Staff Update on Potassium Street Cul-De-Sac Improvements, Improvement Project #17-13

Purpose:
The purpose of this case is to provide an update to the City Council on the status of Improvement Project #17-13, Potassium Street Cul-De-Sac Improvements.
 
Background:
As Council is aware, Staff has been working to secure easements from the three property owners on the north end of Potassium Street, north of old Nowthen Boulevard.  Staff has also been working with the property owners of 15641 Potassium Street, Ron and Shannon Schmitz, to arrive at a cost-share agreement for constructing a temporary gravel cul-de-sac south of their property, which would directly benefit them.
 
As previously discussed, this segment of Potassium Street is a gravel road with no outlet.  For the last few decades, the City has been maintaining this road, including an area on 15641 Potassium Street used by vehicles to turn around.  However, this property was recently purchased by the Schmitz’s who posted no trespassing signs near the street on the south end of the property, in the belief that the public had no right to use the property. This caused Ace Solid Waste to inform its customers along Potassium Street that they would no longer serve their properties since they could no longer safely turn their trucks around at the north end of Potassium Street.
 
Both parties acknowledge that a 33-foot easement exists on the west side of the property, but the City contends that a 66-foot easement exists as conveyed by a previous Deed transfer to the public.  The Schmitz’s dispute that the additional 33-foot easement exists.
 
The City Attorney contends that the City has other protections above and beyond the existing easements due to the length of time that the City has maintained this road for public use.
 
Previous estimated project costs to construct the temporary cul-de-sac totaled $32,200.  The Schmitz’s previously offered to pay up to $3,000 towards project costs as discussed at the September 12, 2017, Council Work Session.
 
On September 22, the Schmitz’s submitted a counter-offer to pay up to $8,050 of project costs, contingent on the following conditions;

• The city obtaining other necessary easements from neighbors.
• The City releasing its claims of recorded easements, unrecorded easements, usage via MN Statute 160.05, and any other unrecorded or claimed recorded easements.
• Any encumbrances, liens, etc., of any nature, aside from the one construction easement, whether known or unknown.
• A settlement agreement reflecting these conditions, drafted by the City at its expense, and subject to review and approval by the Schmitz’s attorney.
• The City would be responsible for the legal fees in drafting the necessary easement for the construction.
• The project must be complete by December 31, 2017, otherwise the Schmitz’s obligation is reduced by $1,000 for each month thereafter that the project is under construction.
• The Schmitz’s are entitled to see the winning contractor's bid
• If the total bid cost is less than the estimated $32,200, the Schmitz’s total obligation will be reduced to 25% of the lower bid.

 
To ensure the project could be completed this year, Hakanson Anderson revised the plans by moving the cul-de-sac 25 feet further south to avoid impacts to the power pole.  This had the potential to delay construction up to several months, and it increased construction costs by approximately $2,500.  Staff then solicited quotes based on the revised plans, but no quotes were received by the submittal deadline of noon Thursday, October 5, 2017.
 
Staff met with the other two property owners on the north end of Potassium Street to discuss the required easements on their properties.  The property owner south of the Schmitz’s are not willing to approve an easement of any size on their property, even if financial compensation was included.  The other property owner west of Potassium Street, who was asked to provide temporary easements, is only willing to provide easements for a period up to 18 months.  Staff reached out to this property owner again to ask if he would consider approving a permanent easement with financial compensation, with the provision that the easement would be vacated at the time the property was re-platted.  As of the time this case was published, no response had been received. Cooperation  from property owners regarding dedication of the new right of way is imperative if the project is to be constructed this year.






the project 

Notifications were not required for this case.

Copies of the 3 easement exhibits are attached, as are the most current plans.

Staff will inform Council of any new developments and will continue to work on a mutual agreement that will allow this project to be commenced to the satisfaction of both parties.

 

Funding amounts and sources are yet to be determined.

This case is informational only.

This case is informational only.