City Engineer Brett Grabau reviewed the feasibility report for potential 2021 street and utility improvements at the Preston City Council’s June 1 meeting.
Grabau explained the report was put together to give the council the ability to pick and choose project areas to keep within financial limitations they had set some months ago. The city’s capital financing plan was updated early this year, setting a preliminary budget for the 2021 project at $4.2 million.
The estimated cost for all nine project areas addressed in the feasibility report is about $5.4 million. The areas listed included the Valley St. area, post office area, five points (portions of St. Paul St., Spring St., North St. and Preston St.), Chatfield Ave., Park Ln., Center St., Cottage Grove, Maple St., and Washington St.
Councilman Robert Maust argued that it will cost less in the long run to do all the project areas in 2021. Mayor Kurt Reicks maintained that increases in property taxes have to be considered, “we still have to pay for it even if borrowing costs are low now.” Maust commented that if they all were done, “we would be done with projects for a long time.”
Councilwoman Holly Zuck said she did not want to do more than that which can be done within the preliminary budget plan. City Administrator Joe Hoffman pointed to tax rate projections, suggesting there would be a 15% increase in the first year if all projects were done. Residents may also have to pay assessments along with some increases in sewer and water rates.
An option presented by the staff included five areas: Valley St., Five Points, Chatfield Ave., Park Ln., and Washington St. The estimated total cost for these five areas is just short of $4 million. Hoffman proposed that they use $500,000 cash from the street fund, $200,000 cash from the utility fund, and bond for about $3.3 million.
Maust continued to argue it will be cheapest to do all the project areas. Councilman David Collett pointed out that borrowing money next year will be the cheapest it will ever get. Zuck maintained, “we have to make it affordable to live here,” adding COVID-19 could still lead to more job losses, “we have to look out for the people.” Councilman Charles Sparks said, “we can only absorb so much cost.”
Maust suggested people looking to move to Preston look at streets, curbs and gutters. Reicks insisted they also look at property taxes. Maust then suggested splitting up the Valley St. area and doing only a portion of it and all of the other areas. The Valley St. area includes 11 blocks and is the most costly of the areas, about $2.5 million.
The debt from the 2014 project will be paid off in 2029. Jim Bakken explained there will need to be ongoing maintenance costs for mill and overlays and sealcoating to protect those streets improved in 2014 and to extend their life. Reicks and Zuck suggested the smaller projects may be able to be fit in over the next several years in a piece meal fashion.
A motion to go with the five suggested project areas, estimated total cost $3,948,929 was made (about $700,000 cash and $3.3 million in bonds). The motion passed 3-2 (Maust and Collett voted no). A resolution to accept the feasibility report and to set a public hearing for July 6 was approved, again by a 3-2 vote.
It is hoped to have an in-person public hearing with the availability of participation through written comments and/or remote access.
Other business in brief
•An application for a conditional use permit from Julie Sogla on behalf of DS Investments to install indoor climate-controlled storage at a property at 144 Main St. SW in the B-3 zone was approved. Two conditions on the permit require a principal permitted use to occupy at least 40% of the gross floor area and the principal permitted use must extend along 60% of the first floor store front. Planning and Zoning committee had recommended approval.
•An application for a conditional use permit submitted by Fred O’Connor to install indoor climate-controlled storage at a property at 212 Main St. SW in the B-3 zone was approved. The two conditions requiring a principal permitted use to occupy at least 40% of the gross floor area and to extend along 60% of the first floor store front were included. Planning and Zoning committee had recommended approval.
•Police Chief Blaise Sass requested approval to replace a 2014 Impala squad with a 2020 Dodge Durango squad. The fully equipped vehicle will cost $37,912. The vehicle itself will be purchased through a state bid for $29,783 with the rest of the cost coming from equipment and graphics. There is $44,000 budgeted in the 2020 squad fund. The purchase was approved as presented and as recommended by staff.
•Ambulance Director Ryan Throckmorton requested the council accept a second Minnesota Department of Health grant for COVID-19 response in the amount of $8,523. Eight-thousand is to be used for staffing costs and $523 is to go toward PPE equipment. A motion to accept the grant was approved.
•Approval was given to reduce by 20% the annual fees for on-sale liquor licenses this year (Collett voted no). A request to prorate the license fees was made by Trout City Brewing and the Branding Iron due to the COVID-19 effect on their businesses. The fee reduction will be made to all businesses with on-sale liquor licenses.
•A temporary liquor license for Fillmore County Ag Society for the county fair July 21-26 was approved. A decision has not yet been made by the fair board for a 2020 fair.
•Kristi Richards, owner of a dog grooming business, was appointed to the EDA.
•The acceptance of a technical assistance housing grant from the Minnesota Housing Partnership was approved as recommended by the EDA.
•The next city council meeting will be held June 15 and likely will still be held virtually via Go To Meeting. The July 6 meeting will include the public hearing for the 2021 street and utility projects.
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