Champion Builders files bankruptcy

Champion Builders, the former general contractor on the East Topeka Learning Center, has filed for a Chapter 11 bankruptcy.

The Joint Economic Development Organization, the public partnership group providing funding for the $5.5 million learning center, already was working with The Hartford, the bonding company on the project, to find a new contractor, said Shawnee County counselor Jim Crowl.

Changing general contractors midstream means completion of the learning center, which was expected to be finished in December, won't occur until spring 2019, Crowl said. But he stressed that the project will be completed.

"It’s unfortunate that Champion has filed bankruptcy, but it will not affect the completion of the East Topeka Learning Center project," he said. "We had already terminated Champion's contract on the project and made a claim against the performance and payment bonds that were issued by Hartford. That’s what those bonds are for."

Issues with Champion Builders, a Topeka-based company owned by Greg Murray, were raised at a September JEDO meeting when The Hartford contacted Crowl to let him know they were holding payments to Champion because of  issues with another project. At the time the JEDO board, comprised of city of Topeka and Shawnee County leaders, instructed Crowl to ask the bonding company to find Champion in default if it was necessary.

Multiple creditors listed in the Champion Bldrs LLC — which is owned by Champion Builders Inc. — bankruptcy filing are those connected to work done on the ETLC.

At least one company official expects payment of its $148,500 bill through The Hartford.

"We will get paid through the bonding of the project. I don’t think any local folks are going to have any problems," said Dan Beal, president of McElroy's, which provided mechanical and plumbing services on the ETLC. "It was bonded properly and the bonding agent stepped in at the right time."

In September, Crowl said that performance and payment bonds were required by Kansas law on public projects. Those bonds guarantee that if there are problems, either because of contractor performance or with parties getting paid, the bond company will step in, Crowl said.

Murray couldn't be reached Wednesday for comment on the bankruptcy filing.

A Chapter 11 bankruptcy is part of the bankruptcy code that allows companies to reorganize debt.

In the bankruptcy filing, Champion Bldrs LLC listed $3.4 million in liabilities. The company's assets included accounts receivable of about $1.5 million and machinery/equipment valued at nearly $500,000. The total assets were almost $2 million.

Champion's bankruptcy filing listed significant dollars owed to Topeka-area businesses. Of the $977,000 owed to creditors who have debt secured by property was Alliance Bank in Topeka, with two claims, one for $174,000 and the other for $750,000. Larger unsecured claims for area businesses include:

• Ace Electric, $60,210

• Anthony S. Barry Law Offices, $242,024

• Concrete Unlimited, $30,764

• Fastrac Excavating, $45,317

• PJ Welding, Auburn, $28,000

• Seltmann Masonry, Mayetta, $45,974

• Sowards Glass, $36,593

• Universal Mechanical and Electrical, $27,000