that it has the financial wherewithal to meet on time its financial obligations to complete the schools. Government has steadfastly refused to provide such assurances.

‘To date, the Ministry of Education has made more than 85 significant changes to their original plans for the two schools-increasing (so far) the costs of the projects by approximately CI$17 million. Importantly, the Ministry never budgeted any funds for these changes or any other contingencies including the furniture and fixtures. Tom Jones International bid on one project and is being asked to build quite another, one that is far more costly.

‘The Tom Jones Group of Companies has been in business for more than 100 years and has completed every job it has ever worked on. Except in the current circumstances in the Cayman Islands, it has never ‘walked off’ a worksite in its more than a century of successful building.

‘For clarity, it is the company’s desire to resolve the current issues with Government and to complete the projects. TJI has the ability, expertise, and experience to finish these projects at a price that is tens of millions of dollars lower than the other on-island contractors.

‘Despite all the recent back and forth regarding Grand Cayman’s new high schools, Government’s role regarding these difficulties can be explained and understood with one simple fact: It never had the resources to build these schools. What resources it did have, it managed poorly.

‘The schools were part-a large part-of the previous administration’s spending spree that was ill-conceived, poorly executed, over-indulgent, and insufficiently funded.

‘In recent statements, the current Government has pointed to meetings held with TJI to provide the additional funding that would cover advances already made by the contractor. However, there was never an agreement in principle to this additional funding arrangement. Verbal discussions touched on an agreement for the advance payments, which would have been acceptable to TJI, but the Government then drafted an agreement that sought to change the terms of the original contract.

‘These changes would have forced TJI to relinquish many of its contractual rights in order to obtain the payment from the Government that was already due. Put another way, the check was being ‘held hostage’ and the ‘ransom’ was a surrender of rights already agreed to by Government in the original contract it signed.

‘There is no magic or mystery in how to build large capital projects such as schools. In Ontario, Canada, the Tom Jones Canadian company within recent months finished building a magnificent state-of-the-art 1100 student high school-on budget and on time. Largely because of efficient design, this school was completed for approximately 29 million Canadian dollars-less than one third the cost of just one of the Cayman schools being constructed!

‘The most important part of the building process is the initial planning that precedes and later directs the architect’s preparing the conceptual drawings and eventually the detailed working blueprints that instruct the builder.

‘Typically, these initial planning discussions reflect a ‘wish list’ of every conceivable ‘bell and whistle’ that anyone around the table can conjure up. However, in most instances, common sense prevails and this ‘wish list’ is then scaled down to reflect reality-especially financial reality.

‘In the case of Cayman’s high schools, common sense never prevailed. The reconciliation between wishes and costs never took place. In fact, as the project progressed, the wish list grew to include such desirable, but non-essential, items as a four-star gourmet kitchen and a state-of-the-art recording studio that would have been suitable for producing the Beatles greatest hits.

‘Astonishingly, at the beginning of these projects the Cayman Government employed a project manager, but he was gone before the first shovelful of dirt was scooped from the earth. The consequence of this has been catastrophic both to the Government treasury and the projects. Until the recent electorally-induced changes in the Ministry of Education, Tom Jones International had spent dozens of hours negotiating, explaining, and trying to educate the Education Ministry (notably former Minister Alden McLaughlin, Chief Officer Angela Martins, and advisor Vaughn Carter) on the timeline and cost consequences of their decisions.

‘More than 12 months since construction first began on the two sites, Government finally appointed another project manager, David Benoit, to oversee the construction. TJI looked forward to working with Mr. Benoit in a professional, fair, and equitable manner. TJI still looks forward to a speedy resolution of outstanding issues, returning to the worksites, and completing these projects under the explicit terms of its contract with Government.’