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January 26, 2009 Item No. 8C <br />Page 3 <br />One item worth noting on the Agreement is that the disbursement of Federal funds is <br />different than the disbursement of Minnesota State Aid funds. On a State Aid funded <br />project, the City can request 95% of the total amount of the State Aid Funds upon award of <br />a construction contract. This provides positive cash flow for the City on the project, and <br />allows the City the opportunity to achieve interest income until the funds are expended. <br />However, as stated under Paragraph E of Section I of the DCP Agreement, on the <br />Federally funded project the City must certify and make each partial construction payment <br />to the contractor before the request can be submitted to MnDOT for disbursement of <br />Federal funds. This requires the City to have an interim local funding source for the time <br />period between when payment is made to the contractor and when Federal funds are <br />received. <br />This language regarding the partial construction payments and disbursement of Federal <br />funds is unchanged from the original version of the Agreement. <br />An approved and certified resolution to enter into the DCP Agreement is required as an <br />attachment to the Agreement. MnDOT has provided sample language for use in the <br />resolution. <br />Recommendation: <br />Resolution 7363 has been prepared in accordance with the previous discussion, <br />incorporating the language provided by MnDOT. The Resolution is attached to this Staff <br />Report for consideration by the City Council. <br />Staff recommends that the City Council adopt Resolution 7363, appointing MnDOT to act <br />as its agent for the Federal funds, and authorizing the Mayor and City Administrator to <br />execute the DCP Agreement with MnDOT. <br />Respectfully submitted, <br />Joseph R. Rhein, Consulting Engineer <br />Attachments: <br />- Resolution 7363 <br />- MnDOT Agreement 90473 (with updated language)