Las Vegas Sun

February 24, 2018

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MGM Mirage, Perini spar over CityCenter after Gibbons meeting

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Steve Marcus / Las Vegas Sun

Aria, the centerpiece of the $8.5 billion CityCenter project, in Las Vegas on Monday, Dec. 14, 2009.

Updated Friday, May 21, 2010 | 3:52 p.m.

The depth of the conflict between Perini Building Co. and MGM Mirage was on full display today as both companies exchanged barbs in what has become one of the most acrimonious disputes between businesses in Southern Nevada’s history.

Perini executives and representatives of the company’s army of subcontractors verbally torched MGM Mirage after meeting for 45 minutes with Gov. Jim Gibbons about their frustration over not getting paid after completing one of the world’s largest construction jobs.

MGM Mirage is Nevada’s largest company with 17 hotels and hotel-casinos in the state, including the city’s three largest resorts, while Perini is the state’s largest commercial general contractor with more than 1,000 local employees.

Perini officials say MGM Mirage still owes builders about $491 million after paying $5.79 billion of the total bill. The company said Perini’s 600 subcontractors are owed $391 million and the company itself is due $100 million.

“I wouldn’t do business with MGM again if they were the last owner on the planet,” said Ron Tutor of Tutor Perini Corp., the parent company of general contractor Perini Building Co., which completed work on MGM Mirage’s $8.4 billion CityCenter project in December.

MGM Mirage didn’t attend the meeting with the governor, but returned fire against Perini in a statement issued by the company.

“In early May, Perini presented its ‘final’ bill – 300,000 pages of disorganized, scattered, and incomplete documents in 140 banker’s boxes,” the MGM Mirage statement said. “Cover sheets have a different amount billed than the supporting documentation below the cover. The bills lack support or documentation but show that Perini is still billing CityCenter for ‘projections.’ How can Perini or anyone else expect CityCenter to hand over a half-billion dollars to Perini on this record?”

Despite the acrimony, Gibbons, mindful of fresh unemployment figures showing Nevada hitting a record 13.7 percent jobless rate, said he would try to bring the two parties together.

“Our goal is to work with both sides, try to facilitate a meeting where we can get them to sit down and look each other in the eye and realize that for the good of Nevada, for the good of hundreds of people who are on both sides of this issue that a resolution take place so that we have no further degradation of either the capabilities of the state of Nevada in terms of its construction and commercial business or the gaming industry which is so vital to the state as well,” Gibbons said after the meeting.

But gaming industry handicappers would put long-shot odds on such a meeting occurring. Tutor said he invited MGM Mirage executives Jim Murren and Bobby Baldwin to today’s meeting with the governor, knowing they wouldn’t come “because they wouldn’t have the courage to show up.”

MGM Mirage countered that Perini approached the governor with the subcontractor payment issue to mask their failures in the construction of the Harmon Hotel building at CityCenter.

“MGM Mirage has never refused to pay the subcontractors the money they are owed,” the company’s statement said. “Contrary to claims made by Perini in the media, CityCenter is prepared, willing and able to pay all legitimate bills to subcontractors.

“As the general contractor, Perini is responsible for managing the process of issuing a final billing statement and closing out subcontractor payments. Instead, Perini is giving up that responsibility and unleashing a PR campaign against CityCenter as a cover for its default. As a result, CityCenter is stepping in to do what Perini has failed to do.”

MGM Mirage is reticent to attend a public forum since both companies have sued each other – Perini filing a mechanic’s lien and MGM Mirage, a construction defects suit over the Harmon.

Perini says MGM Mirage is using the Harmon issue as an excuse for not paying its bills.

“It is time to stop hiding behind Harmon as an excuse for not paying,” said Craig Shaw, CEO of Perini Building. “Harmon can and will be repaired, the only one preventing that from happening is MGM Mirage.”

Others attending today’s meeting were Mel Hawkins of Apex Electric; Kent Metranga of Bomel Construction; Derrick Hodson of Desert Plumbing; Darrell Harwood of Fisk Electric; Scott Chatelain of Rapid Mechanical; Wayne Searle of SME Steel; Nick Mamula of T. Nickolas Tile; Charlie Urata of Urata & Sons Cement; Marc Furman of the Carpenters Union; Keith Marshall of the Laborers Union; and Anne-Merelie Murrell of Giroux Glass.

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