Motor City Electric Submits Low Bid on Fire Protection System Upgrade, Contract PC-782

Motor City Electric submitted the low bid on December 12, 2012 for the project known as "Plant-Wide Fire Alarm and Fire Protection System Upgrade and Integration," DWSD Contract No. PC-782. 

There were three bidders on this project. Here are the as-read bids:

1. Motor City Electric . . . . .  $5,749,000
2. Shaw Electric . . . . . . . . . . $5,942,725
3. Bayview Electric . . . . . . .  $7,290,319

The work under Contract PC-782 contract includes:

• Supply and install new fire alarm systems (FAS) and upgrade the existing FAS for numerous buildings at the Detroit Wastewater Treatment Plant (WWTP), the Detroit Marine Terminal (DMT) site and the Water Board Building (WBB).
• Replace all existing, non-functional FAS devices to ensure a fully functional FAS.
• Integrate the new and existing FAS of all relevant buildings and bring all points to two central on-site locations at the Detroit WWTP and one off-site location at the WBB.

Click here for a copy of the Bid Notice. 

For more about DWSD Update, click here. 

Joint Venture Submits Low Bid on Water System Improvements Contract, WS-648A

Executive Construction Mgmt. Co/NQN Contracting, Joint Venture, submitted the low bid on December 11, 2012 for the project known as DWSD Contract WS-648A, "Water System Improvements: Various Streets Throughout the City of Detroit."

Here are the as-read bids. Equalization will not affect the outcome of this bid.

1. ECM Co/NQN Contracting, JV . . . . $3,692,100
2. Imperial Construction Co. . . .  $4,336,423
3. Major Cement Company . . . . . $5,235,930
4. RBV Contracting, Inc. . . . . . . .  $5,754,589
5. Blaze Contracting, Inc. . . . . . .  $5,792,000
6. Willie McCormick Co. . . . . . .  $5,932,757
7. Pamar Enterprises, Inc. . . . . .  $6,176,266
8. Lawrence M. Clark, Inc. . . . . .  $6,178,641
9. Ric-Man Detroit, Inc. . . . . . . .  $9,181,373 

Comment: Its good to see a lot of bidders on this job, including a number of new faces. Competition is a good thing. However, the low bidder appears to be quite low. $644,323 is an awful lot of money to leave on the table, and that's assuming Imperial has a good number. Even they look pretty low.   

For more about DWSD Update, click here.

EPA, MDEQ Submit Joint Statement to Court following Review of Restructuring Plan

On December 3, 2012, the U.S. Environmental Protection Agency (EPA), along the Michigan Department of Environmental Quality (MDEQ), filed a Joint Statement(*) with U.S. District Judge Sean Cox to report on their review of DWSD's restructuring plans. This report follows the EPA's October 12th request for time to review the EMA plan.

In their Joint Statement, the EPA and MDEQ explained that while EMA's proposal is outside of their normal jurisdiction and area of expertise, "because EMA's Proposal was raised in DWSD's Motion for an Interim Order, EPA and MDEQ reviewed [it] to assess whether an aspects of it appear likely to affect DWSD's compliance with its NPDES permit and the Clean Water Act ("CWA), 33 USC 1251, et seq." 

Its not surprising, then, that the one aspect of the EMA plan that attracted negative attention was the planned 75% reduction of staff within the wastewater operations group (WWOG) headed by Assistant Director Sam Smalley:   

At this time, EPA and MDEQ take no position on the appropriateness of EMA’s Proposal. However, EPA and MDEQ have identified one aspect of the Proposal that, if implemented as written, could have a negative impact on CWA compliance: the significant projected reductions in staffing levels within DWSD’s wastewater operations group (“WWOG”). DWSD informs EPA and MDEQ that the WWOG currently has over 600 employees. By contrast, after implementation of all recommended actions, EMA’s Proposal projects fewer than 150 WWOG employees.   In discussions with EPA and MDEQ, DWSD managers indicated that EMA’s projected staffing levels have not been adopted by DWSD and are only projections, not a plan. DWSD represented that it intends to move forward with EMA’s proposed staffing actions (i.e., job classification redesign, team training, etc.) in a step-by-step, piloted manner, with time to evaluate and adjust as necessary. DWSD further represented that no recommended actions would be implemented that threatened safety or compliance. 

Safeguards already in place should help to minimize the risk that reductions in WWOG staffing levels might undermine DWSD’s ability to comply with its NPDES permit and the CW A: [4 bullet points omitted]

At this time, EPA and MDEQ have not identified a basis for seeking relief concerning DWSD's consideration of EMA's Proposal. EPA and MDEQ will continue to monitor WWOC staffing levels through the ACO already in place. [FN4 - Below] 

Because the extent to which specific elements of the Proposal will be implemented remains to be determined and because EMA’s recommendations and DWSD’s actions in the future may change, EPA and MDEQ reserve their right to review future developments to ensure continuing CWA compliance.

By conducting this review and continuing to monitor the situation, EPA and MDEQ do not intend to impair DWSD’s efforts to undertake appropriate reorganization, automation, and/or technology and control systems upgrades that DWSD may deem necessary to improve  efficiency, control costs, and address DWSD’s need for long-term strategic and financial planning. 

The EPA and MDEQ also acknowledged the firestorm controversy surrounding the EMA Proposal, but report that they are not inclined to interfere with DWSD's plans, for now, so long as there is compliance with the Clean Water Act.  

FN4 -- The United States and Michigan are aware that, on November 20, 2012, the Detroit CityCouncil rejected a part of the EMA Proposal that called for a $48 million contract between EMA and DWSD. We also are aware that DWSD recently proceeded with a smaller EMA contract involving job classification redesign, training, and implementation. There have been suggestions that EPA and/or MDEQ should take a position on the $48 million EMA contract (for example, by approving or disapproving it). While the United States and Michigan reserve the right to take all actions necessary to ensure compliance with the Clean Water Act and any other applicable federal or state laws, we are not aware, at this time, of any reason why the United States and Michigan would assert authority to approve or disapprove any contract between DWSD and EMA.  

(*) For readers with a PACER Account, the EPA and MDEQ's Joint Statement was filed 12/3/12 in Case No. 2:77-cv-71100-SFC at Dkt #2509. If you're interested in a copy, I'd be glad to e-mail it to you. Just write me and put "Joint Statement" in the reference field. While the statement itself is only 5 pages, there's an additional 85 pages of exhibits, including the Administrative Consent Order [7/8/2011] and First Amended Administrative Consent Order [5/18/2012]. The entire document is about 7MB. It should be available through Scribd within a few days. 

For more about DWSD Update, click here. 

Inland Waters Settle Claims and Pending Litigation with Detroit, Cleared to Bid New Work (UPDATED)

Late Wednesday [11/28], the Detroit Water and Sewerage Department announced in a press release (here), that it had agreed to settle all pending claims and litigation against Inland Waters Pollution Control, Inland Management, Inc., and Inland Pipe Rehabilitation, LLC for $4.5 million. 

Inland, in a separate statement released on November 27th, reported that the $4.5 settlement with the Department resolved claims that were in excess of $380 million. 

Inland Waters, Inland Management, and Inland Pipe Rehabilitation were among 13 contractors originally suspended by the Board of Water Commissioners on December 21, 2011. The Board reversed itself three weeks later on January 11, 2012, and lifted the suspension on 5 of the 13 contractors, including Inland Waters Pollution Control, Inc. 

Inland Waters is still one of over three dozen Defendants in a federal lawsuit filed on July 18, 2011 by the Macomb Interceptor Drain Drainage District that remains pending. The allegations in that lawsuit focus on the cost of repairing a sewer line that collapsed in 2004.   However, several recent decisions in that case have gone against Macomb, and its questionable now whether the Drainage District will be able to continue its lawsuit against Inland Waters and the other 40 contractors in that case.  

Comment: I'm not familiar with all of the claims made by the City of Detroit in the federal litigation against Inland Waters, but if the City's claims were on the order of $380 million (a number that seems very high, but probably includes alleged treble (3x) damages), Inland's $4.5 million settlement was a pretty good deal. Maybe even a great deal. The settlement amount was less than  $0.02 on the dollar! And, even better, Inland has been declared to be a Responsible Vendor, cleared just in time to bid on two new sewer repair contracts the Department is planning to advertise for bids in December, Contracts DWS-886, and DWS-887. 

What do you think about the terms of Inland's settlement? Was this a good deal for DWSD?

Update (1/7/13): The Department is now planning to advertise four (4) new sewer repair contracts during Q1 of 2013 -- DWS-886, DWS-887, DWS-889, and DWS-890. 

Update (2/25/13): The Inland Waters settlement is featured in Crain's Detroit Business (here) as one of the biggest legal settlements of 2012. 

For more about DWSD Update, click here.  

Moody's Cuts Detroit Water and Sewer Bond Rating Again, Increased Risk of Detroit Bankruptcy Cited

The City of Detroit's deteriorating financial position and political dithering continues to affect DWSD's bond rating. 

On Wednesday [11/28], Moody's Investor Service downgraded the Department's water and sewer bond rating for the second time in 7 months. 

Concurrently, Moody's has downgraded the ratings for the Detroit Water and Sewage Enterprise Revenue debt one notch to Baa3 (Senior Lien) and Ba1 (Second Lien) as the rising risk of a city bankruptcy filing brings ongoing uncertainty regarding the treatment of these securities in the event of a filing. Ratings for the Detroit Water and Sewage Enterprise Revenue Bonds have been removed from review for possible downgrade and the outlook has been revised to negative. The negative outlook for the water and sewer debt is based on the increasing possibility that the city could file for bankruptcy over the next 12 to 24 months. 

The last downgrade of DWSD's bond rating by Moody's occurred on April 9, 2012, as we reported here.  

For more about DWSD Update, click here. 

Detroit City Council Rejects EMA Contract, Plan to Downsize DWSD. What's next?

Last week, the Detroit City Council took no action on a $48 million contract with EMA, the consultant behind a controversial plan to reduce DWSD's workforce by some 81%. 

Earlier today, the Detroit City Council took action, but voted to reject the EMA contract outright and along with it DWSD's restructuring plan. The Detroit Free Press reports (here) that the City Council vote was unanimous. Council member Ken Cockrel Jr. cited the EPA's October 12, 2012 request for 45 days to review the EMA plan as a key reason to delay approval. 

“Those 45 days have not elapsed yet," Cockrel said. "We have not heard from the EPA. They have not indicated that they have no concerns. And I think when you have a federal agency that’s in charge of regulating environmental concerns for the country…I think we ought to give them the time to do it.” (Cite: Michigan Radio)  

The Board of Water Commissioners, anticipating this outcome, last week voted to proceed with EMA under a $2.0 million stopgap contract. This is only a temporary solution. 

Comment: So what's next? Will the Water Board acquiesce (uh, not likely) or proceed with (24) consecutive $2 million contracts, each one just small enough to avoid a City Council vote? (Possibly) Or will Judge Cox resort to "more drastic measures" as he has alluded to in several of his rulings this past year? (What will that look like?)  And is this any way to run a public utility, one that serves 4.3 million people? Really?  

For more about DWSD Update, click here.     

Water Board Approves Stopgap Contract with EMA as City Council Fails to Act on Larger Contract

Confronted with the Detroit City Council's failure to take action toward approval of a $48 million contract with Minneapolis-based consultant EMA, the Detroit Board of Water Commissioners yesterday held a Special Meeting and approved a resolution authorizing Director Sue McCormick to negotiate a stopgap agreement with EMA, for an amount not to exceed $2.0 million.  

The term of this agreement will cover the period from November 14, 2012 to June 30, 2013. And because of the dollar amount, this contract will not require City Council approval. 

Comment: It is unclear to me why City Council was required to approve EMA's $48 million contract -- it was approved by the Water Board on September 7, 2012 -- after all of the steps taken in the past 12 months by Judge Cox and others to separate DWSD from the rest of the City of Detroit. DWSD now has its own general counsel, HR department and finance. Submitting a contract that comes with an 81% staff reduction, to an elected body for approval, is a suicide mission. The Board of Water Commissioners knows this; Judge Cox must know it too. 

This situation probably explains a November 8, 2012 Root Cause Committee Report that requests, in part, that DWSD be allowed to exempt certain contracts from City Council approval. Without the Court giving the Board of Water Commissioners sole authority to approve the entire $48 million EMA contract, it will surely languish with City Council taking no action for the foreseeable future. 

On the other hand, what are the limits of Judge Cox's authority? Can he effectively divest City Council of its role in reviewing and approving significant contracts? Does enforcement of the Clean Water Act trump these concerns? What do you think? 

Update (11/20): Earlier today, the Detroit City Council voted to reject the EMA contract. The Detroit News reports (here) about Council's decision. Now what?  

For more about DWSD Update, click here.     

Former DWSD Director Victor Mercado Pleads Guilty in Public Corruption Case

Earlier today, Victor Mercado, former Director of the Detroit Water and Sewerage Department, pleaded guilty(*) to a single count of conspiracy in connection with his role in the Kilpatrick Enterprise. The Detroit Free Press reports this development here. Its unclear whether Mr. Mercado will testify against his Co-Defendants or remain in the background. No date has been set for sentencing. 

The pending corruption trial involving the former Mayor, Kwame Kilpatrick, his father, and contractor, and friend Bobby Ferguson is currently on hold until November 13th due to a medical condition affecting Ferguon's attorney. 

(*) For readers with a PACER Account, Victor Mercado's Rule 11 Plea Agreement was filed 11/5/2012 in Case No. 2:10-cr-20403 at Dkt #247.  If you're interested in a copy, I'd be glad to e-mail it to you. Just write me and put "Plea Agreement" in the reference field.   

For more about DWSD Update, click here.   

Water Board Authorizes Director to Negotiate New Supply Contract with City of Flint (UPDATED)

The Board of Water Commissioners yesterday authorized Director Sue McCormick to negotiate a new 30 year water supply contract with the City of Flint.  The new contract would allow the City of Flint to blend DWSD water with water taken (and treated) from the Flint River, but with at least one caveat.

A condition of accepting the City of Flint's blending request is that the water from Detroit be treated as "source" water and pass through Flint's own water treatment plant (WTP), where it would be added to treated water from the Flint River. Detroit water would comprise 2/3 of the final output.  DWSD currently delivers treated water through Flint's distribution system. The City of Flint would be responsible for any capital costs associated with re-routing DWSD water through the Flint WTP. (Note: This condition might be a deal breaker for Flint, whose Emergency Manager is quoted here as saying that these additional capital costs could off-set any anticipated savings.)

In another interesting development, Director Sue McCormick reported that DWSD had received a written request from the Genesee County Drain Commissioner's Office to purchase up to 85 million gallons per day of untreated (raw) water. In an October 17, 2012 letter, Deputy Drain Commissioner John O'Brien requested the cost and terms and conditions under which DWSD would agree to sell raw water to Genesee County under a 30 year contract.  

Comment: Genesee County's request to buy raw water from Detroit, coming at this point in time, is a very odd request. The Genesee County Drain Commissioner (Jeff Wright) spearheaded the creation of the Karegnondi Water Authority in 2009 (here), with the stated desire to break away from Detroit. The KWA has developed plans to construct its own $600 million pipeline in 2011 (here), and announced just two weeks ago that it planned to sell $35 million in bonds to begin construction of its own raw water intake.  

With the enormous head of steam that's been built up by elected officials pushing for a new $600 million (raw) water pipeline, why would Genesee County suddenly seek an agreement to buy raw water from Detroit? Something doesn't add up here. Does anyone know what's really going on here?


If you're interested in a copy of Genesee County's recent request to purchase raw water from DWSD, I'd be glad to e-mail it to you. Just write me and put "DWSD Raw Water" in the reference field.

Update (10/26): Earlier today, journalist Ron Fonger with mlive.com hosted an online Q&A with Genesee County Drain Commissioner Jeff Wright (here). I was unable to participate live, but I e-mailed Mr. Fonger earlier this morning and asked if would ask Mr. Wright about the timing of Genesee County's recent request to purchase raw water from Detroit. In short, why now? Mr. Wright responded to my question  during the online chat session:

"For three years, we've asked Detroit to consider selling us raw water so we can treat it ourselves, supply it to our people and save dollars. They've refused, up until three weeks ago when the new director of DWSD, Sue McCormick, made a public statement that Detroit would be willing to sell raw water.  
 
"So our request is twofold: 1. if they are willing to sell raw water, at what price? 2. Could this be cheaper than building our own intake. 
 
"We want to know what their terms would be because it may be more cost effective to buy water from them instead of building a new intake."   

For more about DWSD Update, click here.

J. F. Cavanaugh Submits Low Bid on Hubbell-Southfield CSO Improvements Project (UPDATED)

J. F. Cavanaugh Company submitted the low bid on October 18, 2012 for the project known as DWSD Contract PC-788 “Hubbell-Southfield CSO Control Facility Improvements and Rouge River In-System Storage Gate Improvements.”

Hubbell-Southfield CSO

Here are the as-read bids. It does not appear that equalization credits will change the outcome.

1. J. F. Cavanaugh  . . . . . . . . . $17,669,555
2. Weiss/Bruner, JV . . . . . . . .$18,648,000
3. Walsh Construction . . . . . .$18,889,000
4. De-Cal Mechanical  . . . . . . $19,590,000
5. DeMaria Building Co.  . . . .$19,697,000
6. White Construction . . . . . . $22,323,000

The Hubbell-Southfield CSO facility has an existing storage capacity of 22 million gallons. It was constructed in 1999 by Ellis-Don Michigan. For more information, click here.  

Update (12/19): The Board of Water Commissioners approved a contract with J. F. Cavanaugh Company today at its regular monthly meeting. 

For more about DWSD Update, click here.

DWSD Extends Deadline for Submitting Biosolids Proposals to January 23, 2013 (UPDATED)

The Detroit Water and Sewerage Department (DWSD) earlier this week extended to November 29, 2012 January 23, 2013* the due date for design-build, operate and maintain proposals for Contract PC-792, "Biosolids Dryer Facility." 

DWSD is now seeking proposals for a single, 20 year O&M contract, rather than a 5 year agreement, with a series of 5 year options.  The capacity of the new sludge drying facility is also being reduced slightly to 220 dry tons per day, from 250 tons. These changes are outlined in Addendum 1. 

According to the RFP, as amended:

The Detroit Water and Sewerage Department (DWSD) is seeking a qualified firm to provide design-build-operate-maintain services under a negotiated, fixed‑price contract to provide all design, obtain all necessary permits, furnish all materials and equipment, perform any required demolition, removal or relocation, construct, start-up, and test a biosolids dryer facility with a firm capacity of 250 220 dry tons per day, as well as providing new and/or modified sludge cake conveying capabilities. 

The PC-792 Contractor will also be responsible to operate and maintain the new dryer facility and to load, haul and sell or otherwise beneficially reuse and/or dispose of all biosolids and residuals transferred to the dryer facility for a period of up to twenty (20) years after Substantial Completion consisting of an initial five (5) year operation and maintenance (O&M) period and up to three (3) succeeding five (5) year O&M periods, that may be exercised in the sole discretion of DWSD unless terminated in accordance with the Contract provisions.

Update (11/12): The response deadline for this Biosolids RFP has been extended to January 23, 2013, per Addendum No. 4. 

For more about DWSD Update, click here.

EPA Notifies Court, Seeks Time to Evaluate DWSD Plans to Cut its Workforce

On October 12, 2012, the U. S. Environmental Protection Agency (EPA) asked Judge Sean Cox for 45 days to evaluate DWSD's recently-announced plan to dramatically cut its workforce and  to take no further actions toward implementing the plan during this evaluation period. 

In a two page document(*) filed with the U. S. District Court captioned "Notice of the United States Regarding the DWSD's Motion for Interim Order," EPA Attorney Annette M. Lang, and Assistant U. S. Attorney Peter A. Caplan request that the Court give the EPA time to evaluate DWSD's proposal and whether it would affect compliance with the Clean Water Act:

"The Michigan Department of Environmental Quality ("MDEQ") recently informed EPA about a proposal that the Detroit Water and Sewerage Department ("DWSD") was considering that recommended, inter alia, a dramatic reduction in staffing level within DWSD's wastewater treatment plan and combined sewer overflow operations. EPA has not had the opportunity to review and evaluate the potential impact and implications of the proposal on DWSD's compliance with the Clean Water Act, 33 U.S.C. 1251, et seq, and its NPDES permit, including the operation and maintenance requirements contained therein. To the extent that actions by this Court on DWSD's Motion for Interim Order may open the way for DWSD's initiation of the implementation of that proposal, EPA seeks to notify this Court and the parties of its interest in having the opportunity to meaningfully undertake an evaluation of the proposal prior to any such action. 

"During the period of its evaluation of the proposal, EPA plans to work with both MDEQ and DWSD. To that end, managers and staff from EPA are already planning to meet with managers and staff from MDEQ on Tuesday, October 16, 2012, to discuss and evaluate the current situation. The meeting is intended to provide further clarification on a path forward. 

"With this notice, EPA is not taking any position on any aspect of the proposal before DWSD.  

"Accordingly, EPA seeks a period of forth-five (45) days to evaluate the potential impacts of the proposal on CWA compliance and asks this Court not to take any actions that would open the way for DWSD to initiate the implementation of the proposal prior to that time. DWSD has not reported any violations of its NPDES numeric limitations on solids since November 2011 and has not reported any other NPDES numeric limitations since March of this year [2012]. Therefore, nothing in the record would indicate that immediate commencement of the implementation of the proposal is required." (emphasis added)

Note: The case that Judge Cox currently presides over was originally filed in 1977 by the U. S. Environmental Protection Agency to enforce compliance with the Clean Water Act. The EPA has not played an active role in the case, however, for a number of years. The EPA's request that Judge Cox 'take no action' for 45 days is an interesting development. Judge Cox is not bound to comply with the EPA's request, but it is unlikely that he would simply ignore it. Stay tuned for how the Court and DWSD responds to the EPA's request.

(*) For readers with a PACER Account, the EPA's Notice was filed 10/12/12 in Case No. 2:77-cv-71100-SFC at Dkt #2492. If you're interested in a copy, I'd be glad to e-mail it to you. Just write me and put "EPA Notice" in the reference field.   

For more about DWSD Update, click here. 

Water Board Approves $142 Million in New Design-Build, Construction, Maintenance Contracts

During its regular meeting on Wednesday, September 26, 2012, the Detroit Board of Water Commissioners approved four (4) new contracts, including two design-build, one construction and one as-needed maintenance contract in the total amount of $142,340,715. Walsh Construction (Detroit) was low bidder and awarded two of these contracts. 

(1)  Design-Build Contract DWS-882, "SCADA Radio Network Upgrades" was awarded to Detroit Radio Team* for $7,995,090 and a duration of 1,095 calendar days. Proposals for this contract were originally submitted in March, 2011. 

For a variety of reasons, which Deputy Director Darryl Latimer outlined to the Board during the meeting, it took DWSD more than 18 months to award this contract. The Board was assured, however, that the Contractor would not seek a change order for increased costs due to this delay. DWSD normally asks bidders to hold their prices firm for 180 days to allow for Water Board and City Council approval.

______________________________________________ 

(2)  Construction Contract SP-563, "1958 Filters Replacement and Facilities Rehabilitation at Springwells Water Treatment Plant" with Walsh Construction Company for $75,899,000 and a duration of 1,710 calendar days. 

This project was bid July 31, 2012 and took less than 2 months to be approved by the Board. During the Board's discussion of this contract, it was noted that the Springwells WTP was a major part of DWSD's water supply network, and that both the Northeast WTP and Southwest WTP were being looked at for future decommissioning. We first reported about this in August, 2011 (here) in the context of a CH2M Hill report on the subject.

_____________________________________________ 

(3) Construction Contract PC-790, "Equipment Purchase and Installation on an As-Needed Basis" with DeMaria Building Co. for an amount (NTE) $20,457,244 and a duration of 1,095 calendar days. 

This project was bid just one month ago on August 21, 2012. Commissioner Fred Barnes reported that while his committee recommended approval of this maintenance contract, he hoped it would be the last one. He later referred to the DWSD maintenance contract as a "dinosaur" and "hopes its goes extinct."

_________________________________

(4)  Design-Build Contract PC-791, "Sewage Sludge Incinerator Air Quality Improvements" with Walsh Construction Company for a cost (NTE) $37,989,471 and a duration of 1,676 calendar days.  

Assistant Director Sam Smalley reported during the Board Meeting that this contract involves upgrades to the 8 incinerators in Complex II, and is required to comply with new EPA regulations [40 CRF Part 60] that become effective in March, 2016. This contract also grew out of the March, 2012 Biosolids Management Symposium hosted by DWSD for academics and other experts in the field. The Department selected a design-build form of delivery, Mr. Smalley explained, to shorten the procurement process. Contract PC-791 is scheduled for completion by June, 2017.     

* (Update 10/5):  Detroit Radio Team is a Joint Venture between Motor City Electric and PCI (Process Control & Instrumentation, LLC). CDM Michigan is also reportedly part of this JV. 

For more about DWSD Update, click here.

Macomb Lacks Standing to Pursue Claims against 15 Mile Sewer Repair Contractors, Federal Court Rules

Earlier today, U. S. District Judge Robert Cleland ruled that the Macomb Interceptor Drain Drainage District lacks the legal standing necessary to maintain claims for racketeering and anti-trust violations it filed in July, 2011 against 25 of the 40 contractors involved in the 15 Mile Interceptor Repair Project. The Court granted summary judgment in favor of the contractors. The Court also ordered Macomb to show cause by September 24, 2012 why summary judgment shouldn't be entered in favor of the the remaining 15 contractors. 

In a 30 page Opinion and Order, Judge Robert Cleland determined that when Macomb County bought the Macomb Interceptor in 2009 from the City of Detroit, it did not acquire the rights to pursue all claims arising out of the repair contract. The assignment of rights provision only extended to "rights under all contracts, warranties and guarantees that apply to services or goods related to the Macomb System." Macomb County did not acquire rights to the non-contractual claims asserted in its July 18, 2011 lawsuit, which include racketeering (RICO), anti-trust (Sherman and Clayton Acts), and certain common law tort claims (fraudulent misrepresentation and tortious interference). 

Contrary to Macomb Interceptor's argument, the Bill of Sale does not grant it the right to prosecute "any and all claims" of every description, but only all such claims and rights transferred or assigned in the Acquisition Agreement. Subsection (b) strengthens the conclusion that section 2.4 did not transfer or assign non-contractual claims arising from the [15 Mile Interceptor Repair] Project and strengthens the court's determination that Macomb Interceptor does not have standing as an assignee to bring its non-contractual claims.

Judge Cleland also rejected Macomb's argument that it had standing on the basis that it allegedly paid an inflated price for the Macomb Interceptor or that it was allegedly overcharged between 2005 and 2009, when it bought the interceptor from the City of Detroit. 

The Macomb Interceptor Drain Drainage District, which did not exist in 2009, was an "indirect purchaser," Judge Cleland wrote, and "[u]nder the indirect purchaser doctrine, a plaintiff who does not purchase directly from an alleged antitrust violator generally lacks standing to sue under the antitrust statutes." 

Notwithstanding the Court's ruling, the 40 contractors involved in the 15 Mile Interceptor Repair Project are not yet out of the woods. The City of Detroit, which does have the legal standing to prosecute the non-contractual claims, was granted permission to intervene in the Macomb Interceptor Drain Drainage District's federal lawsuit in May, 2012. 

For more about DWSD Update, click here.   

DES/LaBelle JV Submit Low Bid on As-Needed Electrical Contract, DWS-885 (UPDATED)

DES/LaBelle Joint Venture, LLC submitted the low bid on September 13, 2012 for the project known as DWSD Contract DWS-885 “As-Needed Low Voltage Wiring III.”

Here are the as-read bids. It does not appear that equalization will change the outcome.

1. DES/LaBelle Joint Venture, LLC . . . . . . . .$4,707,318
2. Motor City Electric Technologies, Inc. . . . $4,775,066
3. Bayview Electric Company, LLC . . . . . . . . $5,990,000 
4. Shaw Electric Co. . . . . . . . . . . . . . . . . . . . .  $6,250,836 

Update (10/25): The Board of Water Commissioners approved Contract DWS-885 yesterday at its Regular Board Meeting in the amount of $4,669,337.67 for a duration of 1,095 calendar days. 

For more about DWSD Update, click here.

Walsh Submits Low Bid on Central Services Facility (CSF) Improvements Project (DWS-884)

Walsh Construction submitted the low bid on Wednesday, September 12, 2012 on the project known as DWSD Contract DWS-884 “Central Services Facility (CSF) Improvements.” 

Here is the bid tab with the as-read bids. Even after DWSD equalizes the bids, Walsh will be the low bidder. 

1. Walsh Construction . . . . . . . .$12,929,000
2. DeMaria Building Co  . . . . . . $12,989,000
3. Tooles Contracting  . . . . . . . . $13,560,542
4. Major Cement  . . . . . . . . . . . . $15,349,000
5. Sorenson Gross . . . . . . . . . . . $15,417,013

For more about DWSD Update, click here.