The firm that handled engineering on Hillsboro’s upgraded wastewater treatment plant will pay the city $335,000 in a settlement approved Wednesday during a special meeting of Hillsboro City Council.
With all members present, council voted unanimously for an emergency resolution to approve the agreement hammered out in a 12-hour session in Columbus last week attended by Safety and Service Director Todd Wilkin and city Auditor Gary Lewis.
The settlement agreement also includes the city recouping about $30,000 of the $60,000 it had paid into an arbitration panel, meaning the total the city will recoup is about $365,000.
Wilkin told council it was a good deal for the city. He said that if the settlement had not been reached and the arbitration process had continued, the city may have been awarded as much as $500,000 if a decision went its way. But he said additional legal fees and other costs would have reduced the net amount won by the city, compared to the settlement reached last week.
“It was a long day, but a fruitful day,” said Wilkin as he recommended acceptance of the deal.
Lewis praised the mediator who handled negotiations last week, calling him “very good.”
The agreement between the city and engineer CH2M Hill, Inc., also calls for the engineer to be responsible for all fees charged by the mediator, including those the city would have been required to pay. It includes no admission of liability.
Wilkin said Wednesday that when problems with the upgraded plant became evident, the contractor, PAE, and the engineer blamed each other. He said the city was not blameless, either, and did not provide enough oversight when the project got under way in 2010.
The wastewater plant upgrade was officially completed in January 2013 after many construction delays and design issues. The project ended 262 days behind schedule, city officials said later.
Shortly after the upgraded plant was completed, Wilkin previously told council, the facility experienced problems, including pumps that burned up because they appeared to be too small, and holding tanks that cracked under pressure.
In late 2014, the city filed a demand for arbitration in an effort to get CH2M Hill to pay roughly $1.4 million to the city after the city was ordered by an arbitrator to pay more than $800,000 to the plant contractor.
At the time, Wilkin told council, “The city administration has since held multiple meetings with the engineer on the project, CH2M Hill, to try and negotiate an agreed upon settlement under which CH2M Hill would contribute their share to the arbitrator’s award and further reimburse the city for additional costs arising from the failure of plant components. Unfortunately, no agreement has been made with CH2M Hill and as of December 6, 2014 the city has filed a demand for arbitration.”
City council approved making the EPA-mandated upgrade in 2009. A groundbreaking ceremony was held in February of 2010 for the project, which cost about $18 million, including engineering.
Among the plant upgrades was a doubling of the number of vertical loop reactor (VLR) tanks from three to six, which handle the biological processes of wastewater treatment. Other improvements included upsizing the piping, increasing the capacity of the influent building, adding two additional clarifiers to the two that existed, and adding a 1.33 million gallon EQ (equalization) basin, adding a new UV system with upsized channels to carry more flow, and new process equalization with electrical.
A new 1250 KW generator replaced a 400 KW generator. The new generator can completely operate the plant in case of a power failure, although it requires 100 gallons of diesel fuel an hour to run it.
More than $7.1 million of the plant’s funding was provided through government grants. The city received an additional $10.2 million as a 1-percent Water Pollution Control Loan.
In its only other item Wednesday, council unanimously approved an increase in appropriations in the General Fund of $11,000 in order for the Hillsboro Police Department to purchase a K9 bullet resistant vest for its canine officer. Lewis indicated the money came from donations.
Reach Gary Abernathy at 937-393-3456 or on Twitter @abernathygary.