2021/02/03 Council Agenda Packet

`EVERETT Project title: Approval of Litigation Against East Clearwell Roof Contractor and Subcontractors City Council Agenda Item Cover Sheet Council Bill # Agenda dates requested: 2/3/2021 Briefing Proposed action Consent XXX 2/3/21 Action Ordinance Public hearing Yes X Budget amendment: Yes X No PowerPoint presentation: Yes X No Attachments: None Department(s) involved: Public Works & Legal Contact person: Tim Benedict Phone number: 425-257-8660 Email: jtbenedict@everettwa.gov Initialed by: Department head Council President Project: Approval of Litigation Against East Clearwell Roof Contractor and Subcontractors Partner/Supplier : Location: East Clearwell Roof Preceding action: None Fund: None Fiscal summary statement: Project summary statement: The East Clearwell roof at the City's Water Filtration plant collapsed in February 2019, about two months after it was accepted by the City from the contractor, T Bailey. The City's insurer has paid for the entire cost of replacing the roof (about $3.5 million), except for the City s $100,000 deductible and some other adjustments totaling about $40 000. The replacement roof will be finished this year. Because the City's insurers paid the replacement cost the insurers are entitled to bring claims against T Bailey and its subcontractors. These claims (subrogation claims) are routine in insurance matters. Under the City Charter, the City Council must approve litigation. In the case of subrogation claims by City insurers, it is unlikely that the Charter provision applies, but staff is bringing this item forward anyway because of the Charter ambiguity. Finally, this lawsuit will also seek payment from the contractor for replacement costs not covered by insurance, such as the $100 000 deductible. Recommendation (exact action requested of Council): Approve Litigation Against East Clearwell Roof Contractor and Subcontractors