5.1. SR 07-18-2011REQUEST FOR ACTION
TO ITEM NUMBER
Honorable Ma or and Ci Council 5.1.
AGENDA SECTION MEETING DATE PREPARED BY
Administration ul 18, 2011 ustin Femrite, P.E.
ITEM DESCRIPTION REVIEWED B)/
2011 Street Improvement Project Bob Thistle, Interim City
^ Assessment Hearing -Public Hearing Administrator
^ Resolution Adopting Final Assessment Roll REVIEWED BY
^ Resolution Awarding the Bid and Authorizing Execution
of the Contract
ACTION REQUESTED
Upon conclusion of the assessment public hearing, the City Council is asked to consider adoption of the
attached two resolutions. The first resolution adopts the final assessment roll. The second resolution
awards the bid and authorizes the execution of the contract.
BACKGROUND/DISCUSSION
The assessment hearing for the 2011 Street Improvement project is scheduled for this evening's City
Council meeting. At the start of the public hearing I will make a presentation of the proposed
improvements and the financing aspects of the project. After my presentation, I will be available to
answer questions from the City Council and/or public.
Part of my presentation will touch on the property owners' rights relative to an appeal of the assessment.
It is important to remember that the property owners must submit a written objection at or before the
assessment hearing in order to preserve their right to appeal the assessment. Simply speaking at the
public hearing and voicing an objection is not sufficient to preserve the right to file an objection with the
District Court.
Construction bids were received on Thursday, June 30, 2011. There were a total of eight bids received
which ranged from $1,431,095.72 to $1,780,681.20. A tabulation of the bids is attached. The low bid was
received from Redstone Construction Co., Inc., in the amount of $1,431,095.72. This is slightly below
the feasibility study estimate for the overall construction cost.
At the improvement hearing one comment was received discussing the merits of providing a sidewalk
along Evans Avenue from Main Street south to the Vernon Cemetery. We solicited a bid alternative to
evaluate the costs for adding this section of walk. The cost for adding this piece of walk is $18,186.00.
Based on the relatively high costs, limited amount of use that can be expected, and previous
correspondence with property owners along the project stating sidewalks were not being installed, we are
not recommending award of the bid alternative.
The proposed assessment rate has been slightly reduced from originally estimated in the feasibility report
based on bids received. A standard residential lot in Project Area 1 will be assessed at a rate of $6,984.61.
There are a number of properties on this project that are not typical single residential units. As with
N:\Public Bodies\Ciry Council\Council RCA\Agenda Packet\07-18-201 ] \Assessment and Bid.docx
previous projects all town home or twin home properties are proposed to be assessed at $5,238.46 or 0.75
residential equivalents per dwelling unit. The properties along the 15L Street cul-de-sac are proposed to be
assessed at a rate of $1,746.15 or 0.25 residential equivalents per dwelling unit. Commercial and industrial
properties have been assessed at a rate of $10,476.92 or 1.5 residential equivalents.
Assessments in Project Area 2 have been calculated with the total assessable costs split throughout the
Industrial Park based on 50% per unit and 50% on assessable lot frontage. Assessments in Project Area 2
range from $6,256.83 to $18,852.37.
At the close of the assessment hearing, it would be appropriate for the City Council to consider the
attached resolutions. The first resolution adopts the final assessment roll (which is also attached). This
can be adopted with any revisions to the assessment roll that the City Council deems appropriate after
listening to testimony from the public. A final notice of the assessment schedule including interest rate
will be mailed to each property after the assessment hearing, indicating the action the Council has taken.
The second resolution awards the contract. This resolution has been prepared based on staff
recommendation to not include the sidewalk along Evans Avenue. It would only be appropriate to
consider this second resolution if the resolution adopting the final assessment roll is passed by the City
Council.
FINANCIAL IMPACT
Based on the low bid received, the total project cost including overhead is estimated at $1,655,976.72.
The total cost of private property assessments, as detailed in the attached assessment rolls, is $560,615.41.
The remaining project cost is proposed to be funded by the appropriate City and Elk River Municipal
Utility funds.
ATTACHMENTS
^ Tabulation of bids
Resolution adopting final assessment roll
^ Assessment Roll -Project Area 1 & Project Area 2
Resolution awarding the low bid and authorizing execution of the contract
Action Motion by Second by Vote
Follow Up
N:\Public Bodies\Ciry Council\Council RCA\Agenda Packet\07-18-2011\Assessment and Bid.docx
BID TABULATION
2011 Street Improvements
Elk River, MN
BMI Project No. R13.1033~4
Bids Taken: Thursday, June 30, 2011
Time: 10:00 a.m.
Addendum(s): # 1 -June 27, 201 l
BIDDERS AMOUNT BID BID BOND ADDEND. (S)
1 Burschville Construction ~ ~G D L, ~ ~~
15 I , ~ ~ ~ I
2 C.W. Houle, Inc. J
3 Douglas-Kerr Underground ~ L ~ 3~
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4 Dresel Contracting
5 Fehn Companies
6 Forest Lake Contracting
7
Geislinger & Sons
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8 Hardrives Inc.
9 J.R. Ferche l
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10 Knife River Corporation
11 Kuechle Underground
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12 LaTour Construction
13 New Look Contracting
14 Northdale Construction ~ `~ L(~ L13~ ~
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15 North Valley, Inc.
16 Northwest Asphalt Inc.
17
R. L. Larson
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BID TABULATION
2011 Street Improvements
Elk River, MN
BMI Project No. 813.103354
Bids Taken: Thursday, June 30, 2011
Time: 10:00 a.m.
Addendum(s}: # 1 -June 27, 2011
BIDDERS AMOUNT BID BID BOND ADDEND. (S)
18 Redstone Construction Co ~ t j.,~ ~ ~ ~ ~ ~ a ~C
19 Rum River Contracting
20 S. R. Weidema Inc.
21
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H:\F.T.KR1R1370~3541('C)RRF.S11(1.~i354 TiTflTAfi..)7nC
RESOLUTION I I -
A RESOLUTION FOR THE CITY OF ELK RIVER
A RESOLUTION ADOPTING FINAL ASSESSMENT ROLL IN THE MATTER OF
THE 201 I STREET IMPROVEMENT PROJECT
WHEREAS upon due notice properly made as required by law, the Elk River City Council has met and
heard and passed upon all objections to the proposed assessment for the 2011 Street
Improvement project and has determined the amount to be assessed against each individual
property as the Council deems just;
NOW, THEREFORE, BE IT RESOLVED by the Ciry Council of the Ciry of Elk River, Minnesota:
1. The final assessment roll, a copy of which is attached hereto and incorporated herein by this
reference, is hereby accepted and adopted and shall constitute the special assessment against the
lands therein named. Each such tract of land in the assessment roll is hereby found to be benefited
by the improvement in an amount not less than the amount of the assessment levied against it.
2. Such assessment shall be payable in equal annual installments, including both principal and interest,
amortized in such amount annually as is required to pay the principal with interest at 3.40% over a
period of ten years.
3. The owner of any property so assessed may at any time prior to certification to the County Auditor
of the assessment or the first installment thereof, pay to the City Treasurer the whole of the
assessment on such property, with interest accrued to the date of payment; except that no interest
shall be charged if the entire assessment is paid within 30 days after the adoption of this Resolution.
Prepayment may also be made after the certification of the assessment or first installment thereof by
paying to the Ciry Treasurer/County Auditor the entire amount of the assessment remaining unpaid
with interest. In the case of a payment made before November 15, interest will be calculated through
December 31 of the year in which payment is made. If payment is made after November 15, interest
will be calculated through December 31 of the next succeeding year.
4. The City Administrator shall transmit to the County Auditor a certified duplicate of the attached
assessment roll to be extended on the property tax lists of the County. Such assessment shall be
collected and paid over in the same manner as other municipal taxes.
Passed and adopted this 18~ day of July, 2011.
ATTEST: John J. Dietz, Mayor
Tina Allard, City Clerk
N:\Public Bodies\Ciry Council\Resolutions\Adopt%20final%20assess%20ro11[1].docx
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RESOLUTION I I -
A RESOLUTION FOR THE CITY OF ELK RIVER
A RESOLUTION ACCEPTING BID AND AUTHORIZING
EXECUTION OF CONTRACT IN THE MATTER OF THE
201 I STREET IMPROVEMENT PROJECT
WHEREAS pursuant to a City Council Resolution 11-31, passed at the June 6, 2011 meeting, competitive
bids were solicited and received for the 2011 Street Improvement project; and
WHEREAS the City Council has considered the amount of the bids and the responsibility of the bidders
and determined that Redstone Construction Co., Inc. is the lowest responsible bidder;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Elk River, Minnesota:
1. The Mayor and City Administrator are authorized and directed to execute, on behalf of the City, such
contract with Redstone Construction Co., Inc. as is approved by the City Attorney, for the
completion of the Irving Avenue Area Street Rehabilitation according to the approved plans and
specifications designed by City Council Resolution.
2. The City Administrator is authorized and directed to forthwith return to all bidders the deposits
made with their bids upon execution of the contract specified above.
Passed and adopted this 18~ day of July, 2011.
John J. Dietz, Mayor
ATTEST:
Tina Allard, City Clerk
C:\Documents and Settings\jmiller\Local Settings\Temporary Internet
Files\Content.IES\2XCDIHAD\Accept%20bid%20authorize%20contract[1].doc
In regards to the proposed assessment for the 2011 street improvement project,
specifically 2"d Street from Railroad Dr. to the cul-de-sac east of Evans Avenue.
I. As far as I'm concerned, I don't need a new street.
2. I'm not disputing the fact that the street is in rough shape, and needs to be
repaired or replaced, but it seems to me that the city needs the street, more than I
do. I watch city trucks all day long running past my house on the way to the
~,
power plant on Railroad Drive. They drive up the road in what look like water
tankers, along with the regular city trucks every day.
3. I am already upside down, and now you want to raise my mortgage payment
another 855.40 next year.
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3 ~~ ~,~~~:~/ i-
1O G~./.Gc~"
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Written Objection to the Proposed Assessment for the Elk River 201 Street Improvement
Project
Issue: The formula for calculating the amount of assessment to each business in the Industrial Park bordering Industrial
Blvd, Triangle Road, and 192"d Court is unbalanced and not fair.
Method Used: 50% of the assessment was on a "per unit" basis and 50% was based on lineal feet of street bordering
each property.
Whv this is unfair:
1. In manufacturing and warehousing, unlike retail, the amount of visibility due to road frontage or access has
little to no effect on the success of your business. The only purpose a road serves is to allow access for your
employees and for the transportation of your raw materials and products. This industrial park is virtually all
manufacturing and warehousing, with a two small office buildings.
2. In the specific case of Dynetic Systems, we happen to be located on the inside of the curved corner of Industrial
Blvd. and thus have a large amount of street exposure. Since our business is national in scope and highly
technical in design, our success is not dependant on customers seeing or traveling to our place of business. We
gain no benefit from this specific location in the industrial park on the inside of the turn. Since our product is
small and high tech, we use standard UPS or FedEx step vans to ship our product and receive raw material. We
rarely have semi-truck deliveries of raw material (est. 12/year). We always use our parking lot for
loading/unloading.
3. By contrast, the business across the street from us relies almost exclusively on heavy trucks for delivery and
shipment, and regularly uses the street in question rather than his parking lot to load heavy machinery on
flatbeds using large forklifts. This business buys and resells used heavy machinery. Anytime you steer a solid
tire of a stationary heavy vehicle such as a forklift, as is typical when loading a flatbed, a lot of stress is put on
asphalt; and thus much of the damage to our street is probably due to this neighbors practices.
4. Another business further around the turn with more sales volume than our business has very little street since
they are on the outside of a turn and only have a small wedge of street access for their driveway. They regularly
get deliveries of steel and aluminum by flatbed.
Our Proposal for a Fair Calculation Formula:
Since the council seems opposed to using solely a "per unit" basis for calculating the assessment, we would propose
that the 500 of the assessment currently based on lineal feet of street exposure be based instead on square feet of
land owned by each property. This statistic should be easily obtainable by using plat maps and/or property tax
assessments.
Justification: In manufacturing and warehousing, potential earning power (and thus your ability to pay a special
assessment) of your property is much more closely proportional to the amount of land you have and not how much
street you have. The few offices in this park rely on methods other than visibility to generate foot traffic.
Kurt Sadler
Representative for the family that owns Dynetic Systems at 19128 Industrial Blvd