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HomeMy WebLinkAbout04-16-91 Residential Neighborhoods & Public Works @inntmittee Expert JOINT COMMITTE OF THE RESIDENTIAL NEIGHBORHOODS COMMITTEE AND THE PUBLIC WORKS COMMITTEE an tip (IInmmnn (IIounril of the Otitg of fnu#t! Went: The April 16, 1991 Joint Committee Meeting of the Public Works Committee and the Residential Neighborhoods Committee was called to order by the respective Chairpersons, Council Member Duda and Council Member Zakrzewski at 4 : 07 p.m. in the Council Informal Meeting Room. Persons in attendance included Council Members Coleman, Puzzello, Luecke, Duda, Ladewski, and Zakrzewski; Patricia DeClercq, Sandra Boyd, Greg Pal, Sissy Cartwright, Don O'Blenis, Dennis A. Schermerhorn, Dave Pace, Randy Hauglton and Bob Ullery of BFR, Bill Baumer of Baumer Roofing, Dave Adams, Lloyd Keldron, Vicki Black and Don Black of Master Maintenance, Thomas Brumett, Bob Grant, Roy Milliken of Milliken Construction, Don Porter, and Kathleen Cekanski- Farrand. Council Member Duda noted that the purpose of the Joint Committee Meeting was to continue the discussion of Bill No. 21-91, which proposes contractors registration requirements. She noted that in light of the many questions raised at the last Joint Committee Meeting with regard to implementation and enforcement, and the track record of other communities having such a law, that Mr. Dennis A. Schermerhorn, the Director of Engineering for the City of LaPorte, was invited to give an update on his program. Mr. Schermerhorn noted that he has been a lifelong resident of the City of South Bend and currently lives in the Second District. He stated that the City of LaPorte's Contractor Registration Ordinance has been in effect since 1988. There are approximately 22, 000 people living in LaPorte, and 295 contractors are currently registered. Concerns that it would put the smaller businesses out of business have not materialized. He noted that this has not happened and that the system works well for the City. He emphasized the need for certificates of insurance. He stated that the registration has not been interpreted as an endorsement of the City of the particular contractor, since it is registration as opposed to licensing. He noted that in a recent edition of the Penny Saver an add appeared for a cement contractor advertising that he has been in business since 1975, but he has never registered with the City of LaPorte. In response to questions raised by Council Member Luecke, Mr. Schermerhorn noted that their fee is $50. 00 per year and requires completion of a two page application and requiring Workmen's Compensation as well as public liability insurance in the amount of $300, 000.00 and $500,000. 00. He further noted that they use a card system since they are not Joint Commitee Meeting April 16, 1991 Page 2 computerized. He also stated that they have not experienced a lot of "telltale" by residents. Council Member Ladewski questioned Mr. Pace, who was quoted along with Mr. Schermerhorn, in the April 12, 1991 article which appeared in the South Bend Tribune (copy attached) . He questioned the figure of 28.5%. Mr. Pace noted that this was with regard to cost of labor only. He also questioned the "quality of work" found once the City passed their Ordinance. Mr. Schermerhorn noted that all work must be done according to Code. He noted that often times the problem is the quality of the material. He also noted that he had one experience where someone was utilizing another contractor's registration number. He suggested that two wallet cards be issued to avoid such problems. Council Member Duda questioned how the Ordinance has impacted the City of LaPorte's Engineering Department. He noted that he has a three person office. City Firefighters and City Inspectors work on all inspections and work on each shift. He noted that the front office person processes all applications. He has found the system to be manageable. Renewals are made by Janary 1st of each year. The first two years, reminder letters were sent to each contractor noting the specific date of expiration of their public liability insurance. He stated that in light of the increased postage, that reminder letters were not sent out this year. On a scale of one to ten, with ten being the highest, he would rank the City of LaPorte's system as a "nine". Council Member Duda then called upon the Council Attorney to update the Committee Members on information since the last meeting. The Council Attorney noted that each person should have three handouts. The first is a one page handout entitled "Additional List of Supporters" of the Proposed Bill, listing twelve firms and/or individuals who are in support of the registration proposal. She then reviewed in detail, the one page handout entitled "Proposed Registration Process Bill 21-91" which detailed the two step application process, the five basic requirements of registration permit folders and the five basic responsibilities of the City of South Bend and the specific department or office which would be effected. The last document was a three page memorandum dated April 16, 1991, along with copies of two State law provisions. She noted that this is being provided to the Common Council and all members of the City Administration Joint Committee Meeting April 16, 1991 Page 3 present, as well as the members of the public for additional background information. She noted that she had a copy of Ordinance No. 1854, passed by the City of LaPorte on May 2, 1988. She also had the two page "Contract Registration" application used by the City of LaPorte. She noted that in comparison to the City of South Bend's, that it was much more simplified. She also noted that she had a copy of the City Hammond's application form (two pages) , which also calls for proof of public liability insurance. Since the last Joint Committee Meeting, the Council Attorney noted that she had been in contact with the City Legal Department. She noted that Sandra Boyd had advised her that they had no further information as of this date with regard to the City of Fort Wayne lawsuit involving public liability insurance. Sandra Boyd confirmed this fact and agreed to provide as much information on the case as soon as possible. The Council Attorney also noted that she received a two page letter from Richard Nussbaum, the City Attorney. He highlighted two basic areas of concern with regard to the proposed Bill. The first involved the amount of fees. She noted that on page 3 of her memorandum, that suggested fee modifications were discussed with Council Member Duda and herself. In each case the fees would be modified downward to specifically reflect the cost incurred by the City, which would be proportionate to the services rendered. The other issue is whether the City of South Bend could require public liability insurance as a condition of the registration process. She noted that the City Attorney's office and herself disagree on this issue currently. She then noted that the proposed Bill would require public liability insurance as a "condition to do business as a building contractor within the City of South Bend. " She noted that such requirements have been utilized by the City of South Bend in the past. Examples given included Vehicle Removal Service (Section 4-20.5) , Carnivals and Circuses (Section 4-22) , Food Vending Vehicles (Section 4-25) , Public Parking Facilities (Section 4-39) , and Taxi Cabs (Section 4- 61) . She noted that in many of these instances, specifically the licensing for carnivals and circuses, as well as parking facilities, that in both cases in order to do business within the City, the City required public liability insurance. Again in both cases, such activities as carnivals or circuses were permitted on private property and the governing regulations regarding parking facilities also governed private property. Joint Committee Meeting April 16, 1991 Page 4 She also noted that she has proposed a definition for "handyman" in light of concerns raised at the last Committee Meeting. Council Member Duda noted that currently not everyone who calls themselves a contractor is operating under the same rules and regulations. She noted that those who are following current regulations, are at a disadvantage in light of the extra costs required for insurance and Workmen's Comp. She noted that this is a consumer protection Bill. She stated that typically no more than $600.00 is covered on a homeowners insurance policy for potential liability for contractors. She stated that the insurance provisions are protections for the public as well as protections for the worker. Mr. Ray Milliken noted that the Home Builders Association attempted to do this approximately ten years ago. Council Member Duda noted however that the main difference between then and now, is that the contractors themselves have requested the City for these regulations. Patricia DeClercq, the head of the Department of Code Enforcement, then noted areas of concern. She stated that she is concerned about what would be gained by the City if such an Ordinance would be passed. She voiced concern with regard to workmanship, and believes that requirements of insurance and Workmen's Compensation would raise false expectations on behalf of the public. She stated that the permit and inspection process is currently working effectively. She stated that the Bill has good motives behind it, however she does not believe the City should become a watchdog. She noted that she had been in contact with Mr. Norris of Allen County, and that their regulations with regard to public liability insurance had been struck down by the Court. She did note however, that the need to see the decision as the Council Attorney requested is important. She did not see the proposed Bill as being burdensome, however the current system for building permits is perceived as being burdensome. She noted that she is pleased to see that the fee schedule has been suggested to be reduced, and stressed that she is not attempting to get away from doing any work. She then presented a letter from Mr. Don Fozo, the County Building Commissioner, for review by the Committee. (copy attached) Mr. Greg Pal noted that currently the City cannot issue a stop work order if someone does not have Workmen's Compensation, in response to a question raised by Council Joint Committee Meeting April 16, 1991 Page 5 Member Duda. Numerous questions, comments and discussion then took place. Council Member Duda again reiterated that the topic began over two years ago when Mr. Dave Pace suggested that there is a lack of follow-up currently in the system. She was then approached by Mr. Bob Urbanski, who stated that the industry would like to propose rules. After a series of meetings with contractors, the proposed Bill was drafted. She noted that the Bill has been in process since January of this year. Mr. Milliken stated that he believes that something should be done, but voiced concern with regard to the current process. Mr. Don O'Blenis of the Workers Local Union, stated that he does not see the Bill as increasing fees being passed on to the consumer. He stated that those that are working in an unscrupulous fashion, will continue to pay by cash as they currently do. Sissy Cartwright of the City Controller's office then questioned why the City would be named as an additionally named insured, and questioned the amounts of public liability insurance requested. It was noted that an insurance representative representing a major insurance company, sat in on all of the discussions. The limits proposed are those recommended by the industry as normal limits, and that typically a fee would not be charged by the majority of insurance companies to add the City of South Bend as an additionally named insured. Miss Cartwright also noted that there would be hours required to review the application properly, along with the proposed insurance documents. Sandra Boyd, a Deputy City Attorney, noted that she would be contact with Allen County with regard to an update on the Court decision. Council Member Duda stated that she believes that the proposed Bill is a step in the right direction. She recommended that in light of the fact that a quorum was no longer present of the Committees, that the discussion be continued to a Committtee Meeting on Monday afternoon. She stated that she believes that better practices require reasonable regulations in this area. Council Member Luecke questioned whether if indeed the Fort Wayne lawsuit would effect the liability question, whether Joint Committee Meeting April 16, 1991 Page 6 there would be another alternative within this area. He was advised that this was a possibility. Council Member Duda stated that she is willing to work on the Bill and to continue to receive information and recommendations to improve it, so that it is the best possible Bill in this area. She stated that there is much frustration experienced by the contractors, and members of the public, and that hopefully "these frustrations could be worked out together. " Following further discussion and questions, the meeting was adjourned at 6: 15 p.m. Respectfully submitted, Council Member Loretta Duda, Chairperson Residential Neighborhoods Committee Council Member Thomas Zakrzewski, Chairperson Public Works Committee