By Jill Fennema

On Thursday, Feb. 29, the city council met for a special meeting to pass a resolution to officially award the bid for the Capital Improvement Plan, Phase 1. The council had been discussing options with DGR, the city’s engineering firm, and USDA Rural Development, through whom they have their financing. 

When the city let bids earlier this year, they asked for two bid schedules, with two options. One option was for a smaller scope of work and one for all of Phase 1. The other option was for asphalt streets or concrete streets. The low bidder for all options was Hulstein Excavating, Inc. (HEI).

The council wanted to use the concrete option, but it was more expensive in the short term, although concrete is less expensive to maintain over the 40 year life of a street. 

However, USDA was not willing to pay the extra for concrete, so Trent Bruce, one of the engineers with DGR, explained, the city would be “chasing its tail” by opting to use concrete, even if they paid for it out of their own coffers or with a different loan.

“USDA Rural Development is in the utility business,” he explained. “They are not willing to pay anything extra for streets. So if concrete streets cost more, regardless of the life span, they are not willing to use their funding to propagate that feature.”

He went on to explain that if the council voted to pay for the concrete themselves, they could decrease their future grant options for future capital improvement plans. Rather, DGR recommended that the council pursue an additional loan from USDA so that they can do the entire Phase 1 project. 

The two bids from Hulstein for the scope of the work were for $5,052,514.25  to do a portion of the project (Bid Schedule 1— see map) and $6,950,403.25 to do the entire thing. The amount of the city’s current financial package is $5.6 million. So if the council opted to only do Bid Schedule 1, they would be leaving grant money on the table. By securing an additional $1.3 million loan through USDA, they can do the entire project.

After a 30 minute discussion, the council voted to award the bid for Bid Schedule 2 (the entire project with the asphalt option) to HEI.