The City of Houston has settled the lawsuit brought by the contractor building the expansion of the Northeast Water Purification Plant, the plant that draws Houston’s water out of Lake Houston.
The settlement appears on the City Council agenda for the meeting of Tuesday, October 13 and Wednesday, October 14, 2026, as two related items on the consent agenda. Item 12, Ordinance 2026-0890, approves and authorizes a “Final Settlement, Release and Indemnity Agreement” between the City of Houston and Houston Waterworks Team, a joint venture of CH2M Hill Engineers, Inc. and CDM Constructors, Inc., to settle a lawsuit. Item 13, Ordinance 2026-0891, approves a related agreement on the distribution of withheld liquidated damages in connection with the same settlement, and the agenda notes it should be considered only after Item 12 passes.
Neither ordinance states a dollar figure on the agenda.
What the amount is reported to be
Hoodline, crediting the Houston Chronicle and Houston Landing, reported on Friday, October 16 that Council approved the settlement unanimously on Wednesday, that the figure is about $24 million, that roughly $6 million of it is contingent on work that has not been finished, and that the city had been withholding about $46 million from the contractor since the suit was filed in 2022. Lake Houston Today has not been able to open the Houston Chronicle account, which is behind a paywall, and the council minutes for the October 13 and 14 meeting could not be read. The amount above is therefore reported rather than confirmed, and this paper is not presenting it as settled.
What is confirmed from the city’s own agenda is the existence of the settlement, the parties to it, and that Council took it up on October 13 and 14.
Why this is a Lake Houston story
The Northeast Water Purification Plant sits on Lake Houston and draws from it through an intake that reaches out into the lake. Its expansion is the single largest piece of public infrastructure tied to the lake. A City of Houston committee briefing puts the guaranteed maximum price of the expansion at about $1.77 billion and total appropriations at about $1.94 billion, and records that the city contracted with Houston Waterworks Team to design and build it in December 2015. Four regional water authorities carry the large majority of the cost, with the City of Houston paying a smaller share plus the full cost of oversized facilities.
Kingwood sits inside Houston city limits, so this is city business for a large part of this coverage area, and the plant itself is a few minutes from Humble.
What the fight was about
The contractors sued the city in September 2022 over who would pay for cost overruns on the expansion, with the price of stainless steel the main driver. City lawyers accused the contractors of breaching the contract and of holding the region’s water supply hostage by threatening to walk away from the project, and a state district judge ordered construction to continue while the case was pending.
What is still open
The council minutes for October 13 and 14 would confirm the vote and may carry the amount. They are posted by the Office of the City Secretary but could not be retrieved for this report. Anyone who can open them, or the Chronicle account, can settle the figure.
