MODESTO — The Modesto Irrigation District (MID) and City of Modesto agreed to settle a lawsuit concerning the costs of the Modesto Regional Water Treatment Plant expansion.
The dispute centered over $9 million in additional costs for the problem-plagued expansion. The original plan called for the plant to be completed in 2009 at a cost of $63 million. Delays and construction errors pushed the completion date to June 2016 and increased costs to $106 million.
The suit has been on hold since Sept. 2015 as the two parties negotiated a settlement. Modesto put $9 million in an escrow account so that the expansion could be completed as the parties negotiated the settlement.
Under the settlement, MID will be paid the $9 million in the escrow account. The City and Modesto Irrigation District will each pay their own costs and attorney fees and the suit will be permanently dismissed at a savings of $2 million in legal fees for MID and Modesto customers.
“Resolving this litigation means customers win. I’m happy we can now direct our full attention on working through and refining an agreement outlining our joint, future operations that will benefit all,” said MID Board President Larry Byrd in a news release.
The expansion project doubles the plant’s water capacity. The plant, which was completed in 1994, currently delivers 30 million gallons of water per day or roughly half of the city’s water.
“This collaboration to resolve the construction litigation allows the City and MID to focus our efforts on efficiently providing essential water,” Mayor Ted Brandvold said in a news release.