Assembly reduces funding for litigation over problems with port expansion

Lisa Demer

The city is expanding its contract with an Outside law firm to pursue litigation over serious problems with the Port of Anchorage expansion project, but not by as much as Mayor Dan Sullivan wanted.

The Anchorage Assembly unanimously agreed Tuesday evening to an additional $250,000, on top of an existing $500,000 contract with Seyfarth Shaw, a big firm with offices around the country and expertise in construction law.

The mayor had sought $2 million more, but Assembly members told him and his staff that was too much. The smaller amount is enough for the legal team to work for several months, the mayor said during a break at Tuesday's Assembly meeting.

The city is positioning itself to sue "to recover damages from the parties responsible for the deficiencies in work performed," according to a memorandum from the mayor to the Assembly.

In a brief interview during the break, Sullivan said the city will be seeking another $250 million from the Legislature in 2013 for the port project.

The federal Maritime Administration had overseen the port construction project, including contracts, but the city assumed the lead role earlier this year. Most work halted in 2010 after inspections uncovered damaged steel sheets that are part of the new port structure.

The mayor also provided the Assembly members with information the Maritime Administration had released to the Daily News related to the port project.

Some of the information related to a draft, still-unreleased study by CH2M Hill about whether the port project can be built as designed. In its brief written statement Monday, the Maritime Administration, known as MARAD, said the preliminary findings suggest the design "was inappropriate for the conditions at the Port of Anchorage."

The Assembly has not yet been briefed on the study, and some members said they should have gotten more information.

Both the Assembly and the city's Geotechnical Advisory Commission are scheduled to be briefed on the study Nov. 9 in public meetings, but the city does not intend to release the report itself until December. MARAD required city officials to sign confidentiality agreements and signed off on the timetable for the public briefings, Sullivan said.

"While MARAD's decision to release this information was inconsistent with the terms and spirit of MARAD's own non-disclosure agreement, the details of the report are still being reviewed internally and are subject to further review and comment by the Anchorage Geotechnical Advisory Commission," the mayor said in a memo to the Assembly about the information provided to the Daily News.

Given what MARAD provided, "is there anything binding us from putting out more information in advance of the Nov. 6 election?" Assembly member Paul Honeman asked. He referred to a statewide bond proposition that includes $50 million for the port.

Sullivan said no matter what design is used, the city will need at least another $300 million to $400 million for the port construction.

"I just absolutely guarantee you that we've studied port designs, construction, all over the world, all different techniques, as part of our preparation going forward with this," Sullivan said. "And I can guarantee you it's hundreds of millions of dollars regardless of design."

As for providing more information, the city is holding fast to its end of the confidentiality agreement, even though MARAD "nipped" at it, Sullivan said.



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