Port Angeles OKs Gateway settlement agreement
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Keith Thorpe/Peninsula Daily News
The city of Port Angeles stands to net more than $224,000 in the settlement over cracks found under The Gateway center.

By Jeremy Schwartz
Peninsula Daily News

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PORT ANGELES — With a unanimous 7-0 vote, City Council members ended at least a year of legal maneuvering by accepting an agreement settling legal claims among the city, Clallam Transit and the design and engineering firms involved in the construction of The Gateway transit center.

“This has been burdensome, and we're glad to be done with it,” Port Angeles Mayor Cherie Kidd said at the Wednesday meeting.

The settlement agreement among the city, Clallam Transit, Krei Architecture of Tacoma and Bright Engineering of Seattle nets the city a total of $224,448, City Attorney Bill Bloor said.

That total consists of $146,167 in cash paid to the city by Krei's and Bright's individual insurance companies and $78,282 in fees Krei has agreed to no longer seek from the city, per the terms of the settlement agreement.

As of Nov. 31, 2012, the city had spent $73,180 on outside attorneys and consultants in handling claims.

The city had a claim against Krei for construction delays caused by a crack in the eastern foundation wall of the transit center's main pavilion at Lincoln and Front streets.

Krei in turn asserted that its subcontractor, Bright Engineering, should pay and sought unpaid fees from the city.

The crack was found in the concrete support wall toward the end of pavilion construction and resulted in about seven months of construction delays.

Construction began in June 2007, and the center — featuring a bus stop, parking garage, four-faced clock tower, restrooms and police and transit driver offices — opened in March 2009.

The city began handling the legal claims starting in December 2011, Bloor explained.

Clallam Transit — the city's partner on the project — and its attorney had dealt with the leal claims since about 2008.

In a Tuesday interview, Clallam Transit General Manager Terry Weed had little comment on the city's settlement agreement as the city and Clallam Transit agreed the city would handle the outstanding claims with Krei and Bright and receive any settlement monies agreed upon.

A representative from Krei could not be reached for comment Thursday, and a Bright representative reached via phone had no comment on the settlement agreement.

City Finance Director Byron Olson said Wednesday the final cost of the transit center to the city — which will include legal costs — was not immediately available, but a tally provided by the city in 2011 listed the total transit center cost to all parties at $15.4 million — roughly 4.7 percent more than the original project budget of $14.7 million.

The entire project was funded with $8.1 million in federal and state grants, $500,000 from Clallam Transit and $6.1 million from the city, with the city covering the cost overages.

In an interview before Wednesday's meeting, Bloor said city staff and legal counsel had to weigh the benefits of the city netting roughly $224,400 alongside taking the matter to court and seeking more, but most likely spending more in legal costs.

While Bloor said he may think the city could have done better in the settlement terms, he said the city would not be guaranteed anything going the litigation route.

“Also, to be realistic, we need to realize we could do a lot worse,” Bloor said.

When asked if the city had learned anything from its transit center experience, Bloor said Port Angeles residents would be disappointed if city officials did not learn something from every capital project, adding that each will have its own surprises.

“We try to learn from all those experiences, the good ones and the bad ones,” Bloor said.

In an interview before the City Council vote on the settlement agreement, city Public Works Director Glenn Cutler said he thinks the transit center turned out well and is glad to see it being used by the community.

“I'm just happy we're done with the project,” Cutler said.

“It's been a positive impact on downtown.”

Reporter Jeremy Schwartz can be reached at 360-452-2345, ext. 5074, or at jschwartz@peninsuladailynews.com.

Last modified: January 03. 2013 5:49PM
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