8.4. SR 09-04-2012 Elk REQUEST FOR ACTION
River
TO ITEM NUMBER
Mayor and City Council 8.4
AGENDA SECTION MEETING DATE PREPARED BY
General Business September 4, 2012 Bob Pearson, IT manager
ITEM DESCRIPTION REVIEWED By
Award of Construction Bid—Backbone Fiber Optic Ring Tim Simon, Finance director
REVIEWED BY
Cal Portner, City Administrator
ACTION REQUESTED
• Adopt the attached resolution awarding the Backbone Fiber Optic Ring Project to Michels
Corporation in the amount of$268,721.24 and authorize the execution of the contract.
• Authorize the city attorney to draft a usage agreement for the city, county,and ERMU.
BACKGROUND/DISCUSSION
At the work session on August 6, 2012, staff discussed an opportunity to take part in the building of a
fiber optic ring in Elk River. Staff had embarked on a strategic plan to build a fiber network that would
connect all city facilities to improve data capacity and function. At the August meeting, staff presented
preliminary estimates for a project that would include a partnership with ERMU and the county.
The project estimates exceeded the state bid law minimum of$100,000. With a desire to build a
redundant ring of fiber, city and ERMU staff prepared to go to bid on the project in accordance with the
state bid law.
The backbone will originate from the public safety building data center. The ring design is made up of
144 strands of fiber. The plan is for a 48-strand ring to go west from the city hall campus and 96 strands
to go east of the city hall campus. Please refer to the attached drawing. As we mentioned before the
intention of this network is for connecting government and utility facilities.
It is interesting to note a number of other cities and counties investing in fiber to connect their facilities:
• Anoka County has almost completed a $19 million project connecting 145 public institutions.
• Prior Lake is considering a$28 million project that would require bonding of about$35 million.
It would provide a wide array of high-speed telecommunications services to residents,businesses,
schools and health care providers, as well as local government.
• The Elk River school district and the City of Rogers did a similar partnership in 2010.
Staff prepared plans and advertised the Backbone Fiber Optic Ring Project. Construction bids were
received on Wednesday,August 29, 2012. There were a total of two bids received which are summarized
as follows:
Michels Corporation $268,721.24
TD &I Cable Maintenance, Inc. $445,729.53
p0WIe10 0
1`4AT' URE1
The bids are in line with what was projected at the work session meeting. The specification included two
lateral runs, one to the new public works facility and the other to the waste water treatment plant. The
costs for the lateral runs are approximately$14,000 and would not be a shared responsibility. The public
works facility costs will come from the building project,which had planned to include conduit but no
fiber during initial construction.
We recommend awarding the project to Michels Corporation,the lowest responsible bidder. City
Attorney Peter Beck is drafting a usage agreement for ERMU, Sherburne County,and the city. The city
would be the primary owner of the ring. The usage agreement will allocate a percent of the fiber strands
based on capital invested. For example ERMU wants a 1/3 share,therefore they will own 33% of the
fiber strands for their directed purposes.
FINANCIAL IMPACT
City funding will come from the Liquor Operations Fund and Wastewater Treatment Enterprise Funds as
previously discussed.
After deducting the $14,000 for laterals, the cost-share amount is $254,721.24. ERMU has approval for
participation,which will be approximately$85,000. The county is expected to be approximately$64,000.
The total numbers are dependent of the final actual project cost. The city share would be the remaining
$120,000. The city proportion is higher than the county and ERMU as 90% of our buildings will access
the fiber loop.
ATTACHMENTS
• Resolution Awarding and Authorizing Execution of the Contract
• Project Map
Action Motion by Second by Vote
Follow Up
P'OWERID 9T
I`4AT' UREI
RESOLUTION 12-
A RESOLUTION FOR THE CITY OF ELK RIVER
A RESOLUTION ACCEPTING BID AND AUTHORIZING
EXECUTION OF CONTRACT IN THE MATTER OF THE
2012 BACKBONE FIBER OPTIC RING PROJECT
WHEREAS Competitive bids were solicited and received on August 29, 2012, for the Backbone
Fiber Optic Ring Project; and
WHEREAS the City Council has considered the amount of the bids and the responsibility of the
bidders and determined that Michels Corporation 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 Michels Corporation, as is approved by the city attorney, for the
completion of the Backbone Fiber Optic Ring project according to the approved plans and
specifications.
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 4'h day of September, 2012.
John J. Dietz,Mayor
ATTEST:
Tina Allard, City Clerk
N:APublic Bodies\City Council\Council RCA\Agenda Packet\09-04-2012\8.4Res accept bid authorize contract.docm
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