NEW MILFORD — With the clock ticking on a $2.5 million state grant for demolition of the Century Brass Mill, the town has filed a breach-of-contract suit against the company fired from the project earlier this month.

The $2.5 million state DECD grant was awarded to the town in spring 2014 to pay for demolition and remediation of PCB and asbestos contamination in the 320,000-square-foot former brass mill. If the money is not spent by the end of 2016, the town will have to apply for an extension, Mayor David Gronbach said.

“We‘re still in the time period for the grant,” Gronbach said. “This project is too important to the town’s economic development future to take a passive stance on it.”

“We’re looking at rebidding the project in the future,” Gronbach added. “We’re also giving the surety company a chance to act on this. But we’re giving ourselves the ability to mitigate losses.”

The civil suit, filed Jan. 15 in state Superior Court in Litchfield, asserts the contract between the town and Standard Demolition Services requires the company to demolish the building, including associated abatement and remediation work. Standard was required to complete the contract work in 140 calendar days from the issuance of a notice to proceed, which was issued on Sept. 14, 2015. The contract amount exceeds $2 million, the suit reads.

Standard “materially breached” that contract, the town claims, by failing to conduct the project in a way that assured its completion by Feb. 1 and “failed or refused to comply with pertinent laws, ordinances, or the instructions of the engineer.”

Ray Garcia, attorney representing Standard Demolition, said his firm is “going to defend against this vigorously.”

“It’s clearly unjustified,” Garcia said Thursday. “It’s pretty clear that whatever has to be done needs testing by the town first and the town doesn’t want to do it. They are being preemptive here, which indicates to us that they may have exposure concerns about owing additional compensation for delaying the project.”

The town asserts that Standard claimed in a Nov. 30 letter that it didn’t understand contract terms, conditions and specifications concerning the testing, decontamination and disposal of steel on the project.

In light of Standard’s position, the town said, it cannot be reasonably assured as to which contractual provisions relating to PCB and asbestos abatement and remediation work the company would do.

A draft work plan submitted by Standard to the Environmental Protection Agency was rejected, the suit states.

Standard submitted a draft application of payment for the period ending Nov. 30 seeking $65,000 for the portion of asbestos and regulated material abatement already done. However, the town has refused to pay, saying the company did less work than the bill indicated.

Standard views New Milford’s failure to pay “as a default under the contract,” according to a Dec. 29 letter to the town.

The town demanded judgment for damages, with an amount equal or greater than $15,000.; 203-731-3352