Bill S6844A-2009

Relates to contracts for public work project and accommodation of private facilities or structures; and providing for the repeal of such provisions upon expiration

Relates to contracts for public work projects and accommodation of private facilities or structures within a specified area of New York county; and providing for the repeal of such provisions upon expiration thereof.

Details

Actions

  • Aug 30, 2010: SIGNED CHAP.469
  • Aug 18, 2010: DELIVERED TO GOVERNOR
  • Jun 30, 2010: returned to senate
  • Jun 30, 2010: passed assembly
  • Jun 30, 2010: ordered to third reading rules cal.476
  • Jun 30, 2010: substituted for a8821a
  • Jun 10, 2010: referred to local governments
  • Jun 10, 2010: DELIVERED TO ASSEMBLY
  • Jun 10, 2010: PASSED SENATE
  • May 10, 2010: AMENDED ON THIRD READING (T) 6844A
  • May 3, 2010: ADVANCED TO THIRD READING
  • Apr 28, 2010: 2ND REPORT CAL.
  • Apr 27, 2010: 1ST REPORT CAL.426
  • Feb 24, 2010: COMMITTEE DISCHARGED AND COMMITTED TO CITIES
  • Feb 12, 2010: REFERRED TO LOCAL GOVERNMENT

Votes

Memo

 BILL NUMBER:  S6844A

TITLE OF BILL :

An act to amend the general municipal law, in relation to contracts for public work projects and accommodation of private facilities or structures, in connection with the water tunnel capital program of the city of New York within a specified area of New York county; and providing for the repeal of such provisions upon expiration thereof

SUMMARY OF PROVISIONS :

This bill amends General Municipal Law §103 to authorize the City of New York to include in a contract for any public work project relating to or in furtherance of the City's water tunnel capital program within the area of New York county south of and including 72nd Street any work deemed necessary or desirable to maintain, support, protect or otherwise accommodate, energy, telecommunications and other private facilities or structures not owned by the municipality which are located within, traversing or adjacent to the construction area of such project. The bill permits the public agency to award a contract to the lowest responsible bidder for all of the work, including the utility interference work, with the proviso that if the cost of the agency work is more than twenty percent below the average of the next two lowest bids, the new authorization would not apply. The bill also provides that the costs of utility interference work shall not be borne by the municipality, but leaves intact the provisions for allocation of costs involving certain gas facilities as provided for in Chapter 357 of the Laws of 1988 (Gas Facility Cost Allocation Act), as well as the provisions that apply to projects subject to the Coordinated Construction Act for Lower Manhattan (Chapter 259 of the Laws of 2004, as amended). If the utility interference work is included in the agency contract, the agency would monitor and, to the extent necessary, participate in resolution of disputes between the contractor and the utility. The bill would apply notwithstanding any inconsistent laws, including section 103 of the General Municipal Law. Applicable provisions of section 103 that are not inconsistent with this bill would continue to govern. The bill would expire on December 31, 2014 but would apply to contracts advertised or otherwise formally solicited before that date.

REASONS FOR SUPPORT :

Public rights of way generally contain not only municipally-owned utility services like water mains and sewers but also utility lines for the transmission of energy and telecommunications. These private facilities often must be moved or protected in order for the municipal work to proceed. The municipal work can be delayed or stopped if the utility is required to negotiate the price of protecting or moving the utility facility with the contractor for the municipal work or, locate another contractor to do the work. Because bringing in a second contractor is costly and time consuming, negotiations often stall when the DE FACTO monopoly position of the municipal contractor leads to prices that the utility believes to be far in excess of the value of the work. Delay of the municipal work not only adversely affects the public at large but also has a significant impact on local businesses.

In an effort to reduce the inconvenience resulting from construction delays as a result of utility interference work, in 1992 the City of New York began the practice of "joint bidding." This practice required bidders to provide, within a single bid, separate prices for the municipal work and the private utility work, with the contract awarded to the lowest responsible bidder for the combined work. The utilities, by separate agreement, reimbursed the City for the additional cost of the City's share of the overall low bid if the low bidder on the municipal work was not the same as the low bidder on the combined work. Thus, the cost to the City was never more than the lowest bid for the municipal work. Taxpayers therefore benefited from the conveniences of joint bidding at no additional cost.

The City's joint bidding practices ended in 1998, however, when a contractor who had bid the lowest price for the municipal portion of a project, was not awarded the contract because its bid was not the lowest bid overall, challenged the City's practice of joint bidding. The Court of Appeals determined that private utility interference work is not "public work" and cannot be included in a contract for municipal work bid pursuant to General Municipal Law §103 unless specifically authorized by the Legislature. SEE DIAMOND ASPHALT V. SANDER, 92 NY2D 244 (1998) .ct.

The State Legislature recognized the value of appropriate joint bidding arrangements when it authorized them in the Coordinated Construction Act for Lower Manhattan (Chapter 259 of the Laws of 2004, as amended by Chapter 231 of the Laws of 2004). The provision in this bill is modeled upon section 4(d) of that Act. By enacting the Act, the Legislature sought to ensure a productive revitalization process for the area of New York City devastated by the events of September 11, 2001. In recognition of that goal, the Legislature expressly stated in section 1 that the purpose of the Act was to promote the fast, safe and fair redevelopment of lower Manhattan. To date, the City of New York has awarded four contracts under the Act and these projects are currently under construction. Moreover, on more than twenty other contracts let prior to DIAMOND ASPHALT V. SANDER , experience has shown that jointly-bid contracts establish more reasonable prices for utility interference work and speed street construction jobs, thereby reducing the adverse impact on the public and local businesses. In addition, they do not inflate the costs of the municipal work.

Currently, the revitalization of lower Manhattan is directly benefiting from the projects in construction and these projects include Beekman Street, Harrison Street, Liberty Street, and Fulton Street. The Beekman Street project is the furthest along in construction and has shown significant savings in time by reducing, if not altogether eliminating, delays from work to be performed in the street. Furthermore, having the City include the utilities' work in a single contract has resulted in better coordination and scheduling of all work by reducing or eliminating days when no work is performed as the contractor and a utility argue over a scope of work item; this results in a savings of time for the overall project. Having the utility work included in one contract has benefited the City in that the utilities are now paying their respective shares of costs that the City used to bear when the projects were delayed while the utility and contractor negotiated. Finally, by having a single entity - the City manage the job, with the utilities creating a special office to deal with these contracts, the joint bidding arrangement is more efficient in resolving issues in the field. This centralization of accountability is more likely to result in an on or ahead of schedule completion date. The bottom line outcome is that projects bid with joint bids minimize disruption to the community and return the affected streets to the residents and businesses faster than projects that do not utilize this approach. This experience was reflected by projects in the City that benefited from joint bidding before the Court of Appeals decision, including Columbus Avenue in Manhattan, 9th Street and Tompkins Avenue in Brooklyn, Booth Memorial Avenue and Baisley Boulevard in Queens, and the Carpenter Avenue area of the Bronx. Conversely, projects such as Hudson Street, Boston Road and Queens Village did not include joint bidding and were subject to significant construction delays due to utility interference work.

The City of New York has initiated plans for infrastructure improvements that involve work related to the construction of the City's third water tunnel, which includes the construction of the trunk water mains, water regulation distribution systems and sewers, and their connection to the shafts. Limited use of the third water tunnel, a critical public project that has been the focus of many years of great expense and effort, cannot begin until this work is completed. The work, which will take place in many locations in Manhattan south of 72nd Street, includes engineering challenges that involve key transportation access points, such as tunnels, including the Holland Tunnel, Mid-town Tunnel, and Lincoln Tunnel, and bridges, including the 59th Street Bridge. The work further includes main areas of business and tourist attractions such as Lincoln Center and Times Square. In addition, the work involves intersections that are already congested, as well as side streets that support these access points. Furthermore, in a post-September 11, 2001 environment, there are security concerns involving the locations of the projects and it is essential that these sites and adjoining areas are built in the most efficient and safest way possible. By enabling the City of New York to invite bids for both the municipal work and the necessary utility work on a joint basis for these projects, this bill will achieve the goal of completing the work fast and safely.

Enactment of this legislation would enable the City of New York to obtain reimbursement for the cost of the work, in relation to critical water tunnel related projects within the specified area, from the utilities so that there will be no negative cost impact to the public agency for jointly bidding work; to the extent that the cost of the utility interference work is reasonable, utility customers, including residents and businesses, will benefit. Further, the great inconvenience to the public and local businesses caused when streets are opened in furtherance of these projects will be minimized as a result of the shortened duration of the construction.

EFFECTIVE DATE : This act shall take effect immediately, and shall apply to contracts entered into or otherwise formally solicited on or after such effective date; provided that this act shall expire and be deemed repealed December 31, 2014; and provided further, that this act shall also apply to any contract to which this act would otherwise apply that has been advertised or otherwise formally solicited on or after the effective date of this act and on or before December 31, 2014.

Text

STATE OF NEW YORK ________________________________________________________________________ 6844--A Cal. No. 426 IN SENATE February 12, 2010 ___________
Introduced by Sens. HUNTLEY, SQUADRON -- read twice and ordered printed, and when printed to be committed to the Committee on Local Government -- reported favorably from said committee and committed to the Commit- tee on Cities -- reported favorably from said committee, ordered to first and second report, ordered to a third reading, amended and ordered reprinted, retaining its place in the order of third reading AN ACT to amend the general municipal law, in relation to contracts for public work projects and accommodation of private facilities or struc- tures, in connection with the water tunnel capital program of the city of New York within a specified area of New York county; and providing for the repeal of such provisions upon expiration thereof THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Section 103 of the general municipal law is amended by adding a new subdivision 13 to read as follows: 13. NOTWITHSTANDING ANY PROVISION OF LAW TO THE CONTRARY, TO FACILI- TATE THE TIMELY AND COST EFFECTIVE COMPLETION OF UTILITY WORK WITHIN THE AREA OF NEW YORK COUNTY SOUTH OF A LINE BEGINNING AT A POINT WHERE THE UNITED STATES PIERHEAD LINE IN THE HUDSON RIVER AS IT EXISTS NOW OR MAY BE EXTENDED WOULD INTERSECT WITH THE NORTHERLY LINE OF WEST 72ND STREET EXTENDED, THENCE EASTERLY ALONG THE NORTHERLY SIDE OF WEST 72ND STREET TO CENTRAL PARK, THENCE EASTERLY THROUGH CENTRAL PARK ALONG A LINE EXTENDING FROM THE NORTHERLY SIDE OF WEST 72ND STREET TO THE NORTHERLY SIDE OF EAST 72ND STREET, THENCE EASTERLY ALONG THE NORTHERLY SIDE OF EAST 72ND STREET TO THE POINT WHERE IT WOULD INTERSECT WITH THE UNITED STATES PIERHEAD LINE IN THE EAST RIVER AS IT EXISTS NOW OR MAY BE EXTENDED, INCLUDING TAX LOTS WITHIN OR IMMEDIATELY ADJACENT THERETO, ALL CONTRACTS FOR A PUBLIC WORK PROJECT THAT RELATE TO OR ARE IN FURTHERANCE OF THE WATER TUNNEL CAPITAL PROGRAM OF SUCH CITY WITHIN SUCH AREA MAY INCLUDE WORK THAT THE CONTRACTING AGENCY OF SUCH CITY DEEMS NECESSARY OR DESIRABLE FOR THE COMPLETION OF SUCH PROJECT THAT REQUIRES THE MAINTE- NANCE, SUPPORT, PROTECTION OR OTHER ACCOMMODATION OF ENERGY, TELECOMMU- NICATIONS OR OTHER PRIVATE FACILITIES OR STRUCTURES NOT PUBLICLY OWNED WHICH ARE LOCATED WITHIN, TRAVERSING OR ADJACENT TO THE CONSTRUCTION
AREA OF SUCH PROJECT, WHETHER ABOVE, BELOW OR AT GROUND LEVEL, INCLUDING THE REMOVAL, RELOCATION, ALTERATION, REPLACEMENT, RECONSTRUCTION OR IMPROVEMENT OF SUCH FACILITIES OR STRUCTURES, PROVIDED THAT: (I) THE COSTS OF WORK PERFORMED PURSUANT TO THIS SUBDIVISION, INCLUDING ANY INCREMENTAL OR ADMINISTRATIVE COSTS ATTRIBUTABLE TO SUCH WORK, SHALL NOT BE BORNE BY SUCH AGENCY EXCEPT AS OTHERWISE PROVIDED BY CHAPTER THREE HUNDRED FIFTY-SEVEN OF THE LAWS OF NINETEEN HUNDRED EIGHTY-EIGHT; AND (II) ANY LOWER MANHATTAN REDEVELOPMENT PROJECT, AS DEFINED IN SECTION THREE OF CHAPTER TWO HUNDRED FIFTY-NINE OF THE LAWS OF TWO THOUSAND FOUR, KNOWN AS THE COORDINATED CONSTRUCTION ACT FOR LOWER MANHATTAN, AS AMENDED, SHALL BE GOVERNED BY SUCH ACT WHILE SUCH ACT REMAINS IN EFFECT. IF SUCH AGENCY INCLUDES SUCH WORK IN A CONTRACT PURSUANT TO THIS SUBDI- VISION, SUCH AGENCY SHALL AWARD THE CONTRACT TO THE LOWEST RESPONSIBLE BIDDER BASED UPON THE COMBINED COST OF THE PUBLIC WORK AND THE UTILITY WORK AND SUCH AGENCY SHALL BE REIMBURSED BY THE ENTITY RESPONSIBLE FOR THE UTILITY WORK FOR ANY INCREMENTAL OR ADMINISTRATIVE COST INCREASE IN AN AMOUNT EQUAL TO THE DIFFERENCE BETWEEN THE COST OF THE AGENCY WORK OF THE OVERALL LOW BIDDER AND THE COST OF THE AGENCY WORK OF THE LOWEST BIDDER FOR THE AGENCY WORK ALONE. HOWEVER, IF THE COST OF THE AGENCY WORK OF THE LOWEST BIDDER FOR THE AGENCY WORK ALONE IS MORE THAN TWENTY PERCENT BELOW THE AVERAGE OF THE NEXT TWO LOWEST BIDS FOR THE AGENCY WORK, THEN THE AGENCY SHALL AWARD THE CONTRACT TO THE LOWEST RESPONSIBLE BIDDER FOR THE AGENCY WORK ALONE. IN THE EVENT THAT THE UTILITY WORK IS INCLUDED IN SUCH AGENCY'S CONTRACT PURSUANT TO THIS SUBDIVISION, SUCH AGENCY SHALL MONITOR AND, TO THE EXTENT NECESSARY, PARTICIPATE IN DISPUTE RESOLUTION BETWEEN THE CONTRACTOR AND THE ENTITY RESPONSIBLE FOR THE UTILITY WORK. IN THE EVENT THAT THE UTILITY WORK IS NOT INCLUDED IN SUCH AGENCY'S CONTRACT, NOTHING IN THIS SUBDIVISION SHALL PREVENT SUCH AGENCY FROM INCLUDING PROVISIONS IN ITS CONTRACTS REQUIRING CONTRACTORS TO ENGAGE IN ALTERNATE METHODS OF DISPUTE RESOLUTION REGARDING UTILITY WORK. S 2. This act shall take effect immediately, and shall apply to contracts entered into or otherwise formally solicited on or after such effective date; provided that this act shall expire and be deemed repealed December 31, 2014; and provided further, that this act shall also apply to any contract to which this act would otherwise apply that has been advertised or otherwise formally solicited on or after the effective date of this act and on or before December 31, 2014.

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