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HomeMy WebLinkAbout39-17 RESOLUTION113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 Resolution: 39-17 File Number: 2017-0032 DAVIS LAW FIRM WATER DAMAGE CLAIM: A RESOLUTION PURSUANT TO FAYETTEVILLE CODE OF ORDINANCES SECTION 39.10(C)(4) TO AUTHORIZE THE MAYOR TO PAY THE AMOUNT OF $26,759.34 TO DAVIS, CLARK, BUTT, CARITHERS & TAYLOR, PLC FOR A WATER DAMAGE CLAIM AT 15 AND 19 EAST MOUNTAIN STREET WHEREAS, pursuant to the Fayetteville Code of Ordinances Section 39.10(C)(4), the City Council must approve the payment of water damage claims exceeding $8,000.00. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas, pursuant to Fayetteville Code of Ordinances § 39.10(C)(4), authorizes the Mayor to pay $26,759.34 to Davis, Clark, Butt, Carithers & Taylor, PLC for a water damage claim arising at 15 and 19 East Mountain Street. PASSED and APPROVED on 2/7/2017 Attest: Sondra E. Smith, City Clerk T�jMVF,,3rri FAYETTI wZ* Page 1 girt �; •'jyA N9�if� lON l City of Fayetteville, Arkansas 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 Text File File Number: 2017-0032 Agenda Date: 2/7/2017 Version: 1 Status: Passed In Control: City Council Meeting File Type: Resolution Agenda Number: A. 9 DAVIS LAW FIRM WATER DAMAGE CLAIM: A RESOLUTION PURSUANT TO FAYETTEVILLE CODE OF ORDINANCES SECTION 39.10(C) (4) TO AUTHORIZE THE MAYOR TO PAY THE AMOUNT OF $26,759.34 TO DAVIS, CLARK, BUTT, CARITHERS & TAYLOR, PLC FOR A WATER DAMAGE CLAIM AT 15 AND 19 EAST MOUNTAIN STREET WHEREAS, pursuant to the Fayetteville Code of Ordinances Section 39.10(C)(4), the City Council must approve the payment of water damage claims exceeding $8,000.00. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas, pursuant to Fayetteville Code of Ordinances § 39.10(C)(4), authorizes the Mayor to pay $26,759.34 to Davis, Clark, Butt, Carithers & Taylor, PLC for a water damage claim arising at 15 and 19 East Mountain Street. City of Fayetteville, Arkansas Page 1 Printed on 21812017 City of Fayetteville Staff Review Form 2€12-0032 Legistar File ID 2/2/201.7 City Council Meeting Date - Agenda Item Only N/A for Non -Agenda Item Tim Nyander 1/19/2017 Utilities Director/ Utilities Department Submitted By Submitted Date Division / Department Action Recommendation: City Staff recommends approving a claim settlement for water damage with Davis Law Firm in the amount of $26,759.34 for water damage to the building at 19 E. Mountain St. Budget Impact: 5400.720.4310-5311.04 Water/Sewer Account Number Fund N/A N/A Project Number Project Title Budgeted Item? Yes Current Budget $ 49,500.00 Funds Obligated $ 4,582.26 Current Balance Does item have a cost? Yes Item Cost $ 26,759.34 Budget Adjustment Attached? No Budget Adjustment Remaining Budget V20?407i0 Previous Ordinance or Resolution # Original Contract Number: Approval Date: Comments CITY OF 7 1 ay —Ile ARKANSAS MEETING OF FEBRUARY 7, 2017 TO: Mayor and City Council THRU: Don Marr, Chief of Staff Water & Sewer Committee FROM: Tim Nyander, Utilities Director DATE: January 19, 2017 CITY COUNCIL AGENDA MEMO SUBJECT: Claim Settlement — Davis Law Firm, 19 E. Mountain St. RECOMMENDATION: City Staff recommends approving a claim settlement with Davis Law Firm in the amount of $26,759.34 for water damage to the building at 19 E. Mountain St. BACKGROUND: An unusual situation occurred, where the property owner invested money to protect their property from damage from a suspected water leak. The City could not find the leak using all of the usual leak detection methods. The owner invested money to protect his property. The City finally located the leak and repaired it. , DISCUSSION: Ordinance 5938, -passed on December 20, 2016 will go into effect on January 19. 2017. This ordinance allows compensation to be paid to property owners for investment in sump pumps and/or reasonable measures to protect their property in the event that Water and Sewer staff are initially unable to detect or determine the cause of a water leak, and a compensable water leak is later discovered or confirmed by city staff. On August 5, 2016, the Water Department cut the street and dug down to the water main and tap, and found a small leak on the service. This leak was repaired, but was close enough to where it could have potentially caused the water going into the Davis Law Firm building. Due to the close proximity of the leak that was found, Ordinance 5938 applies to this claim. It is recommended that the city pay this claim in the amount, of $26,759.34 to reimburse Davis Law Firm for the costs of sump pump modifications to the building and janitorial services related to the water leak. BUDGET/STAFF IMPACT: This single claim is higher than normal annual funding provided for these water damage type of events. An internal BA moving budgeted operational funds into the Insurance Self -Non -Vehicle Damage account for this claim has been turned in. Attachments: Staff Review Form Claim Form and Documentation Mailing Address: 113 W. Mountain Street www.fayetteville-ar.gov Fayetteville, AR 72701 Approval Claim Request h ttp://cof-ifforms/Forms/form/aysubmission?instanceld=7142&rou tingR... Although the City of Fayetteville is immune from any claim for liability or damages caused by alleged negligence of its employees, the City Council has authorized a very limited property damage claims procedure. INSTRUCTIONS: Please complete this form clearly stating the reason for the claim, amount you are requesting, all contact information, and attach appropriate documentation including receipts, estimates, photos, etc. Three (3) itemized written estimates must be provided prior to repairs being made. Substantive documentation MUST be provided to establish all -monetary values. Additional sheets may be added. Failure to provide all information and fully substantiate your claim will result in the claim being denied. Please do not discard any items that are being claimed as damaged. Filing a claim does not imply approval; claims will be investigated before a decision is rendered; claims received more than 30 days after the incident will be denied. Claims containing inaccurate or fraudulent information will be denied. Please mail to or hand -deliver documents to: Mayor's Office — Claims, City of Fayetteville, 113 W. Mountain St., Fayetteville, AR 72701 OR Fax to 479-575-8257 CLAIMANT INFORMATION First Name Last Name Middle Initial Davis Law Firm Davis Law Firm Claim Type What type of claim are you requesting? General „ Water and Sewer Email jbutt@davis-firm.com (mailto:jbutt@davis- firm.com) Address Street Address 19 East Mountain Street Address Line 2 City State / Province / Region Fayetteville AR Postal / Zip Code Country 72701 U.S.A 1 of 4 1/23/2017 9:34 AM Approval http://cof-lfforms/Forms/form/aysubmission?instanceld=7142&routingR... Daytime Phone 479-521-7600 Incident Location Alternate Phone Address/Location of Occurence Street Address 15 and 19 East Mountain Street Address Line 2 City Fayetteville Postal / Zip Code 72701 INCIDENT INFORMATION Date of Incident 6/19/2015 Incident Nature Insurance Time of Incident Nature of Occurrence Automotive Related other leaking water main State / Province / Region AR Country U.S.A. Amount being Claimed $ 26759.34 Home Related Personal Do you have any insurance which covers your damage? Yes No The City cannot pay a claim in an amount exceeding a Claimant's insurance deductible, if covered. The undersigned hereby files a claim against the City of Fayetteville, Arkansas for the following reason(s): Attach additional sheets if necessary 2 of 4 1/23/2017 9:34 AM Approval h ttp://cof-lfforms/Forms/form/aysu bm is sion?instanceId=7142&rou tingR... Incident Description The undersigned hereby files a claim against the City of Fayetteville, Arkansas for the following reason(s): Attached is the claim as fully submitted through Kit Williams, City Attorney, on September 27, 2016. The City was first asked to respond to this complaint the day it began on 5/19/15, but declined responsibility until repairs were made on 8/5/2016 and their effect confirmed by termination of the water intrusion over the next 8 weeks on 9/27/16. The City passed an Ordinance on 12/20/16 to allow this particular claim, which Ordnance does not go into effect until 30 days later on or about January 19, 2017.Attached also is the declination of our insurer to cover these costs. Please let me know if you need any further information. Thanks, Jack Butt, for the Davis Law Firm File Upload KIT LTR 092716 re damages, req reimbursement.pdf (/Forms/ha... 3.61VIB Renner Itr denying ins claim.pdf (/Forms/handlers/downloadattac... 18.91 KB Attach appropriate documentation including receipts, itemized estimates, photos, etc. If vehicle related, please include proof of insurance if applicable. Agreement I Agree. By checking the "I agree" box below, you agree and acknowledge that 1) your application will not be signed in the sense of a traditional paper document, 2) by signing in this alternate manner, you authorize your electronic signature to be valid and binding upon you to the same force and effect as a handwritten signature, and 3) you may still be required to provide a traditional signature at a later date. Signature By signing below, I acknowledge that the above -provided information is true and correct to the best of my knowledge and belief. Refer To Shea Fankhouser Department Water and Sewer Additional Davis Law Firm Claim Totals.pdf (/Forms/handlers/downloadatta... 1.64MB Documentation 5938 Amend § 39.10 Water and Wastewater Damage Claims.pdf... 403.22KB Memo 3 of 4 1/23/2017 9:34 AM Approval Letter to Claimant* http://cof-Ifforms/Forms/form/aysubm ission?instanceld=7142&routingR... Ordinance 5938, passed on December 20, 2016 will go into effect on January 19. 2017. This ordinance allows compensation to be paid to property owners for investment in sump pumps and/or reasonable measures to protect their property in the event that Water and Sewer staff are initially unable to detect or determine the cause of a water leak, and a compensable water leak is later discovered or confirmed by city staff. On August 5, 2016, the Water Department cut the street and dug down to the water main and tap, and found a small leak on the service. This leak was repaired, but was close enough to where it could have potentially caused the water going into the Davis Law Firm building. Due to the close proximity of the leak that was found, Ordinance 5938 applies to this claim. It is recommended that the city pay this claim in the amount of $26,759.34 to reimburse Davis Law Firm for the costs of sump pump modifications to the building and janitorial services related to the water leak. Decision * = Approve Recommendation Deny Recommendation Comments Submit 4 of 4 1/23/2017 9:34 AM 1:24 PM 08/29116 Hunnicutt Construction, Co, In Total Paid Dow Building Services Total Paid Grand Total Davis, Clark, Butt, Darithers, & Taylor, PLG Vendor QuickReport July 1, 2015 through August 29, 2016 Type bate Num Memo An7ount c Check 12115/2015 26920 Inv # 33 15.544.00 Check 43131/2016 27176 Inv # 37 10.919 00 26,463.00 Check 1211512015 26908 66640 104.27 Check 11116120/5 26838 66613 109.75 Check 1011512015 26768 66323 54.88 Check 47/1512415 26565 65445 2744 296.34 26,759.34 Page 1 of 1 Davis, Clark, Butt, Cat ors&Toylor PLC 19 East MOunboiO Fayetteville, AR 72701 BILLING FOR THE FOLLOWING ITEMS OFCONSTRUCTION: Hunnicutt Construction P.O. BOX 1901 Fayetteville, AR 72702 479-841-7798 Ldonhunnicutt@aol.com 12X04V2O15 33 BASEMENT SUMP PUMP MO0FUCATIDN8 10EAST MOUNTAIN OFFICE FAYETTEVILLE, ARKANSAS TEST HOLES FOR WATER LEVEL 344.00 DEMOLITION OFWALLS 375.00 CONCFLOOR CUT &POUR 8.750.00 CORNER CABINET &DOOR 825.00 F|N|8H, WALLS 1, PAINT 1.500.00 CARKPETUP&INSTALL 250.00 BASE &TRIM 750.00 SUMP PUMP 8PIPE 2.750.00 TOTAL DUE THIS |NV0|CE— 15'S44.O0 ____________ 1.5;544.00 TOTAL DUE THIS |NV0|CE— 15'S44.O0 V Lj Hunnicutt Const. Co Inc PO Box 1901 Faye%ville, AR 72702 Phone: 479-442-0662 Fax: 479-442-09111 Davis, Clark, Butt, Cathers & Taylor, PLC 19 East MountE ain Fayetteville, AR 72701 INVO.Jr-F BILLING FOR THE FOLLOWING ITEMS OF CONSTRUCTION: 3 - � -7- 2 0 2 nd SUMP PUMP INSTALLATION 19 EAST MOUNTAIN OFFICE FAYETTEViLLE, ARKANSAS 37 f 6TAL WE THIS INVOICE- 10,919.00 CORING THROUGH CONC WALL 344.00 DEMOLITION 37-5.00 CONC FLOOR CUT & POUR 6,000.00 CORNER CABINET & DOOR 825.00 STAIN & FINISH PAINTING 87500 CARPET UP & INSTALL 250.00 WOOD PANELING & TRIM 375,00 SUMP PUMP & PIPE 1,500.00 ELEC+RICAL 375,00 Hunnicutt Construction P.O. BOX 1901 Fayetteville, AIR 72702 479-841-7798 -------------------- TOTAL FOR ALL ABOVE 10,919.00 danhunnicutt(ftol.com 37 f 6TAL WE THIS INVOICE- 10,919.00 4 �n apDJ v 0 5. 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Box 1688 Fayetteville, AR 72701 lNVbll✓E NO" 65445 DATE 06/30/15 SERVICE LOCATION Davls Law Firm 1712 W 5 nset Ave�� Suit a `' Springdale, R 72762-5186 1A a rc Ji �K• T _ d w.� 1 A. 4{: ISI LAW FIRM I'.'IN ClAil,,Fl)11 C.,,\£!11111 ri•:=1.1, ll: {'lx )Y►►'OY. D A ►7 s- F I R r L C0 N I WRITER'S E-MAIL ADDRESS: JBUTTGa DAvis-FIRINLCOM September 27, 2016 FAYETTEVILLE + SIDNEY P. DAVIS, JR CONSTANCE Ci_ CLARK WM. JACKSON BUTT If KELLY CARIT1IERS DON A. TAYLOR CASEY D. LAWSON JOSHUA D.McFADDEN COLIN M. JOHNSON WILLIAM F. CLARK ANDREW D. CURTIS +BRIAN R. LESTER *Also Licensed in Oklahoma + OJ Counsel SPR1,NGDALE K. DREW DEVENPORT RE: Claim for Water Leakage: 15 E. Mountain Mr. Kit Williams Fayetteville City Attorney 302 City Hall 113 W. Mountain Street Fayetteville, AR 72701 Dear Kit: On June 19, 2015, our law firm members arrived at our office to find water standing on the basement carpet of our building at 15 E. Mountain Street, covering perhaps 200 square feet. This is a fully finished, furnished, decorated, busy and occupied secretarial office space in our building. This intrusion was and continued until resolved about 3 months later to be very disruptive to our operations. We had never had such disrupting water intrusion. Our only prior experience with water there was on perhaps three occasions in the 23 years we have occupied that building, we have found a few square feet of dampness which we. resolved within hours by putting a humidifier on the dampness. It appeared that the water in this instance had migrated through the subterranean, exterior wall of that building which fronts on Mountain Street. We contacted the City of Fayetteville to determine whether it xvas a contributing factor. Within a few days, I met with Mark Rogers, of the Fayetteville Water Department which resulted in the City patching and recovering various parts of the curb, gutter, and street in front of our building to hopefully mitigate any penetration of water that was occurring through cracks, depressions, and holes in those city -maintained features. That work was accomplished by July 23, 2016. Significant water intrusion continued, and in an effort to find and resolve the problem, In the ensuing weeks through professional water penetration companies, we determined and mitigated by caulk, sealant, roof coverings, and every possible above -ground avenue by which water could have penetrated the building. As of August 20, 2015 the significant water intrusion continued and we were working with Keith Shreve from the City. Our engineer, Don Hunnicutt, noted that over the last number of years as the City had repaired and DAvls, CLARK, BL Tr, CARITI IEIt$ S TAYLOR, PLC FAYETTEVILLE LOCATION: Y.O. Box 1688 t 19 E. MOUNTAIN 5T. ♦ FAYETTF.,VII,I.E, AR 72702 ♦ PH 479.521.7600 ♦ FAx 479.521.7661 SPRINGDALE LOCATION: 1712 W. SUNSET AVE., STE. E # SPRINGDALE, AR 72762 ♦ PH 479.717.2278 + mx 479.717.2302 Page 2 replaced the sidewalk and street int front of our building and that the underground backfill used was large gravel which allowed rapid transmission of water through such channels. I specifically nnade this comment to Keith in an Augctst 21 email focusing on the "big question" which we believed the Cite could answer: 4'hy the water has not, for several years come through and now has, and where its entry point into those channels occurs; are the big mysteries. In the meantime, we opened the sheetrock wall in our basement so we could observe the actual foundation wall and its seam with the poured concrete floor to determine the source of the water penetration into the basement at 15 E. Mountain Street, and determined Haat the source of the water was coming from the subterranean wall and,up-through the seam ",here the foundation wall nnet the floor, and not penetrating from the roof or any higher external joints of the building. Lyon Hunnicutt hypothesized that the water table next to/beneath the north side of our buildings was.. for some inexplicable reason, now not carrying water away as fast as it had in the past, such that water conning into that .table ww-as forcing its way up through the floor of our basement at the scam "?here the exterior foundation wall met the poured concrete Iloor. In cotTjunctioin With our trying to diagnose the problem, we drilled -test holes through the concrete floor of our basement to determine the thickness of the floor, the strata underneath, and whether the water would come up through the holes. The surprising result was that during !August, September, and the first part of October 2015, wvater continued to.penetrate by pushing upwvan'd into the basement front the floor and subterranean walts. wvhen there had been no rains for weeks and in fact Fayetteville was in a semi -drought condition. Finding? no othersolution to the problem, we determined to build rt sump system inside ofour wwalls that Would collect water penetrating from whatever cause, direct it to a deep sump, and pump it from that sump out onto the alley. Before procceding with that project. I ,vrote Mark Rogers in October 12 as 1o11ows: %lark ... Recent developments caused me to contact you a«ain. Ithasn't rained. to Speak of, for several weeks. In anticipation of the sump system. tliere were a couple of test holes drilled in our basement floor. to see howv thick the concrete was, and what the composition of earth below it was, and ww'ater is now forcinu its wad` up and through those and continues to come through the base of the outside wall ... again. without any significant rain for many weeks. I can 0111y ccmeludc that the source of this continued and increasing %water pressure is from a leaking water or sewagc pipe somewwhere outside of oUr budding — I can't conceive of an�.thing else that would drive the water table up in a period of significant dryness. Can you find a few minutes to come by and look at this, and discuss whether and how ' the City can test for water escaping from its pipe systems? The response of the Cita- to determine if they had a leak, was the appearance of a City worker at our office who, using a plastic cup and some test substance., gathered sonic of the leaked water, put the test medium in it and declared that since it held no chlorine, was not `'city water." We found out after-,vards that chlorine can fairly quickly' leach or evaporate out oftreated wvater, making such a test co►npletelw' inconclusiv C. 1-I0ww`eVer, this wVas the extent of the City's effort to determine if its water ,vas causing the problem. Pare 3 We proceeded at a cost of approximately $15,000 to install in interior sump system in the basement of 15 E. Mountain. That began collecting the water intrusion and discharging it into the paved alley between our building and the federal building. We were hoping that this would diminish the local water table enough to alleviate a smaller such seepage that had begun, about the same time, at our adjoining building to the east, 19 E. Mountain Street, by gathering that part of the subterranean water table which was proximate into the sump. It did not. As a result, we instal led a second sump system at 19 E. Mountain Street for about $10,000. On November 18, 2105, 1 emailed Mark Rogers to tell him that the quantity of water we were collecting and pumping out through the sump kept the City alley between our building and the federal building wet 24/7, and with the onset of cold weather was going to create a hazardous situation when the temperature dropped below freezing. ht response, the City dumped several hundred pounds of salt/chemical on that alley a single time sometime in December. At that point, I contacted you on January 5, 2016, to note that we were requesting signs at either end of the alley to warn of the icy road and hazardous conditions. We never received any response to that, and went through the winter months with a wet and sometimes icy sheet covering that -alley for several hundred feet. Our neighbors Complained to us about the condition of the water on the alley, and we referred them to the City, saying that we did not have a solution. You wrote me an email on March 8, indicating that water on the streets vas not a unique problem, not a legal problem, and that the City administration "must decide how to best use our limited resources for streets and drainage issues citywide.'" As the summer of2016 came upon us, the volume of w atcr entering our basement, regardless of drought outside, wVas significant and persistent, resulting in the alley to our east where our suinps pumped the vwater out remaining not only -wet 24/7, but beginning to get a bit slimy and scummy, creating a traction problem even in w=arm weather, because the alley never dried out. We were evacuating hundreds of gallons a day, from the sumps. On August 2, 2016, 1 emailed Mark Rogers again, noting that the City had not responded to our concerns about the wet alley (freezing or otherwise) with this message: We are now into the very hot, dry months of the year, and Nve are purnpin,7 more water out of our basement onto the alley than ever before. On these 90-deoree-plus days. the alley remains quite wet, more water is being evacuated than can run off and evaporate. I am writing for these reasons: (1) while the city has ostensibly "checked", to see if it is losing Water from its pipes to cause this and determined not, I can`t imagine that an artesian spring, less than 8 feet below the very top surface of the square, is generating thousands of gallons of perched water per week to recharge in underground water table, 24/7/365 ... there simply aren't enough vertical feet or horizontal, space in the tiptop area of the square to catch and hold the amount of water we are pumping out during lengthy periods of time when there is no recharge from rain and surface runoff..I would bet dollars to donuts that the City is losing a lot of seater from broken or leaking pipes in this area. and would sure appreciate it if there were a definitive test that can be run in that regard. [I also noted that we did not find the previous chlorine test determinative, that the constant presence of water was Page 4 allowing moss, mold, and setnaa to grow, slicking ill) the alley-, and that the asphalt patches in the allot seemed to he deteriorating because they were constantly in standing w=ater.] I also contacted all of our adjacent neighbors to see if they had any leakage in their basements— they did not. You replied to myAli gust3 email to R�l�trk Rogers, you asking: i lithe chlorine test,,was determinative and various other questions about hoNv the drainage could be handled. On August 5, 2016, Mark Rogers emailed everybody involved as follows: "We excavated this morning in Mountain Street and found the I" service line leaking, next to the corporation's stop, almost to the city main. We made a repair with copper pipe. The asphalt repair in the street will be completed sometime early in the NN -eek. Jack.. you should see a difference in the runtime of your sump pumps." Within a week. our suaap pumps had stopped running because the sumps had stopped filling; there was still a nominal amount of-,vater in the bottom of the lowest sump, too low to self -trigger the pumps. The water has now receded to a constant level, too low to be pumped 0111 Of the sump. the top of which is about 2 feet below the bottom surface of our floors -and kvhich does not even rise in rails I take from this that there is, indeed, a water table of some kind under our building, that until the City pipe failed in the sutmner of 2015, never accumulated enough water to rise t0. force its way through our floor into our basement. Once the pipe broke, that brought the ground water level to the point that it'vas flooding our basement even in the most prolonged dry spells, which was very aggravated by the least intrusion from rain runoff. Though starting in the summer of 21015 we repeatedly noted to the Cate our suspicions that this was City - generated water, it took the City over a year to take any appropriate corrective action to confirm, much less remedythat, requiring us to invest approximately $25,000 in sumps and 52,000 in cleaning liar the mess the City leakage was making. 1Alhenthe leakage from the city pipes was very promptly and effectively found and remedied in August ofthis year, the (,round water levels under our building have receded to "normal" levels such that they do not intrude into our basement. Its summary, we have incurred about a 527,000 "fix" to zl problem that the City caused. and despite our repeated pleas for help. diel not aptly evaluate or resolve for over a year. Enclosed is the summary of expenses we have paid to resolve this problem, which does not include over 100 man-hours from our own members and staff dealino with flooded office space, wet boxes/furniture/ stuff,. shuttingdown a busy administrative area. and constantly mopping and wet vacuuming the floors and spraying mold inhibitors. Request is made that the City reimburse Davis I.aw Firm in the amount of S26.759.34. Thank you for your attention to this matter. Page 5 Sincerely, DAVIS, CLARK, BUTT, CARITHERS c�!TAYLOR.FLS Jackson Butt II WJBIbr cc with Enc: Firm members n 00,� (40 SIMS � RENNER I N�URAN, is 1' -- -- January 5th, 2017 Davis, Clark, Butt, Carithers, & Taylor, PLC Attention: Jack Butt P.O. Box 1688 Fayetteville, AR 72703 Re- -Insurance — 9/15119 E. Mountain — Hanover-Poiicy #OHT6421715 Mr. Butt, I received your email regarding -the "water issue" at the above property. While water damage resulting from a broken pipe is normally covered under the Business Owners policy form, improvements or betterments to the building are not covered under any insurance policy that I'm aware of. Unfortunately the addition of a pump system would be considered an "improvement or betterment" to the building and would therefore not -be covered by your policy. Please feel free to call me if you have any -questions or would like to discuss this further. - Sincerely, Sims & Renner Insurance Kevin Renner 1280 E. Stearns, Fayetteville, AR 72703 P.O. Box 9903 Fayetteville, AR 72703 Phone (479) 684-4100; facsimile (479) 684-4111 r � 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 Ordinance: 5938 File Number: 2016-0635 AMEND § 39.10 WATER AND WASTEWATER DAMAGE CLAIMS: AN ORDINANCE TO AMEND § 39.10 WATER AND WASTEWATER DAMAGE CLAIMS BY ENACTING A NEW SUBSECTION (4) TO (B) REQUIREMENTS FOR PROPERTY DAMAGE CLAIMS TO BE ELIGIBLE FOR COMPENSATION. WHEREAS, an unusual situation has occurred in which a landowner invested money to protect its property from damage from a suspected leak from a city water line; and WHEREAS; when all usual leak detection methods -could not find a leak, but water still infiltrated the property owner's building, City crews excavated the water main and finally located a leak in the service line close enough to the water main to still be considered the City's responsibility; and WHEREAS, after this line was repaired by the City, the water infiltration problem finally was alleviated; and WHEREAS, the property owner should be able to file a claim now and potentially receive compensation not only for the actual property damage, but for at least some of the costs it invested in sump pumps and their installation costs to control the water infiltration into its building. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1. That the City Council of the City of Fayetteville, Arkansas hereby amends § 39.10 Water and Wastewater Damage Claims by enacting a new (B)(4) as shown below: "§ 39.10(B) (4) When a possible water leak claim has been promptly called to the attention of Water and Sewer staff who initially could not detect or determine the cause of such leak which then caused the property owner to invest in sump pumps and/or other reasonable measures to protect its property, compensation for such property damage prevention efforts may be paid pursuant to this article if a compensable water leak is later Page 1 Printed on 12/21/18 Ordinance: 5938 File Number. 2016-0635 discovered or confirmed by city staff." PASSED and APPROVED on 12/20/2016 A ,..,...,.—i . Page 2 Attest . X,""I" (" Z.//, Sondra E. Smith, City Clerk Trete! w FAYE71 f_v:j 1 r !tom w rr*r"Yr►dl fi!"iS�ti►'"`� PfInted on 12/21/46 4 City of Fayetteville, Arkansas !j Text t rirWt Text File — File Number: 2016-0635 Agenda Date: 12/20/2016 Version: 1 In Control: City Council Meeting Agenda Number: C. 4 AMEND § 39.10 WATER AND WASTEWATER DAMAGE CLAIMS. 113 West Mountain Street Fayetteville, AR 72701 (479) 575-6323 Status: Passed File Type: Ordinance AN ORDINANCE TO AMEND § 39.10 WATER AND WASTEWATER DAMAGE CLAIMS BY ENACTING A NEW SUBSECTION (4) TO (B) REQUIREMENTS FOR PROPERTY DAMAGE CLAIMS TO BE ELIGIBLE FOR COMPENSATION WHEREAS, an unusual situation has occurred in which a landowner invested money to protect its property from damage from a suspected leak from a city water line; and WHEREAS, when all usual leak detection methods could not find a leak, but water still infiltrated the property owner's building, City crews excavated the water main and finally located a leak in the service line close enough to the water main to still be considered the City's responsibility; and WHEREAS, after this line was repaired by the City, the water infiltration problem finally was alleviated; and WHEREAS, the property owner should be able to file a claim now and potentially receive compensation not only for the actual property damage, but for at least some of the costs it invested in sump pumps and their installation costs to control the water infiltration into its building. - NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1. That the City Council of the City of Fayetteville, Arkansas hereby amends § 39.10 Water and Wastewater Damage Claims by enacting a new (B)(4) as shown below: "§ 39.10 (B) (4) When a possible water leak claim has been promptly called to the attention of Water and Sewer staff who initially could not detect or determine the cause of such leak which then caused the property owner to invest in sump pumps and/or other reasonable measures to protect its property, compensation for such property damage prevention efforts may be paid pursuant to this Article if a compensable water leak is later discovered or confirmed by city staff." City of Fayetteville, Arkansas Page 1 Printed on 12/21/2016 Legistar ID No.: d'" t4, -- 0 ("35 AGENDA REQUEST FORM FOR: Council Meeting of December 20, 2016 FROM: City Attorney Kit Williams ORDINANCE OR RESOLUTION TITLE AND SUBJECT: AN ORDINANCE TO AMEND § 39.10 WATER AND WASTEWATER DAMAGE CLAIMS BY ENACTING A NEW SUBSECTION (4) TO (B) REQUIREMENTS FOR PROPERTY DAMAGE.CLAIMS TO BE ELIGIBLE FOR COMPENSATION .APPROVED, FOR AGENDA: F� City Attorney Kit Williams Date OFFICE Or THE CITY ATTORNEY DEPARTMENTAL CORRESPONDENCE TO: Mayor Jordan City Council CC: Don Marr, Chief of Staff Paul Becker, Finance Director Tim Nyander, Utilities Director FROM: Kit Williams, City Attorney `--� DATE: December 5, 2016 Kit Williams City Attorney Blakey Pennington Assistant Cify AtIornry Patti Mulford Pa? f d egcai RE: Proposed Amendment to § 39.10 Water and Wastewater Damage Claims On June 5, 2012, the City Council passed Ordinance- No. 5504 which I had proposed to establish a damage claims procedure concerning "a failure of the municipality owned water or wastewater infrastructure system that results in a trespass into and damages to private property." § 39.10 (A). This section and § 39.11 Damage Claims Other Than Water and Wastewater Damage Claims have worked well over the last four years to provide limited, but reasonable, compensation for property damage to citizens even though the City could deny all compensation because of its sovereign immunity. During this period, a property owner on Mountain Street had suffered water infiltration problems that did not appear tied to rain or weather. Our Water and Sewer maintenance personnel tried to locate a potential leak in the city water main that could cause such a problem. Chlorine tests were run to try to tie this water leak to a city water leak, but those tests failed to establish this was "treated" water. Eventually, the property owner installed sump pumps and did some construction to place these sump pumps where they could catch and pump out this continuing water infiltration. Because this problem would not go away even in times of very dry conditions and because all normal leak detection tests had failed, City Water and Sewer staff cut through the pavement and dug up the water main for visual inspection. This finally revealed a small leak in the service line near the water main. Although most of a service line running to a house or building is the property owner's responsibility, Water and Sewer staff felt the part of the line that was leaking was so close to the city water main that it should still be the City's responsibility and repaired this leak and reburied the main and service line. This action finally solved the continual water infiltration problem. When the property owner sought compensation for its expenditures to purchase and properly install two sump pumps, I informed the property owners that such expenditures appeared outside the allowable "cost of cleaning or repair of the damage." § 39.10 (C) (2). Since the Mayor has expressed his desire to enable the City Council to provide at least some compensation for these expenses, I have drafted a proposed new subsection (B)(4) which under fairly limited circumstances would allow the City Council to compensate a property owner who had to invest in a sump pump because of a city water leak. I have attached the proposed ordinance for your review. This amendment does not mandate or cause any damage claim to be paid. It would authorize some compensation for the costs of sump pumps and their installation if approved by the Water and Wastewater Director (up to $8,000.00) or the City Council (up to $20,000.00). This amendment also would allow compensation even if a formal claim form was not submitted within 30 days because City staff could not detect a leak to justify the property owner submitting a claim form. 7 J ((C �,J 39.10 FAYETTEVILLE CODE OF ORDINANCES TITLE III ADMINISTRATION 39.02-39.09 Reserved ARTICLE II DAMAGE CLAIMS 39.10 Water and Wastewater Damage Claims (A) Establishment of Property Damage Claim Compensation Policy. (1) Without waiving its statutory sovereign immunity, the city establishes the following voluntary policy governing the permissible payment of reasonable compensation for property damage claims proximately caused by a failure of the municipally owned water or wastewater infrastructure system that results in a trespass into and damage to private property. (B) Requirements for Property Damage Claims To Be Eligible for Compensation. (1) The cause of the damage must be directly attributed to a_failure of municipal infrastructure owned and operated by the Fayetteville Water and Wastewater utility, and cannot be associated with or caused by a private sewer or water connection or service line. (2) The failure must not be caused by factors beyond the city's control such as loss of electrical service; flooding of its infrastructure; acts of third parties; failure of claimants to properly maintain protective devices (back flow valves, check valves, clean out caps, etc.); acts of God; and other circumstances beyond the city's control. (3) Aclaim form must be completed in writing and submitted to the Mayor's Office within thirty (30) days of property damage occurrence. Claim forms may be supplemented later with additional information, bills, etc. as allowed by the Utilities Director of the City of Fayetteville. Failure to submit the initial claim form within thirty (30) days of the incident terminates the claimant's opportunity to request compensation. (C) Limitation of Any Compensation That Might Be Paid (1) Because the City of Fayetteville is protected by sovereign immunity, the city shall pay no compensation for any alleged damage associated with or related to any alleged personal injury (except a medical insurance deductible or co -payment) or any other damage except for property damage. (2) Compensation which may be paid for damage to property shall he limited to the cost of cleaning or repair of the damage or, in the event that the cost of cleaning or repair exceeds the fair market value of the subject property, less salvage value, compensation shall be limited to the fair market value of the damaged property less any salvage value. No compensation shall be paid for inconvenience, loss of use, loss of profits or rents, consequential damages, or anything other than cleaning, repair or replacement of property, and, in extreme cases, dislocation expenses not to exceed three (3) days. (3) No payment by the city may accrue to the benefit, directly or indirectly, of an insurance carrier, nor for any damage if such is covered by any insurance policy. If the insurance company waives any subrogation right, the city may pay an amount equal to the CD39:2 FAYETTEVILLE CODE OF ORDINANCES 39.11 TITLE III ADMINISTRATION deductible already paid by the claimant for a property damage claim. Claimants shall be required to provide documents satisfactory to the city establishing their insurance coverage or lack thereof for any claim. (4) The Utilities Department Director may not authorize any payment greater than $8,000.00 for any claim pursuant to this section. The Mayor may request the City Council to authorize an amount greater than $8,000.00 by resolution, but in no case shall the city pay more than $20,000.00 pursuant to this claims procedure for a damage claim related to a water or wastewater utility infrastructure occurrence unless in an extraordinary case the Mayor recommends and the City Council by two-thirds (2/3) majority approves an exemption from the $20,000.00 damage cap and approves a payment up to $40,000.00, (5) This subsection does not pertain to nor affect in any manner the motor vehicle liability insurance requirements of A.C.A. §21-9-303 nor the claims procedure and limitations to comply with that state law. (D) Discretion of the City. (1) The city acting through its Utilities Department Director has complete and sole discretion whether or not to pay any compensation pursuant to this section if the claimant has properly and timely submitted the claim form and all necessary documentation. This section provides no right to compensation for any claimant, nor any right to appeal to the Mayor or City Council - (E) Release Required if Compensation Paid. (1) If the city offers to pay any compensation pursuant to this section, the claimant must sign a full release to receive the compensation offered by the city. (Ord. No. 5504, 6-5-12) 39.11 Damage Claims Other Than Water And Wastewater Damage Claims (A) Establishment of Property Damage Claim Compensation Policy. (1) Without waiving its statutory sovereign immunity, the city establishes the following voluntary policy governing the permissible payment of reasonable compensation for property damage claims (other than water and wastewater) proximately caused by uninsured city vehicles, equipment, infrastructure, or personnel activities. Claims relating to city vehicles which are insured shall be handled by the city's insurance adjustor (currently the Municipal League) except that very small property damage claims may be voluntarily paid by the city if a full release is obtained. (13) Requirements for Property Damage Claims to Be Eligible for Compensation. (1) The cause of the damage must be directly attributed to a malfunction of such uninsured vehicle or equipment, neglect or misuse of such equipment by city personnel, dangerous disrepair of city infrastructure, or other similar situation. CD39:3 l DAvir -s LAW FIRM DAVIS.CIARM.RI)TT. CARITME0.i 6TAYI0M. PIC WWW.DAVis-FIRM.com WRITER'S E-MAIL ADDRESS: JBUTT@DAvis-FIRM.COM February 27, 2017 RE: Davis Law Firm Water Claims Via Hand Delivery Mr. Blake Pennington Assistant City Attorney 302 City Hall 113 W.. Mountain Street Fayetteville, AR 72701 Dear Blake: FAYETTEVILLE + SIDNEY P. DAVIS, JR. CONSTANCE G. CLARK WM. JACKSON BUTT I1 KELLY CARITHERS DON A. TAYLOR CASEY D. LAWSON JOSHUA D. MCFADDEN COLIN M. JOHNSON WILLIAM F. CLARK ANDREW D. CURTIS 'Also Licensed in Oklahoma + Of Counsel SPRINGDALE K. DREW DEVENPORT Returned herewith are three (3) Releases, one each for Davis, Cox & Wright.Building, LLC, Legal Investments, Inc., and Davis, Clark, Butt, Carithers & Taylor, PLC, each of which have been fully -signed and notarized. I look forward to receiving the claim check as approved by the City Council. Thank you for your assistance in this matter. Sincerely, DAVIS, CLARK, BUTT, CARITHERS & TAYLOR, PLC Wm. Jackson Butt II WJB/br Enclosures DAVIS, CLARK, BUTT, CARITHERS & TAYLOR, PLC FAYETTEVILLE LOCATION: P.O. Box 1688 ♦ 19 E. MOUNTAIN ST. ♦ FAYETTEVILLE, AR 727021 PH 479.521.7600 4 FAX 479.521.7661 SPRINGDALE LOCATION: 1712 W. SUNSET AVE., STE. E ♦ SPRINGDALE, AR 72762 ♦ PH 479.717.2278 4 FAx 479.717.2302 RELEASE OF ALL CLAIMS KNOW ALL MEN BY THESE PRESENTS: The undersigned does hereby acknowledge the payment of Twenty Six Thousand Seven Hundred Fifty Nine Dollars and Thirty Four Cents ($26,759.34) to Davis, Clark, Butt, Carithers & Taylor, PLC, which is accepted in full compromise, settlement and satisfaction of, and as sole consideration for, the final release and discharge of all actions, claims and demands whatsoever that now exist or may hereafter accrue against the City of Fayetteville, a municipal corporation, and the elected officials and employees thereof, charged or who or which may be charged with responsibility for injuries to the person and property of the undersigned, the treatment thereof, and all consequences flowing therefrom, as a result of an accident, casualty or event which occurred on or about the 19"' day of May, 2015 through the 5'' day of August, 2016, resulting in alleged flooding, property damage and remediation costs, at or near 15 East Mountain Street, in the city of Fayetteville, Arkansas, and for which the undersigned claims the above-named parties are legally liable in damages (which legal liability and damages are disputed and denied), and acknowledging that nothing herein shall be construed to alter, limit or otherwise compromise that immunity afforded the City of Fayetteville under the Constitution and Statutes of the State of Arkansas, and; The undersigned warrants that no promise or inducement has been offered except as herein set forth; that this Release is executed without reliance upon any statement or representation by the party or parties released or their representatives or physicians concerning the nature and extent of any injuries or damages or legal liability therefor; that the undersigned is of legal age, is competent to execute this Release, and accepts full responsibility therefor, and; The undersigned agrees, as further consideration and inducement for this compromise and settlement, that it shall apply to all known, unknown and unanticipated injuries and damages resulting from said accident, casualty or event, as well as to those now asserted and disclosed. Witness my hand this -3 � day of 2017. DAVIS, COX & WRIGHT BUILDING, LLC By: Name: jr, `/ Title:,` . E 7S' ACKNOWLEDGMENT STATE OF ARKANSAS ) COUNTY OF WASHINGTON ) On this the a3pd day ofLM&LAh,2017, before me, a Notary Public, personally appeared personally, appea who stated that he/she is the t of Davis;.Cox & Wright Building, LLC, and known to me to be the person whose .nam` . Is; ubscribed to the, foregoing ;instrument and acknowledged that she executed the same for the purposes therein contained. In witness whereof I hereunto set my hand and official seal. My commission expires: SEALOFFICIAL SEAL BRENDA REYNOLDS NOTARY PUBLIC, ARKANSAS WASHINGTON COUNTY COMMISSION #12348417 COMMISSION EXP. 07/25/2026 tl 1 Notary Public RELEASE OF ALL CLAIMS KNOW ALL MEN BY THESE PRESENTS: The undersigned does hereby acknowledge the payment of Twenty Six Thousand Seven Hundred Fifty Nine Dollars and Thirty Four Cents ($26,759.34) to Davis, Clark, Butt, Carithers & Taylor, PLC, which is accepted in full compromise, settlement and satisfaction of, and as sole consideration for, the final release and discharge of all actions, claims and demands whatsoever that now exist or may hereafter accrue against the City of Fayetteville, a municipal corporation, and the elected officials and employees thereof, charged or who or which may be charged with responsibility for injuries to the person and property of the undersigned, the treatment thereof, and all consequences flowing therefrom, as a result of an accident, casualty or event which occurred on or about the 19d' day of May, 2015 through the 5' day of August, 2016, resulting in alleged flooding, property damage and remediation costs, at or near 19 East Mountain Street, in the city of Fayetteville, Arkansas, and for which the undersigned claims the above-named parties are legally liable in damages (which legal liability and damages are disputed and denied), and acknowledging that nothing herein shall be construed to alter, limit or otherwise compromise that immunity afforded the City of Fayetteville under the Constitution and Statutes of the State of Arkansas, and; The undersigned warrants that no promise or inducement has been offered except as herein set forth; that this Release is executed without reliance upon any statement or representation by the party or parties released or their representatives or physicians concerning the nature and extent of any injuries or damages or legal liability therefor; that the undersigned is of legal age, is competent to execute this Release, and accepts full responsibility therefor, and; The undersigned agrees, as further consideration and inducement for this compromise and settlement, that it shall apply to all known, unknown and unanticipated injuries and damages resulting from said accident, casualty or event, as well as to those now asserted and disclosed. Witness my hand this 0X3 —, day of 2017. ,71 LEGAL INVESTMENTS, INC. LIM ACKNOWLEDGMENT STATE OF ARKANSAS COUNTY OF WASHINGTON ) On this the —� day of 2017, before me, a Notary Public, ,personally appeared personally .appea& hukt Zho stated that he/she is the of Legal .Investments, Inc., and known to me to be the person whose name is sub"sC ;to the foregoing instrument and acknowledged that she executed the same for the purposes therein contained. In witness whereof I hereunto set my hand. and official seal. My commission expires: OFFICIAL.SEAL BRENDAREYNOLDS Notary Public SEAL NOTARYIPUSUC,ARKANSAS WASHINGTON.COUNTY COMMISSION #12349417 COMMISSION EXP. 07/25/2026 n RELEASE OF ALL CLAIMS KNOW ALL MEN BY THESE PRESENTS: The undersigned does hereby acknowledge the receipt of Twenty Six Thousand Seven Hundred Fifty Nine Dollars and Thirty Four Cents ($26,759.34), which sum is accepted in full compromise, settlement and satisfaction of, and as sole consideration for, the final release and discharge of all actions, claims and demands whatsoever that now exist or may hereafter accrue against :the City of Fayetteville, a municipal corporation; and "the elected officials, and employees thereof,, charged or who or which may be charged with responsibility for injuries to the person "and property of the undersigned, the treatment thereof, and all .consequences flowing therefrom, as a result of an accident, casualty or event which occurred on or about the 19'h day of May, 2015 through the 5` day of August, 2016, resulting in alleged flooding, property, damage and remediation: ;costs, at :or near 15 and 19 East Mountain Street, in the city of Fayetteville, Arkansas; and for which -the.;undersigned claims the above-named parties are legally liable in damages (which Iegal liability and damages are disputed and denied), and acknowledging that nothing :herein shall be construed to alter, limit or otherwise compromise that immunity afforded the City of Fayetteville under the Constitution and Statutes of the State of Arkansas, and; The undersigned warrants that no promise or inducement has been offered except as herein set forth; that this Release is executed without reliance upon :any statement or representation by the party or parties, released or their representatives or physicians concerning.the nature. and extent °ofany 'injuiies or damages or legal liability therefor; that the undersigned is of .legal age, is cor ipetent'to execute this Release, and accepts full responsibility therefor, and; The undersigned agrees, as further consideration and inducement for this compromise and settlement, that it shall apply to all known, unknown and unanticipated injuries and damages resulting from said accident, casualty or event, as well as to those now asserted and disclosed. Witness my hand this 023!1 day of 2017. DAVIS, CLARK, BUTT, CARITHERS & TAYLOR, PLC By: Name: y -/ _A a J.:c.. Title: aG (ti S ACKNOWLEDGMENT STATE OF ARKANSAS ) COUNTY OF WASHINGTON ) On this the 3Yd day ofJ 2017, before me, a Notary Public, personally a peered personally appia who stated that he/she is, the ' of Davis,.Clark, Butt, Carithers & Taylor, PLC and known to me to be the person whose,n, a -is subscribed to the foregoing instrument and acknowledged that she executed the same for the purposes therein contained. In witness whereof I hereunto set my hand and official seal. My commission expires: —11a5>11z-4Q OFFICIALS AL NO PUbI1C SEAL BRENDAREYNOLDS Notary NOTARY PUBLIC, ARKANSAS WASHINGTON COUNTY COMMISSION #12349417 COMMISSION EXP. 0712512028