V&T Commission rejects $1.3 million claim for condemnation costs

The V&T Railway Commission on Monday rejected a claim for $1.3 million from a Sparks asphalt company that had to relocate to make way for the railroad tracks.

Commissioners unanimously agreed that Road and Highway Builders of Sparks is not entitled to $1.3 million in additional claims filed, plus it must return most of the $200,000 it has already been paid.

The claim was filed over costs of moving the RHB asphalt plant located along the V&T's route between Virginia City and Mound House. The commission condemned a piece of that property as right of way for the railroad reconstruction project.

Under federal law, when a public body takes land by condemnation, it must pay for the land and the cost of relocating any business equipment and plants in the right of way.

Under the original contract, commission lawyer Michael Rowe said RHB was to be paid the cost of relocating its aggregate stockpiles as well as the marinating and hot plants that produce asphalt.

The company originally submitted a bill to the V&T Commission for $563,179 but the commission rejected it, paying instead the $200,000 agreed to in the contract.

After the Nevada Department of Transportation advised RHB it could submit more invoices to recoup relocation costs, the company submitted bills seeking an additional $1,321,379.

Engineer Christopher Beck reviewed all the work done to relocate the equipment and get it back into operation as well as contractor costs, employee time sheets and other costs.

The biggest items recommended for rejection by Beck were $309,000 for "standby" costs at the hot plant, $58,000 for standby at the marination plant that prepares the raw materials for the asphalt and $582,000 for standby costs at the aggregate crusher.

"The individual is entitled to only what his costs are," said Beck. "He is not entitled to profit."

Beck not only rejected the $1.3 million claim, he told the commission RHB was entitled to just $66,801 in relocation costs and recommended the company be made to pay back $133,199 of the $200,000 they were paid last year.

Rick Thompson of RHB objected to the entire hearing, saying the company was never informed of all the items it could claim as legitimate relocation costs and wasn't informed that Monday's meeting was its final appeal before the commission.

"We didn't know what you were going to do today," he said. "This is news to us that this is an appeal and your final decision is going to rely on Mr. Beck's report."

Commission lawyer Michael Rowe told the commission there were numerous conversations and five letters informing RHB's lawyer of the process.

Former chairman Bob Hadfield moved to deny the claim and to demand repayment of the $133,000 Beck and Rowe concluded RHB has been over-paid for the relocation. The vote was unanimous.

Thompson said after the vote he isn't sure what the company's next step is.

"Probably litigation," he said.