costs caused by the public utilities activity in the public right away section four eighty eighty two defines management costs as a reasonable cost the local government actually incurs in managing the public rights construction cost component it's yes construction cross due to the presence of utilities is the actual phrase is what's that mean as we understand it the way the other was presented in that case and the way the construction co here the city characterizes construction costs really as two elements construction costs and engineering costs they say the added cost it adds fifteen percent of all costs of a public project are due to the presence of utilities in the public right away twenty percent of all engineering costs of a public project are due to public utilities in the right away way and what i mean due to your honor and i think this was your explained in our brief in telecommunications carriers used to be covered under that statute three sixty four and used to be subject to franchise fees and therefore their fees would have been limited to as a legislature of ever passed these two laws in the same bill using management cost around when they mended section three sixty four to omit telecommunications carriers from the classic years which franchises are required they added code section four eighty eight i bet they did it in the same law they used the term management cost in the same law i bet what do you bet or do you know and when you say lawyer are you talking about a statute a bill a bill that goes to the legislature they vote on the same time with the same meaning what's going on i management fear to change that definition wasn't i your honor i don't know a different other reason why the law was passed in telecommunications art is a different industry from public utilities generally in fact telecom carriers are generally no longer considered public utilities and i think that that bill was passed with the recognition that competition had infiltrated that the communications industry wireless communications carriers now are probably the most prevalent form wrong you're not wrong at all your honor no no we define marriage we believe marriage would cost as a more narrow definition than under the regulatory standard but in addition we do believe that those management costs must be caused shown to be caused by the carrier in order to be imposed whereas under the regula for management of the public rights of way there is f c c cases there is testimony from senators and in sponsoring the bill that reveal the old those activities are for managing the carriers use of the rights of way no where in those examples is any situation where you're allowed to charge just for the headache of having to construct your projects around there and i think that's particularly relevant in iowa because there's two statutes and i want to give utilities that in this case it does include telecommunications carriers the right to occupy the rights away and the city hall of howard in case says you cannot charge rent for chart for using the public rights of way to utility so if we as a utility have the right to occupy the public rights away that is not that is not that is inconsistent with the city of des moines ability to charge a fee for having to work around the council we had a recent case at your bet you know about the from iowa city and there we said the opposite of what you just said we said under rights of way we couldn't just walk across the street right now sir tearing up the road we would have to go through the permitting process with already pay requisite fees etc but ultimately if this i don't think this was the issues before you in that case but ultimately if we were denied access to the public rights of way because the city didn't feel like giving us access i think we would have significant cause of action council i want to go back to the statutory scheme so craigslist did not involve a limitation valving management cost this statute involves a limitation on management costs the cause by which which judge kelly got at but there's also a definition of management costs in the statutory scheme is my understanding which is the reasonable cost to local government actually incurs in managing public rights of way and i'm interested in why the the construction costs don't meet that definition to me that's the pressure point and if you leave aside krag described distance we talked about that around utilities just like we know there's additional fees that utilities have to a cost of the utilities incurred from the work around the city the issue is whether or not these were actually cars you brought up on all the expert did here was gas he s my experience and he had no data sport this year not reviewed any underlying contracts he just said in my experience northern minnesota in the eighty's it was about fifteen percent and added costs for construction twenty percent added cost really only objecting to the definition of management is overseeing directing etc and i'm trying to figure out as a as an initial matter whether construction costs meet that definition i guess i'm sorry or i was moving or said that our second argument no because it's not managing utilities all you know what they're doing is they're managing their own projects they're doing so you create a race and you manage the rights of way right the subject is managing the right away don't you have to construct something to manage the right away it least put up a border sign or something or walk over or s as reflected in the crags opinion for its position that they were correct here and as we pointed out in our briefs as their expert admitted on cross examination i was supreme court just got it wrong they confused the two surveys that the expert used in supporting his cost they looked at that survey that was used for operational costs they confused it with the cop the construction costs and the ultimately for the construction cost so a reserve there is are the rest  may please the court counsel i'm john herald sun and i represent the city of the morning in this matter from our perspective we do not think this is a particularly complicated case how can we tell based on this judge's decision what went on at all well at all particularly about the costs well as you know from judge will these decision decision there were extensive agreements between the parties as to a stipulation of facts and then there were link the post both pretrial in the last the last lines  thousand and sixteen and the supplement documents sixty five filed on november twenty second two thousand and sixteen do you think that's sufficient for us to review i believe that we go your findings of fact to figure out what's going on in the case well we could ask the judge ended in addition when it comes to the particular federal question i don't think the there was no evidence that the city's management fee provided any sort of prohibition for the provision of services by qwest that was a fairly easy decision i think for the court to render given the testimony of the point of sexperts so the case became about the interpretation of for a da well that's what i'd like to turn to is the is the interpretation of the statute and  limitation that statute management costs like there is in the statute well i think it important aspect of craziness to eighteen north west second for ninety two pages five zero five five zero nine five eleven is that the court  intervening three sixty four f goes out of its way to repeatedly use the phrase maintain and manage the right away due to the presence of utilities i believe it uses the phrase maintain and manage the rights of way five times in that opinion so you think you think that the and this is this is the pressure point that's why i asked opposing counsel about this you think that instead of using the definition that the legislature gave us the i will legislature which defines management costs either they implicitly adopted explicitly adopted whatever that definition is the definition from the crack in this case that that's really the definition we should apply not the definition in the statute well i think there are two different ways to look at the phrase actual cost of the reasonable cost actually incurred  the first is that i believe the area of the in the federal law where that is she was done with our medicaid payments i think that i think that's actually in the medicaid statute and the case law and that this wasn't briefed by us but i just before getting ready for this order just look at that issue i believe that those costs are considered the reason we necessary cost incurred in the service of the medicaid of the medicaid client so i think the analogy to that is that construction cost engineering cost in the other costs related to the finding of the studies the two studies and greatness are that construction costs and engineering costs are reasonably necessary in the in a manageable the right i may be true but it talks about that the government actually incur managing public rights of way and i think that probably the the carriers have a little overly broad conception of the same way you have to be able to manage the care sitting in the rights of white is about managing the rights away  south but i also don't know how construction costs are directing or overseeing the rights of way what's what are the synonyms for the word manage it can you help me with that i think i think again the craziness decision is a guide to that the testified or talked about between six thirty and testify in that case is that construction and engineering costs are part of the are part of the management cost of the right away the presence of utilities causes these additional costs in construction and engineering when it comes to the right away as well as administrative overhead and other costs so craig this did not create us in trying to find three sixty five to half describe what management of the right of way is so you think that building a road and having to account you know or whatever a sidewalk and having to account for the fact that there might be electrical wires or telephone wires or fiber optics underneath that those city manager and so he had experience in all three levels of judging how utility conflicts impact building including construction and engineering but they all admit that utilities do cause extra expense in the construction oversight of projects because of conflicts especially in minister policies like the moyo what are the limits that if management costs include construction costs what are the limits can any cost any cost at all that the that the city incurs that's related to the or caused by the the the right of way can that be recovered because it doesn't seem to me that there's a limiting principle here and maybe there shouldn't be maybe that's your argument but what wouldn't be included well the principle is on average of these two hundred or down all over and they cause conflicts and if there is a if they're if they are struck that's a cost that the contractor incurs they they also know the time is going to take so they build end of the cost it is a general principle there are occasions when individual cost utilities that would that would be included it would be included management costs i'm not a particular cost that were a city to isolate a utility i even isolate that it be nobody's that basically it's something the des moines has to pay for because it's not it's not it's not within the realm of management well an example would be mr camp's testimony talking about change orders that come to contracts where where because of delay or utility conflicts a project to slow down to the point where the city has to deal of its own pocket to have the project fixed because it's difficult to extrapolate which utility is responsible even if we felt we could then as a litigation standpoint was to delay the project we have to pay it to get it done because the taxpayers expected to be done that an example of addition to the c embedded in a contract there are additional change order costs that occur as the project goes on that cannot be singled out to a particular utility that's an additional part of the kind of additional cost that city taxpayers incur that the with mr dragon search after two thousand and six because it's important in the two thousand and twelve decision of pregnancy there's a particular line out there from the city is is that we know and this is true this case to the city's expert had extensive construction experience including the building of construction projects conducting the right away it's also a license engineer and that's what i mean let me interrupt you i'd like to focus on a different part of the definition says actually encouraged right boy when you see the term actually  s it sounds like we need a finding of fact about what what's actually incurred and do you think there's any finding in the springs that study is a general study like you characterized it of experience of other places in the general rules does that the actually incurred test or do we need to remain and for a factual finding about what's fact actually and actually incurred what i think there's two principal part of that was my response to judge us on the issue of how that t engineering cost should be valued at twenty percent and increase construction costs should be valued fifty percent and adopt them as our own but but again that pregnancy isn't dealing with the statute that we're looking at we're had that has a specific definition of management costs and talks about actually incurs and cause by it seems to me that there's some difficulty in a general assessment of a percentage that is attributable to utilities and i construction and engineering costs would increase during the a store called nature of how the how the bidding process is and how the costs processes one thing that i think that is key is that in incredulous one seven fourteen ment so the telecoms are pulled out of that agreement craig us also talks about how it's not necessary that the city be able to do the mathematical certainty the third thing is as mr dragon testified is that there's no such thing as the green field that mr schwarzkopf talked about in his testimony yet if you had a greenfield construction costs would be a lot cheaper than they are with utilities present but there's no such thing as a greenfield in a minister paluxy that's like the big difference between the kentucky  referenced by both sides involving rule of highway construction versus municipalities the entities are there it is it is based on his experience and knowledge that these increase the bidding process projects by that amount the embedded cost that goes into these contracts it is it is no doubt a theoretical construct but is a theoretical construct at the supreme court of iowa found key and you interpret what is the maintenance and management because of the presence of utilities in the right of way in construction and engine and engineering expenses and here we believe that sufficient forward to that that is enough to meet the caused by or actually incurred fee but it's based on the past experience in the building of projects and that's how the rate was determined and in reality we're really not charging and should be pointed in that we're really not charging fifteen or twenty percent we're and and obviously a part of the process is that the part of the ordinance is that the study gets reevaluated every five years so it has those components and to double check to make sure that the rate is proper and still remain so but when it comes to the phrase of the actual cost of construction and engineering it isn't historical study that makes a projection that this is the way in which construction bids generally are higher and engineering costs are generally higher because utilities in right away the nature of utility conflicts isn't changing those all those cables are still buried in the road in the city the morning in most major miss palliser not overhead they're in the ground therefore they're hard to determine construct reasonable thing the logical thing and say an attorney are madge will cost me forty eight for utilities in our gas and electric other utilities that using the supreme court's language of water management cost is transferrin that and doing a study to see what thank you just back on the issue as to whether or not management costs include the construction costs and i do know that subsection three of chapter four a so the local government may recover from a public utility only those management costs caused by the public utilities activity in the public right away and i would say that the that word activity has been in charging for your construction costs have been a work around existing plant i would not characterize that as an activity by the by the public utility but it was an activity at one time though right there was an activity ok one time the other two issues that we have are we identify with respect to construction cost deficiencies where the fact that in most cases they can be attributable to the specific utilities yet the des moines has chosen to lump them all together and charge them on a linear foot basis we think that's diametrically inconsistent with that same section the statute which reserves management costs for issue in the crappiest case they actually allocated those cars on a per utility basis there's no evidence in the records of supporting those to do so with that all closed thank you thank you council for your argument  seventeen dash twelve fifty seven is submitted for decision