The Belgrade City Council voted unanimously Monday to terminate its contract with W Construction, a Bozeman firm working on a water line replacement project on the city’s north side.

The council discussed the issue behind closed doors, citing litigation strategy as a reason for calling the executive session. When the meeting was reopened, the Councilman Mark Criner made motion to end “the contract with W Construction for cause.” No further discussion about the issue took place.

Under the contract, W Construction was to replace 19,400 linear feet of aging four-inch water mains on the north side of town with new, 10-inch water mains during Phase I, according to city records. The goal of the job is to improve service delivery, reduce loss due to leakage and increase fire flows. Work began last summer and stretched into October.

Phase II, which was to begin this spring, entails replacing water mains and sewer lines in the alleys immediately north of Main Street between Quaw Boulevard and Davis Street.

In March, the Occupational Safety and Health Administration cited W Construction with “one willful and three serious violations” related to the company’s failure to use trench boxes and proposed penalties totaling $36,400, the agency said. The violations stemmed from complaints filed against the company in September 2010 that sparked OSHA inspections.

In other business, the council agreed to sign an agreement releasing all claims with former Central Valley Fire District Chief Brett Waters. Waters resigned from his post last month.

City Attorney Rick Ramler told the council the addendum basically frees the city and Waters from any liability.

“It’s the prudent thing to do,” he said.

The council also heard an update from finance director Marilyn Foltz on the city’s attempt to collect money from Kids Up creditors to fulfill an obligation to the city Revolving Loan Fund. The company built wheelchairs before closing its doors.

The company is being bought by an outside firm and to make that happen, company representatives asked the council to forego on its first position on the loan in exchange for the company’s accounts receivable, according to city records. The council agreed.

The city has $26,000 left to collect from the original $142,000 loan.

The council also approved a conditional use permit to allow Valley of Flowers Catholic Church to expand its facility to add more classrooms.