Bad decisions and bad legal advice. That's how the Meridian City Council turned a $375,000 bill for work on the new City Hall into a more than $4 million legal nightmare.
In retrospect, it would have been much better for city officials to pay the parking ticket - which is what the $375,000 amounted to in relative terms. City Council member David Zaremba concedes that point.
But that wasn't the mindset when city officials decided to pursue legal action against the company hired to manage the $20 million City Hall project. The building was fraught with trouble almost from the day it opened in 2008. Problems included a leaky roof, malfunctions in the heating and cooling controls, and a fountain in front of the building that was leaking thousands of gallons of water. So when the city received a $375,000 bill from Petra Inc., the construction management company, officials decided to take legal action.
"We wanted to save taxpayers money," Zaremba said.
City officials consulted with attorneys and were convinced they had a winning lawsuit -which is like betting on a "sure winner" in the Kentucky Derby. The gamble didn't work. Zaremba said not a single one of the city's legal arguments held up in district court. So what did city officials do? They decided to appeal to the Supreme Court, which reached the same conclusion as the district court. Now the city is on the hook for paying Petra's legal fees for fighting the case in the Supreme Court. That's in addition to the nearly $2 million the city has to pay Petra in legal fees for district court and the $2 million in legal fees the city accumulated for itself.
Officials say that residents will not see any changes in services and that there will not be an increase in taxes as a result of the misguided actions. But Zaremba acknowledges that the money could have been used for other worthwhile capital projects, such as a community center and a public safety building.
"They are going to have to be put on hold for now," he said.
This is not a proud moment for Mayor Tammy de Weerd and the Meridian City Council. City officials say they stood up for principle. But risking millions of dollars on what turned out to be a losing legal battle is not sound financial management.
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