A week after signing an $11.85 million deal with Lydig Construction/Integrus Architecture for the City of Sequim’s design-build team for the civic center, city councilors approved a $30,000 settlement with Hoffman Construction of Seattle and Belay Architecture of Tacoma.

They were the third team selected to compete to design the city’s new city hall and police station but were denied $125,000 after the city’s design committee ruled they were not compliant after exceeding the design budget by about $900,000.

Councilors made the decision for a settlement after an executive session on Monday, Jan. 13.

City Attorney Craig Ritchie said the city had a meeting with the companies and exchanged e-mails but the companies formally did not file anything against the city.

Ritchie said the companies made the case that they put in a costly amount of effort designing the civic center and that the design-build process called for an honorarium that the city must honor.

“With their position, (they said) yes, we didn’t meet the maximum price, but we would have if we could have (scaled back) and otherwise become compliant,” Ritchie said.

“They said they were in compliant other than the price and the other two competitors had non-compliant parts in their buildings, but we found them relatively minor. We can’t go out and get other bonds to make up the nearly million dollars they went over.”

Ritchie said the $30,000 settlement was reasonable. It comes out of the city’s original budget for the civic center.

Early in the design process, all three design teams, including Hoffman/Belay issued concerns with meeting the initial $11.65 million construction threshold for the civic center project so city councilors unanimously approved a $200,000 increase for the project on Nov. 25, 2013.

Sequim City Manager Steve Burkett said Belay/Hoffman made good points for why they deserved the full amount but still did not meet the honorarium commitments.

“We want to get the dispute behind us,” Burkett said. “We don’t want to delay the project.”

This week, the city’s design-build team Lydig Construction/Integrus Architecture is meeting with the city council and city staff to revise the civic center’s floor plans.

Burkett said they hope to have revisions done by next week to move on with design work and demolition tentatively set for March or April.