Oregon Iron Works has sued the Oregon Department of Transportation, accusing the state of bad faith in negotiating mitigation payments in connection with the Columbia River Crossing project.
The company was one of three manufacturers that inked deals with project leaders earlier this year as compensation for a bridge height that would squeeze their operations on the Columbia River. Oregon Iron Works agreed to accept $11.8 million. Greenberry Industrial would get $24.8 million under its agreement; Thompson Metal Fab would receive $49.8 million.
Oregon Iron Works, which was first to sign its agreement, said in a complaint filed Friday in Clackamas County, Ore., that the deals later given to the other two companies would put it at a competitive disadvantage. Oregon Iron Works argued the payments promised to Thompson and Greenberry aren’t based on their actual business capacity.
“The mitigation payments to Greenberry and TMF are excessive and unreasonable, particularly in relation to the proposed payment to OIW,” the complaint reads.
ODOT Director Matt Garrett called the lawsuit “frivolous” in a statement released Friday. The state will immediately move to throw out the complaint, he said.
“We are disappointed by this action,” Garrett said. “We have a signed contract that is fair to OIW and Oregon taxpayers. We are confident that this lawsuit is frivolous and without merit and should be dismissed.”
The CRC would build a new Interstate 5 bridge with 116 feet of clearance — too low for the three businesses to ship their largest industrial products underneath. The existing twin spans offer 178 feet of head room when lifted.
The mitigation agreements were a key part of the CRC’s efforts to secure a bridge permit from the U.S. Coast Guard, which was granted late last month.
Oregon Iron Works and Greenberry signed both signed their agreements in May. Negotiations with Thompson stalled after Washington largely pulled out of the project in July, lacking any authorized funds from the state legislature. It wasn’t until late August that Thompson — as CRC leaders were staring down a shrinking window from the Coast Guard — finalized its deal.
Officials from Oregon Iron Works soon learned the terms of the others’ agreements. The company approached ODOT about the issue, but was told the state wouldn’t reopen negotiations, according to the complaint. The two sides went to mediation earlier this month.
All three companies operate facilities at the Columbia Business Center in Vancouver. Oregon Iron Works argued in the complaint that giving Thompson and Greenberry higher payments will put them in better position to bid on jobs, make capital improvements, even hire away Oregon Iron Works employees.
Oregon Iron Works asked the court to declare that the other two deals were in breach of the “express and implied undertakings” of its own agreement. It didn’t specify damages, but requested further relief as deemed appropriate by the court.
ODOT noted that Oregon Iron Works voluntarily signed its agreement based on its own information, past business performance and future plans.
None of the agreements will be paid out until the $2.7 billion project is fully funded and ready for construction. The CRC still needs a funding authorization from Oregon and a crucial federal grant, plus other permits.