City Council Agenda Item Report
City Council Agenda Item Report Agenda Item No. 2017-147 Submitted by: Mary Hopton Submitting Department Finance Department Meeting Date: October 23, 2017
SUBJECT An appropriation of $6,000 to support the Municipal Coalition to challenge the central collection and other provisions of the Ohio Revised Code, Chapter 718 regarding municipal income tax. Recommendation: It is recommended that City Council authorize and direct the appropriation of funding in the amount of $6,000 to support the Municipal Coalition's challenge. Background/Synopsis: HB 49, the State's biennial budget bill, contains provisions in Chapter 718, municipal income tax, that will allow for centralized filing and collection of net profit tax by the State of Ohio. Several cities have formed a coalition to challenge the constitutionality of these new sections of Chapter 718, thus preventing them from ever becoming enacted. The Municipal Coalition has hired Frost, Brown and Todd in Columbus to lead the litigation. The challenges include a violation of Home Rule, Single Subject Rule, Uniform Application of Tax and the lack of the State's statutory authority to administer centralized collection. In fact the new law states that if a city does not adopt the new provisions of 718 by January 1, 2018, the city risks losing its authority to collect any income taxes at all. Obviously for Fairfield, that would be catastrophic as income tax accounts for 40% of the City's revenue or in excess of $32 million. Financial Impact:
Financial Impact, Cont'd: An appropriation of $6,000, which is based on the population of Fairfield, to support the Municipal Coalition's challenge to centralized income tax collection and other provisions of the Ohio Revised Code, Chapter 718 regarding municipal income tax. Rule Suspension Requested: Yes Emergency Provision Needed: Yes Emergency Provision: The request for an emergency is to allow the funds to approved and paid prior to the deadline of October 31, 2017. ATTACHMENTS Letter to Interested Muncipal Coalition Members.pdf
Schedule of Cost Sharing for HB 49 Litigation.pdf Memo re HB 49 for Packet - 4834-9612-4240 1.pdf HB 49 Challenge Sample Ordinance.pdf
SCHEDULE OF COST SHARING FOR HB49 LITIGATION
Recent litigation by a coalition of municipalities with regard to small cells and public right of way (HB 331) has provided a potential cost sharing template for use by municipalities interested in challenging the recent municipal income tax code amendments. This template is based on population of cities and villages, and is set forth in the table below.
Population Village 5,000 10,000 25,000 50,000 Over 75,000
Under 5,000 10,000 25,000 50,000 75,000
Contribution $1,000 $2,000 $4,000 $6,000 $8,000 $10,000
*Please note that a municipality can choose to either (1) make a contribution without joining the litigation as a named plaintiff, or (2) become a party to the action. To become a party, it will be necessary for FBT to send the municipality an engagement letter and run a conflict check. Certainly, this process is not unduly burdensome and could be completed within the timeframe necessary to include such municipality on the pleadings. For those municipalities desiring to simply make a contribution to the coalition, we will be establishing a municipality to be the holder of deposited funds. If the litigation successfully concludes with funds still remaining, refunds of the retainer amounts will be made on a pro rata basis. Thank you for your consideration and please do not hesitate to contact me with any questions. 0127214.0625042 4824-1615-3424v1
MEMORANDUM
To:
Interested Municipal Coalition Members
From:
Gene Hollins and FBT Government Services Practice Group
Date:
October 12, 2017
Re:
Potential Constitutional Challenges to House Bill 49
I.
Background
House Bill 49 alters the net profit tax by facilitating the centralized filing and administration of the net profit portion of the municipal income tax paid from a business or profession conducted both within and without the boundaries of a municipal corporation. Taxpayers, other than individuals, may now “opt in” and file their net profit municipal income tax returns solely through the State of Ohio Department of Taxation under R.C. 718.80(A). House Bill 49 also eliminated the “nexus to nowhere” sales provision which established a taxable situs in a municipal corporation if the “property [wa]s shipped from a place within the municipal corporation to purchasers outside the municipal corporation, provided the taxpayer is not, through its own employees, regularly engaged in the solicitation or promotion of sales at the place where delivery is made.” Several Ohio municipalities are considering the formation of a coalition to file a mandamus action in the Ohio Supreme Court, or an injunctive and/or declaratory judgment action in a Court of Common Pleas, against the municipal income tax provisions as set forth in HB 49, as well as the original legislation comprehensively rewriting the municipal income tax statute, HB 5 (enacted in 2014). II.
Potential Challenges
A. Violation of the Home Rule Amendment •
Municipal power over matters of local self-government is derived from the Constitution. Gesler v. Worthington Income Tax Bd. of Appeals, 138 Ohio St.3d 76, 2013-Ohio-4986, ¶17. The Home Rule Amendment to the Ohio Constitution, Article XVII, Section 3 provides that “Municipalities shall have authority to exercise all powers of local self-government * * *.”
Frost Brown Todd LLC
•
With regard to taxing power, “[i]t is well established that ‘[t]he municipal taxing power is one of the “powers of local self-government” expressly delegated by the people of the state to the people of municipalities,” Id. at ¶18, citing Cincinnati Bell Tel. Co. v. Cincinnati, 81 Ohio St.3d 599, 605, 693 N.E.2d 212 (1998), and as such is not tested by the well-known home rule “conflict analysis” that is applicable when a municipality exercises its police power.
•
Rather, any General Assembly restrictions on local income tax authority must be based on the specific constitutional authority granted the state in two other sections of the Ohio Constitution: Article XIII, Section 6 provides that the General Assembly “shall provide for the organization of cities, and incorporated villages, by general laws, and restrict their power of taxation * * * so as to prevent the abuse of such power.” Second, under Article XVIII, Section 13, “[l]aws may be passed to limit the power of municipalities to levy taxes and incur debts for local purposes * * *.” Panther II Transp., Inc. v. Seville Bd. of Income Tax Rev., 138 Ohio St.3d 495, 497, 2014-Ohio1011, ¶ 11 (2014).
•
The Ohio Supreme Court has consistently held that “[t]he taxing authority of a municipality may be preempted or otherwise prohibited . . . by an express act of the General Assembly.” Cincinnati Bell, 81 Ohio St.3d at 605 (syllabus). The Ohio Supreme Court has interpreted the requirement of “an express act of restriction” to mean only that the state “does not preempt local taxes merely by enacting a similar tax of its own.” Panther II Transp., Inc., 138 Ohio St.3d at 500. “[M]unicipal governments have a plenary power to tax, but the General Assembly has authority to impose specific limits on that power.” Panther II, 138 Ohio St.3d at ¶ 11 (citing Cincinnati Bell at 602; Gesler, 138 Ohio St.3d 76 at ¶ 17, 21).
•
Telling statement in uncodified Section 6 of HB 5: “In order to ensure a fair, stable, and efficient system of local taxation, and to prevent any abuse of power by municipal corporations, the General Assembly hereby exercises its authority under those Articles to restrict the taxing powers of municipal corporations by requiring that any income tax or withholding tax levied by a municipal corporation must be levied in accordance with this act and any provisions of Chapter 718. of the Revised Code that remain unchanged by this act.”
•
What if the General Assembly itself chose not to impose a tax (as with income taxation of corporate entities) and therefore did not justify its preemption on a concern about “double taxation” by municipalities? What if the General Assembly attempted instead to simply legislate a rigid template for the exercise by a municipality of its powers of local selfgovernment?
•
General Assembly reached beyond its authority to limit or restrict the municipal taxing authority by dictating a code to the municipalities and by authorizing centralized collection of corporate net profits tax.
B. Other Potential Challenges •
Single Subject Rule - Section 15(D), Article II of the Ohio Constitution provides: “No bill shall contain more than one subject, which shall be clearly expressed in its title.” Dublin v. State involved a challenge to a rider in the biennial appropriation bill relating to municipal control over public utility use of the right of way. The Court in Dublin stated: “[T]he very fact that such a budgetary need justifies inclusion of many diverse appropriations in an appropriations bill increases the need to exercise caution to avoid violating the single-subject rule by adding still more diverse items to the bill that are not so necessarily connected to creating a budget. With so many diverse items already included in the bill, it becomes increasingly incredible that non-appropriation items can be added to the bill without violating the single-subject rule.”
•
Equal Protection/Uniform Application of Tax - Youngstown Sheet & Tube Co. v. City of Youngstown, 91 Ohio App. 431, 108 N.E.2d 571 (Mahoning County 1951), found that the Youngstown income tax was “a denial of equal protection because the tax was imposed on individuals at one rate and on corporations at a substantially higher rate.” Under HB 49, taxpayers may now “opt out” complying with the net profits provisions of Chapter 718 administered by the municipal corporation and “opt in” to new Sections 718.80 through 718.95 whereby the state tax commissioner is the sole administrator of each municipal income tax for which the taxpayer is liable. Applying different tax codes to similarly situated taxpayers in a municipality could be challenged, on its face, as violating equal protection.
•
Lack of statutory authority – Oddly, the state has no authority to administer the new centralized collection of net profits tax unless it is granted such authority by each and every municipality. Uncodified Section 803.100(B) of HB 49 provides: “In accordance with division (A) of section 718.04 of the Revised Code, each municipal corporation shall adopt, by ordinance or resolution, the provisions of sections 718.80 [through] 718.95 of the Revised Code on or before January 31, 2018. Such resolution or ordinance shall specify that the enactment of those provisions applies to taxable years beginning on or after January 1, 2018.” The State admits that it has no authority, but forces each municipality to grant it the authority or risk losing its authority to collect income taxes at all. These new provisions are not self-executing.
III.
Writ of Mandamus
Certainly, with respect to statutes of great public interest and widespread impact, there is precedent for an action to be filed directly with the Ohio Supreme Court to determine what are largely questions of law. In State ex rel. Ohio Academy of Trial Lawyers v. Sheward, 86 Ohio St.3d 451, 1999-Ohio-123 (1999), the Supreme Court considered the constitutionality of the Tort Reform Act. The Supreme Court stated, “This court has previously held that a mandamus action may test the constitutionality of a statute….Moreover, where this court has found a statute unconstitutional it may direct the public bodies or officials to follow a constitutional course in completing their duties.” This is especially true where a declaratory judgment action or mandatory injunction in a Court of Common Pleas would not be “complete in its nature, beneficial and speedy.” Given that H.B. 49 imposes deadlines on municipalities to adopt changes as described above within an unreasonable timeline, it is arguable that no remedy other than a writ of mandamus from the Ohio Supreme Court will be effective to provide municipalities relief from an unconstitutional statute. Pending further research, we would recommend filing a mandamus action directly with the Ohio Supreme Court. 0127214.0625042 4834-9612-4240v1
ORDINANCE NO. ____
AN ORDINANCE TO AUTHORIZE THE [MAYOR/CITY MANAGER/LAW DIRECTOR] TO JOIN A COALITION OF MUNICIPALITIES RETAINING SPECIAL COUNSEL FOR PURPOSES OF INITIATING LITIGATION TO CHALLENGE THE CONSTITUTIONALITY OF AMENDMENTS TO CHAPTER 718 OF THE OHIO REVISED CODE RELATING TO MUNICIPAL INCOME TAX, AND DECLARING AN EMERGENCY.
WHEREAS, the (City / Village) of ________________ recognizes, as a home rule power of local self-government, that municipal income tax administration and collection is vital to the health, safety and welfare of the municipality; and WHEREAS, the (City / Village) of ________________ relies on the revenue from effective municipal income tax administration and collection to provide the services that maintain the health, safety and welfare of the municipality; and WHEREAS, the Ohio General Assembly has attempted to assert control over the administration and collection of municipal income taxes by claiming that a municipality has no authority to impose an income tax unless it adopts a code in strict compliance with R.C. Chapter 718; and WHEREAS, the established law of Ohio is clear that any such preemption of municipal income tax codes by the State of Ohio violates the Ohio Constitution and home rule provisions that allow a municipal corporation the right to administer and enforce its own municipal income tax; and WHEREAS, more specifically, the State of Ohio has enacted HB 5 in 2014 comprehensively rewriting the entire municipal income tax law and HB 49 in 2017 authorizing centralized collection by the State of Ohio of municipalities’ net profits taxes; and WHEREAS, the (City / Village) of ________________ desires to assert its home rule authority to control the administration and collection of the municipal income tax, in order to provide for the health, safety and welfare of the municipality; and BE IT ORDAINED BY THE (COUNCIL / COMMISSION) OF THE (CITY / VILLAGE) OF _____________________________, OHIO: Section I: The [Mayor/City Manager/Law Director] is authorized to join a coalition of municipalities being formed for the purpose of initiating litigation to challenge the constitutionality of amendments to Chapter 718 of the Ohio Revised Code contained in H.B. 5 and H.B. 49, and retain the law firm of Frost Brown Todd LLC as special counsel for the coalition of municipalities. Section II: This Ordinance shall be an emergency measure necessary for the preservation of the health, welfare and safety of the residents of the (City / Village) of ________________, Ohio, such emergency arising from the need for immediate judicial proceedings given that the effective date of Am. Sub. HB 49 is January 1, 2018; WHEREFORE, this Ordinance shall be in full force and effect upon its passage.
(City / Village, add signature and date blocks here)
City Council Agenda Item Report Agenda Item No. 2017-136 Submitted by: Adam Sackenheim Submitting Department Public Utilities Department Meeting Date: October 23, 2017
SUBJECT Appropriation of $47,500.00 for the emergency stabilization of Harbin Park hillside north of Park Place for the purpose of protecting the City's 16" water transmission main that feeds the Hunter Road Water Storage Tower. Recommendation: It is recommended that City Council authorize an appropriation of $47,500.00 from the Water Expansion Fund for the emergency stabilization of Harbin Park hillside for the purpose of protecting critical water distribution infrastructure in the immediate area. Rules suspension and emergency provisions are requested in order to expedite project completion. Background/Synopsis: The City pumps drinking water from its Water Treatment Plant to its Muskopf Road Booster Station - where the water is then pumped roughly 3,400 feet horizontally and almost 400 feet vertically to fill the City's Hunter Road Water Storage Tower. The Hunter Road Water Storage Tower then provides water to most homes and businesses in the southern half of the City. The 16" pipe between the Muskopf Road Booster Station and the Hunter Road Water Storage Tower is a vital part of the City's water distribution network. In recent years, erosion issues on the Harbin Park hillside have compromised the integrity of this pipe and resulted in the loss of ground cover over the pipe. These problems, if left unaddressed, could lead to main breaks that would be extremely difficult to repair due to access and terrain issues. Main breaks on this pipe could also create major water service disruptions to City customers. This project would stabilize the ground over the water pipe to safeguard its structural integrity. Staff requests that the earthwork stabilization be performed by JW Brennan Excavating LLC, per attached proposal. The work is expected to take ten (10) days to complete at $2,500.00 per day for labor and equipment. $25,000.00 is requested for labor and equipment. Staff requests that materials - including rock and rip-rap, be secured from Arch Materials in Batavia, Ohio. Materials quantities are estimated in the attached quantities sheet created by City Engineer Ben Mann. $22,500.00 is requested for materials. Financial Impact:
Financial Impact, Cont'd: Funding for this project is included in the 2017-2021 Capital Improvement Program under project number WAT-17-010: Small Water Line Improvements. Funding source is the Water Expansion Fund. Rule Suspension Requested:
Yes Emergency Provision Needed: Yes Emergency Provision: Emergency provision is requested so that this work can be completed as quickly and as efficiently as possible, in order to safeguard a critical piece of the City's buried water distribution network. ATTACHMENTS Harbin Park Erosion Repairs Material Quantity estimates B Mann.pdf FW_ Water Supply Line - Harbin Park.pdf
@ $41.00/ton = $15,703.00 @ $29.00/ton = $6,757.00 ---------------------TOTAL COST OF TYPE C & D: $22,460.00
From: To: Subject: Date: Attachments:
Adam Sackenheim Adam Sackenheim FW: Water Supply Line - Harbin Park Wednesday, October 11, 2017 4:30:21 PM Harbin Park Erosion Repairs.pdf
From: [email protected] [mailto:[email protected]] Sent: Tuesday, October 10, 2017 6:25 PM To: Ben Mann Subject: Re: Water Supply Line - Harbin Park
Yes...10 days to be safe. The class d riprap is $29.00 per ton and the class c is $41.00 per ton Sent from my iPhone On Oct 10, 2017, at 4:09 PM, Ben Mann wrote: Do you think 7 or 8 days but plan on 10 to be safe? Ben Mann, P.E. City Engineer / Deputy Public Works Director City of Fairfield 867-4213
From: [email protected] [mailto:[email protected]] Sent: Tuesday, October 10, 2017 3:43 PM To: Ben Mann Subject: Re: Water Supply Line - Harbin Park
Ben, it would cost about $2500.00 per day to do the work at harbin park. I think it would go faster to have 3 guys there in a trackhoe, loader, and a tracked off rd truck. If there would be a day here or there where we can do it with just 2 guys there with just 2 pieces of equipment running it would be about $1800.00 a day Sent from my iPhone On Sep 29, 2017, at 3:30 PM, Ben Mann wrote: Jeff We took some measurements of all the areas we walked starting at the top of the hill and working down to where the ductile stub is exposed. I tried to get an idea of total material that would need moved not including the minor grading to open up the ends of the existing pipes on the inlet side.
Hopefully this will be helpful for you to give us a daily rate for a couple operators, excavator, loader, and off-road truck with a backhoe to load the truck (and a rough idea of the number of days). I am assuming Water/Parks would haul broken concrete and dirt is available at the top of the hill. Could you also get me a price for the pipe lining and extension at Ross Road? Thanks. Ben Mann, P.E. City Engineer / Deputy Public Works Director City of Fairfield 867-4213
From: [email protected] [mailto:[email protected]] Sent: Friday, September 29, 2017 3:11 PM To: Ben Mann Subject: Message from KM_C284e
City Council Agenda Item Report Agenda Item No. 2017-144 Submitted by: Ben Mann Submitting Department Public Works Department Meeting Date: October 23, 2017
SUBJECT Drainage improvements at Ross Road near Devonian and Drywell Cleanings in the Muskopf/Sherry area.
Recommendation: It is recommended that funding be appropriated from the Capital Improvement Fund in the amount of $21,500.00 for the proposed drainage improvement projects listed above.
Background/Synopsis: The City has a Capital Improvement Program item for utilizing outside contractors for drainage projects. The work listed above will address a culvert in poor condition on Ross Road and drywells in need of maintenance in the Muskopf/Sherry area. The project funding for this work is in the Capital Improvements Program for 2017-2021 under PWA-17-003.
Financial Impact:
Financial Impact, Cont'd: Total of $21,500.00 from the Capital Improvement Fund for the labor, material, and equipment for the items listed above with costs broken out as follows: $14,000.00 for J.W. Brennan Excavating, LLC. as a change order to the existing Ross Road Sanitary Sewer contract ($12,800.00 plus a contingency of $1,200.00) for the Ross Road drainage improvements. $7,500 for Tele-Vac as a purchase order for drywell cleanings in the Muskopf/Sherry area.
Rule Suspension Requested: No Emergency Provision Needed:
No Emergency Provision: N/A
ATTACHMENTS Muskopf Sherry Area.pdf Ross and Devonian.pdf
City of Fairfield - 2017 Aerial Drywell Maintenance Muskopf / Sherry Area
HIAWATHA CT
L VIL
E DR
SIOUX DR
RT C
D
G
PO T
MUSKOPF R
C T
R ED
CT
B ATE LVD HG
PF
EAS T
AG
LIS
UT
M U SKOP F CT
KO M US
DR
CHAB
AT
SO
IROQUOIS AVE
GAMAY LN
OL D T OW ER
ERRY SH
Project Site
LN
SHERRY LN
AK CT DO
EVALIE DR
M RI T AE A DR R ED
O SK
PL
MARLENE DR
PF
EN
OA
K DR
Y
R
MU
A
RE
JEF FR E
RD
IN G R RN MO RY D O GL
WE
T
AM R IT
R
RE D
W CT DO
I
O
A
K
CHRISTINE DR
OAK KNOLL CT
TOLLEY WOOD DR EMERALD LAKE DR HIGH POINT CT
KE
ND
DR
FL O
C SE
LA
MIC
A HIG
DA V P L ID
LN
GRE
SE
RD
RO
N SU
IM PR
O IMR PR
TA LL AW
LINDENWOOD LN DA D R AN
City of Fairfield - 2017 Aerial Storm Sewer Work Ross and Devonian
ROSS RD
Project Site
DEVONIAN DR
I
City Council Agenda Item Report Agenda Item No. 2017-146 Submitted by: Andy Eddy Submitting Department Public Utilities Department Meeting Date: October 23, 2017
SUBJECT An appropriation in the amount of $7,480.00 is being requested for professional services by T. Luckey Sons, Inc. for concrete crack sealing of the clarifier walls at the City’s Water Treatment Plant. Recommendation: It is recommended that City Council authorize an appropriation in the amount of $7,480.00 from the Water Replacement & Improvement Fund for professional service work at the Water Treatment Plant. Background/Synopsis: The walls of the clarifiers at the Water Treatment Plant are showing stress from age and the elements, as they are cracked and leaking. The Water Division has obtained a price quote from T. Luckey Sons, Inc. for concrete repairs of these tanks. T. Luckey Sons Inc. is a company specializing in support restoration and they have completed similar repairs with good results at the Water Treatment Plant. They are to supply all labor, equipment and materials required to inject polyurethane grout into the leaking cracks and the waterstops at the tank wall joints on the clarifiers. A service proposal by T. Luckey Sons Inc. is attached.
Financial Impact:
Financial Impact, Cont'd: Funding for this project is included in the 2017-2021 Capital Improvement Program under project number WAT-17-006 – Water Plant Concrete / Masonry Repairs. The funding source is the Water Replacement & Improvement Fund. Rule Suspension Requested: Yes Emergency Provision Needed: No Emergency Provision: N/A ATTACHMENTS Clarifier Crack Sealing Proposal 2016.pdf
T. Luckey Sons, Inc. Support Restoration Technologies 10251 Suspension Bridge Road Harrison, Ohio 45030 An EEO/Drug Free Employer
Proposal: Scope, Exclusions, and Agreement Letter To: City of Fairfield Ohio Public Utilities Regarding: Repairing Various Leaking Concrete Cracks (Tanks) DATE:
September 22, 2017
ATTN:
Mr. Andy Eddy
PHONE: 513-858-7775 FAX: 513-829-3536
FROM:
Mr. Randall L. Brooks
PHONE: 513-353-2544
T. Luckey Sons, Inc.
FAX:
513-353-2655
PROPOSAL SENT VIA:
FAX.
MAIL. ENT VIA: Sandra Drive Sewer
MESSENGER.
COPY TO: FILE.
Total number of pages: 3 A. Terms: T. Luckey Sons, Inc. is hereinafter considered the Contractor and is also referred to as T.L.S. Scope of Work: Supply all labor, equipment and materials required for sealing leaking cracks, joints and waterstops through concrete water holding tanks as directed by the City of Fairfield Ohio. Our proposed method of repair will be by injection of potable water approved water activated polyurethane grout. Proposal Details: Drill 3/8” injection holes on approximately 45-degree angles at each leaking crack location as so to cross the crack approximately ½ the structure thickness. Drilling straight into the cracks is also acceptable depending on the surface condition of the concrete at each crack location. Injection holes will be drilled on approximately 1-foot centers. Injection holes may be drilled straight directly into cracks depending on the overall conditions of each crack. Utilize clean water to flush drilling debris from inside each injection hole. Install and secure 3/8” pressure injectors into each injection hole. Utilize clean water injected through pressure injectors to remove debris from inside the cracks. Beginning at the lowest point of each crack and work up begin injection of polyurethane grout. Grouting will continue until grout vents out of the next adjacent pressure injector and or crack.
1
Cap injector and repeat the process on all remaining pressure injectors. Remove pressure injectors and patch remaining holes with hydraulic cement. Pricing Time and Materials:
Labor & Equipment: $2,750.00 per day (max-10-hours per day)
Polyurethane Grout: $82.50 per gallon
Estimated Quantities: Labor & Equipment: 2-days @ $2,750.00ea. = $5,500.00 Polyurethane Grout: 24-gallons @ $82.50ea. = $1,980.00 Totals: $7,480.00 B. Exclusions to Scope: 1. The project Owner shall provide an adequate and convenient supply of potable water for our grout mixing operations. 2. The project Owner shall provide reasonable access to the work. This provided access area shall be utilized for storage and use of our grout materials and equipment. 3. The proposed bid price does not include premiums for payment of performance bonds or special insurance. If a performance bond is required, then please add 2.0 percent to the bid price. Special Insurance shall be negotiated separately. 4. Any required independent engineering, inspection, or testing services, and / or preconstruction and post-construction surveys are excluded from this proposal. 5. The Project Owner shall provide all government required permits, government required fees, and/or any permission of adjacent property owners that may be required for the performance our work, except for those required for the transportation of our equipment and any state or local contractor’s licensees. 6. T. Luckey Sons, Inc. is excluded from any responsibility for damages caused by grout that enters into those underground and/or under-slab utilities that have openings which may allow TLS grout to enter these underground and/or under-slab utilities. TLS strongly urges the project Owner to verify that all underground and/or under-void utilities are “air-tight”. If these utilities are not “air-tight”, then the project Owner must make the utilities “air-tight” prior to beginning grouting operations 7. T. Luckey Sons, Inc. is excluded from any responsibility for grout that enters into those underground (under slab) utilities that T. Luckey Sons, Inc. has no reason to know exist. These underground utilities include but are not limited to: sewer, water, drain tiles, elevator shafts, roof drains, and other unexpected voids. The Project Owner is responsible for clearly marking all project utilities and bringing to the attention of TLS the existence of these utility markings. The project Owner must mark the location of the under-slab utilities so that TLS can avoid drilling into these utilities. 8. This proposal is valid for only 30 days beginning from the date of this proposal. 9. Contractor shall only patch the drilled holes with Concrete materials. The Contractor shall not replace nor restore any floor coverings affected by the grouting operations. 10. TLS expressly takes no design and or engineering responsibility of our performed work.
2
C. Compensation and Dispute Resolution: 1. The project Owner shall pay T. Luckey Sons, Inc. within 30 days of the date of T.L.S. invoice. 2. Both Parties, the project Owner and T. Luckey Sons, Inc. agree to the following three provisions: a) Both Parties agree to arbitrate all disputes. b) In the event of a successful collection action by T. Luckey Sons Inc. against the project Owner, the project Owner agrees to pay T. Luckey Sons, Inc. interest on the owed principal at the prime rate plus 1.5 percent. c) In the event of a successful collection action by T. Luckey Sons Inc. against the project Owner, the project Owner agrees to provide recovery for T. Luckey Sons’, Inc. attorney fees.
D. Signatures Indicating Agreement to this Proposal: Project Owner
Contractor
:
T. Luckey Sons, Inc.
By:
By: Mr. Randall L. Brooks
Title:
_____________________________
Title: Division Manager;
Signature: _____________________________
Signature: _____________________________
Date:
Date:
_____________________________
_____________________________
reslump1.doc
3
SUBJECT An appropriation of $6,000 to support the Municipal Coalition to challenge the central collection and other provisions of the Ohio Revised Code, Chapter 718 regarding municipal income tax. Recommendation: It is recommended that City Council authorize and direct the appropriation of funding in the amount of $6,000 to support the Municipal Coalition's challenge. Background/Synopsis: HB 49, the State's biennial budget bill, contains provisions in Chapter 718, municipal income tax, that will allow for centralized filing and collection of net profit tax by the State of Ohio. Several cities have formed a coalition to challenge the constitutionality of these new sections of Chapter 718, thus preventing them from ever becoming enacted. The Municipal Coalition has hired Frost, Brown and Todd in Columbus to lead the litigation. The challenges include a violation of Home Rule, Single Subject Rule, Uniform Application of Tax and the lack of the State's statutory authority to administer centralized collection. In fact the new law states that if a city does not adopt the new provisions of 718 by January 1, 2018, the city risks losing its authority to collect any income taxes at all. Obviously for Fairfield, that would be catastrophic as income tax accounts for 40% of the City's revenue or in excess of $32 million. Financial Impact:
Financial Impact, Cont'd: An appropriation of $6,000, which is based on the population of Fairfield, to support the Municipal Coalition's challenge to centralized income tax collection and other provisions of the Ohio Revised Code, Chapter 718 regarding municipal income tax. Rule Suspension Requested: Yes Emergency Provision Needed: Yes Emergency Provision: The request for an emergency is to allow the funds to approved and paid prior to the deadline of October 31, 2017. ATTACHMENTS Letter to Interested Muncipal Coalition Members.pdf
Schedule of Cost Sharing for HB 49 Litigation.pdf Memo re HB 49 for Packet - 4834-9612-4240 1.pdf HB 49 Challenge Sample Ordinance.pdf
SCHEDULE OF COST SHARING FOR HB49 LITIGATION
Recent litigation by a coalition of municipalities with regard to small cells and public right of way (HB 331) has provided a potential cost sharing template for use by municipalities interested in challenging the recent municipal income tax code amendments. This template is based on population of cities and villages, and is set forth in the table below.
Population Village 5,000 10,000 25,000 50,000 Over 75,000
Under 5,000 10,000 25,000 50,000 75,000
Contribution $1,000 $2,000 $4,000 $6,000 $8,000 $10,000
*Please note that a municipality can choose to either (1) make a contribution without joining the litigation as a named plaintiff, or (2) become a party to the action. To become a party, it will be necessary for FBT to send the municipality an engagement letter and run a conflict check. Certainly, this process is not unduly burdensome and could be completed within the timeframe necessary to include such municipality on the pleadings. For those municipalities desiring to simply make a contribution to the coalition, we will be establishing a municipality to be the holder of deposited funds. If the litigation successfully concludes with funds still remaining, refunds of the retainer amounts will be made on a pro rata basis. Thank you for your consideration and please do not hesitate to contact me with any questions. 0127214.0625042 4824-1615-3424v1
MEMORANDUM
To:
Interested Municipal Coalition Members
From:
Gene Hollins and FBT Government Services Practice Group
Date:
October 12, 2017
Re:
Potential Constitutional Challenges to House Bill 49
I.
Background
House Bill 49 alters the net profit tax by facilitating the centralized filing and administration of the net profit portion of the municipal income tax paid from a business or profession conducted both within and without the boundaries of a municipal corporation. Taxpayers, other than individuals, may now “opt in” and file their net profit municipal income tax returns solely through the State of Ohio Department of Taxation under R.C. 718.80(A). House Bill 49 also eliminated the “nexus to nowhere” sales provision which established a taxable situs in a municipal corporation if the “property [wa]s shipped from a place within the municipal corporation to purchasers outside the municipal corporation, provided the taxpayer is not, through its own employees, regularly engaged in the solicitation or promotion of sales at the place where delivery is made.” Several Ohio municipalities are considering the formation of a coalition to file a mandamus action in the Ohio Supreme Court, or an injunctive and/or declaratory judgment action in a Court of Common Pleas, against the municipal income tax provisions as set forth in HB 49, as well as the original legislation comprehensively rewriting the municipal income tax statute, HB 5 (enacted in 2014). II.
Potential Challenges
A. Violation of the Home Rule Amendment •
Municipal power over matters of local self-government is derived from the Constitution. Gesler v. Worthington Income Tax Bd. of Appeals, 138 Ohio St.3d 76, 2013-Ohio-4986, ¶17. The Home Rule Amendment to the Ohio Constitution, Article XVII, Section 3 provides that “Municipalities shall have authority to exercise all powers of local self-government * * *.”
Frost Brown Todd LLC
•
With regard to taxing power, “[i]t is well established that ‘[t]he municipal taxing power is one of the “powers of local self-government” expressly delegated by the people of the state to the people of municipalities,” Id. at ¶18, citing Cincinnati Bell Tel. Co. v. Cincinnati, 81 Ohio St.3d 599, 605, 693 N.E.2d 212 (1998), and as such is not tested by the well-known home rule “conflict analysis” that is applicable when a municipality exercises its police power.
•
Rather, any General Assembly restrictions on local income tax authority must be based on the specific constitutional authority granted the state in two other sections of the Ohio Constitution: Article XIII, Section 6 provides that the General Assembly “shall provide for the organization of cities, and incorporated villages, by general laws, and restrict their power of taxation * * * so as to prevent the abuse of such power.” Second, under Article XVIII, Section 13, “[l]aws may be passed to limit the power of municipalities to levy taxes and incur debts for local purposes * * *.” Panther II Transp., Inc. v. Seville Bd. of Income Tax Rev., 138 Ohio St.3d 495, 497, 2014-Ohio1011, ¶ 11 (2014).
•
The Ohio Supreme Court has consistently held that “[t]he taxing authority of a municipality may be preempted or otherwise prohibited . . . by an express act of the General Assembly.” Cincinnati Bell, 81 Ohio St.3d at 605 (syllabus). The Ohio Supreme Court has interpreted the requirement of “an express act of restriction” to mean only that the state “does not preempt local taxes merely by enacting a similar tax of its own.” Panther II Transp., Inc., 138 Ohio St.3d at 500. “[M]unicipal governments have a plenary power to tax, but the General Assembly has authority to impose specific limits on that power.” Panther II, 138 Ohio St.3d at ¶ 11 (citing Cincinnati Bell at 602; Gesler, 138 Ohio St.3d 76 at ¶ 17, 21).
•
Telling statement in uncodified Section 6 of HB 5: “In order to ensure a fair, stable, and efficient system of local taxation, and to prevent any abuse of power by municipal corporations, the General Assembly hereby exercises its authority under those Articles to restrict the taxing powers of municipal corporations by requiring that any income tax or withholding tax levied by a municipal corporation must be levied in accordance with this act and any provisions of Chapter 718. of the Revised Code that remain unchanged by this act.”
•
What if the General Assembly itself chose not to impose a tax (as with income taxation of corporate entities) and therefore did not justify its preemption on a concern about “double taxation” by municipalities? What if the General Assembly attempted instead to simply legislate a rigid template for the exercise by a municipality of its powers of local selfgovernment?
•
General Assembly reached beyond its authority to limit or restrict the municipal taxing authority by dictating a code to the municipalities and by authorizing centralized collection of corporate net profits tax.
B. Other Potential Challenges •
Single Subject Rule - Section 15(D), Article II of the Ohio Constitution provides: “No bill shall contain more than one subject, which shall be clearly expressed in its title.” Dublin v. State involved a challenge to a rider in the biennial appropriation bill relating to municipal control over public utility use of the right of way. The Court in Dublin stated: “[T]he very fact that such a budgetary need justifies inclusion of many diverse appropriations in an appropriations bill increases the need to exercise caution to avoid violating the single-subject rule by adding still more diverse items to the bill that are not so necessarily connected to creating a budget. With so many diverse items already included in the bill, it becomes increasingly incredible that non-appropriation items can be added to the bill without violating the single-subject rule.”
•
Equal Protection/Uniform Application of Tax - Youngstown Sheet & Tube Co. v. City of Youngstown, 91 Ohio App. 431, 108 N.E.2d 571 (Mahoning County 1951), found that the Youngstown income tax was “a denial of equal protection because the tax was imposed on individuals at one rate and on corporations at a substantially higher rate.” Under HB 49, taxpayers may now “opt out” complying with the net profits provisions of Chapter 718 administered by the municipal corporation and “opt in” to new Sections 718.80 through 718.95 whereby the state tax commissioner is the sole administrator of each municipal income tax for which the taxpayer is liable. Applying different tax codes to similarly situated taxpayers in a municipality could be challenged, on its face, as violating equal protection.
•
Lack of statutory authority – Oddly, the state has no authority to administer the new centralized collection of net profits tax unless it is granted such authority by each and every municipality. Uncodified Section 803.100(B) of HB 49 provides: “In accordance with division (A) of section 718.04 of the Revised Code, each municipal corporation shall adopt, by ordinance or resolution, the provisions of sections 718.80 [through] 718.95 of the Revised Code on or before January 31, 2018. Such resolution or ordinance shall specify that the enactment of those provisions applies to taxable years beginning on or after January 1, 2018.” The State admits that it has no authority, but forces each municipality to grant it the authority or risk losing its authority to collect income taxes at all. These new provisions are not self-executing.
III.
Writ of Mandamus
Certainly, with respect to statutes of great public interest and widespread impact, there is precedent for an action to be filed directly with the Ohio Supreme Court to determine what are largely questions of law. In State ex rel. Ohio Academy of Trial Lawyers v. Sheward, 86 Ohio St.3d 451, 1999-Ohio-123 (1999), the Supreme Court considered the constitutionality of the Tort Reform Act. The Supreme Court stated, “This court has previously held that a mandamus action may test the constitutionality of a statute….Moreover, where this court has found a statute unconstitutional it may direct the public bodies or officials to follow a constitutional course in completing their duties.” This is especially true where a declaratory judgment action or mandatory injunction in a Court of Common Pleas would not be “complete in its nature, beneficial and speedy.” Given that H.B. 49 imposes deadlines on municipalities to adopt changes as described above within an unreasonable timeline, it is arguable that no remedy other than a writ of mandamus from the Ohio Supreme Court will be effective to provide municipalities relief from an unconstitutional statute. Pending further research, we would recommend filing a mandamus action directly with the Ohio Supreme Court. 0127214.0625042 4834-9612-4240v1
ORDINANCE NO. ____
AN ORDINANCE TO AUTHORIZE THE [MAYOR/CITY MANAGER/LAW DIRECTOR] TO JOIN A COALITION OF MUNICIPALITIES RETAINING SPECIAL COUNSEL FOR PURPOSES OF INITIATING LITIGATION TO CHALLENGE THE CONSTITUTIONALITY OF AMENDMENTS TO CHAPTER 718 OF THE OHIO REVISED CODE RELATING TO MUNICIPAL INCOME TAX, AND DECLARING AN EMERGENCY.
WHEREAS, the (City / Village) of ________________ recognizes, as a home rule power of local self-government, that municipal income tax administration and collection is vital to the health, safety and welfare of the municipality; and WHEREAS, the (City / Village) of ________________ relies on the revenue from effective municipal income tax administration and collection to provide the services that maintain the health, safety and welfare of the municipality; and WHEREAS, the Ohio General Assembly has attempted to assert control over the administration and collection of municipal income taxes by claiming that a municipality has no authority to impose an income tax unless it adopts a code in strict compliance with R.C. Chapter 718; and WHEREAS, the established law of Ohio is clear that any such preemption of municipal income tax codes by the State of Ohio violates the Ohio Constitution and home rule provisions that allow a municipal corporation the right to administer and enforce its own municipal income tax; and WHEREAS, more specifically, the State of Ohio has enacted HB 5 in 2014 comprehensively rewriting the entire municipal income tax law and HB 49 in 2017 authorizing centralized collection by the State of Ohio of municipalities’ net profits taxes; and WHEREAS, the (City / Village) of ________________ desires to assert its home rule authority to control the administration and collection of the municipal income tax, in order to provide for the health, safety and welfare of the municipality; and BE IT ORDAINED BY THE (COUNCIL / COMMISSION) OF THE (CITY / VILLAGE) OF _____________________________, OHIO: Section I: The [Mayor/City Manager/Law Director] is authorized to join a coalition of municipalities being formed for the purpose of initiating litigation to challenge the constitutionality of amendments to Chapter 718 of the Ohio Revised Code contained in H.B. 5 and H.B. 49, and retain the law firm of Frost Brown Todd LLC as special counsel for the coalition of municipalities. Section II: This Ordinance shall be an emergency measure necessary for the preservation of the health, welfare and safety of the residents of the (City / Village) of ________________, Ohio, such emergency arising from the need for immediate judicial proceedings given that the effective date of Am. Sub. HB 49 is January 1, 2018; WHEREFORE, this Ordinance shall be in full force and effect upon its passage.
(City / Village, add signature and date blocks here)
City Council Agenda Item Report Agenda Item No. 2017-136 Submitted by: Adam Sackenheim Submitting Department Public Utilities Department Meeting Date: October 23, 2017
SUBJECT Appropriation of $47,500.00 for the emergency stabilization of Harbin Park hillside north of Park Place for the purpose of protecting the City's 16" water transmission main that feeds the Hunter Road Water Storage Tower. Recommendation: It is recommended that City Council authorize an appropriation of $47,500.00 from the Water Expansion Fund for the emergency stabilization of Harbin Park hillside for the purpose of protecting critical water distribution infrastructure in the immediate area. Rules suspension and emergency provisions are requested in order to expedite project completion. Background/Synopsis: The City pumps drinking water from its Water Treatment Plant to its Muskopf Road Booster Station - where the water is then pumped roughly 3,400 feet horizontally and almost 400 feet vertically to fill the City's Hunter Road Water Storage Tower. The Hunter Road Water Storage Tower then provides water to most homes and businesses in the southern half of the City. The 16" pipe between the Muskopf Road Booster Station and the Hunter Road Water Storage Tower is a vital part of the City's water distribution network. In recent years, erosion issues on the Harbin Park hillside have compromised the integrity of this pipe and resulted in the loss of ground cover over the pipe. These problems, if left unaddressed, could lead to main breaks that would be extremely difficult to repair due to access and terrain issues. Main breaks on this pipe could also create major water service disruptions to City customers. This project would stabilize the ground over the water pipe to safeguard its structural integrity. Staff requests that the earthwork stabilization be performed by JW Brennan Excavating LLC, per attached proposal. The work is expected to take ten (10) days to complete at $2,500.00 per day for labor and equipment. $25,000.00 is requested for labor and equipment. Staff requests that materials - including rock and rip-rap, be secured from Arch Materials in Batavia, Ohio. Materials quantities are estimated in the attached quantities sheet created by City Engineer Ben Mann. $22,500.00 is requested for materials. Financial Impact:
Financial Impact, Cont'd: Funding for this project is included in the 2017-2021 Capital Improvement Program under project number WAT-17-010: Small Water Line Improvements. Funding source is the Water Expansion Fund. Rule Suspension Requested:
Yes Emergency Provision Needed: Yes Emergency Provision: Emergency provision is requested so that this work can be completed as quickly and as efficiently as possible, in order to safeguard a critical piece of the City's buried water distribution network. ATTACHMENTS Harbin Park Erosion Repairs Material Quantity estimates B Mann.pdf FW_ Water Supply Line - Harbin Park.pdf
@ $41.00/ton = $15,703.00 @ $29.00/ton = $6,757.00 ---------------------TOTAL COST OF TYPE C & D: $22,460.00
From: To: Subject: Date: Attachments:
Adam Sackenheim Adam Sackenheim FW: Water Supply Line - Harbin Park Wednesday, October 11, 2017 4:30:21 PM Harbin Park Erosion Repairs.pdf
From: [email protected] [mailto:[email protected]] Sent: Tuesday, October 10, 2017 6:25 PM To: Ben Mann Subject: Re: Water Supply Line - Harbin Park
Yes...10 days to be safe. The class d riprap is $29.00 per ton and the class c is $41.00 per ton Sent from my iPhone On Oct 10, 2017, at 4:09 PM, Ben Mann wrote: Do you think 7 or 8 days but plan on 10 to be safe? Ben Mann, P.E. City Engineer / Deputy Public Works Director City of Fairfield 867-4213
From: [email protected] [mailto:[email protected]] Sent: Tuesday, October 10, 2017 3:43 PM To: Ben Mann Subject: Re: Water Supply Line - Harbin Park
Ben, it would cost about $2500.00 per day to do the work at harbin park. I think it would go faster to have 3 guys there in a trackhoe, loader, and a tracked off rd truck. If there would be a day here or there where we can do it with just 2 guys there with just 2 pieces of equipment running it would be about $1800.00 a day Sent from my iPhone On Sep 29, 2017, at 3:30 PM, Ben Mann wrote: Jeff We took some measurements of all the areas we walked starting at the top of the hill and working down to where the ductile stub is exposed. I tried to get an idea of total material that would need moved not including the minor grading to open up the ends of the existing pipes on the inlet side.
Hopefully this will be helpful for you to give us a daily rate for a couple operators, excavator, loader, and off-road truck with a backhoe to load the truck (and a rough idea of the number of days). I am assuming Water/Parks would haul broken concrete and dirt is available at the top of the hill. Could you also get me a price for the pipe lining and extension at Ross Road? Thanks. Ben Mann, P.E. City Engineer / Deputy Public Works Director City of Fairfield 867-4213
From: [email protected] [mailto:[email protected]] Sent: Friday, September 29, 2017 3:11 PM To: Ben Mann Subject: Message from KM_C284e
City Council Agenda Item Report Agenda Item No. 2017-144 Submitted by: Ben Mann Submitting Department Public Works Department Meeting Date: October 23, 2017
SUBJECT Drainage improvements at Ross Road near Devonian and Drywell Cleanings in the Muskopf/Sherry area.
Recommendation: It is recommended that funding be appropriated from the Capital Improvement Fund in the amount of $21,500.00 for the proposed drainage improvement projects listed above.
Background/Synopsis: The City has a Capital Improvement Program item for utilizing outside contractors for drainage projects. The work listed above will address a culvert in poor condition on Ross Road and drywells in need of maintenance in the Muskopf/Sherry area. The project funding for this work is in the Capital Improvements Program for 2017-2021 under PWA-17-003.
Financial Impact:
Financial Impact, Cont'd: Total of $21,500.00 from the Capital Improvement Fund for the labor, material, and equipment for the items listed above with costs broken out as follows: $14,000.00 for J.W. Brennan Excavating, LLC. as a change order to the existing Ross Road Sanitary Sewer contract ($12,800.00 plus a contingency of $1,200.00) for the Ross Road drainage improvements. $7,500 for Tele-Vac as a purchase order for drywell cleanings in the Muskopf/Sherry area.
Rule Suspension Requested: No Emergency Provision Needed:
No Emergency Provision: N/A
ATTACHMENTS Muskopf Sherry Area.pdf Ross and Devonian.pdf
City of Fairfield - 2017 Aerial Drywell Maintenance Muskopf / Sherry Area
HIAWATHA CT
L VIL
E DR
SIOUX DR
RT C
D
G
PO T
MUSKOPF R
C T
R ED
CT
B ATE LVD HG
PF
EAS T
AG
LIS
UT
M U SKOP F CT
KO M US
DR
CHAB
AT
SO
IROQUOIS AVE
GAMAY LN
OL D T OW ER
ERRY SH
Project Site
LN
SHERRY LN
AK CT DO
EVALIE DR
M RI T AE A DR R ED
O SK
PL
MARLENE DR
PF
EN
OA
K DR
Y
R
MU
A
RE
JEF FR E
RD
IN G R RN MO RY D O GL
WE
T
AM R IT
R
RE D
W CT DO
I
O
A
K
CHRISTINE DR
OAK KNOLL CT
TOLLEY WOOD DR EMERALD LAKE DR HIGH POINT CT
KE
ND
DR
FL O
C SE
LA
MIC
A HIG
DA V P L ID
LN
GRE
SE
RD
RO
N SU
IM PR
O IMR PR
TA LL AW
LINDENWOOD LN DA D R AN
City of Fairfield - 2017 Aerial Storm Sewer Work Ross and Devonian
ROSS RD
Project Site
DEVONIAN DR
I
City Council Agenda Item Report Agenda Item No. 2017-146 Submitted by: Andy Eddy Submitting Department Public Utilities Department Meeting Date: October 23, 2017
SUBJECT An appropriation in the amount of $7,480.00 is being requested for professional services by T. Luckey Sons, Inc. for concrete crack sealing of the clarifier walls at the City’s Water Treatment Plant. Recommendation: It is recommended that City Council authorize an appropriation in the amount of $7,480.00 from the Water Replacement & Improvement Fund for professional service work at the Water Treatment Plant. Background/Synopsis: The walls of the clarifiers at the Water Treatment Plant are showing stress from age and the elements, as they are cracked and leaking. The Water Division has obtained a price quote from T. Luckey Sons, Inc. for concrete repairs of these tanks. T. Luckey Sons Inc. is a company specializing in support restoration and they have completed similar repairs with good results at the Water Treatment Plant. They are to supply all labor, equipment and materials required to inject polyurethane grout into the leaking cracks and the waterstops at the tank wall joints on the clarifiers. A service proposal by T. Luckey Sons Inc. is attached.
Financial Impact:
Financial Impact, Cont'd: Funding for this project is included in the 2017-2021 Capital Improvement Program under project number WAT-17-006 – Water Plant Concrete / Masonry Repairs. The funding source is the Water Replacement & Improvement Fund. Rule Suspension Requested: Yes Emergency Provision Needed: No Emergency Provision: N/A ATTACHMENTS Clarifier Crack Sealing Proposal 2016.pdf
T. Luckey Sons, Inc. Support Restoration Technologies 10251 Suspension Bridge Road Harrison, Ohio 45030 An EEO/Drug Free Employer
Proposal: Scope, Exclusions, and Agreement Letter To: City of Fairfield Ohio Public Utilities Regarding: Repairing Various Leaking Concrete Cracks (Tanks) DATE:
September 22, 2017
ATTN:
Mr. Andy Eddy
PHONE: 513-858-7775 FAX: 513-829-3536
FROM:
Mr. Randall L. Brooks
PHONE: 513-353-2544
T. Luckey Sons, Inc.
FAX:
513-353-2655
PROPOSAL SENT VIA:
FAX.
MAIL. ENT VIA: Sandra Drive Sewer
MESSENGER.
COPY TO: FILE.
Total number of pages: 3 A. Terms: T. Luckey Sons, Inc. is hereinafter considered the Contractor and is also referred to as T.L.S. Scope of Work: Supply all labor, equipment and materials required for sealing leaking cracks, joints and waterstops through concrete water holding tanks as directed by the City of Fairfield Ohio. Our proposed method of repair will be by injection of potable water approved water activated polyurethane grout. Proposal Details: Drill 3/8” injection holes on approximately 45-degree angles at each leaking crack location as so to cross the crack approximately ½ the structure thickness. Drilling straight into the cracks is also acceptable depending on the surface condition of the concrete at each crack location. Injection holes will be drilled on approximately 1-foot centers. Injection holes may be drilled straight directly into cracks depending on the overall conditions of each crack. Utilize clean water to flush drilling debris from inside each injection hole. Install and secure 3/8” pressure injectors into each injection hole. Utilize clean water injected through pressure injectors to remove debris from inside the cracks. Beginning at the lowest point of each crack and work up begin injection of polyurethane grout. Grouting will continue until grout vents out of the next adjacent pressure injector and or crack.
1
Cap injector and repeat the process on all remaining pressure injectors. Remove pressure injectors and patch remaining holes with hydraulic cement. Pricing Time and Materials:
Labor & Equipment: $2,750.00 per day (max-10-hours per day)
Polyurethane Grout: $82.50 per gallon
Estimated Quantities: Labor & Equipment: 2-days @ $2,750.00ea. = $5,500.00 Polyurethane Grout: 24-gallons @ $82.50ea. = $1,980.00 Totals: $7,480.00 B. Exclusions to Scope: 1. The project Owner shall provide an adequate and convenient supply of potable water for our grout mixing operations. 2. The project Owner shall provide reasonable access to the work. This provided access area shall be utilized for storage and use of our grout materials and equipment. 3. The proposed bid price does not include premiums for payment of performance bonds or special insurance. If a performance bond is required, then please add 2.0 percent to the bid price. Special Insurance shall be negotiated separately. 4. Any required independent engineering, inspection, or testing services, and / or preconstruction and post-construction surveys are excluded from this proposal. 5. The Project Owner shall provide all government required permits, government required fees, and/or any permission of adjacent property owners that may be required for the performance our work, except for those required for the transportation of our equipment and any state or local contractor’s licensees. 6. T. Luckey Sons, Inc. is excluded from any responsibility for damages caused by grout that enters into those underground and/or under-slab utilities that have openings which may allow TLS grout to enter these underground and/or under-slab utilities. TLS strongly urges the project Owner to verify that all underground and/or under-void utilities are “air-tight”. If these utilities are not “air-tight”, then the project Owner must make the utilities “air-tight” prior to beginning grouting operations 7. T. Luckey Sons, Inc. is excluded from any responsibility for grout that enters into those underground (under slab) utilities that T. Luckey Sons, Inc. has no reason to know exist. These underground utilities include but are not limited to: sewer, water, drain tiles, elevator shafts, roof drains, and other unexpected voids. The Project Owner is responsible for clearly marking all project utilities and bringing to the attention of TLS the existence of these utility markings. The project Owner must mark the location of the under-slab utilities so that TLS can avoid drilling into these utilities. 8. This proposal is valid for only 30 days beginning from the date of this proposal. 9. Contractor shall only patch the drilled holes with Concrete materials. The Contractor shall not replace nor restore any floor coverings affected by the grouting operations. 10. TLS expressly takes no design and or engineering responsibility of our performed work.
2
C. Compensation and Dispute Resolution: 1. The project Owner shall pay T. Luckey Sons, Inc. within 30 days of the date of T.L.S. invoice. 2. Both Parties, the project Owner and T. Luckey Sons, Inc. agree to the following three provisions: a) Both Parties agree to arbitrate all disputes. b) In the event of a successful collection action by T. Luckey Sons Inc. against the project Owner, the project Owner agrees to pay T. Luckey Sons, Inc. interest on the owed principal at the prime rate plus 1.5 percent. c) In the event of a successful collection action by T. Luckey Sons Inc. against the project Owner, the project Owner agrees to provide recovery for T. Luckey Sons’, Inc. attorney fees.
D. Signatures Indicating Agreement to this Proposal: Project Owner
Contractor
:
T. Luckey Sons, Inc.
By:
By: Mr. Randall L. Brooks
Title:
_____________________________
Title: Division Manager;
Signature: _____________________________
Signature: _____________________________
Date:
Date:
_____________________________
_____________________________
reslump1.doc
3
