CROSSVILLE — The city of Crossville could face penalties for degradation of wetlands at the Duer Soccer Complex, but members of the Crossville City Council believe the contractor who performed the site work and sold the city the land should pay for any damages the city incurs.

Crossville Mayor J.H. Graham III said during a work session Friday, "Let's go ahead and bring suit against J. Hicks Excavation. This thing could go on and on and on. I think we ought to consider very strongly bringing them in now."

The city was notified Jan. 22 by the U.S. Army Corps of Engineers that fill material was discharged into potential wetlands at the soccer complex in violation of the Clean Water Act, affecting about five acres. Civil fines can be as high as $37,500 per day of violation, while criminal fines can be as much as $50,000 per day of violation, along with any costs for restoration of the impacted areas. According to the letter from the Corps, the office conducted an onsite investigation with the Tennessee Department of Environment and Conservation July 3, 2012.

"It appears you may have filled potential jurisdictional wetlands that abut palustrine forested wetlands in the vicinity of Black Downing Creek," wrote Tammy R. Turley, chief of the regulatory branch of the Nashville district of the Corps of Engineers. "Based on available information and our onsite investigation, we believe your work is unauthorized and thus subject to enforcement action."

The Corps of Engineers recommended the city hire an experienced environmental consultant. City Manager Bruce Wyatt did so, engaging the services of Michael Stagg of the Nashville firm Waller Lansden Dortch and Davis, LLP.

City Attorney Kenneth Chadwell said, "The city's position on this is complicated. We're not convinced that there is any encroachment on wetlands; however, we have to balance that with two or three things."

That includes the expense and time delay to prove that there was not an encroachment on wetlands. Chadwell also noted the city needed a good working relationship with both the Corps of Engineers and TDEC as it works on projects for the city and to help foster economic development.

The city also has a contract with the previous owner of the land regarding environmental issues that Chadwell believes would hold the city harmless for the cost of remediation.

"That company was responsible for doing the site prep work for that land," Chadwell said. "Plus, under that contract that we have, there's a lot of really strong indemnity language and environmental language. They were responsible for all environmental matters, all permitting. And if there were a violation or problem in any way, they would indemnify the city."

The city purchased 40.41 acres for $1.527 million from J. Hicks Excavating, Inc. in April 2007. That purchase price included the company providing excavation work and improvements to the property, with the city only having to provide final grading for the playing fields. The contract also states the seller would indemnify and hold harmless the city against all claims from the work specified in the contract, including environmental matters, and that the seller agreed to abide by all applicable federal, state and local rules, laws, statues and regulations. The contract provides the seller would also be responsible for the city's reasonable attorney fees and costs and expenses from any claims.

Chadwell said the city was trying to work with the Corps of Engineers and TDEC but added, "We're trying to work with them. Our problem with jumping right into a consent agreement is we don't want to do anything that would hinder our indemnification," Chadwell said. "It's my position for the city that J. Hicks Excavation is responsible for every dime we're out for this, whether it's lawyers or experts or mitigation."

Possible solutions include remediation of the wetland areas or mitigation at another site, including wetland banks available in the area.

More information on the wetlands situation, and possible litigation, will be considered at the Feb. 12 meeting of the Crossville City Council. The council is also considering setting a closed session with Stagg regarding the situation.

The city will also consider action on proposed street lighting along Lantana Rd., with estimates expected from Tennessee Valley Authority for the full project, from Adams St. to Dunbar Rd., as well as phases of the project including half of the project and only lighting intersections at this time.

Road Supervisor Joe Miller recommended the council consider additional street lighting on Milo Lemert Pkwy. at Dayton Ave., while Graham suggested also looking at lighting for First St. at Peavine Rd.

The council will also consider issuing a Request for Proposals (RFP) for retirement plan administrators at its February meeting. The city has elected to leave the Tennessee Consolidated Retirement System (TCRS) plan for any employee hired after July 1, 2013, and is developing its own 401(a) plan. Current employees will remain with TCRS.

Fred Houston, finance director, briefed the council on preliminary plans for the new retirement plan, including mandatory 5 percent contributions from employees, matched by the city, and voluntary additional 3 percent contributions, also matched by the city. All contributions will be pre-tax and Houston is recommending a vesting schedule of 20 percent per year. Employees who leave before being fully vested would be entitled to their share of the retirement funds, while city contributions would be vested at 20 percent per year, with employees being fully vested after five years.

The council will meet again this afternoon at 2 p.m. for a work session. The Army Corps of Engineers and GKY will update the council on a raw water study. The meeting will be held in the conference room of Crossville City Hall, 392 N. Main St.