In order to obtain sanitary sewer service to Lots 4 and 5 of Lenhardt Square Subdivision, 1st Filing, the developer, M&K Blue One, LLC., extended 622 feet of 18-inch sanitary sewer main north from King Avenue in South 44th Street West. This extension was not a scheduled City Capital Improvements Project, so the developer paid the entire cost of the project.

It is currently City policy for the development community to pay for the entire cost of constructing water and sanitary sewer mains 12 inches or less in size (interior mains) and for the City to pay for the entire cost of constructing water and sanitary sewer mains greater than 12 inches in size (local mains).  Since M&K Blue One's private contract constructed an 18-inch sanitary sewer main, the developer desires to be compensated for these costs in full.  City staff proposes that such compensation be accomplished through a compensation agreement.

The Council may:
• Approve the Compensation Agreement with M&K Blue One, LLC; or
• Do not approve the Compensation Agreement with M&K Blue One, LLC.

Based on review of the final quantities installed on this private contract, Public Works Department staff has determined that $38,018.00 of sanitary sewer main construction is eligible to be recovered by M&K Blue One, LLC. The extent and timing of the City’s participation in the project costs is determined in conformance with the CIP approved by City Council.  The FY 10  budget has $500,000 included for compensation agreements.

Staff recommends that Council authorize the Mayor to execute the Compensation Agreement with M&K Blue One, LLC.