Question:
Last month our organization decided to remodel our admin building and the Board Secretary was asked to get bids and decide on the best contractor that comes in under $250,000. Since that time, we have had a major wind storm that caused $3.2 million in damage and an insurance deductible is $150,000, which will leave us only $200,000 in the bank. We need to stop the secretary from proceeding, if she hasn’t already let a contract. And the Board cannot meet for another 2 weeks. What do we do?
Answer:
The short answer is call the secretary and find out at what point she is in the contract process. If nothing has been done, tell her the situation and have her stop where she is. If bids have been solicited, but a contractor not notified of their selection or has not had a contract awarded, again tell her to stop.
In both of these cases a motion to rescind (also called annul or revoke) needs to be made at the next board meeting, if you truly wish to stop the project.
However, if the contractor has been awarded the contract, either verbally or in writing, the secretary needs to get in touch with the contractor to either (1) see if the organization can get out of the contract with little or no minimal penalty; or if that cannot be done (2) Se if the contract can be re-negotiated into a smaller area, delayed time frame, unfinished interior, etc. and have those modifications and associated costs to present at the next Board meeting.
In either case of re-negotiation, the board agrees to/selects the option that now fits within its means and uses the motion Amend something previously adopted to adjust the original motion . This way both parties feel comfortable about the situation and may allow some or all of the work to proceed.
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