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HomeMy WebLinkAbout1993-06-02 Finance Committee Minutes� � _ " Finance Ccarmittee ' June 2, 1993 Minutes � Ccarm.ittee Nl�nbers Present: C. Sullivan (for D. Soucy), Chair, M. Frankel, J. Saxl, J. Bragg (for R. Stone) Council N.(�nbers Present: Non,e Staff Present: E. Barrett, J. Quartarairo, J. Ring D. Pellegrino, T. Corbett, A. Stover, A. Stockus, B. Shibles Others Present: Rc�ger Hub�r, Esq. Eaton, Peabody, rep. AT&T Bob MacS�vain, MacS�aain & Co. rep. AT&T Meeting was called to orcler at 7:30 a.m. M. Frankel maved to appoint C. Stii].livan as Chair for the meeting. Seconded by J. Saxl. Passed 1. Application for Utility Location Pennit -- AT&T Ccer�m�nications, Inc. Barr�tt presented itc�n. This i-teqn was referred to the F�nan�e Contnittee by the City Council fzroam the last meeting when AT&T Ccermunications, Inc. presented. an application to install underground aptical fibre cable within the City's right of way. T'he purpose of the cable is to connect • the US and Canada and then Europe. Staff objected to the approval on several grounds: 1. AT&T Co�rmunications, Ina. is not a regulated utility within the language of the Maine statutes and therefore does not have eligibility for access to the RC7W by statutory right. ' 2. Due to the th-rough tx�n��Gsion to Canada and Europe there is the potenti.al for liability should the City break the line wheth�r inadvertent or willfully. City requested infonnation froam AT&T about I potential liability but were not pravided answers. 3. Because AT&T Ccar�minications, Inc. is not a Maine regulated utility the City is suggested a licensing fee, to which .AT&T is not agreeable. 4. Questions were prepa.red. for AT&T and have not been responded to. First is to assure who the applicant is; and seconded who the awner of the cable is. On June 1 a list of 13 or 14 questions was prepa.red. and delivered to Eaton, Peabody for response. Central issue is whether AT&T has access by right without addressing liability issue? Shibles explai.ned. that telephone cc�npanies must apply for locations penni.t, which is what AT&T is doing. Regulated utilities hane right to lay cable without paying other than street opening fees. 35 A M.R.S.A. Sec. 2301 establishes the definition for a regulated utility, and AT&T Ccarmunications, Inc. does not meet the strict language of a regulated utility within its articles of incorporation. Alttwugh AT&T has a PUC order entered. after incorporation, the articles of incorporation does not establish routes to be traveled, or geographic a�G to be served. • � � � � � M. Frankel questioned if AT&T had run cables through other ccgrmunities in Maine? If so, when and where? . Shibles responded. that about 5 years ago AT&T ran a cable frcan Manchester (west of Augusta) to Portland. AT&T did not run dawn the Maine Tuznpike, and Bruce does not ]rnaw haw irouch was run in the railroad right of way, versus mun.icipal right of way. Barrett rai.sed the folla�ing issues: l. That the City should ha.�+e scane lmawledge of the potential liability and inde�nnification f�can AT&T for 48 fibre optic cables. 5hould the City break the cable, and business operations serv+ed by the cal�le were interrupted, what aimunt of liability might the City face? 2. If it is possible to levy a licensing fee, what is an appropri.a.te charge for licensing the right of way? What is the benefit of ha.ving the cable within the City streets? Can AT&T reduce the size of the cable to acccem�odate local teleccgrmunication traffic only? Shibles noted that iri the future the cable may carry cable television and w�uld be subject to cable franchise fee, therefore, if the City and AT&T negotiate the franchise fee naw, then it would be in place when cable sezvice is carried over the AT&T cable. Barrett stated tha.t if AT&T argues that it has a right under state law to hav�e access to the City's right of way, then the burden of proof is on .AT&T to prave that right. AT&T does not want to pay the City for the right to access the ROW, nor to inderrmify the City. . M. Frankel noted that AT&T was facing a time constraint. AT&T responded through Bob MacSwain, MacSwain & Ccgnpany who represents AT&T in most of its negotiations for New �gland, New York and Pennsylvania. 'I'he City's questions were received by letter the day before at about 3:30 p.m. (Barr�tt distributed copies of the letter with the questions) . MacSwain responded verbally to questions in order. 1. Applicant is naw AT&T Ccnnwnications of New England., In�c. 2. Or�mers is AT&T Ccamnunications of NEw England, Inc., does not l�aw if there is mr�re than one awner. 3. Cable will carry wice and data. 'I'he cable will carty tv to the extent that pictures of callers are transmitted and received on a screen, but PUC and P'CC pmhi.bit AT&T frcen c��ng cable tv signal. 4. No to carrying cable tv progranm.ing. 5. Cable operator is AT&T Ccamnunications of New England, Inc. 6. No plans to lease the cable or any portion to other corporations or entities. 7, 9, and 10. together: Installation of cable w�uld allaw Banc,�or and Maine to attract business to Bangor and to the State. Allaw 800 service to Canada and throughout North America. State and the City would ha.ve state of the art ability to provide teleccgmminications services. Current Esnplayment in Bangor is 4 emplay�s, cable would allaw expansion to 6-10 �nploye�s. 8. Size of the cable approxiniates a little fingpx. There is no difference in the size of the cable if it is carrying 2 or 48 fibres. . � � � , ' Does not ]maw the n�r of fibres needed to handle Bang�r and Maine teleccar�minications traffic only. M. Frankel questioned why the rnmiber of fibres was being discussed? • Barr�tt responded that if most of the traffic is originating outside of the City or State, then the benefits fran the cable are not accruing to the residents of the City or State. The potential liability is accruing to the City residents only who are npt receiving the benefits of the cable being within the City's ROW. MacSwain responded that cable must be sized to allaw for potential growth. 11. Not Applicable. Under federal law and tariffs business can not sue AT&T for losses; also Bangor i.s protected frcan sui.t. Huber stated tha.t Ma.ine 'Ibrt Claims Act protects the City k�y limiting sui.ts to $300,000 or the value of the City's insurance, whichev+�x is greater. M. Frankel questioned whether a cable not shawn on utility ccenpany maps was dug up about 5 years ago? If so, what was the outccene? Ring responded that sinae the cables did not shaw on the utility c�any maps, no cost to the City. Z'here was another incident on Main Str�t involving NIDC7r, and cables not unifonnl.y encased. in concrete. The claim cost the City approximately $30,000. Bzrr�tt observed that the AT&T cable will be run_n?ng past a n�nbe.r of properties and chances are s�ne will break the cable, MacSwain responded that Maine had passed a "Dig Safe Law". Continuing #11, if City intentionally breaks the cable vs inadvPxtently AT&T will not � relive liability and ;nd�mn;�i the City. Shibles questioned if MacS�vain was aware of 3rd party claims against other than AT&T. MacSwain responded he is not aware of any. 12. Could not lay frcgn Hillside Avenue, because there is a tie in with NE Telephone. 13. Confidentiality clause in contracts prev+ents disclosure of amounts of licensing fees paid to private ROW c�mers. Range is 1 cents to $2 or $3 per foot. M. Frankel questioned in annual fee? MacStaain responded that it depended upon haw the fee was n�gotiated: one time payments, annual payment or present value paym�it. 14. Ianguage regarding �����fication in contracts are confidential. Huber advised that there is a big difference between private parties and City of Banqor which is protected by State law, while private awners are not. If AT&T i.s a public utility within state law, then AT&T has a right to access ROW upon pa.yment of ��;t fee and approval of City Engineer. . Huber addressed the Cc�mittee. 'Ib put into perspectiv�e, AT&T spoke with City several we�ks ago and received a letter with questions y+esterday. If applicant qualifies as a public utility then State law in the e�lusive � to detennine appraval of application. AT&T proposes to change the • • � ' existing applicant with one that is a public utility and is subject to PUC orders. Articles of incorporation are being requested frcan Secretary of State. City cited section 2301 because the articles of incorporation does not . state the geographic location to be servcd by the utility, yet a PUC order allays AT&T to operate without reference to geographic locations ar�ywh@re in the Sta.te of Maine. Rxmiring AT&T to list each str�t within the State along which it wuuld run a line is impmper. Other pravisions which pravide authority are sections 2501 - 2508. Regarding potential liability and ind�tm.ification: Maine Dig-Safe Act requires excavator to notify the Dig-Safe S�rste�n, and the Systean is required to notify avners of underground facilities. It is AT&T's practice to mark locations and be on-site when excavating. If City ccar�plies with Dig-Safe Act liability evaporates. Maine �ort Claims Act also substantially protects the City. Other jurisdictions charge fees, such as 'I�exas where City Mana.ger caan� frcen. Texas, by statute, allays utility av+�rsight by mur�icipalities. �,n;cipalities may requi_re licensing fees of 2� of gross revenues, therefore utilities can plan for fees. There is not such provision in ainP law. Chapter 25 is the exclusiv�e means; if City wants a provision for a licensing fee or �����fication than a statutory change is needed. Stockus responded tha.t under the new Dig-Safe law, excavator is liable within the marked area whether or not action was willful. M. Frankel stated that law was intended to apply for most traffic w:ithin State, but here Bangor will merely be a conduit for traffic. Statute was drafted incorrectly. If this ccarmittee is not going to make a • recc�miendation to the City Counci.l, than the time spent was wasted. J. Hragg stated that although AT&T is not able to naa run cable tv progranming, if that is a possibility in 5 - 10 years frcan naw, there should be a reservation of rights to revisit the subject in the future. Barrett responded that AT&T is looking to resolve issue sooner or later. I�egal Depart�nt and AT&T will continue to w�rk on the subject and be prepar�d for next Council agenda. Huber stated that he had requested the scheduled itFsn before thG Fi1L*�r'e Cce�mittee go foiward to get the City's questions on the table, and to get thern resolved. Would like to laeep the matter mr�ving fozward and to be prepared. for the next Council or Ccarimittee meeting. Barr�tt stated. that Solicitor Stw�pfe and Assistant Solicitor Shibles will continue to review and probably prepar�d for the next Council meeting. Barrett also advised that AT&T is looking at 46,500 feet of cable to be run through the City's ROW. 2. Skid Steer Loader and Pav�nent Planer (Public Works) Stockus presented request to purchase a New Holland model 785 skid steer • • 'i � • ' loader and paven�nt planer frcgn Ingraham Ford, Corrina, Maine for quoted price of $41,530, further that fornia.l bid process be waived.. Quotes were also requested frcan four other vendors, and this is the law responsive quote. Planer was appraved for purchase in FY93 and bid in August 92, • but will not fit on the ICubota.. Pellegrirw advi.sed that he is satisfied that quoted. prices wc�uld be the same if the City had gone to fonna.l bid. M. Frankel questioned who would hav+e w�n the bid in August if this ite�n was included -- Stockus responded Jordan �,;Fanent. B��tt advised that if appraved, there wr�uld be an order for transfer of appropriations. M. Frankel mpved rec�ndation of staff to purchase a New Holland model 785 skid steer loader and pavement planer frcan Ingrah�n Ford, Corrina, Maine for quoted price of $41,530, and to waive the fonnal bid process. Seconcled by J. Saxl. Passed 4:0. 3. Price Adjust�ent for Zmree Year Bitim�inous Concrete Contract Pellegrino pres�nted it�n. The City i.s in the second year of a three year contract with Lane Construction. Vendor has a right to request GPI inrreases annual, and prices w�x+� held constant for 1991 and 1992. Vendor has requested a 4� increase for 1993. Purchasing agent rec�nds appro�val. M. Frankel maved �pp roval of a 4� price adjustrr�nt for bitUminous concrete contract with Lan�./Construction Ccanpany, Meriden, CT. per letter dated May � 24, 1993. Seconded. by J. Saxl. Passed 4:0. 4. Bids: a. Meta1 Castings (Public Services Depart�r�nt) J. Saxl moved award. of contract for purchase of inetal castings to law bidder Public Works Supply Ccanpany, Lewiston, Maine for price of $19,354.35. Seconded by M. Frankel. Passed 4:0. b. Electric Lamp Contract (City-Wide) M. Frankel maved award of Electric Lamp Contract to Gi]sr�an Electric, Bangor, Ma.ine for est�mated cost of $17,280.67. . Seconded. by J. Saxl. Passed. 4:0. c. Sign Posts (Public Services & Police Depart�nt Parking Division) M. Frankel mpved award of contract for purchase of sign posts to Pernia-Line Corporation of New England, B-rockton, N� for price of $3,907. Seconded by J. Saxl. Passed 4:0. • • � „ . � ` d. Horizantal Baler (Public Service Departm�n.t) J. Saxl moved with enonmus pleasure award of contract for purchase of a � reconditioned. Selco HL 60 EBFID horizontal baler to BSE Recycling Works, for price of $37,820. Seconded by M. Frankel. Passed 4:0. e. Loader Backhoe (N1�tor Pool Depart7r�nt) M. Frankel moved award of purchase of a loader backhoe to Heauregard E ,i�.nt, Inc., Bangor, Me for price of $60,827.94 with a five year net buy back $26,500. Seconded by J. Saxl. Passed 4:0. f. Paper Cutter (Central Services) M. Frankel maved a�ra�d. of cantract for purchase of paper cutter to A. M. Multigraphics, West�u�od, MA for price of $5,765. Seconded by J. Bragg. passed 4:0. g. Wet waste container Bags (Airport Department) Pellegrino shcxa�.�l sa�nple of bag. Due to strength requ.i.re�nts, bags are not made frcan recycled. material. Bags are requircd by USDA for all waste frcan international flights. The waste is then steamed by the airmrt caterer before disposal. Bags were being sold individually, but naw the price is included. in flight service fees for airport. J. Saxl maved award of contract for purchase of vuet waste contai.ner bags � frcan Stone Container Ccanpany, Montvale, NJ for price of $504.50 per thousand. Seconded by M. Frankel. Passed 4:0. J. Hragg maved to go into Executive Session for the pu.rpose of hearing �two hardship tax aba.t�nent cases. Seconded by J. Saxl. Passed 4:0 Into Executive Session at 8:51 a.m. Out of Executive Session at 9:30 a.m. Both cases denied. First case rec�nded for long-tenn deferral, when properi.y sells. Seconded case reccam�nd for 5 year deferral, subject to review at end of 5 years for possible extension or payment in full. Meeting adjourned. at 9:30 a.m. Recording Secreta.ry John Quartararo � •