Lac Ste Anne County Settles 8.5 Million Dollar Lawsuit

Lac Ste. Anne County (LSAC) has reached a settlement in the lawsuit concerning the Administration Building, securing $8,456,000 from the parties responsible for designing and constructing the structure. The settlement funds have been placed in a secure growth savings account, ensuring they are available when needed.

Decision to Replace the Administration Building

The LSAC council has made the tough decision to replace its administration building, which is only eight years old. Councilors approved a resolution to start planning for the construction of a new administration building following an in-camera session at their May 17 council meeting.

The more than $11.7 million, 25,000-square-foot administration building, located about two kilometers south of Sangudo, opened its doors in 2017. Funding for the building came from a combination of provincial grants, primarily through the Municipal Sustainability Initiative (MSI), and a short-term borrowing debenture, which has been paid in full.

The county originally constructed the building to consolidate operations that had previously been spread across three buildings in Sangudo. A 2005 review found the main office building had “major structural flaws,” including an unsafe roof, leaking windows, mould, and an “unsanitary” sewage system, among other defects. The old building also lacked storage space, forcing staff to store paper records in three unheated outdoor containers.

Before construction, LSAC residents debated the location of the building, with many advocating for a site closer to the Onoway/Rich Valley area. Opponents of the project also objected to its design and scale, arguing it was too extravagant and expensive. Two petitions were launched to halt construction. Additionally, the building’s opening faced delays due to weather-related issues and construction defects.

A May 17 media release stated that the council’s decision to replace the administration building, which has significant structural issues, “was difficult but necessary.” The release cited extensive cracking in the walls and ceilings, bowing and sloping of floor slabs, separation of walls from the foundation, damage to the vapour barrier and fireproofing, and exterior cladding issues. Other problems include gaps causing air infiltration, heat loss, and continued structural damage.

Reeve Joe Blakeman acknowledged the difficulty of the decision, stating that no one on council wanted or expected to make such a choice. However, extensive expert investigations and assessments revealed that replacing the building would be more cost-effective than attempting repairs, which may not even be feasible.

“We have spent significant effort ensuring the building is safe, but that could change in a moment if things shift even more,” Blakeman said. Issues with the building predate its opening, as staff observed slab heaving and drywall cracking during the construction phase. Geotechnical experts determined that the underlying issue is moisture changes affecting the high plastic clay beneath the building, causing floor movement as the clay expands and contracts.

Although surface water redirection efforts appeared to resolve some problems initially, the building continues to experience movement due to unresolved foundational issues. The municipality’s consultants warned of a significant risk that existing problems will worsen and new issues will arise due to the differential movement of the interior floor slab.

“Council only had two options,” Blakeman said. “Either we hide and ignore it, or we deal with it and start planning, looking for the proper financial channels to make it affordable for our county and our ratepayers.”

Background and Settlement Details

The settlement follows a series of thorough expert investigations and assessments conducted during the lawsuit. These evaluations revealed extensive damage to the Administration Building, necessitating ongoing monitoring due to the progressive nature of the deterioration. Experts concluded that a full repair of the building would be economically impractical. Consequently, the Lac Ste. Anne County Council determined that replacing the building would be the most feasible long-term solution.

Despite the decision to pursue replacement as the ultimate resolution, the County has continued to monitor the building to ensure its safety and functionality. Expert assessments have confirmed that the structure remains safe for use, and the County has no immediate plans to undertake a significant capital project for the Administration Building.

Ongoing Legal Action

In addition to the settled lawsuit, Lac Ste. Anne County is pursuing a property insurance claim to recover further damages related to the Administration Building. The building was insured under the Rural Municipalities of Alberta (RMA) insurance program. Despite efforts to resolve the claim amicably, the County has been compelled to initiate a second lawsuit against the RMA. This case remains in its early stages, and the County’s leadership has committed to seeking a reasonable resolution.

“We are working diligently to address these challenges while safeguarding taxpayer dollars and ensuring a secure future for our County,” stated Joe Blakeman, Reeve of Lac Ste. Anne County.

Commitment to Transparency and Community

The Lac Ste. Anne County Administration, Reeve, and Council remain steadfast in their commitment to representing and protecting the community’s interests. While legal constraints limit the amount of information that can be shared publicly, the County has pledged to provide updates on both lawsuits through future media releases.

“We sincerely thank our residents for their patience and understanding as we navigate this complex situation,” said Reeve Blakeman. “Together, we will ensure that taxpayer dollars are safeguarded and that Lac Ste. Anne County’s future remains secure.”

The County’s leadership expressed gratitude to ratepayers for their cooperation throughout this process, reaffirming their dedication to maintaining transparency and prioritizing the community’s well-being. Further updates on the Administration Building and the ongoing insurance claim will be shared as developments occur.

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