Pelicano widening stalled by contractor bankruptcy, trustee claims; RMA approves John Hayes water connection change order subject to El Paso Water sign‑off

The Camino Real Regional Mobility Authority told its board on April 9 that construction on the Pelicano widening project remains stalled after the prime contractor defaulted, filed for bankruptcy and had its case converted to Chapter 7, leaving the project roughly 50% complete and federal project funds controlled by the contractor—s surety.

Executive Director Raymond Theis said the contract with JAR Construction was executed in March 2020 with a revised completion date in July 2022. The RMA defaulted the contractor in December 2022 and asserted a claim against the contractor—s performance bond. JAR initially contested the default and in March 2023 filed for Chapter 11 bankruptcy; the case was converted to Chapter 7 in September 2023 and a trustee later reasserted claims totaling roughly $26 million, Theis said.

"The wrongful default claim is what has stalled out the surety," Theis told the board, summarizing filings and court actions that are publicly available. He said the RMA sought a declaratory judgment in January 2024 asking the bankruptcy court to rule whether the default was proper; the court held trials on various issues and the board was told a ruling on the default was expected before the end of April 2025.

Theis said TxDOT, as the delegated authority for the federal funds used on the project, has taken the position that those funds are controlled by the surety because of the default; as a result the RMA cannot directly use the roughly $10 million in project funds to restart work without either a surety takeover or a court ruling. Staff have contacted the surety about an "interim fix" to complete a portion of the corridor, and Theis said the surety has agreed in concept to perform a limited restart. However, staff said the bids received for the interim work exceed the original bid amounts and TxDOT has said it will not allow the RMA to use federal project funds to cover the resulting gap.

"The longer we wait, the longer we stall this project out, the more expensive it's going to be in the end," Theis told the board when asked about escalating costs. The RMA reported it has escalated the issue with TxDOT managers, county attorneys and the district engineer to explore options to restart construction.

The board received a public comment urging urgency. One commenter who identified himself as a longtime regional stakeholder described multiple local impacts, including businesses, schools and emergency access, and urged the board to push for a swift resolution.

John Hayes change order The board also considered change orders on other projects. The board approved a resolution authorizing the executive director to execute change order number 5 on the John Hayes Street Extension contract, in an amount not to exceed $296,202, subject to final review and written approval by El Paso Water. The change order covers an unanticipated water‑line connection at the Pelicano intersection that El Paso Water has asked to be completed now while the contractor is on site. Ed Griffin of Atkins Realis explained that the connection will serve existing neighborhoods and future development and that El Paso Water provided the design set and funding; staff noted El Paso Water had not yet fully signed off on the change order estimate at the time of the vote.

The board approved the John Hayes resolution by voice vote. The executive director noted that the airport hangar change order—an approximately $65,000 electrical addition for a septic pump—was executed under the executive director's delegated authority and presented for notification only.

Next steps and legal briefing Theis recommended follow‑up briefings for new board members and offered to arrange a closed session with agency counsel and county lawyers to discuss litigation specifics. The board asked staff to coordinate additional briefings and continued to press for a court decision that would allow the surety or another mechanism to restart work.