Carson Freeway Dispute That Has Cost Nevada Nearly $6 Million In Legal Fees Settled For $13.6 Million

CARSON CITY – A lengthy legal dispute with the contractor who built the first phase of the Carson City freeway bypass was settled today for about $13.6 million by the Board of Examiners.

With $5.9 million in additional legal costs incurred by the state Department of Transportation to defend itself from the lawsuit filed by Ames Construction in 2008, the total cost to resolve the matter is $19.5 million.

Carson City bypass. / Photo courtesy of NDOT.

The board, made up of Gov. Brian Sandoval, Attorney General Catherine Cortez Masto and Secretary of State Ross Miller, approved the deal reached as a result of mediation. Ames had been seeking close to $50 million in its lawsuit.

The protracted dispute over the work became controversial when some members of the state Transportation Board, including Sandoval, questioned the legal fees and expenses incurred in defending against the lawsuit.

Sandoval said after the vote that the settlement was the best option available, although he continued to express concern about the high level of legal fees. The fees did include expert witnesses and other expenses.

The final cost to settle was about what the Transportation Department had estimated it would have to pay out anyway, he said.

“So overall, to answer your question, I think it was a good result for the state and I’m very pleased at the outcome,” Sandoval said.

Assistant Transportation Director Richard Nelson told the board that the construction firm bypassed available administrative remedies and filed the lawsuit, which has also cost the firm about $6 million in legal fees that it will have to pay. Efforts to meet with the company to try to settle the matter were unsuccessful, he said.

The original contract for the first 3.5-miles of freeway bypass was awarded to Ames in 2003 at a cost of about $69 million. Some contract changes raised that amount. With the settlement today and legal fees, the final full cost of the project ended up at $94.5 million. The segment of the freeway opened in February 2006.

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Audio clip:

Gov. Sandoval says he is pleased with the settlement:

040312Sandoval :06 at the outcome.”