17 AAC 55.050. Termination of local control agreement by department for cause

(a) If a municipality that has assumed control of a public works project under AS 35.15.080 is in substantial violation of an agreement executed under 17 AAC 55.020, or if the municipality has failed to fulfill its responsibilities under the agreement in a proper and timely manner, the department will, in its discretion, notify the municipality of the violation or failure. If the municipality fails to correct the violation within a reasonable time, or to offer assurance satisfactory to the department that the violation or failure will be remedied or the work defects cured, the department will, in its discretion, terminate the agreement and assume control of the project. The department will give written notice to the municipality at least 15 days before the effective date of termination, and will state the reasons for the termination. The municipality may appeal the department's decision to the commissioner within 10 days. Pending the commissioner's decision, no work may proceed on the project. The commissioner's decision is final.

(b) If an agreement is terminated for cause under this section, the department will compensate the municipality for satisfactory work on the project to the extent that the municipality has not been compensated. However, the municipality is not relieved of any liability to the department for damages caused by the contract breach, and the department will, in its discretion, withhold compensation due under this subsection until the amount of damages owing to the department can be determined and deducted against the department's obligations.

(c) The department will, in its discretion, waive the requirements of this section in an agreement if the municipality must sell revenue bonds to provide money for construction of a public works project as proposed in that agreement.

History: Eff. 3/20/86, Register 97

Authority: AS 35.15.080

AS 44.42.030

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