Fife council rejects all bids for Port of Tacoma Road interchange, 5-0

FIFE, Wash. — The Fife City Council voted 5-0 on March 2 to adopt Resolution 2245, authorizing the city manager to reject all bids for the Port of Tacoma Road Interchange Phase 2A project and re-advertise the work. Council members voted after city staff described a temporary restraining order and a bid-form discrepancy that a judge said warranted further review.

City staff presenter Jason told the council the city received five bids on Jan. 29, with amounts ranging about $50.7 million to $53.9 million and identified the lowest responsive price at roughly $50.7 million. Staff said minor, immaterial errors appeared across several bid packages but that a judge had found the omission of an electrical subcontractor license number on a subcontractor list form justified additional scrutiny; the court granted a temporary restraining order on Feb. 25 and scheduled a hearing for March 11. “With that, we're requesting city council's authorization to reject all bids for this advertisement cycle of the Port of Tacoma Road interchange phase 2A project,” Jason said.

The city explained the license-number requirement stems from a July 2025 update to state law cited in the presentation (RCW 39.30.060), and staff said there is ambiguity between the new state requirement and federal guidance on federally funded projects. Staff reported that WSDOT reviewed the city's recommendation and provided written concurrence, and that WSDOT has requested an interpretation from the Federal Highway Administration (FHWA) about whether the federal rule (cited during the meeting as CFR 23.635.11) affects use of the updated state form for federally aided projects.

Jason said the city has $55,000,000 budgeted for the contract and $8,800,000 in contingency — $63,800,000 total — and listed partners and funding sources including the Port of Tacoma, federal grants, TIB, Connect Washington, Move Ahead Washington, roughly $4,000,000 from Senator Murray, and some STBG funds from PSRC. Staff estimated the city could prepare a revised advertisement in about three weeks and, with a three-week advertisement period, reopen bids in roughly six weeks.

Shane Welby, vice president of Johansen Construction Company, urged the council not to adopt the resolution. “Johansen submitted the lowest responsive and responsible bid as required by state law and City contract,” Welby said, telling the council that rejecting bids would raise costs, delay the project beyond the 2026 season, and risk questions about fairness in the public bidding process. Welby said Johansen has agreed to extend the award deadline at no cost to the city and asked the council to consider awarding to Johansen or allow time to resolve litigation rather than rejecting all bids.

City legal counsel Greg Ammon advised the council that municipal authorities and case law give the city broad discretion to reject all bids unless actual fraud or manifest error is shown. He said if the council rejects the bids he would file a motion with the court attaching the council's resolution to make the court case moot.

The presiding official moved adoption of Resolution 2245 and Council Member Andrew Yuuk seconded. The council voted aye with five affirmative votes and no nays; two council members were recorded as excused during roll call. The resolution passed. The council then read a land acknowledgement and adjourned the meeting at about 4:33 p.m.

Next steps: staff will execute the council's direction to reject the current bids, coordinate with WSDOT and FHWA as needed on form and compliance questions, re-advertise the project, and prepare for the March 11 court hearing on the temporary restraining order. If the court lifts the injunction the city could reconsider award timing, but staff said the city has until March 15 to award without added cost and recommended rejecting and rebidding to limit litigation risk.