In October, Red Samm Mining Venture, Venture Construction Inc., and Shoreline Construction Company received nearly $3.2 million to install the water supply system.
As with Grand Forks, the Corps' Omaha District conducted a detailed Community Impact Study, which focused on how the project would affect schools, medical facilities, and other community services. After visiting the construction site area in July 1970, Governor Forrest Anderson teamed up with North Dakota Governor William Guy to testify about citizen concerns before the Senate Subcommittee on Military Construction.
However, Governor Anderson's concerns became moot, as labor problems delayed the influx of workers into the region. Local labor agreements in force in the Great Falls area had generous overtime and mileage compensation rates. Local contractors had few objections to these provisions, because overtime rarely occurred on local projects and local workers had short commutes. However, potential contractors for Safeguard found it difficult to pay these costs and keep the project on budget. Although the two contractors awarded the Phase I excavation contract bowed to local union demands, the potential additional labor costs on Phase II threatened to put the project way over budget. The Watson Construction Company of Minneapolis, Minnesota, received a contract to excavate the MSR building and adjacent power plant and lay out the first floor slab for these structures. The team of H.C. Smith Construction Company and Amelco Corporation shared a contract to do similar work at the PAR site. The contractors completed Phase I requirements on time despite the harsh winter conditions on the northern plains.
However, the timely completion of Phase I became meaningless when the government had difficulty acquiring an acceptable bid for Phase II. Two bids were opened on March 25, 1971; on April 14, 1971, Under Secretary of the Army Thaddeus R. Beal rejected the lowest bid as being "unreasonable in price." The ensuing effort to come to terms with the contractors and unions would stall work on the project during prime construction season. Because local unions insisted on maintaining benefits that could have ended up adding $45 million more to the cost of the project, obtaining a general project agreement proved to be a most difficult endeavor. To stem inflationary pressures, President Nixon had issued Executive Order 11588 that restricted labor contracts to allow inflation only up to six percent and set up a watchdog committee to review potential settlement packages. On July 29, 1971, this committee concluded a review and rejected packages that had been negotiated between the two potential contractors and nine of the local unions.
Frustrated at the local level, the Army turned to national labor organizations. An agreement was signed on October 19th, and although above the six percent guideline established by President Nixon's Executive Order, the package won approval of his watchdog committee on the following day. By mid-February 1972, only four unions had indicated their willingness to subscribe to the contracts that had been negotiated on their behalf by their national leaders. Yet hoping that the local unions would quickly fall in line, the Corps gave Peter Kiewit Sons' Company and Associates (PKS&A) the go-ahead to start Phase II construction with a target completion date of late 1974. As spring arrived on the northern plains, additional contracts were let for the Remote Launcher Sites and the nontechnical support structures.
By the end of May, the project was about 10 percent complete and the contractor had mobilized the resources needed to launch full-scale construction. However, the project would not make much further headway. On May 26, 1972, President Nixon and General Secretary Brezhnev signed the ABM Treaty that limited both sides to one site to protect strategic forces and one site to protect the National Command Authority. With the Grand Forks complex 85 percent complete, the Secretary of Defense suspended construction at Malmstrom. The status of the site rema