Title
Resolution to Approve the Eighth Amendment to Professional Services Agreement with Bodman, PLC, for Legal Services Relative to 1,4-Dioxane from Gelman Sciences, Inc., dba Pall Life Sciences ($95,000.00)
Memorandum
The City has previously litigated against Gelman Sciences, Inc., dba Pall Life Sciences (Gelman) relative to the 1,4-dioxane that Gelman released at its property in Scio Township that has migrated as one or more plumes, via aquifers, both under properties within the City of Ann Arbor and under properties in Scio Township.
On October 27, 2016, the Michigan Department of Environmental Quality (MDEQ) promulgated, and Governor Snyder approved, an emergency cleanup criterion of 7.2 ppb for 1,4-dioxane, replacing the 85 ppb criterion that was previously in effect, and that cleanup criterion of 7.2 ppb has since been adopted on a non-emergency basis.
Under the circumstances, the State was in negotiations with Gelman regarding possible revision of the consent judgment. In December 2016 the City, various Washtenaw County parties, and the Huron River Watershed Council moved and were granted permission to intervene in the case between the State and Gelman. In February 2017, Scio Township also was granted permission to intervene. Although the intervening parties can pursue litigation as parties to the case, the City and other intervenors became involved in the negotiations and met on a regular basis in an effort to reach agreement on an amendment to the consent judgment satisfactory to the intervening parties. Since the 7th Amendment was entered on May 1, 2021, there has been much activity in the case including motions to reconsider, motion for stay the state court litigation, emergency appellate review, and briefing in the Court of Appeals and Supreme Court.
Including amendments 1 through 7, the contract with Bodman, PLC, has reached $797,500.00 for legal services, and, $27,500.00 for the City’s share of expert services.
The total cost of the firm’s additional legal services for August through December 2021 is approximately $50,000, mainly for significant work in the Michigan Court of Appeals Although the amount of time and cost of legal services going forward cannot be predicted with certainty, the costs for recent and foreseeable efforts through June of 2022 would be about $40,000, which would bring the total contract amount for legal services to $887,500.00.
In addition, the City’s original and amended $27,500.00 share of the cost of expert services fees has been depleted. To cover the additional expert costs to prepare for, and participate in the hearing, an additional amount of $5,000.00 is needed, increasing the requested amendment amount to $95,000.00, and increasing the total contract amount for expert services to $32,500.00.
Bodman, PLC, complies with the City of Ann Arbor’s Non-Discrimination and Living Wage Ordinances;
Approval of this eighth amendment in the amount of $95,000.00 to the professional services agreement with Bodman, PLC for the Gelman 1,4-dioxane litigation, of which $90,000.00 is for legal services and $5,000.00 is for expert services, for a total contract amount of $920,000.00, is recommended.
Budget and Fiscal Impact: Funding for this project is available in the approved FY 23 Public Services Area operations and maintenance budget for the Gelman matter.
Staff
Prepared by: Stephen K. Postema, Assistant City Attorney
Reviewed by: Stephen K. Postema, City Attorney
Approved by: Milton Dohoney Jr., Interim City Administrator
Body
Whereas, On October 27, 2016, the Michigan Department of Environmental Quality (MDEQ) promulgated, and Governor Snyder approved, an emergency cleanup criterion of 7.2 ppb for 1,4-dioxane, which criterion of 7.2 ppb has since been adopted on a non-emergency basis;
Whereas, The City was granted permission to intervene in the lawsuit brought by the State of Michigan, through various state agencies, against Gelman Sciences, Inc., dba Pall Life Sciences regarding the 1,4-dioxane plumes originating on Gelman’s property;
Whereas, The City joined the negotiations regarding possible amendment to the consent judgment between the State and Gelman in the state’s case and has pursued those negotiations with other parties who also were granted permission to intervene;
Whereas, Additional efforts were required for those negotiations and provide advice after the negotiations were concluded, and there has been extensive activity in the state court litigation, including emergency appellate review, and an evidentiary hearing;
Whereas, The Bodman, PLC, law firm is well qualified to provide legal services representing the City relative to the Gelman 1,4-dioxane plumes, including representing the City in both negotiations and litigation;
Whereas, The City and firm entered into an initial contract for legal services, which has been amended seven times for a total contract amount of $750,000.00, including $722,500.00 for legal services and $27,500.00 for expert services;
Whereas, The City Attorney recommends a eighth amendment in the amount of $95,000.00, including $90,000.00 for legal services and $5,000.00 for expert services, for a total contract amount of $930,000.00, of which $902,500.00 is for legal services and $32,500.00 is for expert services, to continue those legal and expert services; and
Whereas, Bodman, PLC, complies with the City of Ann Arbor’s Non-Discrimination and Living Wage Ordinances;
RESOLVED, That an eighth amendment to the professional services agreement for legal services with Bodman, PLC, be approved in the amount of $95,000.00 to provide continuing legal and expert services relative to the Gelman 1,4-dioxane plumes;
RESOLVED, That the Mayor and City Clerk be authorized to execute the eighth amendment to the professional services agreement with Bodman, PLC, subject to approval as to form by the City Attorney; and
RESOLVED, That the City Attorney and City Administrator be authorized to take the necessary administrative actions to implement this resolution.