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King County, Washington

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DNRP
Dec. 20, 2012

Verdict favors King County in Brightwater tunneling lawsuit

Jury in King County Superior Court determines contractor default; awards $155.8 million for construction schedule delays and cost overruns

A King County Superior Court jury this afternoon awarded King County $155.8 million in damages after finding a Brightwater tunneling contractor defaulted on key contractual obligations.

“This verdict vindicates our position that Brightwater project delays and cost overruns were the responsibility of the contractor,” said King County Executive Dow Constantine, who made the decision to change contractors soon after taking office. “Should the damage award stand, it will mean lower sewer rates than projected in the future.”

King County was the plaintiff in the lawsuit filed in 2010 in King County Superior Court against joint-venture contractor Vinci Construction Grands Projets/Parsons RCI/Frontier-Kemper, or VPFK. Superior Court Judge Laura Gene Middaugh presided over the civil case.

The County claimed VPFK failed to meet contractually-specified deadlines after two tunnel boring machines broke down several hundred feet beneath Lake Forest Park and Bothell in 2009.

The machines required extensive repairs that threatened to delay the completion of Brightwater’s 13-mile conveyance tunnel by up to three years. Though VPFK repaired one machine and completed a 2.2-mile tunnel drive between Kenmore and Bothell in 2011, the County could not accept the lengthy delay and additional cost the contractor proposed for the repair of the second machine and the completion of the tunneling.

The County hired joint-venture contractor Jay Dee Coluccio, or JDC, to complete the remaining 1.9-mile tunnel between Shoreline and Lake Forest Park. JDC already had a machine underground after completing the adjacent 4-mile tunnel between Point Wells and Shoreline.  

“By hiring a new contractor, we completed Brightwater tunnel mining more quickly and at a lower cost than would have otherwise been possible,” said Executive Constantine.

To recover costs associated with project delays and design modifications, King County sought approximately $155 million from VPFK and its sureties. VPFK counterclaimed for approximately $70 million, saying its delays were excused by unexpected soil conditions and other circumstances that were the County’s responsibility. King County acknowledged some of the claims totaling about $4.7 million were valid. The jury granted VPFK’s counter-claims in the amount of approximately $25 million.

“We sincerely appreciate the hard work of the legal team from King County Prosecuting Attorney Dan Satterberg’s office, and our team from Stoel Rives, led by litigators David Goodnight and Karl Oles,” said Christie True, Director of King County’s Natural Resources and Parks Department.

Should the damage award stand, it will help ensure stable rates in the future. The current two-year sewer rate expires at the end of 2014.

VPFK was awarded the $212 million construction contract to build the two central Brightwater conveyance tunnels following a competitive bidding process in 2006. It was the second of four Brightwater construction contracts that built a 13-mile tunnel to carry wastewater from the treatment plant north of Woodinville to a deep-water marine outfall in Puget Sound off of Point Wells. 

The original contract scope entailed building two deep-bore tunnels with a combined length of approximately six miles between Shoreline and Bothell. Contractor JDC completed mining on the final 1.9-mile section of Brightwater tunnel in August 2011.

The tunnel began full operation on Nov. 2, 2012, conveying the first flows of highly treated effluent from the Brightwater Treatment Plant north of Woodinville to a 600-foot-deep marine outfall in Puget Sound a mile off of Point Wells.

Additional information about the Brightwater project is available at http://www.kingcounty.gov/environment/wtd/Newsroom/ReportersToolkit.aspx.

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Residents enjoy clean water and a healthy environment thanks to King County's wastewater treatment program. The county’s Wastewater Treatment Division protects public health and water quality by serving 17 cities, 17 local sewer districts and more than 1.5 million residents in King, Snohomish and Pierce counties. The regional clean-water agency has been preventing water pollution for nearly 50 years.

Note to editors and reporters: Visit the WTD Newsroom, a portal to information for the news media about the Wastewater Treatment Division, King County Department of Natural Resources and Parks: http://www.kingcounty.gov/environment/wtd/Newsroom.aspx