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Published: Monday, 8/22/2011

Lawmakers eye measure to cap project overruns

BY TOM HENRY
BLADE STAFF WRITER

State lawmakers are considering legislation aimed at preventing massive cost overruns of publicly funded projects, such as the $28 million reservoir in Fremont that has gone up in price by more than $10 million.

"I don't have a problem with a change order if they get into a project and find asbestos, lead, or something like that," state Rep. Peter Beck (R., Mason) said about House Bill 176, which he introduced several months ago in response to excessive spending he believed had occurred in his 67th House district. "Anything that deals with public safety you have to fix. What I have a problem with is change of scope."

Ohio has no limits on change orders that municipalities can make on projects they have under way. Mr. Beck said his bill would require city councils to approve anything more than $75,000.

"At least we'd have some accountability, somebody taking a look at it," he said. "I'm asking for more accountability."

Joe Michles, a Fremont resident highly critical of cost overruns in Fremont's reservoir project, testified on behalf of the bill this year in front of the Ohio House of Representatives' Commerce and Labor Committee.

In a recent interview with The Blade, Mr. Michles said Fremont's case "shows us why there is a need for the law."

The Ohio General Assembly, currently on its summer recess, has not yet acted on the legislation.

Mr. Michles said he believes any project costing more than 10 percent of its accepted bid price should be subject to rebidding.

Fremont's reservoir project is the largest in the city's history.

It is being built to serve as a backup source of raw drinking water when Sandusky River nitrate levels are too high. Nitrates from farm fertilizers flow into the river, and can stay there for weeks at a time, usually during heavy spring rains. Nitrates are one of the few pollutants the city's water treatment plant can't remove.

At high levels, nitrates pose many health threats to infants and other developing children, as well as women who are pregnant, nursing, or trying to become pregnant.

As far back as 1999, consultants recommended an upland reservoir.

After years of negotiations, the city committed to build a reservoir in 2008 to comply with an Ohio Environmental Protection Agency edict to move toward a long-term solution.

But after delving into the project, the city found Swiss cheese-like bedrock known as karst geology in a section of the 146-acre site.

It has holes large enough to drain an unlined reservoir.

So the city committed to line the reservoir at great cost.

Officials have said they chose the site with the original design upon the advice of consulting engineers.

Mr. Michles claims the city failed to do its homework and was penny-wise and pound-foolish about the project from the start.

The project was supposed to be completed last spring.

Fremont has asked for an extension until May, 2012, although it believes its current contractor, H.M. Miller Construction Co. of Mogadore, Ohio, may be able to finish it by the end of 2011.

The project's original contractor, Trucco Construction Co. Inc. of Delaware, Ohio, filed a $5.2 million lawsuit against the city about a year ago, claiming Fremont owes it that much in addition to $3 million the city previously paid it.

The city's engineering firm, Arcadis U.S. Inc., had called some of Trucco's charges "unreasonable" and "unjustified."

Contact Tom Henry at: thenry@theblade.com or 419-724-6079.



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