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Commission approves indemnification addendum with Ajax for Nexus Center grant compliance, 4–1
Summary
The board approved Addendum 1 to the construction contract with Ajax Building Company, adding a capped county indemnity to cover Ajax's obligation to indemnify the Florida Department of Commerce for ARPA‑fund grant provisions; the vote was 4–1.
Flagler County commissioners voted 4–1 on Oct. 6 to approve Addendum No. 1 to the construction contract with Ajax Building Company for the Nexus Center, adding a county indemnity tied to grant requirements from the Florida Department of Commerce (the grant uses ARPA funds).
County Engineer Hamid Tabassian and staff explained that the Nexus Center construction contract predated the department’s $4 million grant. The Florida Department of Commerce required subcontractors to indemnify the department as a condition of the award; Ajax agreed to that requirement but requested the county provide a counter‑indemnity because the work and many subcontractor documents predated the grant conditions.
Tabassian said the county’s proposed indemnity is capped at $1.25 million and is limited to liabilities arising from the Commerce grant provisions. County staff told commissioners federal clauses such as Buy America, Davis‑Bacon wage rules and certain background‑check provisions were determined not to be applicable to this project, and the indemnity is meant as protection should a third party make a claim related to the grant’s specific provisions.
Commissioner Carney moved approval; Commissioner Richardson seconded. Commissioner Pennington recorded the sole “nay” on the 4–1 vote, expressing concern that the county could be on the hook for up to $1.25 million for compliance issues that he said should normally be the contractor’s responsibility and urging that future contracts anticipate grant conditions.
County staff said the alternative would be to forgo the $4 million grant reimbursement and leave the county to fund those construction costs. Tabassian and the county’s finance and legal teams said the addendum narrowly limits indemnity to the grant provisions and excludes unrelated contractor obligations.
Ending: The board approved the addendum with the indemnity cap; staff indicated they will review contracting practices for future projects to better align contract terms with potential grant conditions.
