Obama Presidential Center Hit by Unpaid Work Claims

Subcontractors on the $850-million Barack Obama Presidential Center in Chicago’s Hyde Park say they are still waiting to be paid for completed work, with claims of strained communication, disputed change orders, and growing frustration among firms involved in the project.

The disputes centre on payments allegedly owed for additional work and design changes carried out during construction, which contractors say were authorised on site but have since become difficult to recover through the project’s formal channels.

Communication with the Obama Foundation, subcontractors claim, has largely broken down as they attempt to secure payments through the project’s prime contractor, Lakeside Alliance, a joint venture that includes Turner Construction Co., Power and Sons Construction, UJAMAA Construction, Brown & Momen, Safeway Construction, W.E. O’Neil Construction Co., Trice Construction Co., and II in One Concrete.

The Concrete Collective joint venture, including II in One Concrete, serves as the concrete contractor. II in One Concrete has previously filed a lawsuit against the project’s engineer, Thornton Tomasetti, over concrete and rebar installation.

Most subcontractors declined to speak on the record, but said they were gathering information and weighing whether to file liens or lawsuits.

Omar Shareef, president of the African American Contractors Association, said seven separate subcontractors had approached him in recent months seeking help in pursuing unpaid funds, according to a report by Crain’s Chicago Business.

One of the firms at the center of the dispute, Adamson Plumbing, a minority-owned business, says it is owed more than $2 million.

“There are a whole slew of change orders that [the JV contractor] asked us to price and proceed on,” said Michael Owen, president of Adamson Plumbing, an Illinois-based union employer. 

“A lot of subs on the project had already received that guidance and proceeded. We probably have close to $450,000 in price and proceed and a couple of them we are now at a complete loss for.”

READ MORE: Why Obama’s Presidential Center Is Quietly Radical

In a statement, Lakeside Alliance acknowledged the challenges but said such issues are typical of large-scale projects. “The Obama Presidential Center involved multiple structures, thousands of design documents, and hundreds of trade partners and community businesses. 

“As with many major construction projects, contractual closeout—including the review and resolution of outstanding invoices, change orders, and other project matters—continues long after the doors open.”

It added that the joint venture remains committed to resolving outstanding payments.

“These companies have broadened their skills, expanded their relationships, and enhanced their ability to compete for future work on major projects across the country. We remain committed to working through outstanding matters to successfully close out the project,” it said.

Contractors say the main problem is small mistakes that kept happening during construction, which later led to bigger payment disputes.

Owen explained that these issues often started with small differences in the design that showed up when the project moved from planning to actual building. 

Early in the project, for example, he said bathroom tile walls with flushometers were built to incorrect dimensions, prompting a small change order.

Owen said: “I called the supplier and quickly priced replacements and got the okay to price the new supplies and fix the problem, a roughly $20,000 change order.”

However, subcontractors say that when they later submitted documentation for change orders through the project’s construction management system, some payments were denied despite prior approval to proceed.

They also say the project’s scope evolved significantly during construction, with additional work and rework drawing on contingency funds. The total cost of the Obama Presidential Center reportedly rose from an initial $300 million to $650 million, and eventually to $850 million.

Meanwhile, the project’s endowment, estimated during design at $470 million in donations, now reportedly has only $1 million in cash on hand, according to filings by the Obama Foundation.

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