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Bituminous prices balloon Preston street improvement costs

Fri, Jul 25th, 2008
Posted in Government

Brett Grabau of Bonestroo informed Preston City Council members of the 2008 Street and Utility Improvement bids at their July 21 meeting. He noted that three companies bid with the low bid from Road Constructors Inc. coming in at $193,306.75. The low bid was about $43,000 more than engineer estimates made in May 2008.

Grabau explained that the 20% increase was due to higher bituminous prices which are now at about $68 per ton. This compares to an average of $43 per ton just last year. Grabau added that the bid is expected to be higher in part because of the July bid rather than a late winter or early spring bid when the contractors are 'hungry' for work.

City Administrator Joe Hoffman suggested that the council had four options including not doing the projects, scaling back the size of the projects, increasing the amount of the inter-fund loan, or postponing and rebidding in the winter. Grabau commented that oil prices will probably continue to go up inflating the bituminous price. The projects include Chatfield Avenue, Mill Street and Industrial Drive.

Hoffman said that the unexpected additional cost of the projects could be funded by using an inter-fund loan to fund the gap which in effect would be spending 2009 cash in 2008. The total cost of the projects with engineering costs will total $231,968.10. Council members voted unanimously to go ahead and use next years street funds to pay for the additional cost with an inter-fund loan. Councilman Heath Mensink remarked, "Pay now or pay later." The 2009 street levy will be used to repay the loan.

Sixty-thousand per year is set aside for street maintenance. Hoffman suggested that this amount will need to increase to make any headway with the increased costs.

Ristau Variance

Hoffman explained that Travis Ristau purchased a property at 808 Jeremiah Street. Ristau tore down and removed the garage and had the fire department burn down the house. The property is now an empty lot. Ristau applied for a variance to allow him to build a new two car detached garage where the old garage stood, five foot from the street. He expects to build a house in the future.

Planning and Zoning held a public hearing on the variance. No one spoke against the variance and the P and Z committee recommended approval. The variance was approved.

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