Adopt Resolution #23-054 Approving Plans and Specifications and Authorizing Advertisements for Bids for Improvement Project #23-12, HY-10 Ramsey Improvements  

Purpose:
The purpose of this case is to adopt Resolution #23-054 approving plans and specifications and authorizing advertisements for bids for Improvement Project #23-12, HY-10 Ramsey Improvements. 

Background:
These proposed HY-10 Improvements are needed to support existing uses and future development within the HY-10 Ramsey plat area.
 
Attached are four agenda cases with attachments that outline all relevant background details associated with this case.  The attached agenda cases are from the following meetings;

• EDA meeting - May 13, 2021
• EDA meeting - December 9, 2021
• City Council regular meeting - December 14, 2021
• EDA meeting - February 9, 2023 

Also attached is the final draft of the HY-10 Ramsey Improvements Feasibility Report, dated March 9, 2023.  
 
On February 21, 2023, the Public Works Committee reviewed the attached cases and Feasibility Report and discussed several items.  The Committee members generally agreed with the design outlined in Option 2 and agreed by consensus that it would be best to construct the proposed improvements in 2023. Regarding paying for the improvements, the Committee discussed the potential use of special assessments to pay for a portion of the improvements.  The Committee discussed how the City could justify the use of assessments for this project when no other pavement management projects have utilized special assessments in recent years. Discussions turned to whether assessments should be applied to only properties that would benefit from the extension of Ferret Street, including municipal utility extensions.  After much discussion, staff agreed to develop potential preliminary assessment options for discussion with the City Council during their February 28th work session.
 
On February 28, 2023, the City Council discussed the proposed improvements during work session. The City Council agreed by consensus with the Public Works Committee recommendation for design option 2.  However, when Council was informed that the owner of the property at the north end of the HY-10 Ramsey plat recently indicated they were no longer open to allowing Ferret Street to be extended through their property to connect to Bunker Lake Boulevard, Council agreed by consensus that special assessments would not be supported as a funding source since a primary benefit of the proposed improvements was to provide a secondary access for properties within the HY-10 Ramsey plat area. Council then agreed by consensus that the proposed improvements should be constructed in 2023 to support existing uses and future development within the HY-10 Ramsey plat area.
 
Bolton & Menk, Inc. has completed plans and specifications for the purpose of advertising bids for the proposed HY-10 Ramsey Improvements.  Attached is a copy of the title sheet for Improvement Project #23-12.
 
Also attached is a copy of a construction services proposal from Bolton & Menk, Inc. to provide construction staking and assist with project administration during construction with a not-to-exceed fee of $34,881.
 
City staff will inspect construction.     

Notifications are not required for this case.
 
Advertisements for bids will be published in the Anoka Union Herald and in Finance & Commerce on Friday, March 17th and Friday, March 24th, 2023, as required by State Statute. The project will also be advertised and bid electronically through QuestCDN.    

Observations:
The plans as prepared and proposed for bids include the extension of Ferret Street to Bunker Lake Boulevard which carries the highest project cost. Bolton & Menk already completed the plans with the Ferret Street extension included before the private property owner on the north end of the site indicated they no longer supported the extension of Ferret Street through their property. Extending Ferret Street to Bunker Lake Boulevard provides for the most cost-effective extension of municipal utilities, and provides secondary access to properties within the HY-10 Ramsey plat area. Staff is therefore hopeful that while plans are out for bids further discussions can occur that will result in the property owner once again supporting the extension of Ferret Street due to the benefit this design would provide to all properties in the area, including theirs. If the property owner does not agree to allowing Ferret Street to be extended through his property, the plans will be modified accordingly and an addendum will be issued showing the reconstruction of Ferret Street ending at the existing cul-de-sac north of 147th Avenue.   
 
In order to complete plans and specifications, additional services were performed by Bolton & Menk in the amount of $27,998 as per the attached letter dated March 8, 2023.  This work was needed to address specific design revisions requested by Staff in relation to the proposed ARAA sports dome project and other needs identified by staff during development of the HY-10 Ramsey Improvements plans.  These costs will be spread across the various funding sources based on their applicable funding category.  

As always, final plans and specifications are not attached to this case to prevent potential bidders from using the attachments to submit a bid.  This can be problematic in that they would then not receive any addendum that might be issued before submitting their bid, resulting in bids that are not based on the same plans.  

Alternatives:
Alternative #1:
Motion to adopt Resolution #23-054 approving plans and specifications and authorizing advertisements for bids for Improvement Project #23-12, HY-10 Ramsey Improvements.  

Alternative #2:
Motion of other.  

The construction cost estimate for this project is $1,697,382.  The estimated project costs, which include 23-percent indirect costs, totals $2,087,779.86.
 
Below are estimated project costs based on funding source;

• Streets/Sidewalks  = $1,000,925.41 - Staff proposes to use TIF 14 Bonds for these improvements. 
• Storm Sewer             = $340,673.10 - Staff proposes to use Stormwater Funds for these improvements.
• Sanitary Sewer          = $220,909.85 - Staff proposes to use Sanitary Sewer Funds for these improvements.
• Watermain                 = $525,271.50 - Staff proposes to use Water Funds for these improvements.

The recommended funding source for streets/sidewalks per Finance Director Lund and the City’s financial consultant, Ehlers, is to bond for the approximate $7M in improvements needed in The COR area, which consists of the HY-10 Ramsey Improvements and The COR infrastructure improvements.  Issuing a Tax Increment bond requires increment to be available in the amount of 20% of the bond.  The city does not currently have $7M in the TIF 14 district and the issuance of debt allows the city the flexibility to keep the current TIF 14 funds (approximately $2M for other improvements in the future).  The issuance of debt is a cleaner process as it avoids the need for the set-up of internal loans from other funding sources, tracking these loans with not only pay back when increment becomes available, but also tracking interest.  Bond numbers will be run once the true costs of the improvements are known.   
 
Attached is a construction services proposal from Bolton & Menk, Inc in a not-to-exceed amount of $34,881.  Staff is not able to provide these services and since Bolton & Menk prepared the plans they are best suited to provide the required construction staking and administrative assistance services during construction.  Staff has reviewed this proposal and feel the proposed fees are reasonable.    

Staff recommends alternative #1 based on discussion from the February 28th City Council Work Session.    

Motion to adopt Resolution #23-054 approving plans and specifications and authorizing advertisements for bids for Improvement Project #23-12, HY-10 Ramsey Improvements.