The Mary Esther City Council voted Monday to dismiss both the contractor and the architect firm working on the city’s new city hall and to pursue liquidated damages. Council members said the renovation is 203 days past deadline.

• Councilwoman April Sutton made the motion, which Councilman Larry Carter seconded and the council approved, with Councilman Richard Lawson casting the lone no vote.

It directs the city to immediately dismiss the project architect, Florida Architects Inc., and the contractor, Stockton Construction Group, and to seek liquidated damages set out in the contract.

The city is renovating the former First Florida Bank building at 302 Mary Esther Boulevard, in front of the Santa Rosa Mall, to serve as its new city hall. The council approved buying the building in February 2024 for $2,375,000 and in December 2024 awarded the renovation contract to Stockton, the lowest responsive bidder. The roughly 7,200-square-foot building is meant to replace the city’s current 3,830-square-foot city hall, which the city has said lacks adequate space and ADA accessibility.

• The renovation has repeatedly missed deadlines, and the contract sets liquidated damages at $1,000 for each day the work runs late, according to the city. Mayor Pro Tem Bernie Oder said that figure has piled up.

“By the agreement we signed with them, they are now 203 days behind,” Oder said. “You multiply that times 1,000, that’s $203,000.”

Oder said the city should also pursue actual damages, staff hours and legal fees, and should overhaul how it selects contractors to avoid a repeat. “I’m all for the gloves come off,” he said.

Sutton pressed to remove the contractor without further delay, pointing to repeated errors, including carpet that she said had been ordered incorrectly multiple times.

“I want them off the premises immediately,” Sutton said. “This is the problem with accepting the lowest bid, is you get the lowest quality.”

She later expanded her motion to include the architect firm, arguing it had failed in its oversight role. “We’ve heard this song and dance for the last year,” she said. “These are taxpayer dollars, and no, I’m done waiting.”

City Manager Jared Cobb told the council the contractor was on site the previous week and installed carpet and replaced the council dais, but that not enough carpet was ordered to finish the job. He said three major items remain: exterior signage, the rest of the carpet in the council chambers and resealing the floors.

Cobb said he had scheduled a walkthrough of the building with the city’s architect on Wednesday to prepare a final list of completed and outstanding work. The city still has more than $100,000 left on the contract, he said.

• “We just wanna get it done,” Cobb said, describing staff’s goal as closing out the contract and bringing in subcontractors to finish the remaining work.

City Attorney Hayward Dykes urged the council to follow the contract’s requirements before acting. He said the agreement is an AIA contract under which the architect serves as the first level of review in a dispute, and that two pay applications, numbers 5 and 6, were still being worked through. The architect had reduced the amount on one of them, he said.

Dykes said he would not advise against seeking liquidated damages but cautioned that recovering the full amount is not guaranteed.

“I’m not gonna advise this council not to seek the liquidated damages. It’s in there,” Dykes said. He said case law on liquidated damages is nuanced and that courts have found such awards should not be punitive, meaning a judge could award less than the full $203,000.

He also said there is no fund holding the accrued daily penalties and that the city would have to go after the contractor’s bond or insurance to collect. Litigation would take time, he said.

“If we filed suit today for all the things that have been outlined up here, you’re probably still looking at 16 to 18 months before it gets resolved through trial,” Dykes said, adding that a settlement could come sooner.

Carter questioned what recourse the city has for what council members described as poor workmanship and pressed on the architect’s responsiveness after months of unresolved issues.

Cobb said the architect’s role is to review the contractor’s work before the city pays for it, and that several items, including the carpet, had been rejected and left unpaid. Electrical and plumbing inspections go through Okaloosa County like any other building permit, he said.

Sutton disputed that description, saying the architect’s role is to operate as a general contractor and that the firm should have been replaced already.

Dykes recommended the council let Wednesday’s walkthrough proceed and consider a special meeting to review the remaining work and its cost before deciding on any offer to the contractor.

The council declined to wait, and Sutton’s motion carried.