Army Corps Terminates $309M Chickamauga Lock Contract With Shimmick Construction
According to Engineering News-Record, the U.S. Army Corps of Engineers has terminated its contract with Shimmick Construction Co. for the lock chamber portion of the Chickamauga Dam replacement project in Chattanooga, Tennessee. Shimmick says it is appealing the decision.
A $309M Contract Ends in Dispute
Shimmick was hired in 2017 as prime contractor on the $309-million lock chamber contract, with a scope covering excavation, demolition, drilled shaft installation, a new operations building, and gate control shelters. The contract required completion by January 27, 2026, according to Engineering News-Record.
The Corps, through its Nashville district, alleged Shimmick failed “to prosecute the work with diligence,” fell behind schedule, and did not correct identified deficiencies. This came despite the Corps reporting as recently as late 2024 that both parties were “making significant progress,” including the transfer of 14 miter gate components to the site. The Corps stated it is now exploring contracting options to finish remaining construction and aims to deliver an operational navigation lock by 2028. The overall Chickamauga lock replacement project carries a price tag of approximately $954 million.
Irvine, California-based Shimmick (Nasdaq: SHIM) disputes the termination and says it plans to exercise its right to appeal the contracting officer’s decision within the 90-day window, seeking compensation for work-related costs.
What It Means for Subcontractors
- Schedule defaults have consequences upstream and downstream. When a prime contractor is terminated for cause, subcontractors on that project face payment uncertainty and potential work stoppages. Know your contract’s termination clauses and what triggers them.
- Appeal rights are real and time-limited. Shimmick’s statement highlights the 90-day window to appeal a contracting officer’s decision. Subcontractors on federal projects have similar rights under the Contract Disputes Act, but missing that window can forfeit your claim entirely.
- Progress reports don’t equal protection. The Corps described “significant progress” in late 2024, yet terminated the contract months later. Positive milestone language in owner communications is not a shield against termination. Document your own performance independently.
- Transition risk is real when a prime is replaced. If the Corps brings in a new prime to finish the Chickamauga lock chamber, existing subcontractor agreements may not carry over automatically. Watch for re-bid opportunities but also review any continuity obligations in your current subcontracts.
