Bismarck state legislator, business partner disputes critical report on construction cost overruns

A Bismarck-area state lawmaker and his business partner say the North Dakota state auditor failed to do due diligence in a review of building cost overruns under the late Attorney General Wayne Stenehem.

State Auditor Josh Gallion said he stood by the critical investigative report released last month, but noted time constraints amid a busy audit season until he completed the work requested by state lawmakers.

The Vogel Law Firm, which represents Stealth Properties LLC, co-owned by Congressman Jason Docter, R-Bismarck, and CJ Schorsch, provided the Tribune on Friday afternoon with more than 800 pages of documentation regarding the project. Stealth’s attorney says records show Dockter and Schorsch’s companies involved in the construction project “acted honestly and in accordance with their legal and contractual obligations.”

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Docter told the Tribune, “We think we did nothing wrong from top to bottom.”

The recipients of Stealth’s response to the report are current Attorney General Drew Wrigley and the chairman of the Legislature’s audit committee that investigated the overreach. Panel members said the report raised questions about credibility and double billing.

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Wrigley said his office will evaluate Stealth’s response over the weekend, particularly on how its records may affect the office’s lease for the building at 1720 Burlington Drive in south Bismarck.

He said he would also provide Stealth’s response to Montana state investigators he assigned earlier this month to look into the cost overruns, as requested by the Legislature’s audit committee.

The cost overrun, which Wrigley said was $1.8 million, was actually $1.2 million, according to Stealth’s response.

In addition, the Attorney General’s Office overpaid nearly $225,000 in costs, according to Stealth’s response.

Project costs have not yet been fully agreed upon, according to Schorsch, who said the $1.8 million is based on subcontractor cost estimates. He attributed the overrun to delays due to the coronavirus pandemic, cost overruns and order changes. Some caulking, a trash enclosure and small items remain to be completed, Schorsch said. Reconciliation or harmonization of finances will take place “as soon as possible”, he said.

Dockter, according to the report, was looking for a public tenant to lease the building before Stealth Properties purchased it. He was also Stenehjem’s 2016 and 2018 campaign treasurer.

Docter said he owns 12.5 percent of the building, a “minority interest,” and called the lease fair.

“We have our lives outside of the legislature. We have a business,” he said.

Docter said he and Stenneheim are friends, “but it has nothing to do with” the building. He said the AG leasing the building stemmed from a “casual conversation” in 2019 with the director of the State Crime Bureau, part of the Office of the Attorney General, and that Stealth would have purchased the building regardless of whether the AG leased it .

“It worked out and they could save money on rent and so they made a decision,” Docter said. Former Chief Deputy Attorney General Troy Seibel primarily handled the construction project, he said.

The report also cited $322,005 in uninvoiced payments to Frontier Contracting, another company owned by Dockter that worked on the project. Schorsch said the Gallion team did not request the disputed invoices.

Gallion’s office obtained records from the attorney general’s office and met with Docter and Schorsch “several times,” the auditor said.

“If there was additional information, my question is why didn’t they provide it in those interactions,” the state auditor said.

Docter said the Gallion team “not once asked us about any of these discrepancies” despite numerous emails and three meetings.

Gallion, who released the critical report to state lawmakers last month, said he stood by it but noted that his review was done within a 90-day window to meet lawmakers’ deadline amid the busy season of major audit projects.

“If we had additional resources and additional time, we would be happy to look at additional areas,” Gallion said.

The report said Frontier did not have a contractor’s license.

Docter said the contractor’s license is held by D & S LLC, doing business under the trade names Parkway Property Management and Frontier Contracting, all of which are companies he and Schorsch co-own.

“The city of Bismarck won’t give you a building permit, you can’t even start” a project without a contractor’s license, Doctor said. D&S will change its forms to recognize which entity provides contracted services, he said.

KFGO political talk host Joel Heitkamp, ​​a former Democratic state senator, recently filed a complaint against Dockter with the state ethics commission, citing Dockter’s involvement in the building.

The board earlier this month took the unprecedented step of hiring a lawyer as a special assistant to the attorney general for legal advice on seven complaints, the contents of which are confidential.

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