Working Session

Wednesday, May 24, 2010 - - 6:30 p.m.
Council Chambers

Present: Mayor Brown, Bjerke, Christensen, Gershman, Glassheim, Kreun, McNamara
Absent: Bakken.

Gershman called the meeting to order.

1. Capital Improvement Plan

Jerath provided opening comments that purpose of meeting is to provide information on upcoming capital projects for the City of Grand Forks and department heads will address and answer questions related to their projects planned in their departments.

* Utility Infrastructure -

Todd Feland, Public Works Director, reviewed capital projects planned for the utility funds. Comments were:

Landfill Closure – this is an estimated number for budgeting purposes at this time. More information will be provided throughout the rest of this year and into 2011 on more exact costs.

Baling Facility – the intent of this item is to plan ahead for the future replacement and other needs so that the facility is able to meet the needs of the community.

Wastewater – Feland displayed a map showing the wastewater system. He explained that recently a smart ball was run through the system to evaluate it and were some areas that will be reviewed further including 10th Ave N to Gateway Dr., which is some of the oldest infrastructure in the City, and on the southern end of Columbia Road near Vaaler Insurance. In summary the system seems to be in better condition than was anticipated, but there is some work needed on the northend, which had already been anticipated for this year. Another upcoming need will be an expansion of the system, which has been moved to start in 2013. This will allow for more review of the needs to be included in the project, which will also bring a redundancy to the system which it does not currently have, as well as planning for future growth of the City. They have also moved back the pump station #28 project located at 11th Ave S and 39th St S to begin in 2012. He explained that the current pump station serving this area will be undersized once development in this area is completed. The move back a year will better coincide with completion of some of the development in the area. For the Wastewater Treatment Plant, there is a project scheduled for 2016 to address issues from biosolids that accumulate in the lagoons. The project will involve treating and drying these so that they can then be disposed in the landfill. Simplot has been a contributor to the biosolids, but has made some changes in their pretreatment process and we would like more time to see what affect those changes have on the flow so that we can better plan for our needs for the future.

Water Treatment – Feland explained that a pilot project is going to Service Safety Committee meeting at tomorrow’s meeting and noted that we have a poor source for our water and do a great job treating that water for use in the community. At this time work continues on funding source development and information has been sent to the Federal and State working towards getting their participation on the new plant project. The pilot project is planned to start in August 2010, completion in May 2011, and hope to have answer by then from both the Federal and State on available funding.

Storm Water – Feland stated that Engineering has been working on this area and will be using these funds to assist them with regional ponds and a consultant.

Questions / Discussions:

Bjerke asked if there are more costs needed in Wastewater than what is included in this plan. Feland replied that there will be one more year of expenses and will also be having some policy decisions needed in this area as it progresses and that these costs are all funded through rates.

Bjerke asked regarding PS#28, if this need is related to the Alerus Center, as if it is then should consider that the ¾ % sales tax proceeds can be used for infrastructure and would take the burden from some other sources. Feland stated that it is related to development in this area, but not Alerus Center development directly and that the improvement is funded through rates.

Bjerke asked for more information on the storm water pond project. Feland explained that new regulations require that water in developments be held for a time to held keep solids out of the system so developers are including a ponding aspect in park land in developments and this project will work with that to help make those ponds more of an amenity and is still in planning phase.

Glassheim asked who typically pays when pump station work is done. Feland replied that for wastewater users pay through rates and for stormwater stations property owners of benefiting properties pay.

Christensen asked what the water fund currently has for a cash balance and also when we would be looking at construction for the new plant. Stjern replied that they currently have about $7-8 million in cash not including a loan that will be repaid from wastewater of $1.2 million. Feland stated that construction is anticipated in 2014 -2015. Christensen commented that are looking at $100 million project and encouraged that if we sell bonds for the project he hopes that we sell enough to replenish the cash used from the fund as that has been a help for short term internal financing for other funds.

Hal inquired with the forcemain project how long repairs were anticipated for that project on Columbia Road and whether the line was located under the street. Feland replied that due to the nature of the project would be most of the summer for completion and that is currently under the roadway. Grasser added that unfortunately due to the work being done in an already developed area and amount of right-of-way, etc. available, it will need to be reinstalled under the roadway when replaced.

*Streets & Bikepaths
Al Grasser, City Engineer, reviewed the projects included in the plan and commented that have included projects in a timeline to meet the projected cash flows. Other comments were:

Year 2013:
Signal upgrade on intersection of 42nd & 11th Ave S does include using some Alerus Center funds in the project funding mix.

32nd Ave S / I-29 / Washington Rehab project is basically a mill and overlay of older pieces that have not been replaced recently due to other projects. The project is slated to be done in sections and anticipate entire project being completed within six weeks. The 2012 project for catch basin and manhole work will also include work in these areas.

Year 2015:
There is a concern as the MPO plan puts Columbia Road project out further, but we are seeing more traffic in that area and not sure that we will be able to wait longer to complete that project.

Questions / Discussion:

Bjerke asked whether the Gateway Drive Project listed is a duplicate. Grasser replied that it is not, the DOT is working on area from 55th St to River and still working on how components will be done.

Bjerke asked if the downtown signal project is to address traffic flow problems and if there is any plan to coordinate with similar project in East Grand Forks at same time. Grasser stated that the project will rehab the signal standards, make all interconnect wireless and will address the issues of traffic backup over the bridge. East Grand Forks is not doing a similar project, but does not recommend we wait for them to move ahead with our project.

Bjerke inquired if the Columbia Road and 13th Ave S project is just that intersection. Grasser stated that it actually goes back a distance on each side to about 11th Ave S and 14th Ave S to address overall intersection concerns.

Grasser commented that on the Sorlie Bridge project, DOT has start of the PCR and will be looking to accommodate historical issues with the bridge and will be bringing back more updates as this moves along. Construction is scheduled for 2018 and amounts included in the CIP at this time is to build funds so that when the projects hits will have funding available to cover our share as well as costs for other things that we may decide to do that are not covered under the State project.

* Bikeway:
Grasser noted that first project, as well as street projects, is funded from Infrastructure sales tax allocation. The other bikepath projects and repair projects are being funded through Highway Users fund.

Questions / Discussion:
Grasser noted that the cash flow projection included in the packet shows that based on the projected projects cash flow will be negative in 2014 if all projects are done as planned. If special assessments are used for local share instead of Infrastructure sales tax dollars on projects then would have the cash flow to carry through 2016. This will be coming back for discussion on policy used and whether a change in how we use special assessments for infrastructure projects is needed.

Bjerke asked about transportation system projects if that is new or repair and if those in LMI could be funded through CDBG funds. Grasser stated that they are mill and overlay projects and while may be in LMI area, does not believe that they would be eligible, but could look into it and bring information back.

Bjerke inquired about allocation to Property Management and if that was the beautification funds or what that was for. Hoover stated that is to cover items including the maintenance of downtown properties, land on dry side of dike that is City owned, and Public Safety Building. Bjerke questioned whether there should be a different funding source for this which would free up funds for street projects. Christensen replied if not here then would probably have to come from the General Fund which is property tax dollars and not sure we want to make that change.

Bjerke asked Hoover about the ability to cover streets in LMI areas with CDBG funds. Hoover stated that sometimes could be applicable dependent on the street. CDBG funds can not be used for arterial streets, but could be used for smaller cross streets. Kreun suggested that perhaps need to keep that in mind and when looking at a project, if eligible consider trying to use CDBG, but sometimes it cost is higher to make the project eligible than to just do it with regular funding source. Regarding the landscaping, thought that was part of the management of road way and could look for a different funding source, but not sure where would be more appropriate, since it is a maintenance item.

Christensen commented on property management have to discuss as if are looking at another source, then have sales tax, enterprise funds, or property tax left to choose from. He asked on the Kennedy Bridge project is it only Minnesota DOT that has approved proceeding with the project. Grasser stated that both North Dakota and Minnesota have now approved the project and will include painting and pier stabilization, but our local share will only be about $100,000, much less than the Sorlie Bridge. Kennedy will be covered 80% federal share, and 20% state divided between the states. The allocation we have set aside is to cover any incidental items that may arise that would not be covered by either the state or federal.

Bjerke commented that in looking at the Highway User page thinks that we need to be cautious as not sure that we can maintain this level of funding going forward.

*Facilities & Buildings:

Noah’s Ark Building – Greg Hoover explained that there is some work being done this year on the property. For 2011 the work will include repairs to air pressure, upgrade HVAC both boiler and rooftop unit. For 2012 the work will include fire equipment upgrades.

401 & 402 DeMers – Hoover explained that there are repairs needed to correct some water leakage problems, that are planning some work in 2010 for about $622,000 and need to look at funding as in 5996 fund would need to take from allocation set aside for deals.

Gershman inquired whether there is any ability to go back against the contractor on the Corporate Center building repairs, as they sound like design or construction deficiencies. Hoover stated that we are past the statute to go back to the contractor. Hoover stated that he came to Grand Forks in 2003 and found out about the problem in 2004 that had been ongoing and began to research the issues however, by the time concluded research was too late to take action on the contractor. Christensen stated that should be a 10 statute or limitations and need to look at when the certificate of occupancy was issued and consult with City Attorney and go back to the contractor if at all possible and regarding the 2010 repairs they were not in budget and what the funding source will be. Hoover replied that reports were not completed with cost estimates at time the 2010 budget was being completed, and will be bringing forward a budget amendment to cover the projects.

Christensen asked what the proposed funding source could be. The group discussed funding available and that if all projects and budgeted transfers in are done as planned, there will only be $200,000 left for deals in the fund. The group discussed that this is an area that needs further study as we need to look at the dual need to stimulate economic development as well as being able to maintain our property. Gershman stated that he agrees that we need to have further discussion on this as tenants are paying their rent and we have an obligation to maintain our property. He suggested that perhaps this item should come back to Finance and then may need to have a task force work on some potential solutions. Kreun agreed and thought that Finance Devleopment Committee should first discuss this and then make recommendation on how to proceed.

201 S 4th Street – Hoover stated that are using $175,000 from CDBG for this project and and believe that any additional costs should also be eligible for CDBG and will cover that way, subject to Council determination they would want to handle that way.

Parking Ramp – Hoover explained that they had hoped to use CDBG funds for these repairs, but found it was not eligible, so will need to determine a new funding source. There will be information coming back to Council related to potential increases for fees and rental rates. In comparison to other cities, Fargo and Bismarck have both increased their rates and Minot gave to a private entity for review.

Questions / Discussion:

Bjerke asked about the Public Transportation project. This project will renovate the bus garage and potentially do an expansion. Feland explained that there has been discussion about where the Dial-A-Ride vehicles are housed and that perhaps they should be kept at the Bus Garage. Other upgrades that will be done are needed upgrades based on age of facility.

Bjerke commented that in regards to building repairs, if we didn’t own those buildings then we wouldn’t need to repair them. Further, that he believes that the rents we charge should take care of the needs to maintain the building. Hoover stated that when the initial leases were set up several years ago they were established at a level to cover the cost of construction of the building only and that most of those are up for renewal in 2013 and will be looking at doing some adjustments at that time.

Bjerke commented that there are still many buildings not included on the list and that if we are not including them then he would anticipate that we will have no capital needs for any of those buildings for the next 5 years, but that believes that is not realistic and should be planning for repairs that we know will be coming for all buildings.

Bjerke asked if the repairs at 1550 S 48th St will be due to normal wear and tear or upgrades due to tenant. Hoover stated that they are normal routine upgrades.

Bjerke asked regarding 201 S 4th St. what the new monitoring equipment will be for. Hoover stated that it is a temperature control.

Glassheim clarified that this plan is not to include normal routine maintenance, but should be for major projects affecting the buildings.

Christensen commented that perhaps there are some properties that could look at selling, but would need to look into any requirements due to funds used to rehab and construct them. Jerath commented that we have an agreement with the State and can’t see some properties until the construction bonds are paid off. Christensen replied that perhaps should check with the State and see if there are any options to change that agreement. Kreun agreed that especially given how some things have been handled for recovery in other communities and that they have not been bound by similar agreements and may be good to monitor and see if there is any opportunity to make changes. Glassheim commented that dependent on terms in the agreement may also require legislative approval to make changes.

* Equipment Replacement: There were no comments.

Meeting adjourned.

Respectfully submitted,


Sherie Lundmark
Admin Spec Sr