The city is commissioning an internal investigation into how a wastewater facility project took nearly a decade longer and $60 million more than originally anticipated.
When the city hired a consultant in 2008 to evaluate five sites for the construction of a new lift station, a report said placing the structure in Luke Wood Park would be the cheapest option and invite the fewest technical difficulties.
Estimates for the Lift Station 87 project were $8.5 million, with construction taking 18 months. Twelve years later, the city anticipates it will spend more than $67 million on the facility. Construction near the intersection of U.S. 41 and U.S. 301 is still six months away from completion. Once operational, the lift station will handle one-third of the city’s wastewater.
The issues have piled up over the years: a failure to successfully drill beneath the Hudson Bayou in 2012, abandoned plans to build the structure underground in 2014, an unsuccessful lawsuit against the initial contractor in 2018 that resulted in the city paying damages. The project team delayed the expected completion date — set for late 2012 when the first construction contract was awarded — at least five times.
Now, as crews attempt to finish the project by the new March 2021 target, city officials want an official investigation into what, exactly, went wrong with Lift Station 87. The commission voted unanimously Tuesday to direct the city attorney’s office to prepare a report on the problems associated with the project.
Commissioner Hagen Brody placed the item on the agenda for Tuesday’s meeting. Given the amount of attention the project has garnered — and the expenses and delays — Brody believed the city needed to have a formal document providing analysis and answering questions.
“When we lose $50-plus million in overages on a project, I think we need to own up to it and explain to the community what happened, so we and future commissions don’t have the same problem,” Brody said.
During the commission’s discussion, City Attorney Robert Fournier said that any report would likely highlight a confluence of factors that contributed to the budget coming in nearly eight times as high as the original estimate.
“There’s no one single cause that I think anyone is going to be able to point to as the reason expenses — both on the litigation side and on the construction side — turned out to be significantly more [than expected],” he said. “There’s a whole series of events and decisions.”
The city did not make an official available for interview or answer a series of emailed questions about the lift station project but stated the forthcoming report would address many of the questions raised.
Here are some key events and decisions that transformed Lift Station 87 into a high-profile fiasco:
The impetus for constructing Lift Station 87 dates back to 2004 and 2005, when a series of failures at Lift Station 7 spilled more than 1 million gallons of sewage into Hudson Bayou.
The aging wastewater facility on Pomelo Avenue was a source of consternation for residents, who complained about the smell in addition to the spills. By 2006, the city had begun negotiations with Sarasota County Schools about the possibility of building a replacement station on or near Sarasota High School property.
When school board members expressed some concern, city officials began to consider alternate sites. The city first discussed Luke Wood Park at a community workshop in November 2007. The proposal was contentious, drawing concerns from residents in the nearby Central Park condominiums and others concerned about building the structure in a park.
Despite some public opposition, the City Commission voted unanimously to pick Luke Wood Park as the home of Lift Station 87. In a series of reports, staff and city consultants said the park represented the most cost- and time-effective option. Cost estimates for various locations on the Sarasota High property ranged from $9.8 million to $11 million.
The first plan
Reports from two engineering consultants in 2008 acknowledged that Luke Wood Park was a challenging site for a lift station.
Crews would need to install piping beneath Hudson Bayou to reroute wastewater from Lift Station 7. The city hired engineering consultant AECOM Technical Services to oversee design of the project, which called for the station to be constructed largely below ground, with landscaping to obscure the building within the park.
Construction began in spring 2011 after the city awarded a $9.6 million contract to Westra Construction Corp. By 2012, however, construction stopped, and the city parted ways with both AECOM and Westra for failing to successfully tunnel beneath Hudson Bayou.
In February 2013, the city sued AECOM for breach of contract, alleging the firm failed to do necessary prep work. In a court filing, the city said it had no experience with microtunneling and relied upon the outside engineers to determine whether the procedure was feasible.
The revised plan
In August 2013, the City Commission — composed of five members who weren’t in office when Lift Station 87 planning began — selected McKim and Creed as the new engineering firm on the project.
At the time, commissioners expressed frustration with a project that had cost $9 million and extended beyond schedule.
Although City Manager Tom Barwin — also not around for the original plans — hoped work could be done by August 2015, the targeted completion date was pushed back to 2018, then 2020. The new project team called for an above-ground lift station, stating the original design was not hurricane resilient. Cost estimates increased: $27.1 million in 2014, $32 million in 2015, $54.1 million in 2017.
Today, the city estimates it will incur a total of $68.5 million in expenses, including $48.6 million for planning and construction. Robert Garland, the project manager with McKim and Creed, said in 2017 that the initial cost projections were not a useful point of comparison because they came during an economic downturn. At the time, then-Utilities Director Mitt Tidwell said the cost increases were also tied to an emphasis on building a more stable structure.
In 2014, when Commissioner Willie Shaw asked whether the city considered pivoting to a new site for the lift station, Tidwell recommended sticking with Luke Wood Park because of how much the city had already invested there.
“We’re on the site we have,” Tidwell said.
As cost estimates associated with the lift station continued to increase, on multiple occasions, City Manager Tom Barwin pointed to the outstanding lawsuit with AECOM as a potential source of relief.
“Our attorneys will not promise anything, but from an administrative perspective we’re seeking to recoup $10 million to $20 million from AECOM,” Barwin said at an October 2017 meeting.
In November 2018, however, the city got unfavorable news: A jury ruled the engineering firm didn’t have to pay the city any damages. At the same time, the jury said the city breached its contract with Westra, ordering the city to pay $686,233 in damages.
Once targeted as a possible windfall, legal efforts have only added to the expenses associated with Lift Station 87. To date, the city has paid $10.1 million in legal fees tied to the project.