BELMAR, NJ — Belmar has agreed to pay $230,000 to settle a lawsuit with a contractor hired for a major water infrastructure project in the southwestern corner of the borough.

The borough council on November 8 authorized the settlement with Metra Industries of Little Falls, which was awarded a $900,000 contract in 2013 to clean and reline the water pipelines in the residential area commonly known as the Rhode Island Point. For years, residents of Briarwood Road, Pine Tree Way, Maplewood Road and Oakwood Road have been plagued by brown water running through their taps.

However, shortly after the water improvement project began, it was discovered by Metra and the Belmar Public Works Department that the discolored water was not being caused by the aging lines. Instead, the valves on the underground pipelines had been shut off, causing them to be dead-ended and resulting in the rusty-looking water. “The water had nowhere to go and created the brown water,” said Borough Administrator Colleen Connolly. “Now that the system is working as it should; the water is clear.”

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Since the major part of the work was no longer needed, the borough sought to have the contract reduced — triggering legal action by Metra. While it was determined Metra completed about $150,000 worth of the work, the company maintained it should be paid no less than $400,000 due to “reasonable expectations” of the contract, according to former borough attorney William Northgrave, who represents Belmar in the litigation.

Under the proposed settlement recommended by Northgrave, the borough has agreed to pay Metra $230,000 rather than go to trial, which would have meant $30,000 to $50,000 in additional legal fees and no guarantee of a judgment in its favor. “This is the very best we could have done at trial,” said Northgrave.

Although Mayor Matthew Doherty voted to approve the settlement, he voiced his frustration over “having to pay (Metra) $80,000 for work they didn’t do.”

Connolly pointed out that the settlement is being paid through the water utility’s account without incurring debt. That’s because the borough’s recent renegotiation of its water contract with New Jersey AmericanWater Co. has resulted in substantial savings that is reflected in the water utility’s 2017 budget, she explained.

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