Settlement reached in dorm lawsuit

Three Wisconsin subcontractors, including one from Portage, have settled a lawsuit against an Iowa-based company that sought payment for work done on a University of Wisconsin-Baraboo/Sauk County campus dorm.

A firm that manages student housing on two University of Wisconsin campuses has settled a lawsuit with three subcontractors who said they were never paid for work done on one of the dorms.

One of the subcontractors said he’s pleased to have finally been paid, but is disappointed companies that were not party to the lawsuit still have not been made whole.

“Not everybody got paid, and that’s what I’m unhappy about,” said John Nikolai, owner of the Marshfield-based McMillan Electric.

In January, Nikolai’s firm and two other subcontractors filed a lawsuit in Sauk County Circuit Court against Bluffstone, an Iowa firm that developed and manages dorms at the University of Wisconsin-Baraboo/Sauk County and the University of Wisconsin-Marshfield/Wood County.

The subcontractors threatened to foreclose on the Baraboo dorms if they were not paid more than $360,000 in construction liens, plus other costs, they said they were owed.

Nikolai said he received nearly $250,000 under terms of the recent settlement. Zimmerman Plumbing owner Sarah Johnson said her firm was paid more than $43,000. A representative of the third plaintiff, A. Glewen and Sons Excavating, of Waupun, could not be reached for comment Wednesday.

“We are satisfied in that we got paid,” Johnson said. “We’re certainly are not satisfied in how this whole thing was handled.”

Bluffstone’s attorney, Kyle Engelke of Madison, said he could not comment Wednesday on behalf of his client. A request for comment from Bluffstone officials placed through Engelke was not returned.

The Baraboo college campus is jointly owned by the city of Baraboo and Sauk County. Local government and university officials entered a deal with Bluffstone in 2013 in which they leased the dorm property to the Iowa firm. In exchange, the company agreed to construct and manage the dorm at no cost to taxpayers.

In 2015, state lawmakers requested that the Wisconsin Department of Justice investigate after subcontractors that worked on the Baraboo project – and a similar one on the Marshfield campus – were never paid.

Local law enforcement officials later revealed they had opened investigations in conjunction with the Department of Justice. In February, a Baraboo Police Department representative said a detective was working with prosecutors to bring about charges in the matter.

Meanwhile, some of the firms that worked on the dorm projects remain unpaid for their work.

“We have not been paid,” said Scott Katzenberger, owner of Gaffney Plumbing of Marshfield. He said his company still is owed nearly $19,000, but he decided not to file a lawsuit because attorney fees likely would exceed that amount.

Follow Tim Damos on Twitter @timdamos

Baraboo News Republic reporter

(3) comments

Peter Vedro

I agree with Supervisor Kriegl; most of the major projects for the County and City regarding the UW Sauk/Baraboo campus have been handled without seeking the "partnerships" which often result in less quality products and greater headaches!

Thomas Kriegl

I think everyone would have been served much better if this project had never been privatized. This is not the only time that the public good has suffered because of the desire to privatize things.

egle krosniunas

Campus and city officials didn't know what they were doing -- hiring shady companies.

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