Construction of the Taipei Performing Arts Center, which was already running behind schedule, came to a halt yesterday, after contractor International Engineering and Construction Co on Thursday unexpectedly filed for bankruptcy.
Company president Yi Chih-fan (衣治凡) on Thursday sent a letter to his employees, complaining about the construction and “unexpectedly high level of technicality” and restrictions the government imposes on public infrastructure, saying that these, compounded by the company’s financial problems, are the reasons behind its failure to complete the construction.
The NT$5.4 billion (US$169.8 million) construction in Shilin District (士林), one of the largest infrastructure projects in Taipei, was scheduled for completion next month.
Taipei Mayor Ko Wen-je (柯文哲) last year told the Taipei City Council, amid criticism of the project’s delay, that if officials overseeing the project botched it, he would “strangle every last one of them.”
Democratic Progressive Party (DPP) Taipei City Councilor Wang Wei-chung (王威中) told a news conference in Taipei that, based on his investigation, the construction firm knew it would go bankrupt, as it had accumulated a debt of more than NT$2 billion in recent years.
The company had been dishonest about its finances and undertook the project to secure a NT$760 million down payment from the Taipei City Government to ease its financial difficulties, Wang said.
The firm’s shareholding structure had undergone several major changes since 2014 and is now solely owned by Yi, which means the city might not be able to reclaim the down payment and levy fines for the construction delay if Yi has transferred his assets elsewhere, he said.
The company should not have been selected as the contractor, because it had concealed a syndicated loan of NT$540 million that it took from seven banks in 2011, he said.
As of last year, the firm owed the project’s subcontractors up to NT$80 million for building materials, prompting the subcontractors to pull workers from the construction site and causing the construction to fall seriously behind schedule, he said.
Wang drew a parallel between the arts center and the beleaguered Taipei Dome project, saying that he had advised Ko to suspend the contract between the city and the contractor, but that city officials who oversee the project, including former Department of Rapid Transit Systems (DORTS) commissioner Chou Li-liang (周禮良) and former Department of Culture commissioner Ni Chung-hwa (倪重華), had endorsed the firm and covered up the real cause of the delays.
New Party Taipei City Councilor Chen Yen-po (陳彥伯) asked Ko during a council meeting if the building could be completed before his term ends in 2018.
Ko said the city government would endeavor to finish the construction before his term expires.
The top priority is to resume construction work as soon as possible, Ko said, adding that a new time frame for the project would be proposed.
DORTS chief secretary Wang Wei (王偉) said the city is working on a plan to deal with the situation, and that it would deliberate whether to seize the company’s assets.
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