(The Center Square) – Spokane Valley approved a final $11.75 million settlement on Tuesday with the contractor that built city hall after a probe found that poor compaction caused the foundation to sink.
The city council signaled its approval on Tuesday, bringing the total amount when considering settlements with subcontractors to nearly $14 million. The Valley spent around that much to buy the land and build city hall but has since devoted more than $6 million to fix several issues.
The most significant was structural damage to a curved wall in the council chambers due to about 14 feet of poorly compacted material under the foundation. City Manager John Hohman said most of city hall sits on top of a basement except that wall, which had its own foundation.
“The contractor used that as a ramp to get in to do all the concrete work in the basement,” Hohman said, “and as they were finishing and the wall was constructed … the contractor did not compact about 14 feet worth of soil just for that little area.”
As the foundation sank, the sheetrock and bricks that made up the wall started to crack, leading to an investigation. The city found several other defects throughout the process and sued Meridian Construction, the general contractor, which agreed to this $11.75 million deal.
Spokane Valley previously settled over the defects with architectural and project management firms Eight31 Consulting, Architects West and Allwest Testing & Engineering for $2.18 million.
The municipality entered mediation with Meridian Construction for a few days over late fall, but Hohman said the parties failed to resolve the matter. About a month prior, City Attorney Kelly Konkright told the council that the Valley would take the matter to trial if they didn’t eventually settle.
“I can say, probably without a doubt, that this building has been reviewed and looked at more than any building in the Spokane region,” Hohman said.
The investigation included around 2,000 pages documenting the defects with the wall, sinking foundation and several other issues. Hohman said they added five addendums examining every aspect of the building before suing all the contractors in 2020.
According to a news release, the council awarded Garco Construction a $4 million contract in January 2023 to fix the issues. The contractor finished repairing the foundation and related impacts in August 2024, and the city is assessing whether further remediation is needed.
“We are thankful to recoup taxpayers’ dollars and to see this process come to a close, as this settlement not only reimburses the money spent on critical repairs but also ensures that we can address all remaining work,” Mayor Pam Haley wrote in the release. “It’s a significant step forward for Spokane Valley as we move on from these challenges and focus on our 2025 city priorities.”
After publishing, Attorney John Black, who represents and provides counsel to Meridian Construction on behalf of Dunn & Black Law Firm, said his client “vigorously disputed the city’s claims. However, Meridian’s insurance carrier made the business decision to settle the lawsuit on mutually agreeable terms.”
