City Council decides not to appeal $2 million tennis complex decision

Las Vegas officials decided today to put to rest a long-running arbitration case over construction of the Kellogg-Zaher Sports Complex instead of appealing a recent ruling to District Court.

It was presented as a practical financial decision, given the time and expense that proceedings with Asphalt Products Corp. already have involved, and the likelihood that an appeal would be just as expensive while resolving little.

“There are no winners in this one,” said City Attorney Brad Jerbic.

“Yes, there is,” countered Mayor Pro Tem Gary Reese. “The lawyers. The arbitrators.”

Jerbic said the city racked up $3.5 million in legal costs during the proceedings, and estimated that APCO spent at least that much.

An arbitration panel ruled 2-1 recently that the city should pay $2.08 million to APCO to settle claims arising from the park’s construction.

Located on Washington Avenue between Buffalo and Durango drives, the complex has 11 soccer fields and the Amanda and Stacy Darling Memorial Tennis Center.

The city's allegations against APCO included cracks in tennis courts that were designed to attract professional tournaments, defective welds in fencing, and missing playground equipment, among many other items.

The city has most of that money available, said Mark Vincent, the city’s chief financial officer. He said $1.1 million consists of final payments that were held during the proceedings, with some surplus funds from the project set aside as well.

Still, $219,300 will have to be moved from a fund for parks capital projects to satisfy the award.

APCO’s original claim, filed in 2005, sought $6.5 million.

The city had the option of challenging $980,000 worth of damages awarded by the ruling.

Jerbic said a likely scenario was that a judge would send the case back for further arbitration, which would cost as much or more than the settlement.

The arbitration panel’s majority opinion said problems at the park stemmed from the city's rushing incomplete plans to the contractor to finish construction more quickly.

In one paragraph, the ruling singles out the office of former Councilman Larry Brown for unduly pressuring staff members to get the project rolling.

It’s a conclusion city officials dispute, saying APCO’s work on the site, not city plans, should be at issue.

Brown, now a Clark County commissioner, visited today’s council meeting to say he treated the project the same as any other and that he had “no apologies for my role in Kellogg-Zaher.”

The legal wrangling might be over, but one issue remains — cracks in the tennis courts at the Darling Center that were a major feature of the dispute to begin with.

“They are still cracked,” said Councilman Stavros Anthony, who inherited the situation when he was elected to represent Ward 4 last year. “We’re just going to have to find a way to fix them.

“Obviously, if money is involved, that’s going to be an issue. The courts are still playable. They shouldn’t have cracks, and that’s all we can do at this point.”

Although conflicts over public works projects will arise in the future, the scenario faced in this case is not likely to repeat itself because of a change in state law.

It used to be a requirement that public works project disputes had to be settled by binding arbitration. Now governmental bodies are merely required to use some type of alternative dispute resolution before taking a case to court.

Las Vegas contracts now contain a clause calling for “nonbinding mediation,” Jerbic said. That process usually is over in less than a day.

Contact reporter Alan Choate at achoate@reviewjournal.com or 702-229-6435.