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HomeMy WebLinkAbout09/17/1981 Council Minutes1 1 September 17, 1981 71 The Special Meeting of the Lino Lakes City Council was called to order at 7:30 P.M., September 17, 1981, by Mayor Gourley with all Council members present. Mr. Locher, Mr. Schumacher, Mr. Steve Mattson, Mr. Andrew Merry, Mr. Bob Frigaard and Mr. Bernie Mettelstead were also present. Mayor Gourley noted there is a limited agenda at this meeting, therefore, there will be no open mike. The topic for discussion at this meeting is the sale of the bonds. Mayor Gourley asked Mr. McLean about his question concerning the Public Hearing minutes - did he wat to purseu that at this meeting? Mr. McLean said he had received a copy of the minutes and his motion was substanially as was passed. Mayor Gourley asked if he wished to consider those minutes at this meeting and Mr. McLean asked that they be approved at a regular meeting. Mayor Gourley noted, that as had been discussed at the last Council meeting, there has been a change in the connection point and he requested the Eng- ineer to present his report to the Council. Mr. Mittelstead presented the two alternatives to connect to the interceptor; 1) to connect to the Circle Pines system; 2) to go directly to the main interceptor on North Road. The contract submitted to the City of Lino Lakes by the City of Circle Pines had been reviewed and the estimated costs are $82,000.00 The alternate route, going directly into Blaine, if the pipe can be installed within the shoulder - that estimated cost is $67,000.00 If it becomes necessary to install within the road bed, the estimated costs are $93,000.00. Mr. Kulaszewicz asked at what figure this cost was being computed? Mr. Mittelstead said 3460 feet x 11.00 per foot; the fittings - 1.00 per foot; the sod replacement $26,000.00 and if it is necessary to replace the street surfact, that is estimated at $52,000.00. Mr. Mittelstead said the average is approximately $80,000.00. These figures are within the 10% figure re- gardless of the route of the connection. Mr. Kulaszewicz - in talking with teh Metropolitan Waste Control Commission, they have indicated to Lino Lakes that the costs would be $50.00 per foot. Mr. Kulaszewicz said that in 1976 the ocst was estimated at $156,000.00 Mr. Kulaszewicz said the figures don't jive. Mr. Mittelstead pointed out that the figures he presented were based on bid prices that has just re- cently been taken. Mr. McLean questioned the total costs, it would appear to him the costs would be $120,000.00 Mr. Millelstead explained that both sod replacement and street replacement would not be included, it would be one or the other. The highest costs would be if it is necessary to put the force main in the roadbed. Mr. McLean asked if these costs are written down any place and Mittelstead said they just have their hand written estimates. Mr. McLean asked if there is a map showing this location ? Mr. Kulaszewicz asked if there was a feasibility study? Mr. Mittelstead said, No, a feasibility study had not been prepared for this connection. This is already included in the estimate prepared for the project. At the time the initial estimate was prepared, an outlet was considered and monies estimated for this cost. September 17, 1981 Mr. McLean asked about the size of the pipe and Mr. Mittelstead said, six inch. He added that perhaps this should be an 8" pipe - this will be decided at the time the specifications are prepared. The additional cost would be 1.00 to 2.00 per foot. The volumn of flow will have to be de- cided - if the pipe is too large that could cause problems. Mr. McLean asked if he felt the estimates are on the conservative or on the low side. Mr. Mittelstead answered, that based on the prices that they have received, he would said these estimates are on the conservative side. Mr. Kulaszewicz asked if a 10" line could be installed and Mr. Mittelstead said he did not think so - he did not feel there is enough flow for that size line. This is a closed system and must keep itself clean. Mr. Mittelstead said a design curve must be prepared for the flow of this system. Mr. McLean asked if PCA or MWCC had been approached? Mr. Mittelstead said that they had discussed this with MWCC and they had given verbal approval; Anoka County has also been approached and there is no problem in that area. Mr. McLean asked about PCA and Mr. Mittelstead said PCA has no jurisdiction as to where the connects - they must approve the plans. DNR? plans do not have to be submitted to DNR. Mr. Kulaszewicz reported on the time schedule for submitting the plans and specifications to MWCC. Mr. Mittelstead said he was sure that this is correct. Mr. Kulaszewicz said there is no feasibility study - shooting in the dark -1 we haven't got the okay from Waste Control yet and in order for us to okay this thing - supposedly Mr. Mattson says they can sell the bonds - and how can we sell the bonds when the project is not completed? I can't see how a Bond Counsel can come up here and say to us - we're gonna sell these bonds - when the project is not completed, when it's not. Mr. Mettelstead said the process that is normally gone through is, if - the preliminary report has been prepared and did include the cost of this connection. Mr. McLean said the connection to Circle Pines is the only one that had been considered by the Council. The laternative to connect into Blaine has not been considered at any time. Mr. Mittelstead said when Mr. Long made his presentation, there were contingency funds for the connection - for the purpose of covering an alternate. The Council authorizes the preparation of the plans, the plans are prepared prior to Council authoirzation for the letting of the bids, these plans must be approved by the MWCC, PCA and Board of Health. This is the proper time for the MWCC to review the plans. Mr. McLean insisted that he does not have a piece of paper that says this is the plan, and that noe of this information was available until tonight. Mr. Mittelstead said taht in order for them to make a recommendation as to the point of connection, it was necessary to study all alternatives and their related costs. Now that they have received a copy of the proposed contract as presented by Circle Pines, they could make this recommendation, and that is what has been done. 1 September 17, 1981 73 Mayor Gourley noted that the Council did not have the detailed plans, such as Mr. McLean was asking for, when Circle Pines was contacted. He felt the important things to recognize is that the outlet is there and that the costs are approximately the same. Mr. Kulaszewicz disagreed - he said it is not known what size pipe is to be installed - 6" - 8" - 10 ". He did not feel that Mr. Mattson could stand up here and sell bonds if he is not sure as to what size pipe is to be installed. Mayor Gourley suggested that he ask Mr. Mattson that question. Mr. Kulaszewicz asked Mr. Mattson if his company, Juran 8 Moody, would sell bonds when this project has not been completed? Not defined? Mr. Mattson said the City has complied to State Statute 429 and bonds can be sold on construction estimates and that is what is being presented. Mr. Kulaszewicz asked Mr. Mattson if he felt those estimates are correct? and Mr. Mattson said that is not his line of espertise at all. Mr. Kulaszewicz said he did not see how this Council could sit up here and approve bonds because this is a hit and miss situation and were gonna have to sit down and get a feasibility report, sit down and get something to look at and then come back and then if the bonds are to be sold, so be it - but not right now I'd just as soon make a motion to deny this. Mr. McLean, is that a motion? Mr. Kulaszewicz - that's a motion. Mr. McLean - second it. Mayor Gourley - the motion by Mr. Kulaszewicz is - to deny this - whatever 'this' is. Mr. Kulaszewicz - the sewer project. Mayor Gourley put the motion - to deny this. All in favor - Aye. no one voted. Those opposed signify by saying - Aye - no one voted. Mr. Kulaszewicz revised his motion to read - to deny the sale of the bonds at this time due to the inadequacy of the study given by the Engineers. Seconded by Mr. McLean. Mr. Jaworski asked - if the motion to deny the sale of the bonds passes - where does that leave us? Mayor Gourley said teh bids would not be opened and the bonds would not be sold this evening. Mr. Jaworski said he felt the motion is inappropriate - he felt the motion should have been to table. Mayor Gourley said teh motion has been accepted and on taking the vote the motion failed on a three to two vote. • Mr. Jaworski felt the points brought up should be considered. He said he felt uncomfortable with the lack of some information. He emphasied that he is not against the sewer. Mayor Gourley felt the important thing that should have been gotten from Mr. Mittle stead's report is 1) there is a connection for the City, and 2) Ithe cost between the connection in Circle Pines and this one are approximately equal, and 3) regardless of this connection or any other connection, thses costs were included in the feasibility study. In his opinion, there is no change in the project - the Council is still talking about the same project. Mr. Mittelstead said the reason this alternative connection was presented 74 was this is an obligation of the Engineers to prepare this report and present to the Council. Mayor Gourley asked Mr. Locher if this constitutes any problem with the hearing process taht we held as a mojor project? Mr. Locher said he had talked to Bond Counsel about this, and 1) must have an outlet, 2) this does not change the area being assess, and 3) if it is within 100 of the cost that is built into the law. September 17, 1981 Mr. McLean felt the numbers are inadequate. He said he did not know what the figure $2,150,000.00 represented. Mr. Millelstead saod this is an estimated cost to include contingencies. All he could say was that the costs of the connection was included in the feasibility costs. 1 Mr. Jaworski asked, in your initial plans, alternative plans were taken into consideration - and when the costs to connect to Blaine were computed - both these alterantives were included in the original feasibility sutdy? Mr. Mittelstead said that was correct. Mr. Jaworski, is that the construct- ion costs? and Mr. Mittelstead said, No Sir, that includes the total cost of the entire cost of the project. Mr. Jaworski asked Mr. Locher, if the sale of the bonds were to proceed and he bonds were sold and the Council ordered Plans and Specifications - ordered bids to be taken - at the time the bids were in, the Council does not have to accept those bids, if the Council did not wat to - is that correct? Mr. Locher said, Yes, that is correct. All bids can be accepted or re- jected. This is automatically a part of the ad. Mr. Jaworski, said at that point the Council would have an extra cost of the project? Mr. Locher, said in theory - the final costs are not know until the project is completed. There is a 10o variable for unexpected conditions that could be encountered. 1 Mr. McLean said there are costs the City would have to pay in case the project did not proceed - the additional costs for plans and specifications - which is approximatelsy what? Mr. Mittelstead said plans and specifications preparation is approximately $80,000.00 to $89,000.00 - that includes all the necessary preliminary work and the work done during the actual construction of the project. Mr. McLean said if the bids for the bonds are accepted tonight and plans and specifications are ordered, the City automatically commits itself to pay 80/90,000.00. Mr. Jaworski pointed out to Mr. McLean that one thing he is not taking into consideration is that if the project fails, the City would have $2,150,000.00 in the bank collecting interest which would pay for that cost. Mr. Schumacher reported that this Council has three years before this money must be spent. Mr. Schumacher said he had calculated teh difference between what the interest on the bonds would be and what he could invest that money for - he had used a figure of 4% which he felt was conservative - this difference would in approximately one year earn enough to pay for these plans and specifications. September 17, 1981 75 Mr. Jaworski felt that instead of ordering another feasibility study then deciding not to do the project, that at this time, the City should go ahead with the sale of the bonds, get all plans and specifications, and if it doesn't come within the guide lines - then abondon the project. Mr. Locher presented the affadivits of publication for the sale of the bonds - from Commercial West and teh Circulating Pines, Mr. Mattson reported thattwo (2) bids have been received for the sale of $2,150,000.00 of bonds. One bid from Marquette National Bank of Minneapolis and one from the First National Bank of Saint Paul, The Marquette National Bank bid was considered first. Mr. Mattson had provided forms for the Council to follow along with. Marquette National Bank will pay for the bonds - $2,109,150.00. Coupon rate is 11.20% making the total interest costs $763,250.00 for a net effective interest rate of 11.833 %. The bid from the First National Bank of Saint Paul with serveral co- managers, they will pay for the bonds $2,109,795.00 - their coupon rate is 10% making the cost $685,205.00 for a net effective interest rate of 10.6233 %. Mr. Mattson asked for a few minutes to check these figures. Mayor Gourley said the Council will recess for about five minutes. The meeting was reconvened. Mr. Mattson reported that he had reviewed the bids and they were correct. The bid of the First National Bank of Saint Paul is the low bid. He pointed out that thisis an excellent bid - it is at least one point lower than he had expected. Mr. Mattson recommended acceptance of this bid. Mr. Kulaszewicz asked, in your honest opinion, what is the shape of the over- all bond market and Mr. Mattson said, it is not good. Mayor Gourley said a Resolution for the acceptance - 81 -32 - which has been provided by the firm acting as bond counsel has been placed before the Council members. Mrs. Elsenpeter moved to adopt Resolution 81 -32 in its entirety awarding the bid to the First National Bank of Saint Paul for the sale of $2,150,000.00 bonds. Seconded by Mr. Jaworski. Mr. Locher asked that this motion read "to adopt the total Resolution as provided by Bond Counsel ". Mayor Gourley asked Mrs. Elsenpeter to amend her motion to read thus. Mrs. Elsenpeter so moved. Mr. Jawroski accepted the amendment. Mayor Gourley asked for discussion on the motion - there was none. The vote on the motion was as follows; Mr. Kulaszewicz - No; Mr. Jaworski - Aye; Mrs. Elsenpeter - Aye; Mr. McLean - No; Mayor Gourley - Aye. Mayor Gourley announced that the motion passed. Mr. Mattson said because of the amount of interest that can be earned on these bonds, they will set the date for delivery of the money in approximately three weeks. Mayor Gourley said he also has Resolution 81 -33 ordering the improvement and preparation of the plans and specifications. Mr. Jaworski moved to adopt Resolution 81 -33. Seconded by Mrs. Elsenpeter. There was no further dis- cussion. On the vote - Mr. Kulaszewicz - No; Mr. Jaworski - Aye; Mr. McLean - 76 September 17, 1981 No; Mrs. Elsenpeter - Aye; Mayor Gourley Aye. Motion was declared passed. Mr. McLean moved to adjourn. Seconded by Mr. Jaworski. Mr. Al Ross asked to speak. He said he was sure he was not speaking for himself but for the vast majority of Lino Lakes, the majority of this Council is creating a situation that is becoming unbearable, not only financially but mentally, and I just wanted all you people to think about it. Mayor Gourley thanked Mr. Ross for his comments. Motion to adjourn was passed. Council adjourned at 8:45 P.M. These minutes were considered and approved as presented at a regular Council meeting held on September 28, 1981. Edna L. Sarner, Clerk - Treasurer Special Council Meeting September 21, 1981 1 The special meeting of the Lino Lakes City Council was called to order at 8:10 P.M. by Mayor Gourley. Council members present; Elsenpeter, Jawroski, Kulaszewicz. Absent; McLean. Mr. Volk was also present. The meeting had been called to consider the bids for the seal - coating as proposed and advertised for by Mr. Volk. Mr. Volk reported he had received two bids; 1) Allied Blacktop at 0.45 per square yard for a total cost of $16,006.50; 2) Schifsky 8 Son at 01.44 per square yard for a total cost of $15,650.80. Both companies had supplied bid bonds, both companies can be on the job tomorrow, Mr. Volk recommended acceptance of the bid as proposed by Schifshy 5 Son. Mr. Jaworski asked what size rock - Mr. Volk said, pea rock; Mr. Jaworski asked about the sweeping - Mr. Volk said this would be done by the City, both prior to and after the materials are put down. Mr. Kulaszewicz moved to accept the bid of Schifsky 5 Son. Seconded by Mr. Jaworski. Mr. Al Ross asked to speak - he realized that this proposal was for Shenandoah but had anyone taken a look at Ware Road, it is cracking up - he asked that Ware Road be included in this proposal and be seal - coated at this time. Mayor Gourley pointed out that this is a matter of advertising for bids for a particular number of streets to be seal - coated and additional work cannot be added to this bid. Mr. Jaworski pointed out that Ware Road has been checked and the council is aware of the conditions of that street. This Council can only do the work that there are funds to handle.