The city of Bend will likely pay $3.2 million to a Washington-based construction company that was tasked with, but did not complete, the expansion of Bend’s wastewater facility.
In a unanimous vote Wednesday, the City Council approved a tentative settlement with Apollo Inc., which in 2016 sued the city of Bend for $8 million for unpaid work and damages. The sewage treatment plant expansion — which began in 2013 and was supposed to be finished in summer 2015 — was delayed and over budget. The city removed the contractor with the project about 85% complete.
The company’s complaint alleged several design flaws from the Colorado-based company CH2M, which designed the facility, led to delays and unexpected costs. The city claims Apollo caused delays and other problems by not properly managing the site.
A total of $4.6 million will be paid out to Apollo Inc., with $1.4 million being paid by CH2M.
The city did not have to pay any attorney fees.
Councilor Justin Livingston, who participated in a final mediation session last week, said the settlement recognizes some design issues the city and contractor had with CH2M, and that overall the deal is fair for everyone involved.
“Sometimes jobs just go bad, and I think we can all agree this job went bad for all involved,” Livingston said.
The expansion was designed to double the plant’s capacity. Apollo Inc. was awarded a $32 million contract to expand the facility in northeast Bend, which treats all of the sewage produced in the city. In 2017, the council voted to allow M.A. Mortenson Co., a Minnesota-based construction firm, to finish expanding the plant without having to go through a public bidding process.
The city has learned lessons from this process, Livingston said, including going to an alternative bidding process for technical products that don’t rely on going to the lowest bidder.
“It’s not a great situation for anybody,” Livingston said. “But all things considered, it’s a good outcome.”
The city’s legal team is going over final edits and hopes to have the settlement finalized by the end of this week.
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