Contractor on brink of closure: Feds never paid

Contractor on brink of closure: Feds never paid »Play Video

TACOMA, Wash. -- A longtime building contractor may be forced to close its doors because the federal government is allegedly withholding $215,000.

Sterling Exteriors of Tacoma helped renovate the famed Paradise Inn at Mount Rainier. The project has been completed since last May, but the government still hasn't paid the entire sum due.

The tough economy and downturn in building has already forced Sterling to issue layoffs. But the company says it has no more corners to cut, and fears it may have to close its doors just in time for the holidays.

Paradise Inn renovations took two years and cost $23 million. Sterling re-roofed the entire lodge.

"We were very excited to get this project," said owner Doug Vieselmeyer.

But Vieselmeyer says once the company finished the project, the National Park Service came up $215,000 short on its payment.

Vieselmeyer claims park service architects made crucial errors. The roof turned out to be steeper than the architects' estimates, which made the project bigger in scale and also more challenging, Vieselmeyer said. And that cost extra money.

"Reality is that it took an additional 4,000 square feet of cedar shakes to do the roof. And we've not been paid for that along with the additional labor," he said.

The park superintendent says it's not their issue; it's an issue for the main contractor - a partnership that includes Tacoma's John Korsmo Construction.

But Vieselmeyer says no, the federal government owes him that money. And if he isn't paid before this weekend, he'll have to shut his doors. That means he'll shut down all his current projects and lay off all 40 of his remaining employees.

"It's really tough," he said. "I've got great employees and a great staff of people and I'm going to lose them."

"I'm newly married, have a toddler and another one on the way. It's not a really pleasurable thing to think about," said employee Jared Pullen.

Vieselmeyer's dilemma comes at a time when President-elect Barack Obama is talking about spurring the economy with federal building contracts. But if the government doesn't pay in a timely fashion, Sterling workers said, the projects won't do any companies any good.

KOMO News has contacted Congressman Norm Dicks, D-Bremerton, who chairs the subcommittee that oversees the National Park Service, and he said he will get to the bottom of the issue.