Modesto and the Modesto Irrigation District have agreed to put on hold their costly legal dispute over which one has to pay $9 million in extra costs for the botched expansion of the Modesto Regional Water Treatment Plant, which is operated by MID and provides the city with drinking water.
The city and district have been on track to spend more for lawyers, consultants and experts than the $9 million they are fighting over. In July, officials said those costs for both governments were about $4.5 million and expected to rise significantly as they prepared for a November trial.
City and district officials announced Tuesday they had entered into an agreement to put the lawsuit on hold in an effort to resolve the dispute between themselves and not incur additional legal costs. The agreement also calls for the two to discuss a new contract between them regarding the water treatment plant and potential accords on other water issues.
“A new agreement will help MID and the City protect and defend surface water rights and groundwater use as well as increase the potential to obtain state and federal grants for water system improvements and future projects,” MID General Manager Roger VanHoy said in a news release.
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Councilman Bill Zoslocki – who is concerned about how much the legal dispute has cost and its impact on city and MID ratepayers – echoed those comments: “I think this a good opportunity to start working together to start solving the (water) problems in our community.”
MID and Modesto entered into an agreement in 2005 for the irrigation district to double the capacity of its Regional Water Treatment Plant at Modesto Reservoir. The city is paying for the expansion, while MID would continue to own and operate the plant. MID sells water to the city at its cost to produce it.
The expansion was expected to be completed in 2009 at a cost of nearly $63 million. But the project was botched and has taken more time and money, with a completion date expected by end of the year at a cost that officials have said will be nearly $108 million. MID replaced the project’s contractors, and it and the city recovered money from them for the additional costs but not enough to cover all of them. That left the $9 million shortfall.
Kevin Valine: 209-578-2316