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Rushford grabs opportunity during project


By Kirsten Zoellner

Fri, Jun 27th, 2014
Posted in Rushford Government

With the Highway 43 Project slated to begin Monday, June 30, the Rushford Electric Commission is considering expanding lighting upgrades along the highway corridor. The lighting will be temporarily removed for the project, so the commission will seize the chance to upgrade all lighting while the roadway is disrupted.

The commission has worked to determine the scope of the project with engineer Tom Nigon and has determined the best course of action is to replace all lighting with LED due to significant cost savings. In addition, it is considered replacement of wooden poles with steel. However, following a recommendation from downtown business leaders, the commission is considering upgrading all lighting to decorative steel poles/heads as well.

Of the 36 current poles, 11, from Grove Street north and along west end of Harry Street, are wooden. Of the 27 metal poles, within the in the central business district, five need replacement due to rusting. The consensus is that changing all poles to a decorative style will make the Highway 43 corridor uniform. “The thinking was, if streets are going to be torn up, this is a chance to upgrade,” noted City Administrator Steve Sarvi.

The estimated cost for complete upgrades is $430,354, however, it was noted that the estimate is an “all-in,” inflated cost. The city has several opportunities for further savings on the project by ordering direct, saving 5-8 percent of the project cost, as well as reusing the conduit. The bids for the project will be split in order to account for these.

The commission has considered several styles of decorative lighting, but will be looking for public input on the options. A six to eight week order time will allow for public review and comment. The city has authorized a bid package to be put together. The commission will make a decision in July to put forward to the city for approval.

Financial consultant Mike Bubany, of David Drown Associates, noted that there are special rules for electric debt, but it can be done with special considerations. The commission would likely spend down a portion of its reserves for the project leaving just $200,000 to be bonded. Bubany suggested having the bond funded by a local bank or several local banks. Another option would be to fund bond amount through a Minnesota Rural Water Association microloan. For amounts of $250,000 or less and seven years or less, Bubany noted the microloan would have substantially lower issuance costs. The city would need to get a program exception because of having no general obligation pledge, but feels it can be done.

“The best time to spend this is when the project is going on. It will be a very inviting downtown with consistency from one end to the other,” added Councilor and commission member Mark Honsey. “We want people to be proud of our city; want them to be happy when they drive down our streets. The commission has considered this for a long time.”

Following the commission’s decision in July, financing based on the budget will be recommended to the council. Should the added upgrade move forward, the city would likely place the order July 28, at the second monthly meeting. Poles could be placed by the end of September or early October.

The city has approved a bond financing deal for the Highway 43 Project with the mayor signing the bond purchase agreement June 24 with additional PFA funding finalized June 26. The negotiated sale of the $1,300,000 general obligation improvement bonds come with a 20-year term at 3.85 percent, slightly above predicted interest rate. The city faced several hurdles in financing and opted for the negotiated sale with Robert W. Baird, as opposed to a competitive sale, for a chance to highlight the city’s challenges.

The bonds were unrated, but the city did well on the deal. “I tried to flush out whether we got a good deal and we’re within a quarter of a point of what would have been an A rating,” noted Bubany. “I was a bit concerned in negotiations, with the challenges, but to come out here, at what would be essentially an A rating? Yeah, this is absolutely a good deal,” he continued.

Other good news for the city continued past financing to discussion regarding the June 18 contractor meeting for the project. ““The closer we’re getting to this, the better I’m feeling about it,” stated Mayor Chris Hallum.

“It was impressive,” chimed in Councilor Roger Colbenson. Council and staff agreed.

The contractor is proposing a two phase project, with two portions to phase one. Phase 1A will begin on the south portion of the project, between Jessie Street and Highway 16 west. An area with known contaminated soil and 300 feet of asbestos pipe that needs to be cut, bagged, and hauled away, the section has the most unknowns. Hitting it first allows the contractor more time to deal with any potential hiccups. Also, it will get the project in and then out of the way for Farmers Cooperative Elevator, a major downtown business, who would struggle with a closed road at harvest time.

“By no means are we expecting all project areas closed at the same time,” said Sarvi. “We’ll leave streets open as much as possible. When leave a section, almost everything will be done.” The city also doesn’t anticipate shutting off water, except when switching it over.

Phase 1B will encompass Rushford Avenue north to Winona Street. North end bridge is expected to remain open until approximately September 1. Phase 2 is scheduled last for Rushford Avenue to Jessie Street. Two full crews and one half crew are slated, with one tackling water upgrades, one set for sewer upgrades, and the half crew for other related items. Crews will work 7 a.m. until 5 p.m., but will make some exceptions. The project is expected to be concluded by November 15. At a minimum, it is expected that the first layer of bituminous will be down on the highway before winter.

“It’s important for business owners and residents to communicate to us,” added Sarvi. “We’re going to get a good effort; a good crew. It’s important for people to work with them, but stay out of their way and let them work.”

Ground breaking on the project will begin Monday, June 30. The project can be followed via the city’s website at http://www.rushford.govoffice.com, under the “Highway 43 Project” tab on the left side of the page.

The next regularly scheduled council meeting is Monday, July 14, at 6:30 p.m., at city hall. The public is encouraged to attend.

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