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HomeMy WebLinkAbout5G Industrial Park Utility Extension Project Feasibility Study Update�p4 PRIp, F� U tr1 �INNESO�� 4646 Dakota Street SE Prior Lake_ MN 55372 CITY COUNCIL AGENDA REPORT MEETING DATE: Oct. 17, 2011 AGENDA #: 5G PREPARED BY: Katy Gehler, P.E., Public Works and Natural Resources Director PRESENTED BY: Katy Gehler, P.E., Public Works and Natural Resources Director AGENDA ITEM: CONSIDER APPROVAL OF A RESOLUTION AUTHORIZING THE MAYOR AND CITY MANAGER TO EXECUTE THE CITY'S STANDARDIZED PROFESSIONAL SERVICES CONTRACT FOR ENGINEERING SERVICES FOR THE INDUSTRI- AL PARK UTILITY EXTENSION PROJECT FEASIBILITY STUDY UPDATE DISCUSSION: Introduction The purpose of this agenda item is for the City Council to award the City's stan- dardized professional services contract to Bolton & Menk, Inc. for the Industrial Park Utility Extension Project Feasibility Study Update. History On September 18, 2006 the City Council placed the Welcome Avenue Industrial Park Utility Extension Project in the 2007 Capital Improvement Program (CIP). The original project scope covered Industrial Circle, Credit River Road and Wel- come Avenue. The Industrial Park was not served by city utilities at that time. Properties were served by individual wells, septic systems and sewage holding tanks. These individual systems were noted as areas of concern. The Industrial Park is located within the City's High Vulnerability Zone of the Well- head Protection Area. This area was noted in the 2007 Wellhead Protection Plan as having characteristics that make it more vulnerable to potential groundwater contamination which feeds the public water supply. The existing septic systems and wells are considered potential contamination sources for the groundwater. In 2007 the City completed a feasibility study of the extension of water and sewer to all properties within the Industrial Park along with improvement of the gravel road surfaces. The cost of the total improvements was estimated at $3.0 million. The study found the improvements to be feasible from an engineering standpoint but noted economic challenges for the project. The project was referred to the Assessment Review Committee. The Assessment Review Committee felt that the 100% assessment rates for the improvements for the industrial park exceeded expectations of the area. They questioned whether the benefit of the improvements exceeded the calculated assessment rate. The Assessment Review Committee recognized a number of important City bene- fits for the Industrial Park Improvement. They included: • Elimination of wells and septic systems within the City's Wellhead Protec- tion High Vulnerability Zone • Developers willing to invest in the Industrial Park • Future lack of suitable commercial properties within Prior Lake • Opportunity to develop areas to a higher use • Opportunity to develop areas to the east • Paving of these roadways reduce erosion issues and maintenance of gra- vel surfaces. The committee recommended investing approximately $100,000 to extend the sa- nitary sewer from the lift station near the west end of Markley Lake, through an undeveloped parcel to the border of the Industrial Park. Once the sanitary sewer is extended to the property line, Developers in the area will have the opportunity to connect to City services. From there, the Assessment Review Committee recom- mended that as development occurs, Developers would extend the sanitary sewer and watermain through the Industrial Park. At a point where the utilities are rough- ly 75% completed, the City would initiate a project to finish the utility improve- ments and complete the street and stormwater improvements. This incremental approach allows time for the following to occur: • City easement acquisition for future ponding • Pursuit of economic development options • Determine wellhead protection requirements • Developer investment into the Industrial Park The incremental approach was anticipated to take up to five years for utility ex- pansion in the Industrial Park. An initial project was completed in 2008 through a developer's agreement with one of the property owners. This project extended sewer and water to serve 3 of the 19 properties. Current Circumstances The current project includes the extension of water and sewer to serve the re- maining properties in the Industrial Park. This project is in the 2012 Capital Im- provement Plan with funding identified for the $900,000 project from 429 bonds, assessments and the utility enterprise funds. The 429 Improvement Process applies to all projects that will be financed in whole or part through special assessments or bond proceeds. The first step in the process is for the Council to order preparation of a Feasibility Report for the im- provement projects. A feasibility study was completed in 2007 for the full project and accepted by the Council on May 7, 2007. An update to the study is recom- mended to incorporate the phased approach and update cost estimates for the project. The updated information will also be used to determine if assessments are feasible for road restoration options (gravel vs. paved). Following receipt of the updated Feasibility Report, the Council will direct City Staff to abandon or proceed with the Chapter 429 process, dependent upon whether the requirements for the Chapter 429 are being met. If the Chapter 429 process is to proceed, the Council can then schedule a Public Hearing. Following a Public Hearing, the Council may consider authorizing the preparation of plans and speck 2 fications. Once completed, the City Council would be asked to approve the plans and specifications, authorize advertisement for bids, conduct the special assess- ment hearing and then award the contract. Conclusion A proposal was obtained from Bolton and Menk, Inc. to update the feasibility study. Bolton and Menk, Inc. completed the original study and can most cost ef- fectively provide an update. A proposal was submitted to complete the work for a cost not to exceed $16,548. ISSUES: There are several reasons which support the completion of this project. 1) The existing septic systems and wells pose an on -going threat to the City's water supply due to their location within the High Vulnerability Zone of the Wellhead Protection Area. 2) The property in this area is ideal for industrial development considering its adjacency to County Road 21. But no additional development or redevelopment can occur without utility extension to the Industrial Park. 3) The City has limited commercial and industrial property available for immediate development once Deerfield Industrial Park is completed. FINANCIAL The financial impact of this project will be further analyzed in the updated Feasi- IMPACT: bility Report. ALTERNATIVES: 1. Approve Resolution 11 -XX ordering the Feasibility Report and directing staff to review the long term process for the Industrial Park Utility Extension Project. 2. Table the Resolution for a specific reason. 3. Deny the Resolution. RECOMMENDED Alternative 1 MOTION: Pao 0-4 �I�!� 4646 Dakota Street SE Prior Lake, MN 55372 RESOLUTION 11 -xxx A RESOLUTION ORDERING THE UPDATE TO A FEASIBILITY STUDY FOR THE 2012 INDUSTRIAL PARK STREET AND UTILITY IMPROVEMENT PROJECT Motion By: Second By: WHEREAS, it is proposed to construct improvements for Industrial Circle, Credit River Road and Welcome Avenue including the construction of storm sewer, sanitary sewer, watermain, aggregate base, concrete curb and gutter, bituminous surfacing, and appurtenant work and to assess the benefited property for all or a portion of the cost of the improvement, pursuant to Minnesota Statutes, Chapter 429; and WHEREAS, The extension of utilities is necessary to protect the City's Wellhead Protection Area and to permit development in the Industrial Park; and WHEREAS, A feasibility study was completed by Bolton and Menk and accepted by the Prior Lake City Council on May 7, 2007; and WHEREAS, A portion of the project was completed in 2008. NOW THEREFORE, BE IT HEREBY RESOLVED BY THE CITY COUNCIL OF PRIOR LAKE, MINNESOTA as follows: 1. The recitals set forth above are incorporated herein. 2. That the proposed improvements be referred to the Public Works Director for study and that she is instructed to report to the Council with all convenient speed advising the Council in a preliminary way as to whether the proposed improvements are necessary, cost - effective and feasible and as to whether they should best be made as proposed or in connection with other improvements, and the estimated costs for the improvements as recommended. 3. That City staff be authorized to enter into the city's standardized professional services contract with Bolton and Menk, Inc. for completion of the feasibility study with a cost not to exceed $16,548. PASSED AND ADOPTED THIS 17th DAY OF OCTOBER 2011. YES NO M ser M ser Erickson Erickson Hedber — Hedberg Keeney Keene Soukup Souku Frank Boyles, City Manager CADocuments and Seftingslcgreen\My Documents\SharePoint DraftsMelcome Feasibility Update RES.domdoc