CONTACTS 
0201 - Department of Natural Resources    406 444 6699 fax 6721
020101 - Ms. Sarah Bond, Esquire
020102 - Department Counsel =406 444 6660; Legal Division
020103 - Mr. Walt Anderson; Hydro Power Section Supervisor
020104 - Engineering Division
020105 - Mr. Wayne Wetzel

SUBJECTS
Voith Contract Closeout
Planning meeting, 911009
Strategy on Evaluating all Claims

0605 -    ..
0606 - Summary/Objective
0607 -
060701 - Scheduled meeting for next Tuesday 0830 to plan contract closeout, per
060702 - ref SDS 5 and 5 and DIP 1.
060703 -
060704 - Walt will develop some tasks he sees need to be done to reach
060705 - contract closeout.
060706 -
060707 - Sarah is preparing an overview of the legal issues in making claims,
060708 - arbitrating and closing out the contracts, per ref SDS 1 and 2.
060709 -
060710 -    Objective
060711 -
060712 -    To is identify relationships between contract closeout activities
060713 -    and filing claims/litigation (i.e. the Welch contract scope).
060714 -
060715 -    Develop a specific schedule objectives for closeout.
060716 -
060717 -       See as well discusison below re Speed Increaser line 140849.
060718 -
0608 -
0609 -

SUBJECTS
Welch Contract
A01 - Voith Claim Computer &
SDS Training
Payment Mobilization & Computer
Independent Contractor Exemption

0908 -
090801 - Sarah clarified that the new DNRC computer will be used primarily for
090802 - the work of the Welch contract until completion, as set out at ref SDS
090803 - 2 line 191.
090804 -
090805 - She will complete the language of the amendment and get it circulated
090806 - today for approval.
090807 -
090808 -     The new DNRC computer arrived today.  I brought my cpu into the
090809 -     office this morning in order to commission the new one which was
090810 -     accomplished.  Wayne and Walt dropped by briefly before the
090811 -     meeting to see it.  Walt and Mike Simms observed the fully loaded
090812 -     system in the afternoon and discussed applications:
090813 -
090814 -         E-Mail via modem between Plant and DNRC Helena office;
090815 -         networking with Legal; backup.
090816 -
090817 -
090818 - Payment
090819 -
090820 - I requested that DNRC try to expedite payment on the computer invoice
090821 - because Welch is carrying this as a personal expense at the present
090822 - time.  Wayne and Sarah indicated this could be accomplished.
090823 -
090824 -    Workmen's Comp Exemption
090825 -
090826 -    Sarah advised DNRC accounting people have still not received the
090827 -    approval on the Workman's Comp Exemption.  Walt indicated Welch
090828 -    cannot be paid until this step occurs.
090829 -
090830 -    Sarah said she would go pick it up at the Labor Relations office.
090831 -
090832 -
090833 - Mobilization payment - Sarah's feels this can be made today or
090834 - tomorrow, since the Workmen's comp exemption thing is done.  She had
090835 - not received it, but after lunch, it was delivered.
090836 -
0909 -
0910 -

SUBJECTS
Voith Claim Review
Organize existing record, 911004

1005 -
100501 - There is not a chronological "reading" file for Voith contract in
100502 - DNRC.  It would be very helpful to have at least one comprehensive
100503 - assemblage of actual documents in date order.
100504 -
100505 -     This makes it possible to immediately obtain documents that are
100506 -     cited in other documents and by individuals verbally.
100507 -
100508 - Sarah indicated Charity is doing some work on this.  She also expects
100509 - the Welch contract work will organize documents according to claim or
100510 - other issue.
100511 -
100512 - She recalls seeing a box of correspondence files which may be the
100513 - missing the missing letters from Tudor to Voith for period from
100514 - Voith's contract inception to April 1989.  The correspondence from
100515 - April 1989, forward appears to be in the Tudor jobsite records.
100516 -
100517 -     After the meeting, I discussed this briefly with Charity and she
100518 -     has not encountered that box yet.
100519 -
100520 -     An action plan was developed in the afternoon by Sarah and Walt
100521 -     for Charity to proceed in creating the chronology, if it exists.
100522 -
100523 -
100524 -
100525 -
1006 -
1007 -

SUBJECTS
Welch Contract Assignments
Backcharges to Voith from Sletten Contract
Speed Increaser; Presumed damages
DNRC procedures for Recording Damages
Strategy on Evaluating all Claims
Need for Engineer

1709 -
170901 - Sarah and Walt confirmed earlier directions that Welch should
170902 - initially develop support for the Tudor letter of Oct 5, 1989, setting
170903 - out backcharges to Voith (see ref SDS 1 line 091001.
170904 -
170905 -    Background
170906 -
170907 -    Sarah indicated this letter has been sent to Voith (evidently
170908 -    several years ago).  Voith has not responded, but has verbally
170909 -    requested substantiation.  Sarah recalls DNRC asked Tudor for the
170910 -    substantiation, and Tudor has not responded.
170911 -
170912 -    I requested copies of the letter to Voith making claim, and any
170913 -    notes of Voith's response, and DNRC's correspondence with Tudor on
170914 -    follow up.
170915 -
170916 -
170917 - There was some discussion about Welch developing an independent
170918 - opinion based on the record of increased entitlement by DNRC.  Sarah
170919 - cited Jeff's view about the Pit Pier matter. Voith's misrepresentation
170920 - of DTL tolerances is another such issue; Sarah feels it is reflected
170921 - in Tudor's $12,500 recommendation.  In general, if the record shows
170922 - greater entitlement exists, this will be presented to DNRC for
170923 - consideration.
170924 -
170925 -
170926 - Presumed Damages
170927 -
170928 - This will be treated as an independent matter after completion of the
170929 - first assignment.
170930 -
170931 -
170932 - Other Claims
170933 -
170934 - Walt cited other backcharges that may exist.  He indicated some
170935 - notices have been issued to Voith.
170936 -
170937 -     Punch List
170938 -
170939 -     Some of these (Other Claims) appear to be defined within the
170940 -     current Punch list, submitted by Walt, ref DIP 1, showing items
170941 -     complete and others still pending.
170942 -
170943 -        Record of Expense
170944 -
170945 -        Of the items completed, which were performed by DNRC and at
170946 -        what expense?  Of the items performed by DNRC what does the
170947 -        record show was the understanding between the parties with
170948 -        respect to entitlement?
170949 -
170950 -        Responsibility
170951 -
170952 -        Can any of the work performed by DNRC have a negative impact on
170953 -        Voith work, and will this cloud the liability issue with
170954 -        respect to recovery and/or warranty?  The punch list does not
170955 -        designate who did the work nor the order of magnitude and
170956 -        implications.
170957 -
170958 -
170959 -  ..
170960 - Speed Increaser
170961 -
170962 - Received telecon report from Sarah, following up review on 911005 of
170963 - Tudor's finding that Speed Increaser had a noise problem. ref SDS 3
170964 - 3088
170965 -
170966 -     This has a lot of stuff that requires rigorous follow-up (SDS ?).
170967 -
170968 -     It lists a number of potential consequent impacts to the plant
170969 -     from the SI failure which require discreet treatment (e.g.
170970 -     overhead crane concrete foundation, bearing housing concrete).
170971 -
170972 -     Consideration should be given to have the caller submit a written
170973 -     report of all such findings, and to link them to findings of
170974 -     excessive vibration.  Alternatively, the telecon memo might be
170975 -     formalized and sent to the caller to confirm understandings.
170976 -
170977 -     Where caller states:
170978 -
170979 -         ...we need to have [Voith's] finite analysis, absolutely must
170980 -         have or we can't sign off on the design.
170981 -
170982 -     This expert might be asked to confirm its position in writing, if
170983 -     it has not already done so, stating what concerns they have that
170984 -     make this so essential.  Such report would then support placing a
170985 -     demand on Voith and/or hiring engineering oversight support at
170986 -     Voith's expense.
170987 -
170988 -
170989 -     Engineering Management
170990 -     Coordination btwn Lee/Maritech
170991 -
170992 -     Memo raises serious concern about management of engineering
170993 -     disciplines.  This is Tudor's job.  They have or should have the
170994 -     expertise and professional insurance (?) to perform this function.
170995 -
170996 -     DNRC should develop an Engineering Management ment budget from
170997 -     Tudor or someone else, then advise Voith of the expected cost and
170998 -     let Voith convince you through its written promises and conduct
170999 -     that it is not necessary to incur such expense.  It may turn out
171000 -     Tudor no longer has the expertise to do this job; in which case
171001 -     someone else should be hired, depending upon Voith's response.
171002 -
171003 -
171004 - It is not clear whether DNRC views this as contract work, or whether
171005 - it is a separate cause of action outside the contract.  If Tudor's
171006 - substantial completion letter was formally rejected and/or it can be
171007 - demonstrated the plant has never met contract performance standards
171008 - then the matter may still be within the contract.
171009 -
171010 - In either case, the same questions arise with respect to accumulating
171011 - evidence of damages.
171012 -
171013 -     How is DNRC expense being identified?
171014 -
171015 -        a.  Direct labor, materials and equipment
171016 -        b.  Management and engineering time
171017 -        d.  Expert evaluation and advice
171018 -        c.  Legal and consultants
171019 -
171020 -
171021 - Discussed the importance of recording conditions encountered at the
171022 - worksite and giving timely notices (both informational and demands for
171023 - performance) through verbal and written communications to Voith on its
171024 - obligations with concomitant notice to Tudor for its guidance on
171025 - insuring compliance with contract provisions.  My general sense is
171026 - that DNRC is working at carrying out these objectives.
171027 -
171028 -
171029 - No Welch Assignment
171030 -
171031 - At this time, Welch has no specific assignment with respect to the
171032 - Speed Increaser matter, and is only addressing it as coincident
171033 - information like this record.
171034 -
171035 -
171036 -
171037 -
171038 -
1711 -