Undergrounding Lawsuits Come to an End
City regains $917,000 out of over $2 million –
Over 5 years ago, City Council members were suddenly informed about construction cost overruns for installation of underground utilities in the private utility district known as the Piedmont Hills Underground Assessment District.
To complete the underground work and litigate the matter cost the City was well over $2 million. The final cost arising from the problem is not known at this publishing.
The City brought litigation against two engineering firms, Robert Gray and Associates and Harris and Associates, who were responsible for the underground project design work. Settlement with Gray was $500,000 and combined with the $417,000 Harris settlement equals $917,000.
The City in approving the private utility district contracts assumed the project risks for the private project, which proved to be financially consequential. The plans had not indicated the large amount of rock encounter in the excavations resulting in significant additional cost to complete the project. Various individuals and entities were considered to be potentially culpable in the matter. Known legal action was taken only against Gray and Harris.
Press release from City:
City Announces Settlement with Harris & Associates
At its regular meeting of February 16, 2016, the City Council approved a settlement agreement with Harris & Associates, the second of two engineering firms that the City had sued to recover costs associated with the Piedmont Hills Underground Assessment District. The City previously settled with the other engineering firm, Robert Gray & Associates.
The City filed suit against engineering firm Harris & Associates in April 2011, alleging causes of action for both breach of contract and professional negligence related to Harris & Associates’ engineering practices. The agreement provides that Harris & Associates will pay the City $417,000 to settle the suit.
“This settlement brings an end to our legal disputes relating to the Piedmont Hills Undergrounding Project, provides the City with partial compensation, and allows the City to put this unfortunate chapter in our history behind us and to focus our attention on Piedmont’s bright future,” said Mayor Margaret Fujioka.
“This settlement is the result of protracted negotiations with Harris & Associates and their attorneys,” said City Attorney Michelle Marchetta Kenyon. “While the attorneys representing us in this case would have worked tirelessly to prevail in a lengthy trial, settling this case best conforms to the City’s long term interests.”
Read the staff report and correspondence on the settlement with Harris & Associates
<<< To read a full accounting of PCA reporting on the subject, click “Undergrounding”on the left side of this page and scroll down.
Once again, I’m appalled and angered by the City’s assumption of risk associated with this unfortunate Rule 20B project. The entire risk should have been laid at the feet of those who asked for the work. They should have been the ones to bare the added cost; and thus responsibility to litigate the failure of the two engineering firms. Why are the rest of us forced to assume the added cost?
“Those who cannot learn from history are doomed to repeat it”
George Santayana