Anchorage taxpayers will pay full bill for homeless shelter contracting failure

Anchorage taxpayers will foot the entire bill for settling a construction contractor’s lawsuit that stemmed from a failure in the mayor’s administration.

In a special meeting Friday, the Anchorage Assembly approved paying Roger Hickel Contracting nearly $2.5 million to settle its lawsuit. That dollar figure covers the contractor’s full ask for partial work it completed last year on a now-suspended project to build a new homeless shelter and navigation center.

The administration of Mayor Dave Bronson said last year that it made a mistake in ordering construction to proceed without Assembly approval. The Assembly balked and suspended the project. Hickel went unpaid for months while several key city executives involved in resolving the issue were fired or quit. 

That included former Municipal Manager Amy Demboski, who claimed it wasn’t an innocent administrative error. She said that Mayor Dave Bronson knew ordering construction to begin without Assembly approval violated city codes, which say the Assembly controls the city’s purse strings.

Bronson has not publicly addressed this allegation. 

To assert the Assembly’s role, Chair Chris Constant pushed for a $50,000 reduction in the settlement payout during Friday’s meeting. 

“And so here we are, because of a quote, ‘mistake,’” he said. “And so we have a set of facts where the Assembly is now asked to give up its legislative power, its appropriating power. This is a separation of powers issue if there ever was a separation of powers issue.”

Some Assembly members said they appreciated Constant’s intent, but feared a last-minute change after negotiating the settlement would undermine trust in the city. 

Constant’s $50,000 trim failed, and the full payout passed in an 8-2 vote, with Karen Bronga and George Martinez voting no. 

“We won’t, at the municipal attorney’s office, allow this to happen again,” said Municipal Attorney Anne Helzer after the vote. 

This isn’t the first time city officials ordered Roger Hickel Contracting to begin work without Assembly approval. A similar situation arose in 2013 on a utility project. 

The prospect of reviving the shelter project itself was the subject of an Assembly work session on Friday.  

A measure to fund the project near the intersection of Tudor and Elmore roads is up for an Assembly vote on Tuesday, though key Assembly members said they’d be unwilling to rush into approving this project while a wider campaign is underway to identify other potential shelter projects for comparison.