ST9302-CL010118DATE;
TO:
FROM:
RE:
Jalluary 18, 2001
Jim Witt, City Manager
Clay Phillips, Deputy City Manager ~J3
Claims on Damaged Residential Irrigation Systems
This memo is being written up as a follow-up to the conversations we have had regarding the
damage that resulted from the "brown water" incident that occurred during this past summer in
relation to the construction of Sandy Lake Road. At the time of the incident the City determined
that we should ensure that any individual homeowner did not incur cost as a result of the actions
of the contractor working on the project. It was thought that the eommemr or one of their sub-
contractors would, through their own insurance company, cover the claims that we received
regarding this incident.
That practice was followed for a period of time, but now has been halted by the insurance
company of the sub-contractor that constructed the waterline. They have indicated that they will
no longer be paying claims resulting from that incident. They based this decision on the fact that
the City is immune from such claims from a legal standpoint and working as a contractor to the
City they are therefore also immune. In conversations with Attorney Robert Hager, he generally
agrees with that assessment. Therefore it appears that there may be no further action short of
litigation that could be taken against either the contractor or the sub-contractor. Having said that,
it does appear that the City should continue to stand behind its pledge to ensure that homeowners
are not damaged by this incident.
Attached you will find a list of claims to date, along with an estimated dollar amount for repair.
R appears that total claims yet to be paid total less than $5,302.49 dollars to completely make
these individual homeowners whole. We will continue to process these claims and make
payment to the homeowners who can successfully prove that the damage occurred as a result of
the incident in question.
If you would like for us to proceed in a different fashion please let me know. None of these
claims have been processed for payment by the City to date. I have visited with both Ken Griffin
and Vivyon Bowman regarding this matter, and this is the process they have anticipated
following as well. Just let me know if you need any additional information.
CP/sh
Attachment