Setting aside months of dispute, the city Monday agreed to lift a termination notice against the contractor of the stalled $54 million Joint Traffic Management Center at Alapai and South King streets.

Work was expected to resume Monday, and Mayor Kirk Caldwell joined other key city officials and representatives from the contractor and two of its affiliate companies for a blessing ceremony.

“With any home, when the family encounters problems, we want to have a blessing,” Caldwell said. “We want to make sure that as we restart, that everything is clean, it’s cleansed. … And if there’s anything in between that created pilikia, it’s dealt with.”

Shane Bauer, chief financial officer for The Weitz Co., said he now expects completion of the project in the first quarter of 2019.

The original contract called for the project to be completed by June 2017. Caldwell pointed out that if the building had been completed on time, emergency response officials would have gathered at the management center, instead of the basement of the Frank F. Fasi Building, for emergency operations during last week’s storm preparations.

“In one building here, in one room with no walls, nothing separating us, no silos, able to communicate directly and in real time and make decisions as Hurricane Lane approached,” Caldwell said. The joint traffic center will allow that to take place 24 hours a day, 365 days a year, he said.

In July the city issued a termination notice against contractor Watts Construction LLC requiring it to stop construction for failing to correct defects in a timely manner. The city first sent out a default notice against Watts in February. Among the defects cited were water leaks and improper installation of lobby glass walls and fire escape stairways.

Caldwell praised city Corporation Counsel Donna Leong for getting the sides together to hash out an agreement.

Leong said after the termination notice was issued, officials from Orascom Construction, Watts’ parent company, and The Weitz Co., its sister company, “stepped up, brought in their ‘A’ team and committed to us in the city that it would work with us to construct a safe, secure and enduring building that can house the first responders and the transportation agencies during a hurricane such as Hurricane Lane.”

Caldwell said key emergency services personnel — from the Honolulu Police Department, Honolulu Fire Department, ocean safety, Department of Emergency Management and Department of Transportation Serv­ices as well state and federal agencies — at the new location would have been a boost during last week’s storm preparations.

Like other complex construction projects, the JTMC project “ran into some issues,” said Kevin McClain, president and chief executive officer of Orascom and The Weitz Co.

Usually such disagreements devolve into protracted litigation, but that did not happen here, McClain said. With the help of city officials, “we were able to see the bigger picture, cooler heads prevailed and ultimately the focus was on what’s right for the people of the City and County of Honolulu.”

Leong said the city agreed to reverse its position and allow the contractor to resume after Orascom and Weitz officials committed to constructing the building “the way it’s supposed to be built and in a timely manner.” Those officials flew into Honolulu from the mainland “so that we could quickly reach an understanding,” she said.

Caldwell pointed out that the management team previously responsible for the project was no longer in the picture.

Orascom not only replaced its upper management team locally; it has promised to bolster the number of people working on the project, Bauer said.

Ty Fukumitsu, chief of the Traffic Signals and Technology Division, said the project is on budget, while the contractor “has absorbed a lot of … the overrun costs.”

The city is in the initial stage of planning for a completely separate, stand-alone emergency operations center, which would cost between $25 million and $30 million, next to the traffic management building, Emergency Management Director Melvin Kaku said.