Hey Williams, get off your rear-ends and start paying the bills owed for work done on YOUR pipeline! At least 77 local businesses in and around Lancaster County, PA are caught in the crosshairs of a dispute between Williams and one of its main contractors, Welded Construction (see Williams Withholds Payment Forcing Pipeline Builder into Bankruptcy).
Last October Welded Construction, a pipeline construction contractor headquartered in Perrysburg, OH, filed for Chapter 11 bankruptcy protection because Williams refused to pay them $23.5 million for work completed on Atlantic Sunrise Pipeline, and that refusal/dispute leaked out into the marketplace and created a “liquidity crisis” (crisis of confidence) with other Welded customers and their projects. By filing for bankruptcy protection, Welded sought to create “breathing room” and settle folks down and reassure them their projects are OK.
Welded had further subcontracted out to local businesses in the Lancaster area for the Atlantic Sunrise project, and because Welded is in bankruptcy, and because Williams has still not paid them, Welded can’t pay its bills. Now the little guys Welded hired to help build the pipeline (a pipeline that now turns in big bucks for Williams) are stiffed. Some of them are on financial life support nearing bankruptcy themselves because of this mess.
We get it. Williams may have a legitimate beef with Welded. Even if Williams is totally within their rights and has good cause to refuse payment to Welded, the fact remains this is a public relations disaster for Williams. Williams needs to make the situation right and make it right, NOW. Pay off the little guys on behalf of Welded, so they can stay in business. Otherwise, for the next pipeline project Williams builds, the little guys will think twice, and maybe walk away, from doing business with Williams and its contractors.
Williams’ reputation is on the line here. MAKE IT RIGHT. Paying $23.5 million to make it right may end up being a small price in the end.
When the controversial Atlantic Sunrise gas pipeline was gearing up to be built through Lancaster County in 2017, Rob Warihay was one of the cheerleaders touting the benefits to local businesses.
Now, the co-owner of Warihay Enterprises is still waiting to be paid $1.8 million for work his Manheim-based commercial landscaping business completed for the pipeline last November.
He’s had to max out the company’s line of credit to survive and is paying interest on the credit.
“It wasn’t fun,” he said.
Warihay’s firm is one of 77 businesses in Pennsylvania — from a Morgantown hardware store to a York ice maker to owners of portable toilets and pest-control services — that are still waiting to be paid $7.7 million for services they rendered on the Atlantic Sunrise and Mariner East gas pipelines.
The companies were stuck with unpaid bills after Welded Construction — the large Ohio-based pipeline builder that was the main contractor on both pipeline projects — declared bankruptcy last October. The bankruptcy filing came after the owners of both pipelines refused to pay Welded.
Williams Partners claims Welded breached its contract on the Atlantic Sunrise, which cuts a north-south swath through western Lancaster County.
Mariner East owner Sunoco charges that Welded failed to comply with environmental regulations on its pipeline, which cuts through a corner of northeastern Lancaster County.
Claims deadline is Feb. 28
Welded’s case is still pending in bankruptcy court.
Some 77 Pennsylvania businesses, both large and small, still have unpaid bills and have prepared claims to be filed in U.S. Bankruptcy Court of the District of Delaware. The deadline for filing isn’t until Feb. 28, and about 10 new claims are rolling in each day.
Even the Pennsylvania Department of Revenue is getting in its 2-cents worth in the case. The department filed — literally — a 2-cent claim for a penalty on a $16.24 unpaid hotel occupancy tax.
Some businesses that did work for the Atlantic Sunrise project are seeking to be paid through a bonding process. Welded put up a $450 million bond with pipeline builder Williams Partners for the Atlantic Sunrise work.
“We continue to do what we can in working with Welded and the bond surety, Federal Insurance Company, so that claims related to the Atlantic Sunrise project can be resolved in a timely manner,” Williams spokesman Christopher Stockton wrote in an email.
“As the surety evaluates these claims, we believe that appropriate claims will be promptly satisfied.”
Subcontractors who need assistance with the process can e-mail Williams at [email protected]
Welded did not respond to a request for comment.
‘Caught in the middle’
Among those who filed a bankruptcy claim was Michael Deitrich, president of Columbia Motor Parts, whose store sold parts and serviced Atlantic Sunrise vehicles to the tune of $11,808.
Have the unpaid bills hampered Deitrich’s business? “Anything hurts but it won’t put us out of business,” he said.
Deitrich said he has been told he will eventually get paid and he said that other auto parts businesses in the region were paid recently.
The company is one of more than 350 from several states that have so far filed claims against Welded in bankruptcy court. Most of the claims are for the Atlantic Sunrise and Mariner East projects.
The owners of the two Lancaster County businesses say they certainly never expected it to end this way.
“We got caught in the middle of it,” Warihay said.
Deitrich is less forgiving. “For as public as it was, as controversial as it was, I certainly never thought they would allow this kind of thing to pop up for local businesses.”*
Nice that Williams is doing something. Frankly, it’s not enough. Do more. Now. Pay the 77 PA businesses and give them a generous amount of interest on top of it to compensate them for their trouble. That’s the right and honorable thing to do–if Williams wants to keep its reputation intact.
*Lancaster (PA) LancasterOnline (Feb 12, 2019) – Lancaster businesses waiting to be paid more than $1M for work on Atlantic Sunrise pipeline
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