Jury rules against Tampa Bay Water in reservoir trial

TAMPA — After a trial that lasted a month, a federal court jury took less than four hours Tuesday to find that the company that designed Tampa Bay Water's reservoir is not responsible for fixing the cracks that have plagued the structure.

Instead, the cost of the multi-million-dollar repair work will likely fall on the shoulders of the 2 million ratepayers in Pinellas, Pasco and Hillsborough counties.

Tampa Bay Water general manager Gerald Seeber expressed disappointment at losing a case where the utility had sought $73 million in damages from HDR Engineering to help pay for fixing the 15.5-billion gallon reservoir.

"We feel strongly that the public shouldn't have to pay twice for a fully functioning reservoir," Seeber said. "We hired HDR to design the facility. HDR certified its design and the construction to the state, so we believe HDR is liable."

Seeber and the utility's attorney, Richard Harrison, said they would meet with Tampa Bay Water's board members behind closed doors Monday to discuss their options, including a possible appeal of the verdict.

Seeber acknowledged that, unless the verdict is overturned, the estimated $122 million cost of fixing the reservoir will have to be "funded by the ratepayers and by grants from other sources." The original construction was paid for in part by state and federal tax money.

However, in response to a reporter's question, Seeber said that grants from state agencies such as the Southwest Florida Water Management District are a lot harder to come by now, thanks to budget-cutting by Gov. Rick Scott and the Legislature.

As for federal funding, Seeber said, "I don't think anybody in the country is getting federal funding for projects of this magnitude."

HDR CEO George Little issued a brief statement late Tuesday saying he was "pleased the jury based its decision on the facts and found in our favor."

The verdict marked a major victory for HDR, the Nebraska firm that designed the C.W. Bill Young Reservoir in rural Hillsborough County. Last fall the company had agreed to settle the suit for $30 million, but Tampa Bay Water officials rejected that as too little.

Now the company doesn't owe its former client a penny.

The quick decision also marked another public relations setback for Tampa Bay Water, which has seen two of its boldest water supply projects — the reservoir and the Apollo Beach desalination plant — repeatedly become a source of headaches.

And it marked yet another twist in a saga that already involved a stolen laptop and accusations of a conspiracy.

The reservoir — the largest in Florida — opened in June 2005 as a place to store water skimmed from the Alafia River, Hillsborough River and Tampa Bypass Canal. The reservoir's walls consist of an earthen embankment as wide as a football field at its base, averaging about 50 feet high. An impermeable membrane buried in the embankment prevents leaks.

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The embankment's top layer, a mixture of soil and concrete to prevent erosion, is where cracks were discovered in December 2006. Some cracks were up to 400 feet long and up to 15½ inches deep. Workers patched the cracks, but the patches didn't last.

The cracks have now shown up along two-thirds of the embankment, Harrison told jurors during closing arguments. More cracks are occurring even now as the utility draws down the water inside the reservoir, he said.

In 2008, Tampa Bay Water filed suit against HDR and two contractors who had worked on building it, saying they should pay for repairs. The two contractors settled the utility's claims for $6.75 million, and agreed to work with Tampa Bay Water on its suit against HDR. But no one from those companies was called to testify during the trial.

However, jurors did hear about how the laptop computer that contained HDR's only copy of its modeling of the design was stolen from an engineer's car, and how the employee that Tampa Bay Water assigned to oversee the work was still working on getting her engineering degree during construction.

HDR's attorney, Wayne Mason, contended in his closing argument that his clients "did deliver a terrific reservoir." Some cracking was expected, he said. Anything beyond normal was the result of construction errors, not any design flaw — and it's not serious, he said.

"That reservoir is just like most of us, ladies and gentlemen," Mason told the jury. "It's got a scar."

Mason contended that the utility's "sham of a lawsuit" was part of a conspiracy to make someone else pay for an expensive upgrade to the reservoir that he contended wasn't necessary.

Last year Tampa Bay Water hired Kiewit Infrastructure South to repair the reservoir and also boost its capacity by 3 billion gallons for $162 million. The company, expected to start work this fall, has promised to finish in two years — during which the reservoir will be drained dry, and the utility will rely more heavily on its seldom-used desalination plant.

"The whole notion that anybody at Tampa Bay Water has engaged in any kind of conspiracy is absolutely ludicrous," Seeber said after the verdict.

Despite Mason's prediction that losing the lawsuit would prompt the utility to cancel the Kiewit contract, Seeber said, "I believe our board will forge ahead with the work."

Craig Pittman can be reached at craig@tampabay.com