City Attorney's Office
Reference: Resolution Authorizing Settlement
To: Mayor Gregory Mills and Members of City Council
Through: Michael P. Martinez, City Manager
Prepared By: Alicia Calder?n, City Attorney
Date Prepared: August 29, 2025
PURPOSE
To approve a resolution giving authority for the City to enter into a settlement agreement to share the costs of the repair for a water main break and releasing any claims associated therewith.
BACKGROUND
To approve a settlement and sharing of costs associated with a water main break that occurred February 13, 2025. While performing work on Bridge Street for the widening and improvements, a subcontractor of Brannan Construction hit a water main, causing a major water leak. This water pooled around a transformer and caused a power outage. The transformer had to be replaced, and the water line repaired.
Attorneys for Brannan, the City, the subcontractor, and the engineer on the project have been negotiating after the City sent a demand letter to Brannan and JR Engineering for costs incurred related to the outage and transformer replacement. When the attorneys met, it appears the costs are approximately $100,000. This includes the cost of replacing the transformer, payment for damages to a homeowner, and equipment rentals the day of the incident used to repair the water main. Amongst the four parties, the attorneys are seeking authority from each of their clients to each pay approximately $25,000.
In order to avoid the cost of litigation, the parties are proposing entering into a settlement agreement to divide the costs evenly among the four parties. All parties would release any claims they may have against the others.
FINANCIAL IMPACT
The cost of settling will be $25,000; whereas, the cost of litigating would be a much higher and unknown cost.
STAFF RECOMMENDATION
The City Attorney recommends approving the resolution to accept the settlement.
OPTIONS FOR COUNCIL CONSIDERATION
Approve the Resolution
Deny app...
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