NEWYou can now listen to Fox News articles!
Weeks after the Obama Presidential Center’s star-studded opening in Chicago, a subcontractor who previously claimed his company was stiffed for nearly $4 million has shut down operations and laid off 25 union workers.
Mike Owen, the owner of Chicago-based Adamson Plumbing Contractors, told Fox News Digital that the financial fallout forced the company to abandon about half a dozen other construction jobs and left it on the verge of collapse. Owen described the shutdown as a painful decision he believed was necessary to save the company from bankruptcy.
“Laying off close to 30 people is something that no owner in our industry wants to do,” Owen said. “It’s a hard thing to do, especially when you know you can finish them and the company can still make money. But we were put in a pretty bad corner.”
SUBCONTRACTORS SAY THEY’RE OWED MILLIONS, FACE FINANCIAL RUIN, AFTER HELPING BUILD OBAMA PRESIDENTIAL CENTER
Adamson, which performed its work on the center under the name Marsh-Adamson, has since filed a $1.72 million mechanic’s lien against the property, escalating the payment dispute into a legal fight.
The company is one of several subcontractors to report financial trouble after working on the center, which was promoted as a transformative economic opportunity for small and minority-owned businesses.
A previous Fox News Digital investigation identified several subcontractors — including Black-owned firms the project was specifically intended to support — that said they were owed money or had absorbed losses ranging from hundreds of thousands of dollars to millions. The largest dispute involves the Concrete Collective, which is seeking more than $40 million in additional payment.
‘Final death blow’
Before the center opened, Owen said the project had left his company with $3.9 million in losses tied to delays, rework, labor overruns and changing project demands. He said he spent months negotiating with Lakeside Alliance, the project’s construction manager, before going public after failing to reach a resolution.
Against the backdrop of that larger dispute, Owen said the breaking point came around the time of the Obama Presidential Center’s opening celebration.
Owen said Adamson and Lakeside Alliance reached an agreement under which Adamson would provide two journeyman plumbers to perform last-minute “housekeeping” work on campus at premium nighttime rates.
In return, Owen said, Adamson was supposed to receive part of its outstanding payment days before the center opened on June 19. An email reviewed by Fox News Digital shows a Lakeside representative telling Owen that $100,000 would be released through Adamson’s May payment application.
Adamson completed the requested work, but the payment did not arrive on time, according to Owen, who said it was the company’s breaking point and left him with no choice but to suspend operations on June 25.
“We negotiated it in good faith,” he said. “Against my better judgment, I agreed [to do the work].”
“Not getting that large sum of money just kind of pulled the brakes on the train. It was just the final death blow to the company,” he added. “Rather than try to stretch it out and go bankrupt, I just decided the responsible thing was to shut it down. We’ll regroup, and we’ll see where we’re at come September.”
Owen said that the promised $100,000 retainage payment and around $35,000 for change orders payments have since arrived from Lakeside Alliance — more than two weeks after he suspended operations and laid off 25 workers.
Owen said the money helped reduce the company’s debt to one supplier but did not reverse the shutdown.
“It’s almost like too little, too late,” Owen said. “It probably would have just prolonged the inevitable at this point,” he said. “We’re still deep in the hole of what they owe us.”
Owen said Adamson has now moved out of its building and that he is working from home while turning the dispute over to his attorneys and determining whether the company has a future.
OBAMA CENTER ISN’T A TRADITIONAL PRESIDENTIAL LIBRARY. CRITICS SAY IT’S AN ACTIVISM CENTER.
Legal battle begins
Owen has escalated his nearly $4 million payment fight.
Documents reviewed by Fox News Digital show that Marsh-Adamson filed a $1.72 million mechanic’s lien against the Obama Presidential Center property, alleging it remains owed money for plumbing work performed on campus. A mechanic’s lien is a legal claim filed against a property by a contractor or supplier alleging that it has not been fully paid for completed work.
The lien is considerably lower than the approximately $3.9 million Owen says Adamson lost over the course of the project. Owen said the lien covers the amounts he believes are most readily documented, including unpaid fees, logged change orders and labor overruns supported by company records.
“It doesn’t mean that I’m not going to pursue the $3.9 million in change that we lost overall,” Owen said. “I’m still working with my legal team on that $3.9 million figure because I feel that it’s only right that we still hold ownership at the presidential center accountable.”
Owen said he had initially avoided filing a lawsuit or lien while attempting to negotiate a resolution.
“I’m not a litigious person, but at the same time, our legal system is there to protect the small guy,” Owen said. “I’m just going to have to fight this out legally from here on out, and these aren’t cheap costs.”
Last week’s payment will be deducted from the $1.72 million, he said.
Lakeside Alliance, a joint venture led by Turner Construction and four Black-owned Chicago construction firms, served as the project’s construction manager. The other firms are UJAMAA Construction, Powers & Sons Construction, Brown & Momen and Safeway Construction.
In a previous statement, Lakeside said approximately 475 contractors worked on the center. In its latest response, the alliance pointed to the project’s scale and said “contractual closeout continues long after the doors have opened” on major projects of such complexity.
“Lakeside Alliance remains committed to working through all outstanding matters to successfully close out the project,” a spokesperson said. Lakeside Alliance did not directly address Owen’s allegations, the layoffs or the $1.72 million lien.
WATCH: Subcontractor says his company is owed nearly $4M for work on Obama Center project
The Obama Foundation, former President Barack Obama’s private nonprofit organization that oversees the construction, said Lakeside was responsible for managing and paying subcontractors and that the foundation had no outstanding disputed charges with the alliance.
While it did not directly address Adamson’s allegations, the foundation said its financial support for firms working on the project exceeded industry standards.
“Our commitment began with a 15-day payment cycle, which is largely unheard of in major construction projects,” the foundation said in a statement, adding that it sometimes accelerated payment timelines or advanced payments months before work was completed.
The center has also faced scrutiny over its soaring price tag and promised taxpayer protections. Construction costs, initially projected at approximately $350 million, had climbed to $830 million by 2021 and have since reportedly surpassed $1 billion.
Meanwhile, just $1 million has been deposited into a promised $470 million reserve intended to protect Chicago taxpayers if the center encounters financial trouble.
Those questions have drawn added scrutiny because the Obama Foundation secured the 19.3-acre Jackson Park site through a 99-year lease requiring a one-time $10 payment.
‘They don’t care’
Owen said the ordeal has left him financially and emotionally drained and uncertain whether he will ever restart Adamson Plumbing.
“This entire process really drained me out financially and emotionally,” Owen said. “So that’s where I’m at — just kind of in a holding pattern.”
Owen said the opening ceremony — which featured performances by Bruce Springsteen, Christina Aguilera, John Legend and U2’s Bono and The Edge, among others — only sharpened his anger. Against that celebratory backdrop, he said, the struggles of the workers who built the center went largely unrecognized.
Owen argued that Chicago’s proud protest culture had been conspicuously absent — and that the reaction would have been markedly different if the project were associated with figures such as Elon Musk or Ken Griffin, the Chicago billionaire whose name adorns the neighboring Griffin Museum of Science and Industry.
“There would be holy hell to pay,” Owen said. “They would be picketing. They would be storming the castle.”
Owen also singled out Illinois Gov. J.B. Pritzker, questioning why the pro-union governor had not addressed the layoffs or payment disputes.
“But he hasn’t said anything publicly about the union companies at the presidential center getting stiffed,” Owen said. “And it bothers me.”
Pritzker’s office did not respond to a request for comment.
Owen said he was not accusing former President Barack Obama of personal responsibility but believes the foundation should publicly acknowledge the subcontractors’ complaints and help seek a resolution.
“It’s become perfectly obvious to me that the ownership group there — they truthfully just don’t care,” he said. “I don’t know any other way to say it.”
Owen said contractors had held out hope that their disputes would be resolved once construction ended.
“But I think a lot of us out there, the main subcontractors, all still had this feeling that it was going to be worked out in the end — until it wasn’t,” he said.
Now, with Adamson’s future uncertain, Owen said the project has left him facing a personal turn he never saw coming.
“I mean, the only leverage I have now is just to continue speaking out and see where it goes,” he said. “But my career — it’s funny — I’m going to have to go find a job, which is fine. It’s just that I did not anticipate the completion of this project would take this turn.”
WATCH: Black subcontractors at Obama Presidential Center still seeking payment as Juneteenth opening nears, advocate says
Read the full article here
