Adamson Plumbing Contractors, a subcontractor involved in the construction of the Obama Presidential Center, has suspended operations and laid off 25 union workers due to an ongoing payment dispute of nearly $4 million, according to company owner Mike Owen.
Owen stated that the financial strain forced the company to abandon approximately six other construction projects and pushed it to the brink of collapse. He described the shutdown as a necessary measure to prevent bankruptcy, noting the difficulty of laying off employees.
The Chicago-based firm, operating as Marsh-Adamson on the center project, has filed a $1.72 million mechanic’s lien against the Obama Presidential Center property. This legal action escalates the dispute over payments for plumbing work performed on the campus. The company claims the lien covers documented unpaid fees, change orders, and labor overruns.
Adamson Plumbing is among several subcontractors that have reported financial difficulties after working on the center, which was promoted as an economic opportunity for small and minority-owned businesses. A previous investigation highlighted other subcontractors, including Black-owned firms intended to benefit from the project, reporting losses ranging from hundreds of thousands to millions of dollars.
Owen indicated that before the center's opening, his company incurred $3.9 million in losses attributed to project delays, rework, labor overruns, and evolving project demands. He stated that months of negotiations with Lakeside Alliance, the project's construction manager, failed to resolve the issues.
The situation reached a critical point around the time of the Obama Presidential Center's opening celebration on June 19. Owen said Lakeside Alliance agreed to release $100,000 of the outstanding payment to Adamson Plumbing in advance of its May payment application, contingent on Adamson completing last-minute "housekeeping" work at premium nighttime rates. Despite completing the work, Owen reported that the promised payment did not arrive on time, which he identified as the "final death blow" to the company.
Following the suspension of operations on June 25, Owen stated that Lakeside Alliance subsequently released the $100,000 retainage payment and approximately $35,000 for change orders. He described these payments as arriving "too little, too late," noting they reduced debt to one supplier but did not alter the company's shutdown status.
Lakeside Alliance, a joint venture led by Turner Construction and four Black-owned Chicago firms, released a statement acknowledging that "contractual closeout continues long after the doors have opened" on complex projects. The alliance affirmed its commitment to resolving outstanding matters but did not directly address Owen's allegations, the layoffs, or the filed lien.
The Obama Foundation, which oversees the center's construction, stated that Lakeside Alliance is responsible for managing and paying subcontractors and that the foundation has no outstanding disputed charges with the alliance. The foundation also noted that its financial support for project firms exceeded industry standards, including a 15-day payment cycle and accelerated payment timelines.
Concerns have also been raised regarding the center's escalating costs, initially projected at $350 million and reportedly surpassing $1 billion by 2021. Additionally, only $1 million has been deposited into a promised $470 million reserve intended to protect Chicago taxpayers.
Owen expressed that the experience has left him financially and emotionally depleted, uncertain about the future of Adamson Plumbing. He voiced disappointment that the struggles of subcontractors have not garnered more public attention, particularly in contrast to the celebratory opening events.