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Shannon: City 'vastly' overpaid for Emporium Plaza demolition; city disputes claim

Shannon: City 'vastly' overpaid for Emporium Plaza demolition; city disputes claim

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Emporium Plaza

Four bays at the Emporium Plaza, 1503 Galvin Road S., were razed by Omaha’s Heimes Corp. in early April for $25,320.

*Editor's Note: The online version of this story is updated with new information that was not available by the print version presstime deadline.

At-Large Bellevue City Councilman Pat Shannon said city officials “vastly” overpaid for the demolition of portions of a strip center he owns on Galvin Road.

Four bays at Emporium Plaza, 1503 Galvin Road S., were razed by Omaha’s Heimes Corp. in early April for $25,320 after the property had sat in what the city claimed was disrepair for nearly a year. The property was damaged in a May 2019 flash flood that caused a retaining wall at an adjacent property to fail, resulting in land debris and railroad ties crashing through Shannon’s property’s back wall, affecting numerous bays.

Shannon attempted to block the demolition by requesting a temporary restraining order and injunctive relief in Sarpy County District Court, which was subsequently dismissed by Judge George Thompson. The injunction is currently under review by the Nebraska Court of Appeals.

Demolition expenses were approved during the council’s June 16 meeting. This action, Shannon said, resulted in the city paying $16,000 to $18,000 for work that wasn’t completed.

The original bid the city received from Heimes Corp. totaled just over $29,000, according to a proposal submitted by Heimes Corp.’s Matt Sykora. Ward 5 Councilman Don Preister, who serves as the body’s president, said that the city’s bill was properly adjusted and that only completed work was paid.

Shannon, in January, received an above-ground demolition bid from Sykora on behalf of Heimes Corp. totaling $7,877, provided documentation from Shannon shows. The total estimate at that time provided to Shannon was just under $35,000.

The $7,877, Shannon said, is approximately the amount of demolition work actually completed on the city’s behalf.

“Just doing the above ground, which is all they have done now, it’s only $7,000 worth of work,” Shannon said. “Why would they do that? Once again, it’s harassment of me, because the city is going to turn around and bill me $25,000, and now I’m stuck having to finish the job myself.”

City Attorney Bree Robbins said the assertion that the scope of the work completed was about $7,000 isn’t accurate. One of Shannon’s points of contention is that the footings and floor slab of the demolished property weren’t removed, as highlighted in the city’s original demolition plan.

Robbins said the adjustment reflected that work not being completed.

“I think where Pat may be confused is that he is looking at his bid, and it says there’s a price of $11,885,” Robbins said in relation to the demolition section highlighting footing and wall removal. “It talks about excavating and removing the floor slabs and footing.

“And I think he’s trying to allege that that’s the full price, and since Heimes didn’t remove the floor slabs and footing, they should have reduced their bill by the $11,000.”

That’s not accurate, she said, because that figure also included the removal of the north and east building walls, which Robbins said was completed.

“He’s trying to make that look like almost $12,000, but the actual cost to remove the floor slabs and footings was the approximate $3,700 …,” Robbins said. “I reviewed this extensively when Mr. Shannon brought this to the city’s attention before the last city council meeting, and I had (City Engineer) Mike Christensen review it and (City Administrator) Jim Ristow review it, and we were all very comfortable with the price that was on the last city council agenda, and the reduction from Heimes for the work that was not completed.”

This was the second time in two years a property owned by Shannon was demolished by the city.

In 2018, after a half-year battle, Heimes Corp. demolished a car wash owned by Shannon just south of 28th Avenue and Capehart Road that was declared a nuisance by the city before being condemned and razed.

In a June 16 letter to Robbins, Shannon’s attorney, Donald Loudner of The Saathoff Law Group, raised concern regarding the most recent demolition.

“My client has not been able to move forward with reconstruction, because Heimes Corp. has never completed all the work it outlined in its bid to the city,” Loudner said.

Work not completed as outlined in the city’s bid, Loudner said, included removing all of the footings and floor slab of the demolished property. This work not being completed has prevented Shannon from moving forward with reconstruction of the bays, Loudner said, adding that Shannon is concerned the expense will be wrongfully transferred to him.

Additionally, Shannon said there are currently 15 open sewer connections as a result of the above-ground demolition that pose a safety hazard.

“When they took the floor out, they were supposed to go down to that main sewer pipe and cap everything off,” Shannon said.

“They are now letting sewer gases out in 15 places right in that one area ...”

Lastly, Shannon expressed concern about Heimes Corp. acknowledging in its demolition notes a report from engineering and surveying company TD2 regarding stabilization of the bank on the backside of his property, which he said poses a huge concern should it collapse.

Loudner said Shannon is concerned that Heimes Corp. completed dirt work without any guidance from TD2.

“My client has previously contacted TD2 and TD2 denied ever producing any such report for the city or Heimes Corp.,” Loudner said.

The Leader, following a public records request to Robbins, received a copy of the report completed by Kurtis L. Rohn, a geotechnical engineer for TD2. His report was received by the city on March 18, according to a date-received stamp on the three-page document.

The Leader received the document from Robbins after its weekly print deadline.

In a letter addressed to City Engineer Mike Christensen, Rohn said, “At your request, TD2 made a site visit to the above referenced site (1503 Galvin Road) to observe the conditions of the surrounding soil slopes and the consequences of removal of the condemned building.”

The report, which is attached to this story, subsequently highlights several stabilization options for city officials to consider.

City officials prior to the Emporium Plaza demolition said they needed to take action out of necessity. In an affidavit statement, City Engineer Mike Christensen said no improvement plan was implemented and that no follow-up demolition work had been completed since about 10% of the building was demolished in the days following the accident.

Shannon, they said, was given every opportunity to take action to repair or demolish his property on his own; when he didn’t, the city stepped in and was forced to foot the bill to protect area residents.

Shannon argues that he wasn’t sitting idly for more than 10 months and that the city jumped the gun demolishing his property. Especially, he said, since the insurance provider of the adjacent apartment complex requested a Notice to Preserve to investigate and assess the scene of the accident.

“We were under orders to preserve evidence and leave things in place to allow the apartment’s attorneys and insurance company to do their investigation,” he said.

“The city was trying to knock the building out and get it out of there before they could do it, just to interfere with my ability to recover money from the apartments.

“All they had to do was leave it there another 30 days and they would have been done with their investigation.”

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