Adopt Resolution #17-07-182 Ordering Plans and Specifications for Improvement Project #17-10, Puma Street Utility Extensions

Purpose:
The purpose of this case is to consider adopting Resolution #17-07-182 ordering Plans and Specifications for Improvement Project #17-10, Puma Street Utility Extensions.

Background:
Two developments are currently proposed within the Future Business Park area west of Armstrong Boulevard.

Capstone Homes is proposing to construct a residential development consisting of slightly less than 300 single-family homes. This development, known as Riverstone, is proposed to be located within the area bordered by the Northfork golf course, Alpine Drive, Puma Street, and Highway 10. This development is in the City’s MUSA area and therefore needs to be served by City sewer and water. Capstone appears to be firmly committed to this project due to the more than $400,000 in non-refundable payments they have made to the current property owner to date, and due to the agreements and associated letters of credit that are being considered for approval by Council this evening.

PSD, LLC is proposing a second development in the form of a new business park located on about 45 acres of land between Bunker Lake Boulevard and Highway 10, immediately east of Puma Street.  PSD recently purchased this land from Hageman Holdings. This proposal includes mass site grading and clearing, storm water pond grading, and installation of utility stubs to make the building sites "pad ready" in anticipation of future construction. PSD appears to be firmly committed to this proposal.

In 2006, Bunker Lake Boulevard was improved west of Armstrong Boulevard.  The first 2,650 feet of Bunker Lake Boulevard was constructed with trunk utilities and a permanent pavement section. The remaining 1,400 feet of Bunker Lake Boulevard to Puma Street, and all of Puma Street between Bunker Lake Boulevard and Alpine Drive, was constructed without utilities and only a temporary pavement section consisting of roughly 2 inches of bituminous pavement over a few inches of aggregate base.  Permanent street and trunk utility improvements were intended to be constructed along the remainder of Bunker Lake Boulevard and Puma Street as adjacent properties developed.

The City recently awarded a contract to Metro Utilities to extend trunk watermain and sanitary sewer along Bunker Lake Boulevard to Puma Street, which will serve the two proposed developments.  The existing trunk watermain under Bunker Lake Boulevard is 16-inch ductile iron pipe (DIP), and the existing trunk sanitary sewer is 18-inch polyvinyl chloride (PVC) pipe.
 
The temporary street sections are proposed to be improved in 2018 after utilities are extended in 2017.

Constructing trunk utilities along Bunker Lake Boulevard will allow the south end of the Riverstone development to be served with utilities.  Phase 1A in the attached Future Business Park Proposal addresses this.  Utilities must be extended north along Puma Street to serve additional homes in the Riverstone development.  Phase 1B in the attached Future Business Park Proposal addresses this work.
 
As discussed in an earlier case, an Assessment Agreement is proposed to be executed between the City and the developers of adjacent properties.  This will allow the City to recover 40% of project costs to extend utilities along Puma Street.
 
In March of 2017, Bolton Menk updated the Future Business Park report to include estimated costs for extending trunk utilities along Puma Street. A copy of the updated report is attached for reference. The report identifies estimated costs to extend trunk watermain along Phase 1B of Puma Street at $182,000, and to extend trunk sanitary sewer at $545,000. These costs include 30% contingency and indirect costs.
 
Capstone Homes proposes to begin construction of the Riverstone development on July 31, 2017.  If Council orders preparation of plans and specifications this evening, construction of trunk utilities should be complete by mid-December, barely meeting the developers desired utility service schedule allowing Certificates of Occupancy to be issued for homes in the central area of the Riverstone development.
 
Attached is Figure 1 showing the trunk utilities extension project location and scope.

The Public Works Committee was not willing to recommend Council approval of ordering plans and specifications without having financial securities in place first given the uncertain status of the Riverstone development at the time.  If the Assessment Agreement were approved, the required financial securities would be in place, removing this concern.

No notifications are necessary for this case.

Observations:
Staff will work with adjacent property owners along Puma Street during development of plans and specifications to properly design all utility service stubs.
 
Staff proposes to use aggregate base as a temporary street surface on Puma Street over the winter months since the street typically has low traffic volumes and is proposed to be reconstructed next spring/summer.
 
Alternatives:
Alternative #1 – Motion to recommend adoption of Resolution #17-07-182 ordering Plans and Specifications for Improvement Project #17-10, Puma Street Utility Extensions.

Alternative #2 – Motion denying adoption of Resolution #17-07-182 at this time.

City Staff proposes to utilize Bolton & Menk to prepare plans and specifications.  An estimate of their proposed engineering fees for this work is $104,780.  See attached proposal dated June 20, 2017.  Please note the schedule is now pushed out one-month.
 
Bolton & Menk’s estimated costs for extending utilities along Puma Street with Phase 1B is $727,000.  This does not include costs to restore the street in a temporary manner over the winter, which is estimated to cost $50,000.
 
City staff proposes to administer the project and to inspect construction.
 
All City project costs (costs not covered by other parties through the Assessment Agreement) are proposed to be paid using City sewer and water funds.

Staff recommends alternative #1 to support current and future development opportunities within the Future Business Park area.

Motion to recommend adoption of Resolution #17-07-182 ordering Plans and Specifications for Improvement Project #17-10, Puma Street Utility Extensions.