HRA Agenda 02-19-1988MINUTES
MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY MEETING
Wednesday, February 10, 1988 - 7:OOAM
City Hall
Members Present: Chairperson Ken Maus, Lovell Schrupp, Ben Smith,
and Al Larson.
Members Absent: Everette Ellison.
1. CALL TO ORDER.
The HRA meeting was called to order by Chairperson Kenneth
Maus at 7:10AM.
2. APPROVAL OF THE JANUARY 6, 1988 AND THE JANUARY 26, 1988 HRA
MINUTES.
Lovell Schrupp made a motion to approve the January 6th and the
January 26th HRA minutes, seconded by Al Larson, the motion
carried 4-0.
UPDATE ON THE NEGOTIATIONS FOR TAX INCREMENT DISTRICT 92 PARCELS
FOR A POSSIBLE ELDERLY HOUSING PROJECT 02.
At the January 26, 1988 HRA meeting the committee had elected
Al Larson and Ken Maus to initial negotiations with Joe O'Connor
and Donna and Ervin Stelton. Mr. Larson reported that Mr.
O'Connor was out of town; however. Al had obtained Joe's
phone number from his daughter. Mr. Larson proceeded to
contact Mr. O'Connor who was definitely interested in neg-
gotiations with the City, he to more interested in relocation
than to retire his business. Mr. O'Connor may be home
this weekend. Ken Maus reported that Rick Wolfsteller,
Donna and Ervin Stalton, Gary DeBoor, 011ie Koropchok and
himself had met and discussed concept of the project but
had no discussion of numbers. The HRA is not interested In
the building but recognize they may have to purchase
the property, the business and ft's goodwill, and pay for
relocation and moving expense. Gary Do Boer was to check
on relocation sites such as Kjollberg's, Harry Bobo's and
the A-V Room (old meat market). Perception from the Stolton's
was it may be doablo.
The HRA than discussed the rationale of the O'Connor and Stelton's
appraisal, the $17,500 and $15,500 estimated market value respectively,
based on the boat use of the property was for demolition; however,
the HRA recognizes to the owners they are selling an existing
business. The appraisal of the Jones property not being completed
at this time, the HRA questions if the property will be treated
the same. The HRA further discussed the possibility to relocate
O'Connor with Dahlhoimor or at another site, Ken Moue didn't foal
the HRA had time for a trade.
Koropchak reported that the proposed development would be 28 unite
If the three properties were acquired and 24 units if only Stalton's
and O'Connor's were acquired. Relocation costs are determined
HRA Minutes — 2/10/88
3. CONTINUED.
by two methods by Actual Coats or Fixed Payment. According
to Mr. Tom Hayes, City Attorney, if the HRA has a willing
buyer and willing seller, and a fixed payment is agreeable
the HRA would need to hold a public hearing since the
relocation and moving expenses are the use of taxpayers monies.
Bud Schrupp inquired about improvement of the alley? Ken Maus
responded if the TID has sufficient monies and with the deletion
of 3 to 4 property owners it may be easier for the City to
acquire easements from the remaining property owners than a
few years ago because of the fewer number of property owners.
Koropchak had recaped the project cost using $50,000 per property
acquisition coat. The HRA discussed how to arrive at acquisition
cost, Nr. Larson suggested to start by comparisons to the
Flake property acquisition, another questioned if Stelton's
had their property appraised. Rick Wolfateller estimated the
project was workable with numbers at $80,000 to $90,000 per property.
Ken Maus suggested that the HRA go at one step at a time:
first,negotia to with O'Connor; second, negotiate with Stelton's;
and third, negotiate with Jones. Metcalf and Larson needs
the HRA to obtain options on the properties for FmHA application
deadline March 1, 1988.
4. NOTIFICATION OF MEETING AT THE SENIOR CITIZEN'S LOUNGE.
Ben Smith. Al Larson, and 011ie Koropchak had met with a
handful of citizens at the Senior Citizens Lounge on
February 3. 1988 in the afternoon. The small group of
citizens agreed that the concept of townhouse housing
close to downtown as a good idea; however, of that group
no one was Interested as a possible purchaser. A portion
of Block 33 has been considered by the HRA as one possible
site location for the elderly townhouse project. Koropchak
had previously reported that the Olson property's asking
price is 174,900.00. Ben Smith reported the Lindberg property
to for solo but no numbers given. Suggested interested
parsons (purchasers) of the said project are: Lee Trunnall,
Lots Racine, Dr. Charles Fish, and Jean Brouillard.
Koropchak having chocked with Wright County State Bank for
guidelines for a builder to secure financing on such a
project. The bank replied it is not always necessary
for a builder to have a percentage of the units sold prior
to securing financing. it is based on one's credit rate
and possible known local builder. Based on this information,
Al Larson expressed he thought the HRA was proceeding in the
wrong direction and suggested the HRA act am the catalyst
for the site location and as a catalyst to a builder for
the need of an elderly townhouao project close to downtown.
on the upper scale, and the size of units; therebyo, tho
builder takes the risk of selling the units. The committee
is aware the first unit is the hardest to sell and that
the elderly want to sea and walk through a unit.
•
HRA Minutes - 2/10/88
4. CONTINUED.
Koropchak is to verify the location of the water and sever
lines to Block 33 and is to verify if the HRA according
to Minnesota Statutory can purchase and demolish property
for the purpose of selling property to a developer for
an upscale elderly housing project. Other suggested
site locations were in the vicinity of River, Locust, and
Linn Streets.
S. RECAP OF 1988 MONTICELLO TAR INCREKENT DISTRICTS.
The HRA accepted the report as written.
6. OTHER BUSINESS.
None.
7. ADJOURNMENT.
The HRA meeting adjourned by consensus of the committee.
011ie Koropchak
HRA Executive Secretary
Amendments to the said above Option Agreement:
1) The total purchase price to be paid to the OWNER shall
5V .V c) 1 be $61-,,16000, or the amount determined by FmHA for mortgage
purposes, whichever is greater.
(This due to the acquisition cost to the HRA for the three
parcels of Jones Manufacturing Company, Stelton's
Laundromat and Dry Cleaning, and Monti Truck Repair.)
4) If said title is not marketable or is not made so within
said thirty (30) day period, than this agreement shall
at the option of the OPTIONEE or the OWNER be and become
void and of no further force and effect. (Delete remaining
sentence.)
- 8) A11 parties hereto are advised and are on notice that the
OPTIONEE intends to use the premises herein for the purpose
of at least a 28 -unit elderly development. This agreement
is contingent upon the OPTIONEE'S obtaining proper toning
of the premises, adequate utilitas from the City of
Monticello, for such residential purposes, tax increment
financing, and soil boring tests that confirm the site's
soils and water tablas being compatible with the proposed
site usage.
11) This option agreement is contingent upon the OWNER'S
obtaining approval for Modification 03 of the Tax Increment
Finance Plan for Redevelopment District 02. *
Olive Koropchak
HRA Exacucive Secretary
February 26, 1988
* An addition
OPTION AGAFJKE10=
For and in consideration of the sum of One Dollar and Other Good and
Valuable Consideration ($1.00), in hand paid, the receipt of which is hereby
acknowledged, the undersigned, MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY
(hereinafter called OWNER), does hereby grant unto BROADWAY SQUARE LIMITED
PARTNERSHIP, a Minnesota Limited Partnership (hereinafter called OPTIONEE), its
successors and assigns, an exclusive and irrevocable option to purchase at any 0k")�<<'
time up to midnight, June 30, 1988, for a total purchase price of $667O06:0O, or
the amount determined by FmHA for mortgage purposes, whichever is greater, the
following described premises located in the City of Monticello, County of Wright,
State of Minnesota, to -wits
Lots 1, 2, 3, 4 and 5, and the South 15 feet of Lot 15,
Block 51, Original Plat of Monticello.
OPTIONEE shall be deemed to have exercised said Option if a written
notice expressing such intention is deposited in the U.S. Mails, postage prepaid,
within the time above specified, the notice shall be by certified mail.
In the event that said option is exercised by the OPTIONEE, then said
purchase shall be on the following terms and conditions:
1. The total purchase price to be paid to the OWNER shall be
cc :,0 466,OOOr00, or the amount determined by PmRA for mortgage
purposes, whichever is greater.
2. OWNER shall furnish and deliver to OPTIONEE an Abstract of
Title certified to date evidencing marketable title to the
OWNER.
3. After receipt of said Abstract, OWNER shall be allowed thirty
(30) days to cure such defects after written receipt of objections
from the OPTIONEE.
4. If said title is not marketable or is not made so within said
thirty (30) day period .than this agreement shall at the option
e1 �uro'V of the OPTIONS an coma void end of no further force and
effect. pro, 4A,A _thot thia_4�.toVi Pe4vo_OPTI034EE
5. Within ton (10) days after it has boon determined that OWNER has
marketable title, than this transaction shall be closed, the
money paid over to the OWNER and dead delivered to the OPTIONEE.
6. OWNER shall pay the real *state taxes duo and payable for that
portion of the year determined to be before the data of sale of
the property from the OWNER to the OPTIONEE. The OWNER shall
pay for and satisfy all existing aonocamonto presently levied
against the property. Said assessments to include, but not to be
limited to storm sower, sanitary sower, water, paving and any
other a000ssmonto.
7. Possession of the premises shall be given to the OPTIONEE
immediately after the dead is delivered to the OPTIONEE
and the purchase price paid to the OWNER.
S. All parties hereto are advised and are on notice that the
OPTIONEE intends to use the premises herein for the purpose
of reoideatiai development. This agreement is contingent
upon the OPTIONEE'S obtaining proper coning of the premises,
adequate utilities from the City of Monticello, for such
residential purposes, tax increment financing, and soil
boring tests that confirm the site's soils and water tables
being compatible with the proposed site usage.
9. Time is of the essence of this agreement and OPTIONEE represents
that it will pursue the purpose for which this pption was given
with all deliberate speed. The provisions of this agreement
shall be binding upon the legal representatives, successors,
heirs and assigns of the parties hereto.
10. In the event that OPTIONEE receives written notice from the
Farmers Home Administration of the United States Department
of Agriculture, that the residential development proposed
for this site will not be funded, said notice shall be forwarded
to the OWNER and upon receipt shall void this Option Agreement.
Dated this 24th day of February, 1988.
MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY
By1
Kenneth Maus, Chairperson
By%
011ie Koropchak, Director
STATE OF MINNESOTA 1
1 sa.
COUNTY OF WRIGHT 1
On this 24th day of February, 1988, before me, a Notary Public within
and for said County, personally appeared Kenneth Maus, as Chairporeon and 011ie
Koropchak, as Director, of MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY and
who executed the foregoing instrument and acknowledged that they executed the same
on behalf of the MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY.
Notary Public
DRAFTED BY1
METCALP 4 LARSON
Attorneys at Low
313 W. Broadway, P.O. Box 446
Monticello, MN 95362-0446
(612) 295-32321 421-3393
-2-
MONTI TRUCK REPAIR - 247 West Broadway, Monticello, Minnesota 55362
LAND - 5,115 square feet
Building- 2,110 square feet
APPRAISAL - St. Cloud Appraisal, January, 1988
CROSS LAND VALUE ESTIMATE - $25,500.00 ENV $17,500.00
ESTIMATED MARKET VALUE, 1987 Tax Book - $27,800.00
$11,500.00 Land $16,300.00 Building
1988 PROJECTED TAXES - CURRENT ASSESSED VALUE - TAXES
$8,570.00 $838.80
1988 ASSESSMENTS - CURRENT DUE - REMAINING BALANCE
74-I $ 92.00 $152.08
77 -SI 14.16 108.80
$106.16 $260.88
AA###RA*AAAAAAR#A#AAA###AAAAAAR#*#A#ARfRA#RRRAARR**f AA###A*AARA#*A#AA
STELTON'S LAUNDROMAT 6 DRY CLEANING - 237 West Broadway, Monticello, Minnesota
LAND - 4,537.5 square feet
Building - 2,915 square feet
APPRAISAL - ST. Cloud Appraisal, January, 1988
CROSS LAND VALUE ESTIMATE - $22,500.00 EMV - $15,500.00
ESTIMATED MARKET VALUE. 1987 Tax Book - $39,900.00
$10,200.00 Land $29,700.00 Building
1988 PROJECTED TAXES - CURRENT ASSESSED VALUE - TAXES
$12,295.00 $1,203.39
1988 ASSESSMENTS
- CURRENT DUE -
REMAINING BALANCE
60-1
$ 13.04
$ 22.12
61-I
4.12
9.94
74 -PI
118.30
195.50
77 -SI
12.56
96.67
$148.02
$324.23
ARAAAAA#RBBB#R#A#RRRAAAR*AMA*R#AAR#AAAAAAA*RAA*R####RAA#RAARAAAAAARAAA
JONES MANUFACTURING - 110 North Locust, Monticollo, Minnesota 55362
LAND - 3,690 square feet
Building - 2,120 square feet
APPRIASAL - ST. Cloud Appraisal, January. 1988
CROSS LAND VALUE ESTIMATE - $13,000.00 EMV - $52,000.00 Land $13.000.00
Building $39,000.00
ESTIMATED MARKET VALUE. 1987 Tax Book - $39,100.00
$6,100.00 Land $33,000.00 Building
1988 PROJECTED TAXES - CURRENT ASSESSED VALUE - TAXES
$12,043.00 $1,178.72
1988 ASSESSMENTS - CURRENT DUE = REMAINING BALANCE
61-1 $ 1.86 $ 4.50
77-8I 46.84 359.97
$ 48.70 $364.47
FORMER MONTICELLO FORD BUILDING - 249 West Broadway, Monticello, Minnesota
LAND - 14,872.5 square feet
Building - 6,661 square feet
APPRAISAL - St. Cloud Appraisal, May 1987
GROSS LAND VALUE ESTIMATE - $78,000.00 EMV - $67,000.00
ESTIMATED MARKET VALUE, 1987 Tax Book - $43,400.00 (vacant property)
$23,400.00 Land $10,000 Building
SOLD - SEPTEMBER 15, 1987 $10,000.00 Land
$75,000.00 Purchase Price
- 25,000.00 Down Payment
$50,000.00 Contract for Deed at 102 over 4.5 years
13,000.00 Projected Demolition (Actual cost $6,494.00)
2,000.00 Administration Cost
ANNUAL DEBT/SERVICE OF =14,000.00 TO RECOVER ALL HRA COST 7 YEARS.
RRA ARRAAAARMARAffifffRRARAAAAAAffAAffRRRRRRAARARARRAAAARRAARAAAAAA
APPRAISAL COMPARISONS
$5.0428
$74,999.043 FORMER MONTICELLO FORD BUILDING - $67,000.00 divided by 14,872.5 sq ft
$4.5049 per sq ft land
$25,779.60 MONTI TRUCK REPAIR - $17,500.00 divided by 5,115 sq ft - $3.4213 per eq
ft land
$22,881.705 STELTON"S LAUNDROMAT 6 DRY CLEANING -$15,500.00 divided by 4,537.5 eq ft
-$3.4159 per sq ft land
$18,607.932 JONES' MANUFACTURING - $13,000.00 divided by 3,690 sq ft = $3.5230 land
$39,000.00 divided by 2,120 sq ft - $18.40 building
CITY ENV COMPARISONS
FORMER MONTICELLO FORD BUILDING - $33,400.00 divided by 14,872.5 - $2.25
$10,000.00 divided by 6,661 - $1.50
vac bldg.
MONTI TRUCK REPAIR - $11,500.00 divided by 5.115 - $2.25 per sq ft land
$16,300.00 divided by 2.170 - $7.50 per aq ft bldg.
STELTON'S - $10,200.00 dividod by 4,537.5 - $2.25 per sq ft land
$29,700.00 divided by 2,915 - $10.19 per sq ft building
JONES' - $6,100.00 divided by 3,690 - $1.65 per sq ft land
$33,000.00 divided by 2.120 - $15.57 par sq ft building
Expenditures, Purchasing, and Contracts
Employees can easily test many products by
counting, measuring, or weighing. In other cases,
the city may need to have an outside agency per-
form the tuts.
Many cities may find the certification plan that
the United States Bureau of Standards established
useful . Under it, a list of manufacturers have in-
dicated their willingness to supply commodities in
accordance with standard federal specifications.
These manufacturers certify that their products
comply with the specifications. In many instances,
cities may adopt the specifications of the federal
government and then require potential suppliers to
state whether or not their products meet those
specifications.
Central Storage
Some cities establish a central storehouse of
goods. This may help the city get the lowest pos-
sible wholesale prices, but the city should consider
the costa and risks in storage. For many com-
modities, the 'price agreement' method may be
better and more economical .
Salvage Operations
Cities can often save by disposing of surplus
supplies and property. A city can sell excess
materials from construction work, excess inven-
tories, obsolete or out -grown equipment, and other
items, or another department may be able to use
them. Some official, preferably the city purchasing
agent, should maintain a list of all surplus
property, selling unneeded items and promoting in-
terdepartmental sharing of equipment whenever
possible. This procedure helps eliminate unneccs-
sary duplications of equipment.
E. Contracts
Only the council may make contracts on behalf
of the city. Individual council members, council
committees, and city administrative officers may
not enter into such contracts. However, the
manager in Plan 8 statutory cities may let con-
tracts when the amount does not exceed SI,000.
Charters often give the city manager similar
limited authority.
Other than this, the statutes do not Gmit or
restrict a city's contracting authority. A long as
its actions aro reasonable and honest, a� and so
long as it does not bind the city for an sea -
reasonable length of time, the council may enter
into contracts on any terms it secs appropriate. If
a contract does not require a tax levy higher than
that allowed by law or result in indebtedness which
exceeds the city's statutory debt limit, the law does
not put an expenditure limit on such agreements.
Execution of Contracts
The council must approve, by resolution, every
contract. In addition, the mayor and the clerk (or
the manager in Plan B cities) must sign the con-
tract and affix the city seal upon it. As long as the
contract expresses an agreement of the council as
a whole, and as long as there is no other
reasonable doubt concerning the contract's
legality, these officiab may not, on the basis of
their own judgment, refuse to execute it.
F. Competitive Bidding
Requirements
Competitive bidding is accessary in the follow-
ing instances.
1. A city must competitively bid contracts for
local improvements under the local im-
provement code when the estimated coat of
the improvement exceeds 315,0011. ag
2 All contracts for the sale or purchase of
supplies, materials, equipment; rental of
equipment; or the construction, alteration,
repair, or maintenance of real or personal
properly, when the estimated amount of
the contract exceeds $15,000, aced com-
petitive bids. The uniform municipal con-
tracting law requires these bids. This law
supersedes all inconsistent laws governing
contracts. 49 While the law makes no men-
tion of its effect on cities with inconsistent
charter provisions, the attorney general
hes rut d that it supersedes such provi-
sions. Public notice specifics in home
rule charter cities are left to the local
charter. Specialized charters or statutory
provisions may require bidding in instances
when the uniform municipal contracting
taw would not, sub as group insurance for
city employees.
3. A city must let to the lowest responsible
bidder, a public improvement project which
the city is financing with special asseu-
Page 358 Handbook fur Minnesota Cities
The four basic purchasing procedures are:
1. The regular purchasing procedure, which
may or may not involve competitive bids;
2. Purchasing through price agreements;
3. Emergency purchasing; and
4. Purchasing from petty cash funds.
Regular Purchasing Procedures
Whether or not competitive bids are necessary,
all normal purchasing, except those with other
price agreements or which come out of petty cash
funds, should adhere to the following process.
1. The department or person needing the
item should prepare a requisition form.
This should include a description of the
product, quantity, applicable specifica-
tions, and any similar information. It
should go to either the purchasing agent or
the clerk for presentation to the council.
2. The purchasing agent or the clerk should
then see whether the budget has author-
ized the purchase and if sufficient funds
are available for that item The clerk or
purchasing agent should cancel the requisi-
tion if the budget doesn't allow the pur-
chase or if funds are not available. The
council may modify the budget or make an
emergency appropriation. Except for Op-
tional Plan B cities, 42 the statutes do not
require these two checks, but cities may
wish to use them.
3. After completing the first two steps, the
purchasing official may then proceed to ac-
quire the requested item.
4. If the city has no purchasing agent, if the
ppurchase is beyond the agent's authority, or
if the city needs to get bids for the
proposed purchase, the requisition should
go to the council for further action.
5. After the city has received the item and
tested compliance with specifications, the
city may process and pay the biU.
Chapter 23
Price Agreements
Cities often use price agreements to acquire
items it frequently purchases in small quantities.
For example, cities often buy gasoline and heating
fuel under price agreements.
A price agreement is a contract between the city
and a merchant . Under it, the merchant agrees to
supply all of the city's requirements for the
specified commodities during the period of the
agreement. The price may be fixed or variable,
such as a fixed discount from market price. While
not obligated to purchase any definite quantity, the
city usually estimates its probable needs. Price
agreements expedite delivery, reduce paper work,
and generally result in lower prices.
The city may then make purchases as the need
arises. Depending on the commodity and the fre-
quency of purchases, the council may or may not
require separate requisition forms. It should set
some check, however, to prevent the city from
overspending its budgetary appropriation.
Emergency Purchasing
The law requires cities to let all contracts for
materials or construction costing $15,000 or more,
to the lowest responsible bidder after publishing
notice in the official newspaper. 43 Exceptions are
available for emergencies.
While the council determines whether an emer-
gency exists, the attorney general has said that the
emergency must be real and not just an incon-
venience, in order for the council to dispense with
regular bidding requirements. 44 The attorney
general has ruled for example, that thef ilure of
a well might constitute an emergency, 49,but the
breakdown of public works equipment does not
justify dispensation of bidding requirements. 46
Before deciding that an emergency exists, the
council should consult the city attorney.
Inspection and Testing
After the city has received purchased items, but
before it pays for them, someone should determine
whether they conform to specifications. Normally,
the purchasing aotacy, or an employee in the
department reecivntg the item, makes the check.
Handbook for Minnesota Cities Page 357
meats, undertaken by day labor contracts
under the local improvement code, for the
purchase of supplies, materials and equip.
ment which exceed S5,000.51
d. The city must competitively bid gree? in-
surance for 25 or more employees. SS
Problem Areas
The law requiring bids is in effect, regardless of
which fund the city uses to pay for the contract,
except for improvements the city finance& with
special assessments under the local improvement
code. (See the note at the end of the footnotes for
a discussion of the problem of the conflicting dol-
lar limits in the statutes.) The statutes do not d s.
tinguisb between new and used equipment or
materials, and cine& must get bids even if it is
seeking used 'items. S3
The uniform municipal contracting law covers
purchases of supplies, materials, and equipment
and construction alteration, repair, or maintenance
of real or personal property where the amount in-
volved is more than 513,000. 54
Deflnition of Contract
Another problem area in the uniform municipal
contracting law is the definition of a 'contract.*
The definition covers any agreement for the sale
or purchase of supplies or materials or rental of
them From this broad definition it seems dear that
all cities must advertise for bids when selling
materially and equipment or when mating such
items.
Advertising for Bids
If a council fails to advertise for bids when the
law reqquires compelitive bidding, the contract is
void. TAc cGy must pay for any benefits it received
in order to avoid injustice to the party who per.
formed work under the contract and to prevent un-
just enrichment of the city by its own failure to
advertise for bids. So Council members probably
would not be personally I�Vlc to the contractor if
they acted in good faith. 77
Chapter 23
Splitting a Contract
In general, a city cannot avoid bidding require-
ments by splitting a contract into several contracts,
each of which is below the minimum amount re-
quiring bids. 58 For example, the city could not
purchase lumber in several transactions, each in.
volving an expenditure of less than $15,000.
However, if materials or work logically fall into
two Separate contracts because they involve
separate transactions, as for the service of con.
tractors specializing in different kinds of work,
there is no reason why the city couldn't negotiate
the contracts individually withou bids if they do
not exceed the 515,000 minimum S91f splitting the
purchase into separate contracts serves no specific
purpose except to reduce the amount of the con-
tracts to less than $15,000, the courts will probably
consider the contract invalid.
The City may not accept a bid which includes a
number of items when the . d%Artisement called for
separate bids for each item
Changes la Specifications
Cities must re -let competitive bids when they
make a material change in the specifications of the
contract, even if the change would have no effe
on the rank order of the bids the city received. 61
The tough issue is the determination of the
materiality of the change in relation to the entire
contract. It is not clear in Minnesota whether this
is a fact question for the jury or a legal issue for
the court. Certainly a city should not make
changes in a contract or the specifications without
consulting with the city attorney. The Minnesota
Supreme Court has granted attorney tea to an on.
successful bidder and expenses for the cost of chal-
lenging improper bidding procedures when a
governmental unit makes an error and when
rebidding is impractical. Generally, however o
unsuccessful bidder canna recover damages.
Wages and Hours
The municipal contracting law does out prohibit
any city from adopting rules, regulations, or or-
dinanee& which utabl'uh the prevailing wage rue
Handbook far Minnesota Cities Page 359
Expenditures, Purchasing, and Contracts
in Minnesota law, 63 as a minimum standard for
wa�cs, and which establish hours and working con-
ditions prevailing for the largest number of
workers in the same class of labor as a minimum
standard for a contractor's employees. 64
Contracts for Less Than $IS,000
Councils must follow certain procedures with
respect to contracts of less than $15,000. If the es-
timated amount of the contract exceeds $10,000
but is less than $15,000, the city may use sealed
bids or direct negotiation, by obtaining two or
more quotations and without advertising for bids
or otherwise complyittpt with the requirement of
competitive bidding. 63 The city must keep all
quotations un Gk for at least one year.
If the estimated amount of the contract is less
than $10,000, the council may make the contract
either upon quotation or in the open market. As
far as practical, the contract should be based on
at Least two quotations which the city should keep
on ride for at least one year. 9 For All practical
purposes, the procedure of purchases under
$15,000 Is the same regardless if the contract is
over or under $10,000.
If the city publicly solicits bids where the law
/does not require competitive bidding the Court
has held that the city must 'pursue such method
in a manner reasonablX designed to accomplish its
normal purpose of giving all contractors an equal
normal
to bid and of assuring the ttaxpayers
e beat bargain for the least money.' 67
ompedtivs Speciflestlons
When a city calls for bids for the purchase of
supplies or equipment which arc competitive in na-
ture, it cannot prepare specifications to exclude all
but one type of supplies or equipment. 68 While
the statute does not apply to construction con -
trans, it is clear from the Minnesota court cases
that the same general principle applies. The
proposals and specifications must allow free and
full competition. They may not give a prospectsvq
bidder an unfair advantage over asy otber. 6Y
However, a city can include a reasonable specifica-
tion, even it its inclusion results in fewer bidders
being able to Md than could do so without the
specification. 70
Specifications must be sufficiently definite d
precise to afford a basis for comparable bids.�I
If the city cannot determine in advance the number
of unitWt will need it can ask for bids on a unit
basis. The city should, however, estimate the
number of units since the number may affect the
unit price.
Rejecting Bids
The local improvement code gives the city the
right to reject any asci all bids. 3Because of the
statute, this right exists even if the city doesn't in-
clude such a statement in the advertisement for a
local improvement . The same is true of any city
with a similar charter provision applying to other
contracts. In any other case, the city may and
should reserve the right to reject any or all bids,
or to waive informalities or irregularities. +y It is
possible that if the local improvement code is not
involved, and the city has not reserved the right to
reject any and all bids, a court action could compel
the city to take the low bidder.
The council probably has authority to waive ir-
regularities in bids when they do not result in a
substantial departure from specificatiQns or favor
the bidder guilty of the irregularities. 15 A failure
by a few minutes to comply with a bid deadline or
a failure to seal a bid until after it has been sub.
mitted are irregularities which the council may
waive. 76
Lowest Responsibte Bidder
Statutory city contracts and contracts of all
cities for improvements under the local improve-
mcni code must go to the lowest responsible bid-
der. Most home rule charters contain similar re-
quirements which govern contracts not under the
control of the local improvement code, but some
use varying terms, such as 'lowest bidder; or
'lowest and best bidder. -
The bidder who submits the lowest bid in dollars
is not necessarily the lowest responsible bidder'
and the quoted phrase given the council reasonable
discretion in choosing among bidders.
'Responsibility; in bid statutes, meant not only
financial responsibility but also integrity, skill, and
the likelihood of the bidder's doing faithful and
satisfactory work. Prompt{Ass, for example, is an
element of responsibility.
While it Is not clear under Minnesota law
whether a bidder has a right to a hearing before
the council rejecu the bid on grounds of imspon-
Page 360 Handbook for Minnesota Cities
sibility, councils should reject bids based on tack
of bidder responsibility only after reasonable
notice to the affected bidder of an opportunity to
present his or her side of the issue. 78
Value does not always depend on price alone.
The council may also consider the quality,
suitability, and adaptability of the articles. Where
plans and specifications demand consideration of
several factors and no single bid is lowest in all
these factors, the council may decide what weight
to give to the various factors, and, considering all
of them, accept what it deems to be the lowest
responsible bid. 79
Variances la Bids
Principles of competitive bidding require that
the successful bid conform to the specifications.
If the final contract contains provisions beneficial
to the successful bidder and not in the specifica-
tions, the contract is void. 80 Similarly, an award
of a contract is invalid if the bid does not adgress
a material provision of the specifications. I A
material variance is one that gives a bidder a sub-
stantial advantage or benefit that other bidders do
not enjoy. For example, when the company will in-
stall equipment according to the company's
specifications instead of those of the city, and
when the bidder does not agree to pay for a city
inspector during the six-month trial period as the
specificaons required, the variances are
material .
Whether a variance gives a bidder substantial
advantage or benefit is not the sole test for. deter-
mining if such variance is material. Unless the bid
responds to the specifications in all material
respects, it is not a bid, but a new proposition the
city should reject. 83
Lire Cycle Costs
Cities must use competitive bidding when
amounts over $13,000 aro involved. Yet the initial
purchase price or construction cost measures only
one part of the total ciq expenditure in respect to
most buildings or equipment . For this reason,
cities ought to consider life cycle costs in many bid-
ding situations.
Consider this elampple. The city needs to pur-
chase one or more pol cars. Any ear purchased
must meet certain criteria as to space and per
formanee. Using traditional bidding methods, the
Chapter 23
dealer submitting the low dollar bid on a car
meeting the interior space, engine size, and op.
tional equipment criteria set out in the specifica-
tions makes the sale. Over a two-year, 100,000 mile
useful life, however, a squad car which averages 10
miles per gallon may consume an amount of fuel
costing approximately as much as the purchase
price of the car. On the other hand, a car similar
in other ways, but averaging 15 miles per gallon
could easily save the city a substantial amount of
money during the same period.
Maintenance cost and salvage value are also cru-
cial to an accurate determination of 'lifetime
cost.' An auto that needs frequent tuning and a
major engine overhaul prior to retirement from
city service obviously can cost the city more in
total outlay than a similar vehicle aeeding less fre-
queat or less costly service.
The same considerations apply to design and
construction of public buildings sewer systems,
etc. A public swimming pool budding which is well
insulated and equipped with a solar pool heater
may be substantially more expensive to construct
than a similar conventional building. Yet, the total
costs of construction, interest, energy use, and
maintenance may show that the design entailing
more construction expense may be substantially
more economical on a long-term basis.
Public officials can apprcach fife cycle costs in
at least two ways. First, specifications can demand
a product with characteristics that will assure
utility and economy. This is the traditional ap-
proach to bidding. It can include some additional
specifications so as to exclude bids from suppliers
of goods that aro not economical and suitable for
the intended use. For most buildings or other con-
struction, and for most equipment, the city can
usually make reliable calculations of total energy
costs involved in the alternatives under considera-
tion. Likewise, the city may be able to estimate
maintenance costs relying on the rity's own ex-
perience or published statistical information.
In the police car example, operating economy
estimates may be available from annual EPA
mileage fires. After calculating the dollar im-
pact of mileage at the likely price of fuel to the
city during the period of the ear's on. the city can
draft specif
uicationa to demand reasonable mini -
mm tiPA mileage figures, as well as any other
reasonable performance or physical measurement
standards.
Handbook lbr Minnesota Cgles Page 361
Expenditures, Purchasing, and Contracts
The city can estimate maintenance costs by ex.
amining owner's manual maintenance schedules.
However, unless fleet statistics on maintenance
costs are available to justify the specification of
one or a limited number of models of specific
manufacture, it will be difficult to access main-
tenance costs without subjecting the city to pos-
sible legal challenge.
The second method of taking account of life
cycle costs is through 'total cost bidding.' This
method can take into account mechanical
durability, or at least the dealer's most realistic as-
sessment of quality. It is a solicitation of bids
which guarantee [imitations on the citys costs of
ownership and operation of the product. Using
this approach, the burden of making an accurate
assessment of the product's durability and quality
belongs to the dealer or distributor. This requires
each bidder, in addition to submitting a bid price,
to guarantee that maintenance costs will not
exceed a certain amount during a certain period
of time.
Presumably, the city could require bidders to
provide the same kinds of guaranteed limitations
as to total fuel use. However, because operator
care has an even greater impact on fuel usage than
on equipment fife, such a demand is likely to dis-
courage most potential bidders.
Most total cost bid solicitations also require
each bidder to guarantee a minimum salvage value
by agreeing to submit a bid for repurchase of the
item at a time the solicitation specifies.
Major impedimenta to total cost bidding are
doubts about its legality; the complexity of
developing specifications to take operating and
maintenance costs into account; dealer or contrac•
for resistance to the more complex bidding
procedure; the longer term commitment required
of the supplier; and the additional expense to the
city and the supplier resulting from the need to
keep detailed records over an extended period of
time. Despite these potential difficulties, cities
have used total cost bidding extensively for the
purchase of heavy construction equipment . It may
also be practical in other areas, such as the design
and construction of wastewater treatment
facilities.
The Minnesota Supreme Court has recognized
reasonable council discretion to choose among
bids, on the basis of quality and adaptability, when
the goods are not capable of precise or exact
specification. 84
Therefore, a city whose specifications contain
defensible criteria relating to quality (including
economy of operation) and adapta¢ility, is almost
always in a sound legal position. i
The attorney general has recognized the validity
of such an approach. 86 Consequently, specifica.
tions which contain reasonable economy of opera.
tional standards and require servicing for a stated
period at a stated price, with perhaps a guaranteed
salvage value, are legal in Minnesota.
Which purchasing approach the city should take
will depend on many factors, such as the dollar
amount of the purchase, availability to the city of
reliable information as to specific quality elements
of the available products, and distributor coopers.
tiveness. Regardless of the approach, careful
analysis of long-term utility and economy is the
key to wise purchasing.
Bidding Procedures
Once the engineer or purchasing agent has
prepared the necessary specifications, the council
should seek competitive bids if the law requires
them or the council feels they are desirable. The
city should award the contract in the following
manner. If the council seeks bids, the city must
follow all statutory procedures wheth r or not the
law required bids on the contract .
Requests for olds
The statutory requirements are as follows.
1. Except as noted in points 2 and 3 below,
the city must publish all requests for com-
petitive bids in the city's official newspaper
at least 10 days byfmc the lust day for sub-
mission of bids. ee For other than local Im•
provements, 89 a charter may provide
other publishing requirements.
2. When special assessments will finance a to.
cal improvement project, under the local
Page 362 Handbook for Minnesota Cities
CI:"-' OF tWTICELLO
TAX INCREMENT FINANCE APPLICATION
Name of Company
Company Address
Company Mailing Acdress
Company Telephone Number
Owner's Name(s)
Owner's Address
Owner's Telephone Number
Proposed Number of New Jobs
Total square footage of proposed building
Square footage of office area
Square footage of manufacturing area
Square footage of cold storage area
Describe type of structure (masonry, concrete, metal)
Acreage of land
Requirements
A. Initial Fee: For an estimated project cost less than $50,000, the
initial fee is 5% of the project cost.
For an estimated project cost of $50,000 and over, the
maximum initial fee is $2,500.
The initial fee is due after approval of the financial
statements and business plans.
The initial fee will be refunded at the time the
Development Agreement is executed and the land acquired.
No initial fee will be refunded if the Development
Agreement is not executed and the land not acquired.
B. Company Financial Statements
1. Balance Sheets (three years prior)
2. Profit and Loss Statements (three years prior)
3. Either Projections (three years) or Business Plans
C. Preliminary Building and site Plans (Gary Anderson, Building/Zoning
Administrator). For BRA review, prior to setting a public hearing date on
the sale of public lands.
D. Final Building and Site Plans. Prior to Public Nearing on TIP Plan.
E. Proposed Development Time Table.
F. Statement of Financial Commitment and Arrangements to date.
G. Execution of Development Agreement and Acquisition of Land.
ins use of TIF must be approved by the Monticello Housing and Redevelopment
Authority, the Planning Commission, and the City Council.
0.
Authorized Signature
Date
TAX INCREMENT FINANCING CHECKLIST
Preliminary Phase
Site Plan
Building Plan
Legal Description
Land Cost (Current Market Askinq Price)
Statement of Developer's Financial Committmont
Comprehensive Plan
Original Asucanod Value (UAV)
New Assessed Value (NAV)
Captured Assessed Value (CAV)
Proliminary Devolopment Agremront
Certification Phase
Final Site Plan
Final Building Plan
Purchase Agrcoment/Option on Land
HRA Resolution Approvinq Proposal
Notice of Public Hoarinq on Salo of Public Lands
Minutes of Public Hearinq on Salo of Public Lands
HRA Resolution Adontinq T.I.N. Plan
letters to School District and County
Sign-offo by School District e. County (if available)
Notice of Public Ilcarinq on T.I.F Plan
Minutes of Public Iloarinq on T.I.F. Plan
Cuuncll Rcuolution Adontirul T.I.F. Plan
County Auditor's Certification of OAV
Asua000r'o letter Sottinq Futimatwi NAV
T.I.F. Plan (Final)
Executed Developer'u Agreement
C. STAFF RECOMENDATION.
No recommendation is given by the staff only to consider that
debt services should be retired as quickly as possible within
reason, consider the mill rate does not remain consistent, and
the assessed valuation of River View Park may fluctuate.
D. SUPPORTING DATA.
Projected Cost
Options A. B-1. B-2.
Letter from John Simola.
Site plan (presented at meeting).
TAX INCREMENT DISTRICT /2
DISTRICT PROJECT COSTS
Securities (9 years remaining)
Metcalf 6 Larson 1996
Old Monticello Ford Garage
Contract for Deed $50,000
Interest (pay off 6/88) 2,500
Demolition Cost 6,500
Administrative 2,000
Assessments 980
Downpayment 25,000
$86,980
Less FmHA 56,000
2,5 remaining years 1990
Jones
Property 52,000
Relocation 6 Moving Exp 5,000
Demolition 51000
Taxes (I of 1988) 590
$62,590
O'Connor
Raw Land
45,000
Relocation 6 Moving Exp
5,000
Demolition
5,000
Assessments
370
Taxes 0 of 1988)
420
Administrative
$55,790
Stelton's
Property
60,000
Relocation 6 Moving Exp
5,000
Demolition
5,000
Taxes U of 1988)
600
$70,600
Administrative
91000
Bond Discount
4,000
Plan/Dev
5,000
Bond Issuance
12,000
Copltaliced Interest (18mos)
36 000
66,00
TOTAL
$39,465
30,980
254,980
Bond Issuance 260,000
ANNUAL
$ 4,385
14.000
•
3. CONSIDERATION TO APPROVE MODIFICATION p3 OF THE TAX INCREMENT
FINANCE PLAN FOR TAX INCREMENT REDEVELOPMENT DISTRICT /2.
A. REFERENCE AND BACKGROUND.
The RRA does have executed purchase option agreements on the
Stelton. O'Connor, and Jones' properties through June 30, 1988,
and an executed option agreement with Metcalf and Larson. The
final breakdown of the project costs are included in the Supporting
Data. Also, included as Supporting Data is Option A., projected
tax increment based on $24,500 per unit on the proposed 28 -unit
elderly project and River Park View 31 -unit. Since no development
agreement was made for the River Park View development, no
assessment dgreement has been executed guaranteeing a minimum
assessed value on the apartment. The assessed value per unit
will decrease from $27,500 (Tax Book 1988) to $24,500 (Tax Book 1989),
therefore, projected tax increment had to be recaluated. Option B.,
has the aseessed value of the proposed 28 -unit at $27,500 per unit
and the River Park View at $24,500. With a development agreement
for the 28 -unit apartment the county assessor will guarantee a
minimum assessed value of $27,500, thereby, increasing the
tax increment. According to Doug Gruber, County Assessor, the
decrease is determined by using the gross rent multiplier versus
the actual gross rent of subsidized apartments. The HRA needs
to vote on which Option to use for the modification of the finance
plan.
According to Brad Larson, the application was submitted to FmRA
on March 1, 1988 and the needs study was completed by updating
Hornig's study. The architect for Hornig has been informed to
develop site plans for strictly low income family units which
leads one to believe the FmRA is anticipating funding the elderly
project on West Broadway. This is verified by Gary Anderson,
Building/Zoning Administrator. Brad estimates that in three weeks
(week of April 25), they should hear from the St. Cloud FmHA Office.
Time is crucial on this project -
• approved funding
• Stalton's request of 30 days from closing date to move
• Demolition time
• Streetscape project to begin July 5.
Enclosnd is o letter from John Simola on the old galvanized
sarvice to properties on Broadway. This may be an added cost
to our project. It's my understanding the properties of
O'Connors and Staltons is also galvanized service.
B. ALTERNATIVE ACTIONS.
1. Option A
2. Option B-1
3. Option B-2
4. Decline the Modification.
MODIFICATION ;3 OF THE TAX INCREMENT
FINANCE PLAN
REDEVELOPMENT DISTRICT j2
BASED ASSESSED VALUES
OAV
NAV
155-010-050010 City of Monticello
exempt
exempt
050011 Teslow, Marguerite S.
$ 9,860
S 14,424
050081 Metcalf & Larson
13,574
15,908
050100 Broadway Partners
10,536
73,798
050101 City of Monticello
exempt
exempt
050111 Hollenbeck, Duane R. 6 Lois
8,960
9,550
051010 Monticello HRA (Ford)
4,455•
051011 Monticello HRA (Jones)
3,690*
051020 Monticello HRA (Ford)
10,418*
051040 Monticello HRA (O'Connor)
5,115*
051050 Monticello HRA (Stelton)
4,537*
161,182
051111 Gustafson, Clifford M.
6,277
6,173
051130 River Park View
9 660000
$ 87,022
175,142
*Total square footage X $2.50 X 40%
not tax exempt but 408 of vacant land
Building - 28 unite 0 $24,500 per unit
$686,000
Land - 28,215 aq ft @ $2.50 per aq ft
70,537
686,000 70,537
20 34
T577M 3TITg
NAV for 28 -unit elderly project $161,182
District 12 HAV
$456,177.00
OAV
87,022.00
CAV
$368,364.00
1988 Mill Rate
.097876
TI payable 1990
$ 36,013.57
OPTION A
I
pq
DEBT SERVICE
1988
1989
1990 1991
1992
1993
1994
1995
1996
SECURITIES
; 4,385
; 4,385
; 4,385 ; 6,385
$77-385
; 4,385
; 4,385
; 4,385
; 4,385
FORD
14,000
14,000
7,000
PROJECTED
TAX INCREMENT
25,319
23,497
36,073 36,073
36,073
36,073
36,073
36,073
36,073
BALANCE
6,934
4,888
24,688 31,688
31,688
31,688
31,688
31,688
31,688
BOND ISSUANCE
;260,000 @ 9.25%
22,000 30,000
30,000
30,000
30,000
30,000
30,000
over 16 years
1997
1998
1999 2000
2001
2002
2003
2004
2005
34,500
34,500
34,500 34,500
34,500
34,500
34,500
34,500
34,500
;260 x ;122.17 -
;31,764.20
x 16 years
- ;508,227.20 OPTION
A
(1990)
22,000
x 1 year
- ; 22,000.00
(1991-1996)
30,000
x 6 years
- 180,000.00
(1997-2005)
34,500
x 9 years
- 310,500.00
DEBT RETIRED
;512,500.00
MODIFICATION 03 OF THE TAX INCREMENT
FINANCE PLAN
REDEVELOPMENT DISTRICT 02
BASED ASSESSED VALUES
OAV
NAV
155-010-050010 City of Monticello
exempt
exempt
050011 Teslow, Marguerite S
; 9,860
; 14,424
050081 Metcalf 6 Larson
13,574
15.908
050100 Broadway Partners
10,536
73,798
050101 City of Monticello
exempt
exempt
050111 Hollenbeck, Duane R 6 Lois
8,960
9,550
051010 Monticello HRA (Ford)
4,455*
051011 Monticello HRA (Jones)
3,690*
051020 Monticello HRA (Ford)
10,418*
051040 Monticello HRA (O'Connor)
5,115*
051050 Monticello HRA (Stelton)
4,537*
177,982
051111 Gustafson, Clifford
6,277
6.173
051130 River Park View
9,600
175,142**
;87,022.
;472,977.
* Total square footage x ;2.50 x 402
Not tax exempt but 402 of vacant land when sold to
developer
•* Based at ;24,500 per unit x 31 x 202 plus
land valuation ;2.00 x 342
Building 28 unite @ ;27,500 per unit ;770,000
Land 28,215 sq ft @ ;2.50 per sq ft
70,537
;770,000 ;70,537
.20 .34
;154,000 ;23,982
NAV for the proposed 28 unit elderly project
is ;177,982
District 02 NAV ;472,977
GAY 87,022
GAY ;385,955
1988 Mill Rate .097876
Tax Increment (1990) ; 37,775
OPTION B
BOND ISSUANCE
$260,000 @ 9.252 24,500 31,500 31,500 31,500
over 15 years
1997 1998 1999 2000 2001 2002
36,000 36,000 36,000 36,000 36,000 36,000
$260 x $125.90 - $32,734 x 15 years - $491,010.00 OPTION B-1
(1990) 24,500 x 1 year - $ 24,500.00
(1991-1996) 31,500 x 6 years - 189,000.00
(1997-2004) 36,000 x 8 years - 288,000.00
DEBT RETIRED $501,500.00
DURATION OF DISTRICT $2 Is 2010
$260,000 @ 9.152 over 14 years
$260 x $130.25 - $33,865 x 14 years - $474,110.00 OPTION B-2
(1990) 24,890 x 1 year - $ 24.690.00
(1991-1996) 31.890 x 6 years - 190,340.00
(1991-2003) 36,275 x 7 years - 253.925.00
DEBT RETIRED $470,155.00
31,500 31,500 31,500
2003 2004 2005
367o00 36,000
DEBT SERVICE
1988
1989
1990
1991
1992
1993
1994
1995
1996
SECURITIES
$ 4,385
$ 4,385
$ 4,385
$ 4,385
$ 4,385
i 4.385
$ 4,385
S 4,385
$ 4,385
FORD
14,000
14,000
7,000
PROJECTED
TAR INCREMENT
25,319
23,497
37,115
37,775
37,775
37,775
37,775
37,775
37,775
BALANCE
6,934
4,888
26.390
33,390
33,390
33,390
33,390
33,390
33,390
BOND ISSUANCE
$260,000 @ 9.252 24,500 31,500 31,500 31,500
over 15 years
1997 1998 1999 2000 2001 2002
36,000 36,000 36,000 36,000 36,000 36,000
$260 x $125.90 - $32,734 x 15 years - $491,010.00 OPTION B-1
(1990) 24,500 x 1 year - $ 24,500.00
(1991-1996) 31,500 x 6 years - 189,000.00
(1997-2004) 36,000 x 8 years - 288,000.00
DEBT RETIRED $501,500.00
DURATION OF DISTRICT $2 Is 2010
$260,000 @ 9.152 over 14 years
$260 x $130.25 - $33,865 x 14 years - $474,110.00 OPTION B-2
(1990) 24,890 x 1 year - $ 24.690.00
(1991-1996) 31.890 x 6 years - 190,340.00
(1991-2003) 36,275 x 7 years - 253.925.00
DEBT RETIRED $470,155.00
31,500 31,500 31,500
2003 2004 2005
367o00 36,000
Phone (612) 29&2711
Metro (612) 3335739 Apr i 1 4, 1988
CiE� o� l�onficel[o
MONTICELLO, MN 55352.9245
samamo
ArveQhCAuMI:
old Monticello Ford Garage Property
c/o Monticello HRA
Den sampan
250 East Broadway
Fran Falr
Monticello, MN 55362
William Fair
Warren 6mlth
Attn: 011ie Koropchak
Director HRA
Administrator:
Rick Wofteft'
Re: Replacement of Old Galvanized Water Services
Pudic Works:
John Slmda
Dear Ms. Koropchak:
a
rl=
Ecwromm owwakpmem:
The City of Monticello is proposing two projects in the near future
(Xle Kwopchak
which may have an effect on your water service. The City is
proposing a new water reservoir that could increase the water
pressure in the downtown area by as much as 25 pounds per square
inch. This increase in pressure could cause a rupture of a
deteriorated, old galvanized service.
With the 1960 Street Inprovement Project along Broadway, the City of
Monticello replaced almost all of the old galvanized water services
to the property line shut-off valve with copper. Many of the
property owners at that time then replaced the rest of the water
service from the valve into their building to the water meter with
copper also. A recent investigation of your water service indicates
that your water service from the valve outside your building to the
water meter may still be an old galvanized type of pipe which could
rupture with the increase in water pressure.
This summer, starting in July, the City will be doing a otreetocape
project and will remove all of the concrete sidewalk from in front of
your building and replace a sidewalk with decorative pavement as well
as additional lighting, trees, etc. If you were to replace your old
galvanized service just prior to the City project, you would save tho
costly replacement of the sidewalk. In addition, you would greatly
reduce the possibility of having to repair your service in the
immediate future. We, therefore, request that you have a plumber
verify as to whether you have one of these old galvanized type of
serviceor and if you do, replace it during the month of June. You
may at that time fill the excavation with gravel to the top of the
nearby sidewalk and pimply maintain it in a safe, passable condition
until the City begins its project in early July.
250 East aroeamy
MonacNo. Minnowta
65302.6246
Ms. 011ie Koropchak
April 4, 1988
Page 2
If you have any questions or need any assistance concerning
verification of the type of service you have or the replacement of
same, please contact us.
P
ully,
Simola
Public Works Director
JFS/kd
cc: Walt Mack, Water Supt.
is
Pile
4. CONSIDERATION TO DETERMINE DEMOLITION OPTIONS FOR THE STELTON
AND JONES' PROPERTIES.
A. REFERENCE AND BACKGROUND.
Within the projected project cost the HRA has allowed $5,000.00
per property for demolition cost or a total of $10,000 for
Stelton's and Jones'. We are aware that Joe O'Connor is interested
in demolition of these properties. The low bid for the demolition
of the Old Ford Garage was $6,494 by David Spinler of Austin, MN
which was awarded. Mr. O'Connor's bid was $12,500 for that project.
The Ford Garage was 6,661 square feet. The Stelton's building
is $2,915 aq ft and the Jones' building is 2,120 aq ft. Building
demolition will be within city specifications. Options for
bidding.
1. A city must competitively bid contracts for local improvements
under the local improvements code when the estimated coat of
the improvement exceeds $15,000.
2. Contracts for Less than $15,000.
If the estimated amount of the contract exceeds $10,000
but is less than $15,000, the city may use sealed bids or
direct negotiation, by obtaining two or more quotations
and without advertising for bids or otherwise complying with
the requirement of competitive bidding. The city must keep
all quotations on file for at least one year.
If the estimated amount of the contract is less than $10,000.
the council may make the contract either upon quotation or in
the open market. As far as practical, the contract should be
based on at least two quotations which the city should keep
on file for at least one year.
If the city publicly solicits bids where the law does not
require competitive bidding, the Court has held that the
city must "pursue such method in a manner reasonably
designed to accomplish its normal purpose of giving all
contractors an equal opportunity to bid and of assuring the
taxpayers the beat bargain for the least money.
Based on this information, the HRA could consider using sealed bids
or direct negotiation, by obtaining two or more quotations and
without advertising for bids.
TO: The Monticello Planning Commission.
FROM: 011ie Koropchak, Monticello HRA Director and Executive Secretary.
SUBJECT: 9) Public Hearing - A rezoning request to rezone platted
lots from B-4 to PZM. Applicant, Metcalf 6 Larson.
DATE: February 8, 1988.
Unfortunately, I'm unable to attend the Planning Commission meeting
on February 9, 1988; however, I would like to inform the Planning
Commission members of the HRA's position on Metcalf and Larson's
rezoning request to rezone platted lots from B-4 to PZM zoning.
The HRA supports the above said request. At a special HRA meeting
held January 26, 1988, a motion was made, seconded, and passed
by the HRA members establishing the development of Block 51
(portions of) it's first choice to assist a subsidized elderly
housing project with the tool of Tax Increment Financing based
on 1) this area has been earmarked by the HRA as a prime concern
for some years, 2) this area is in created Redevelopment Tax
Increment District 02, 9) the project eliminates blight, and 4)
the project would enhance pedestrian traffic for the retail/
commerical businesses.
The HRA has acquired and demolished the Old Ford Garage building
and has proceeded to have the properties of Steltons', Monti
Truck Repair, and Jones' appraised, these appraisals completed
by St. Cloud Appraisal, Inc. Initial contacts by the HRA with
property owners Steltons and O'Connor has been made for acquisition
negotiations. Negotiations would include the acquisition of said
properties with possible inclusion of moving and relocation expenses,
whereafter, the HRA plane demolition of said properties. The HRA
meets Wednesday AM and will establish negotiation plane for the Jones'
property.
HRA officers and members: Ken Maus, President
Lowell Schrupp, Vice President
Ban Smith
Al Larson
Everette Ellison
i � Cif o� �%nEice[[o
r MONTICELLO, MN 65382-9246
ytJ
February S, 1988
Ph" (612) 2852711
Metro (612) 333.6739
Ms
Gib -no
Cay Council:
Dan 8brrfpan
Fran FW
W,Mwn Fair
W°fen Smith
Dear HRA Member:
Please note the regular HRA meeting
scheduled
for
akaW
Wednesday, February 3, 1988, was canceled and
is
Public works:
rescheduled for Wednesday, February
10, 1988,
7:OOAM,
.lam Simsta
Monticello City Hall. Cancellation
was due to the
p wngar
fact that attendance at the meeting
would not
consist
of three committee members which is
necessary
to
E
Oft Koropchsk
constitute a quorum for the purpose
of conducting
business.
See you the 10th.
Sincerely.
/
Cyt qt -'
011ie Koropchak
HRA Executive Secretary
250 East 8101119 at
MDmCro, MYaesm
66302.8245