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Scotia Technology sues seacoast company over A-10 aircraft components

LACONIA — A local aerospace company has filed a lawsuit against a seacoast company for failing to properly clean and perform a special kind of treatment of stainless steel tubing that was subsequently sold to the  Boeing Company which used them in the wings of the A-10 Aircraft used by the U.S. Air Force.

According to pleadings obtained from the Belknap County Superior Court, Scotia Technology, a division of Lakes Region Tubular Products Inc., said it lost more that $2.5 million fixing the deficiencies.

Scotia was notified by Boeing on Feb. 12, 2012, that the stainless steel tubing cleaned by Areodynamics Inc. of Seabrook, was leaking under hydraulic pressure from pin holes.

"On April 9 Scotia Technology was required to issue a Notice of Escape to Boeing and the matter was reported to the Air Force," said the pleading. "At the Hill Air Force Base in Utah and at the Robbins Air Force Base in Georgia, the Air Force suspended A-10 operations."

Scotia claims that the Air Force's A-10 program required them to replace all of the tubing at no cost to Boeing. Scotia also had to expedite its production schedule and ship the replacement tubing in time to meet the Boeing deadline September 2012 imposed by the Air Force.

The specialized kind of treatment — called passivation — involves cleaning recently molded stainless steel piping to remove any production materials like iron or iron compounds that may linger after machining and fabricating.

If not property done, these corrosive agents can lead to extreme pitting and the possible failure of stainless steel components.

The suit said that Aerodynamics "holds itself out as accredited and certified by the National Aerospace and Defense Contractors Accreditation Program" and said it complied with all required protocols.

Scotia claims that Aerodynamics used an alkaline solution that did not meet necessary standards, that one of the tanks the company used was not big enough to properly clean large tubes, and the rinse water was room temperature and not the required 140-160 degrees.

The suit also says that all of Areodynamics tanks were not labeled, that there was not enough nitric acid in the passivation bath, and that the tubes could not be rinsed in de-ionized water after the passivation bath because Aerodynamics used the same tub for both processes.

The suit also claims the drying operation at Aerodynamics was insufficient.

Scotia claims that they retained the independent company Materials Research that determined the chloride ions in the alkaline cleaning solution and in Seabrook tap water "were the root cause of the pinhole leaks in the stainless steel tubes."

Legally, Scotia filed a claim for breach of contract, breach of implied warranty of workman quality, a violation of the N.H. Consumer Protection Act, intentional or negligent misrepresentation and negligence.

At a scheduling hearing last week, Belknap County Judge James O'Neill determined both sides should be ready for trail by the end of 2015, but said both should reconsider mediation before moving forward to trial.

Lawyers for Scotia said mediation hasn't worked in the past and that Scotia fears that Aerodynamics will declare bankruptcy before mediation and trial.

Aerodynamics attorneys said the case is very complex, involves matters of national security, and that it will take a great deal of time to compile the discovery items that it anticipates will be requested by Scotia.

 

Last Updated on Thursday, 20 March 2014 01:14

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City officials seek to fix bill exempting RVs from property tax

LACONIA — City officials and state lawmakers are scrambling to fix a bill that threatens to shrink the city's total assessed valuation by $10 million, trim its property tax revenues by $200,000 and add 10 cents to its property tax rate.

Senate Bill 333, sponsored by Sen. Jeanie Forrester (R-Meredith), would exempt from property taxation recreational vehicles remaining in any one city, town or unincorporated place for fewer than 45 days as well as recreational vehicles stored or placed rented on a rented campsite at a recreational campground or camping park no matter for how long.

The bill carried the Senate by a unanimous vote of 24-0 in January and is scheduled to be heard by the House Municipal and County Government Committee of Tuesday, April 1, at 10:30 a.m.

The statutory definition of a recreational vehicle includes motor homes, vans, pickup campers and tent trailers as well as recreational trailers of 400 square feet or less. The definition includes so-called "park models," which may be 12-feet and 36-feet long with pitched roofs and gabled windows that resemble miniature cottages with room to sleep as many as 10 people.

Jon Duhamel, the city assessor, has counted 423 recreational vehicles parked at a dozen campgrounds year around with an aggregate assessed value of $9,994,500. They have been taxed for years, but would become exempt from property tax if the bill were enacted. He estimates that the city would forgo more than $220,000 in revenue.

Meanwhile, at Bristol Shores on Newfound Lakes in Bristol, Christina Goodwin, the assessing assistant, said there are 183 "park models" with a total value of nearly $8 million that would become exempt from property tax, representing almost $160,000 in foregone revenue to the town. In Alton, Tom Sargent, the assessor, said that currently there are 147 units with a value of $900,000, but a campground with space for another 147 is in the offing. "Because our tax rate is so low the revenue impact is only about $12,000," Sargent said," but that pays for a part-time secretary."

Laconia City Manager Scott Myers contends that recreational vehicles permanently parked in campgrounds do not comply with the intended definition of a recreational vehicle, but are more akin to seasonal camps and cabins of fewer than 400 square feet on private lots, which are liable to property taxation. He points out that these recreational vehicles are not registered as either motor vehicles or trailers, a sign that their owners, most of whom reside in another state, do not intend to move them. Likewise, he notes that manufactured housing is defined as a unit of 320 square feet or more, while units that qualify as recreational vehicles, which are in campgrounds throughout the year, measure between 369 square feet and 408 square feet. He questions if the distinction is sufficient to tax one but not the other.

Apart from the loss of revenue, Myers claims that those living in these units avail themselves of municipal services, if only on a seasonal basis, and should contribute an equitable share to their cost.

Forrester introduced the legislation at the request of the New Hampshire Campground Owners Association, whose lobbyist Henry Veilleux this week proposed an amendment intended to mitigate the fiscal impact on municipalities. The amendment would exempt only those recreational vehicles less than eight-feet, six inches in width, leaving all wider units liable to property taxation.

Veilleux said that this provision would entitle municipalities to tax the "park models," which represent the bulk of the assessed valuation of recreational vehicles. He estimated that the amendment would enable Laconia to recapture at $6,568,000, or 66 percent, of the assessed valuation. The amendment would leave all the units at Bristol Shores taxable.

Myers expressed reservations, explaining that the issue was not confined to the "park models." He said that other units meeting the statutory definition of a recreational vehicle were effectively permanent, if seasonally occupied, structures, many with porches, decks and other extensions. "They are not intended to be moved," he said.

The issue arose in the wake of two court decisions. In 1999, the New Hampshire Supreme Court ruled that a truck trailer could be assessed and taxed as a building "if by its use it:  (1) is intended to be more or less permanent, not a temporary structure;  (2) is more or less completely enclosed;  (3) is used as a dwelling, storehouse, or shelter;  and (4) is intended to remain stationary." Two years later the Belknap County Superior Court applied this standard to eight trailers at the Hack-Ma-Tack Campground at The Weirs, when the City of Laconia taxed eight trailers on the property as buildings.

On the strength of the court decisions, the New Hampshire Department of Revenue Administration (DRA) urged municipalities to apply the criteria strictly. Some did, but others found the cost of assessing the units and billing their owners, many of whom reside outside the state, outweighed the revenue collected.

Forrester said that she received calls from campground owners and municipal officials in different communities troubled by the inconsistent application of the law. In particular, she found that recreational vehicles parked at the 117 campgrounds in the state were treated differently by different municipal assessors. Some are taxed as real property while others are not. Some municipalities bill the owners of the recreational vehicles while others, unable to identify the owners, bill the owners of the campgrounds. Her bill, she said, is intended to bring order to what she called "a crazy quilt."

Last Updated on Thursday, 20 March 2014 12:29

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Bicycle Exchange Proposed for Downtown Laconia.

LACONIA — An informational session on a Laconia Area Bicycle Exchange will be held Monday, March 24, from 11:30 a.m. to 12:30 p.m. at the conference room at the Lakes Region Child Care Center at Health First.

The goal of the program, proposed in January by John P. Rogers of the Better Together organization, is to find a location in downtown Laconia where as many as 40 bicycles can be stored which will be available to clients of social service agencies who can use them to provide themselves with transportation to jobs and medical appointments as well as for recreation.

Rogers said the clients will be provided with vouchers from social service agencies such as Genesis to use the bikes for free or possibly for rent. They will also be provided with helmets and safety brochures along with air pumps and repair tools.

He is looking for a good, safe location in the downtown area which would be open a couple of days a week, and for volunteers to organize and guide the Bike Exchange and says he has already received support and encouragement from places, such as Piche's Sports.

For more information on the program or to RSVP at Monday's meeting call Rogers at 524-5288 or by cell at 603-630-7571 or by email at This email address is being protected from spambots. You need JavaScript enabled to view it. .

Last Updated on Thursday, 20 March 2014 12:13

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Committee planning LHS renovation to begin meeting on March 25

LACONIA — The first meeting of the Joint Building Committee for the project at Laconia High School is scheduled for March 25 at 3 p.m. at Harvard Street School.

The installation of a fire suppression system in the older portions of the high school as well as some additional ventilation was made possible when the district qualified for a Qualified Zone Academy Bond for $1.8-million interest-free bond.

The Joint Building Committee is comprised of the members of the School Board who serve on the Building and Grounds Committee – Beth Arsenault, Malcolm Murray and Joe Cormier — plus members of the Laconia City Council, and administration teams from both the city and the school.

Councilors Bob Hamel, Henry Lipman and Armand Bolduc are the City Council representatives for the Huot Technical Center renovation project.

District Business Administrator Ed Emond said the purpose of the March 25 meeting will be to organize the committee and set a timetable for their meetings and the project.

Work on the project is expected to begin once school ends in June.

Last Updated on Thursday, 20 March 2014 12:07

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