Difference between revisions of "643.1 Utilities - Status and Liability Acceptance"

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Revision as of 10:14, 19 November 2008

Utility Status Letter

643.1.1 Introduction

Construction of and improvements made to the state highway system require negotiations with various utility companies (including cities and railroads) for right of way, construction easements, and adjustments that may be required to their facilities to eliminate conflicts with the proposed highway improvement. These negotiations must also comply with MHTC policy.

643.1.1.1 Responsibility

It is the responsibility of district personnel to negotiate with local utility companies, cross-state pipelines and other interstate utility facilities for right of way, easements, and adjustment agreements. Design personnel are readily available to assist with these negotiations.

643.1.1.2 Utility Status

The District Utilities Engineer will write a Utility Status Letter for every project that requires the adjustment of utilities. This status will be provided to the Project Manager for inclusion with submittal of the final plans to Design.

All projects must be cleared prior to a monthly Bid Opening. The Transportation Project Manager must submit the Utility Status Letter to the Design Division at least 10 weeks prior to the bid opening date. Utilities “clear” is defined as:

  1. All utilities are physically adjusted on the project. Or,
  2. Utility construction work is active and has been completed to such a point that no impact would be expected to the road contractor. The status of the work is given in the utility job special provision. Or,
  3. Utilities are not expected to be adjusted by the notice to proceed date for the road project, but the utility work will have no impact on the progress of the road contractors work. Or,
  4. Utilities must be adjusted after the road contractor completes stage construction. A job special provision, reviewed by Chief Counsel’s office, must be included in the bid proposal to properly advise bidders. Or,
  5. Utility adjustments, plans and specifications, are included in the bid documents for the road project. A utility agreement (UT4) must be executed.

643.1.1.3 Liability Acceptance Procedure

MHTC accepts additional risk of liability when any of the following occur:

  • MHTC agrees to indemnify or save harmless another party
  • The standard indemnification clause is not included in an agreement
  • MHTC accepts less than a warranty deed or permanent easement for property conveyed from another party
  • A project is awarded to a contractor before clearance of the utilities is obtained.

Generally, MHTC will not accept another party’s liability. The standard indemnification language must appear in all agreements and permits when there is a possibility MHTC could be liable for an injury or loss caused by another party. The standard indemnification language is notice to a contractor or other person working on MHTC property of the requirement to indemnify and save harmless MHTC from any damages that may result from their actions.

It is important to consider the risk of potential liabilities for MHTC in all agreements. A valuable tool in this effort is the use of standard utility agreements developed by the chief counsel’s office (CCO) in an approved format.

The following procedure will be followed when a division or district recommends MHTC accept additional risk for additional liability:

  1. The division engineer or district engineer submits a request to the chief counsel a minimum of 60 working days prior to the date a reply is required with a copy of the draft agreement, permit, job special provision, request for proposal or other document indicating the reason(s) the division or district wants MHTC to accept additional liability. The request must include an issue statement assessing the pros and cons of the risks to be accepted, including an estimate of the potential costs and savings from proposal. When the district engineer submits the request, the appropriate division engineer must be aware of the request to assure they concur.
  2. CCO will review the request and provide written comments, including its assessment of the risks to the appropriate division engineer and district engineer within 5 working days.
  3. The division engineer or district engineer will submit a written request to the appropriate director together with the CCO comments within 5 working days.
  4. The director will forward the request, CCO comments, and their recommendations to either the chief engineer or chief financial officer, as appropriate, for their approval or disapproval within 5 working days.
  5. The chief engineer or chief financial officer will act on the request within 5 working days and return it to the appropriate director who will in turn return it to the appropriate division engineer or district engineer with a copy to CCO.
  6. The division engineer or chief counsel has the right to appeal the decision to the department director within 5 working days.
  7. The department director will rule on the appeal within 5 working days.
  8. If after appeal, the chief counsel is still not in agreement with the department director’s decision, they will advise the department director in writing within 5 working days and have the opportunity to present the issue to MHTC for consideration at the next available MHTC meeting.
  9. The department director will not implement the request for waiver until after the next MHTC meeting in order to allow the chief counsel to present the issue to MHTC for final decision.

Compliance with this mandatory procedure will expedite completion of projects and minimize the risk a project will be delayed by untimely consideration of liability issues.