City Engineer Brett Grabau explained at the March 15 Preston City Council meeting that the city had received three bids for the 2021 Street and Utility Project.
The low bid was submitted by Alcon Excavating, Inc. in the amount of $3,107,040.97 for the main project and $55,055.05 for the alternate project (retaining walls). The bid was lower than the engineer’s estimate, which was $3,221,277.05 for the main project and $48,070 for the alternate project.
City Administrator Joe Hoffman reported on the opinion of the League of Minnesota Cities (LMC) in regard to council member votes on projects that affect their property. Three members have property in this project area. “Council members can discuss and vote on local improvement projects that affect their property.”
A long discussion ensued as to whether or not to include the retaining walls/alternate project. Hoffman said it can be included in the project cost or it could not be included at all at this point. It would then have to be dealt with when it becomes an issue.
Councilman Dean Aug said he was worried about setting a precedent.
Scott Melver, property owner, asked who owns the walls (in the St. Anthony St. and Spring St. areas)? Hoffman noted the wall looks like it sits in the right of way, but that is not the deciding factor as to who owns the wall.
Grabau explained there is no assessment language pertaining to walls. For the streets some portions of the street costs are not assessed and are paid by the city. The portion that is assessed is assessed at 40% property owner and 60% city. Other sidewalks being replaced as part of the project are being assessed as part of the project. In other words, people will be paying for sidewalks that are not necessarily bordering their property. Grabau added everyone gets different benefits from the project.
Melver noted the wall is leaning and should be replaced. Councilman Charles Sparks said the wall is there to allow for the sidewalk to be there; it should be part of the whole reconstruction project. Grabau maintained the wall could be done separately at a later date as long as construction doesn’t cause an issue with the wall.
Hoffman said the assessment policy could be modified to include walls. Grabau admitted there is always a benefit to do things all at once. City Attorney Dwight Luhmann, speaking only as a homeowner, said the walls are there to allow for the sidewalk which is a public amenity. There is a public benefit to have the sidewalk.
Mike Bubany, financial adviser, suggested they decide if the retaining wall is a benefit to the city as a whole or just the property owner. If the cost of the wall is shared, the cost would be minimal when spread out. In any project some things benefit certain homeowners more than others.
Mayor Kurt Reicks acknowledged if the walls/sidewalks are a benefit to the city, they should be part of the whole project and assessed accordingly. A motion was unanimously approved to include the alternate bid with the total project and that the cost be assessed to all of the property owners.
A motion was unanimously approved to award the project with the alternate bid to Alcon Excavating, Inc. of Rochester.
Mike Bubany explained the total capital outlay will be $3,830,246 ($2,596,670 for the city and $1,233,576 for the utility). With the addition of discount allowance and other fees and costs the total is $3,935,647.67. After a city cash contribution of $525,647 (from utility water fund and city street budget) the actual general obligation improvement and utility revenue bond issue will be $3,410,000. Bond payments are to be spread over 15 years.
Bubany explained that he inflated the interest rate for now due to inflation risks. The bond sale date is set for May 17. It is difficult to say what the interest rates will be at that time. A resolution was unanimously approved authorizing David Drown and Associates, Inc. to solicit bids. Closing is expected to be on June 1.
Other business in brief
• Jeff Broberg, speaking for the National Trout Center, updated the council as to this year’s plans. The first order of business is to hire an executive director, a part-time position. A board of directors meeting should be held next week. One person interested in the executive director position is a disabled veteran who ran a Fly Fishing for Veterans program and who is a trout angler.
There will be an update at an April council meeting.
• EDA housing incentives for 2021 were approved. The EDA had approved three New Construction incentives and two Single Family rehabilitation incentives. The incentives will be on a first come first serve basis.
• April is Sexual Awareness Month. Permission was given for Fillmore County Victim Services to place teal ribbons on the light poles in Preston for the month of April to bring about continued awareness of sexual assault and the resources available for those who have been victimized.
• The next city council meeting will be held on April 5. The city audit and a county jail needs study will be presented. At the April 19 meeting the Local Board of Appeal and Equalization will be held.
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