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HomeMy WebLinkAbout2005-09-28 - MinutesMayor Dan Coody City Attomey Kit Williams City Clerk Sondra Smith City Council Water & Sewer Meeting Minutes Sept 28, 2005 Page 1 of 8 Member Aldermen aye evi le AR KA N SA 5 City of Fayetteville Arkansas City Council Water & Sewer Committee Meeting Minutes September 28, 2005 Ward 1 Position 1 - Robert Reynolds Ward 2 Position 1 - Kyle B. Cook Ward 3 Position 2 — Robert Ferrell Ward 4 Position 2 - Lioneld Jordan A meeting of the Fayetteville City Council Water & Sewer Committee was held on September 28, at 5:30 p.m. in Room 326 of the City Administration Building located at 113 West Mountain Street, Fayetteville, Arkansas. MEMBERS PRESENT: Chairman Kyle Cook, Alderman Robert Ferrell, Alderman Lioneld Jordan Members Absent: Robert Reynolds Staff Present: David Jurgens, Gary Dumas, Tim Conklin, Steve Davis Chairman Cook called the meeting to order. 1. Approval of the Minutes of August 25 and September 1 Water & Sewer Committee Meetings. A motion was made that the minutes of these two meetings be approved as submitted. The motion was seconded and passed unanimously. 2. WSIP Update a. West Side Treatment Plant Action Plan Jim Ulmer, McGoodwin, Williams & Yates gave a report on what has occurred regarding the WSIP project. Brasfield & Gorrie was given a copy of the repackaged bid (with the changes requested by the Committee). Broyles Road and the wetlands planting had been removed from this plan. Brasfield & Gorrie then reviewed the plans, talked to all the suppliers, subcontractors, etc. and came up with a price. MWY & staff met with them on Tuesday to go over their proposal. Mr. Ulmer said Brasfield & Gorrie has developed a very detailed listing of all the cost elements of the project. At this point staff, MWY and Brasfield & Gorrie have come to an understanding of what they believe to be a reasonable and fair price for this particular project in the current marketplace. Mr. Ulmer then introduced Gary Harrington, Vice President of the Plant Construction Division and Robert Carswell, the Chief Estimator with Brasfield & Gorrie. He said he was very impressed with the process Brasfield & Gorrie has gone through and the level of detail and the grasp they have on the project. Gary Harrington, Brasfield & Gorrie spoke about Brasfield & Gorrie. He said they have six different offices, eighteen different divisions. His group does between $150 to $180 million 113 West Mountain 72701 (479) 521-7700 (479) 575-8257 (Fax) accessfayetteville.org City Council Water & Sewer Meeting Minutes Sept 28, 2005 Page 2 of 8 dollars a year, strictly water & sewer projects. They have as many as 600 employees working for them. They feel their company is unique in that they do the work themselves. He explained how Brasfield & Gorrie and staff had come up with the price to be submitted. He said the price is a "guaranteed maximum price" and explained that the company is guaranteeing the cost of the project will not go above that price. He said if the cost comes in below that price, the City and Brasfield & Gorrie will split the savings according to an agreed upon formula. He also explained that there still may be change orders — the guaranteed maximum price can change based on the scope of the work (if a clarifier is added, that will add to the scope of the work and change the guaranteed maximum price). Robert Carswell with Brasfield & Gorrie said his company got the bid package & started working on it on Labor Day weekend. They put together two prices because the Committee had asked to look at a comparison with a membrane treatment plant option. He explained that they had gone into great detail and carefully reviewed every part and piece of the project. They not only talked to the subcontractors and suppliers that they knew had previously quoted prices to the City, but they went out into the marketplace to try to find additional prices. The marketplace is very different now even than it was a few months ago. They did everything they could to make sure they give the City the best price possible. Mr. Carswell reviewed a detailed schedule for the project with the Committee. He said his company tends to do more planning on the front end of the job. During the first few months, they would be working with the City's engineer to try to do as much cost savings as possible on the project. They would also be getting submittals in to make sure the pipe, rebar, etc. is on site when they get ready to pour concrete in April. By the end of January they would be putting up erosion controls, silt fence, etc. to meet the requirements of the regulatory agencies. Overall it would be about 31 months, with a 28 month construction schedule which he said is a pretty aggressive schedule. Mr. Carswell talked about the two options his group had investigated. For the membrane option, which is a smaller footprint facility, the equipment is more expensive. He presented the cost of both options to the Committee. He spoke briefly about the possibility of some sales tax savings, based on what the State decides on what is and isn't subject to sales tax on a wastewater project. Alderman Ferrell asked if the possible sales tax reduction and/or substitution or change in the project agreed upon through cost saving discussions with City engineers would be included in the total figure we start with or would it come off as we work down. He was told it would be a deductive change order as it would be a change in the scope of the work. David Jurgens said it would probably just not be included in the guaranteed maximum price (GMP), resulting in a lower guaranteed maximum price. Robert Carswell said they will self perform the majority of the work on the project. They will bring in key personnel and they will be hiring locally for pipe fitters, carpenters, etc. Alderman Cook asked, as a guess, how much of the project would be self -performed and how much contracted out. Robert Carswell said they will probably self -perform about 80%. The major sub -contracts they would have would be electrical and painting, with some smaller pieces like flooring, etc. Alderman Cook asked how far out Brasfield & Gorrie went to get prices, regionally or anywhere in the marketplace. 113 West Mountain 72701 (479) 521-7700 (479) 575-8257 (Fax) accessfayetteville.org City Council Water & Sewer Meeting Minutes Sept 28, 2005 Page 3 of 8 Robert Carswell said they first chose to go to markets in Northwest Arkansas. They sent a lot of plans out seeking quotes and got some response. They also got quotes from some contractors in Oklahoma, Georgia, and Mississippi. Alderman Ferrell asked for clarification about how many workers Brasfield & Gorrie would bring in from their company and how many they would hire locally. Robert Carswell said they would bring in the superintendent, a couple of field engineers, crane operators, lead foreman (i.e. pipe foreman, mechanical foreman, concrete foremen). They might also have some tradesmen but not many. Carpenters, laborers, cement finishers, etc. they would hire locally. Gary Harrington said a safety inspector would be on site at least once a month, sometimes twice a month. The insurance company does the same thing. They drug test on pre -hire for all employees and do random testing also. They run a safe work environment. Alderman Ferrell said he likes what he is hearing. He asked Steve when we might know about the tax situation. Steve Davis said we should know within three weeks. It was filed about four weeks ago. If we don't hear within another seven days he will contact them. Alderman Ferrell said he likes what he is hearing and feels that if we wait too long we'll take a risk on completing on time and are in jeopardy with the cost factor. David Jurgens said that every item that had been identified as a potential savings area, staff has already started researching. Some of the answers we have gotten today and we will be continuing to pursue that next week. We should have all that information within the next week. Alderman Jordan asked if there had been in scaling back on odor control. He was told we are back to where we started on that. Nothing had been deleted or altered. Gary Dumas responded to a question from Alderman Cook regarding where we should go from here by suggesting that a special City Council meeting be scheduled for October 20 to approve the contract. We can deal with the items that are known and the items still on the list can be put in a separate category to adjust the guaranteed maximum price as required. Alderman Ferrell moved that the Committee recommend that a Special Council meeting be called for October 20 to approve the contract. Alderman Jordan seconded the motion and it carried unanimously. b. Discussion of On -Site Inspectors for Construction Monitoring David Jurgens said that by State law each of the designing engineers is responsible to provide construction supervision, by contract and by health depalttnent requirements. However, the City will also be staffing up to do some on-site inspection. These employees will be hired for the life of the construction only. There is also a need to add staff to help with the invoicing, etc. 113 West Mountain 72701 (479) 521-7700 (479) 575-8257 (Fax) accessfayetteville.org City Council Water & Sewer Meeting Minutes Sept 28, 2005 Page 4 of 8 Steve Davis said that our accounting manager and internal auditor have met with Brasfield & Gorrie representatives to learn how they handle their billing. They will tailor their billing and reporting to meet our information needs and will supply a "raft" of detail with each invoice. It is also in the contract that we have the right to audit their corporate books to affirm that control procedures are followed for costing contracts. Alderman Cook said that the GMP is one of the tightest contracts you can have with a contractor. He also feels the city monitoring is very important to make sure we are looking out for the City's interests. David Jurgens said staff will be coming to the Council with requests for the needed personnel. These staff will be paid out of the WSIP budget. He also said that we advertised today for the first of the line work projects for the WSIP, the force mains going from the Hamestring lift station to the wastewater treatment plant. The bid opening on that is November 3. In response to a question from Alderman Cook about how far out the requests for bids are advertised, Mr. Jurgens said it is advertised on the intend as well as the statewide newspaper, and all the plans houses in the regional (probably a 10 -state) area got copies of the plans. 3. Hamestring Sewer Basin Update David Jurgens said RJN has gone over the preliminary numbers. We are expecting the final report within three to four weeks. Our initial assessments were based on every lot approved being filled with a house. You also then have to figure the lag time between when a subdivision is approved and when the sewer actually will be utilized in the houses. Once all that information is calculated, we will be able to determine when we might have to do some work on the west side of town, supplemental to what we have now, to last until the new plant goes online. Once the plant goes online, the problem goes away. Unless the rate of building out these lots increases over what has happened in the past two years, it looks like we will not have a dry -weather sewer capacity problem on the west side of town. It appears, based off rough numbers, that we will not have to do any type of temporary fix or come up with any type of interim solutions on the west part of time. But if we do come close, we will have a plan in place where we'll have a number of houses where design can begin and a number of houses where construction can start so that a problem will not be allowed to exist. As accounts are turned on we will track those numbers at least quarterly and probably monthly. Alderman Jordan said he wants to know when the point is reached that any sort of solution has to be put into place. Gary Dumas said the staff hopes to be able to give the committee a graph at least quarterly, maybe monthly, to show where we are as far as sewer flow on the west side of town is concerned. 4. STAG Grant Application/Approval Status David Jurgens said that in the last week we have received all three (2003, 2004, 2005) STAG grant applications. The 2005 is going forward to the City Council for approval. This will total about $1.4 to 1.5 million for sewer rehab work. We will be making sure we meet all the grant requirements and we should be advertising for bid in about a month. 113 West Mountain 72701 (479) 521-7700 (479) 575-8257 (Fax) accessfayetteville.org City Council Water & Sewer Meeting Minutes Sept 28, 2005 Page 5 of 8 Gary Dumas reminded the committee that these requests originated back in 2002 & 2003 with white papers to our delegation in Washington DC. We have been very successful with those requests. Alderman Jordan made the motion that we move forward with the STAG grants. Alderman Ferrell seconded the motion and it carried unanimously. 5. Duncan Associates Contract Tim Conklin said staff is planning to bring forward a bid waiver and contract to update our wastewater fees to the City Council at the October 18 meeting. Back in 2000 Duncan Associates was selected to develop the methodology to calculate our current water and wastewater impact fees. That fee was based on $42 5 million for the west side treatment plant, with a 10 million gallons a day capacity. The cost has changed now and part of the contract is to update that fee. We are also looking at having Duncan Associates develop the methodology and calculate a fee for the capacity that is created in the collection system, which includes the lift stations, and having them and look at how we can use impact fees with outside jurisdictions that we serve with water and wastewater such as Elkins and Farmington. The contract with Duncan Associates will be a two-phase contract. The first is around $12,300 to put together an organizational structure and program for how to develop the methodology. The second phase will be to actually develop the methodology and calculate the fee. Phase 1 will be before the Council for approval on Oct. 18. The City Council will then have to approve a contract amendment for phase 2 after phase 1 is complete. Steve Davis, in response to a question from Alderman Cook, said that quote provided by Duncan Associates to do the project all at one time, the total was $39,000. We would expect phase 2 of the project to be somewhere around $30,000. Alderman Ferrell said he believes Duncan Associates will recommend an increase in impact fees and he has a problem with holding homeowners responsible for an increase in a rate that results from the fact that the plant was not done on schedule. Tim Conklin said that typically communities utilizing impact fees update their fees every three to five years to reflect the change in cost of construction of infrastructure. Our parkland dedication or fee -in -lieu -of parkland dedication gets updated every two years to reflect changes in costs. Alderman Cook said he understands Alderman Ferrell's concern and agrees with him, but the costs of these improvements are what they are at this point and we have to pay for it. And the ones who are creating the need for these improvements should be the ones paying for them. Steve Davis said that when the impact fee is revisited, staff needs clarification from City Council on whether the impact fee only applies to new development or if it applies to new connections. Right now someone who comes off a well and connects to the water system or comes off a septic system to be connected to the wastewater system is not being charged an impact fee. This also applies to step type community sewer systems. 113 West Mountain 72701 (479) 521-7700 (479) 575-8257 (Fax) accessfayetteville.org City Council Water & Sewer Meeting Minutes Sept 28, 2005 Page 6 of 8 Alderman Jordan moved and it was seconded that the Duncan & Associates item be placed on the City Council agenda. Alderman Jordan and Alderman Cook voted yes. Alderman Ferrell voted no. 6. 33.4 Acre Purchase, North Side in the west side WWTP property Tim Conklin said the City does have an ordinance with regard to the sale of municipal property. Notice of Intent to Sell was advertised last September or October. The Council did approve a resolution to put the property up for sale. We got three appraisals because there was such a disparity between the first two. In June the City Council passed a second resolution setting the minimum bid price at $1,015,000. "For Sale" signs were placed on the property and sealed bids were clue last Thursday. We received one bid at $1,039,007. The buyer has placed two conditions in the contract. One is that City Council passed a resolution moving Persimmon Street into the 33.4 acres in order to utilize Broyles Ave. They also asked for approval of a residential development on the property. Prior to actual sale of the property, City Council will have to consider rezoning the property to RSF4. Alderman Cook asked if there was an estimate of what it would be an estimate of the buyer's share of road improvements. Steve Davis said that since Ron Petrie is not present tonight, staff will get the information and have it available for the committee. In response to a question from Alderman Ferrell, he said the proceeds of this sale will go to the project fund, helping to pay the bill for construction of the plant. Alderman Ferrell moved that this item be moved forward for City Council discussion. Alderman Cook seconded the motion and the motion passed unanimously. 7. Arkansas Natural Resources Commission Interest in the west WWTP property David Jurgens said that Arkansas Natural Resources Commission (formerly Arkansas Soil & Water) is interested in entering discussions with the City regarding wetlands banking and are specifically interested in the area around our wastewater treatment plant site. This would require that we negotiate a price with ANRC, sell them the land and the property would then become a wetlands bank for the region. They are already in negotiations with the owner of the 40 acres immediately south of our site. This might be a mechanism to sell some of the property in the area, gain the revenue, gain environmental benefit and impact for the entire area and still preserve the buffer zone we want to have around the plant. We don't know how many acres or which specific acreage at this point. ANRC just raised the possibility within the last week. The staff is asking for approval to investigate the possibility. Alderman Jordan said Ward 4 doesn't have a major park and he wants to make sure that if there is land available that it isn't sold if it can be used for a park. Alderman Ferrell said though he is not opposed to this, the more land we give away or sell to not -for -profits, the less property tax collected. He asked about what it would sell for and was told the ANRC had seemed to indicate market price rather than a token amount. He was also assured that the proceeds would go toward the construction of the wastewater treatment plant project. 113 West Mountain 72701 (479) 521-7700 (479) 575-8257 (Fax) accessfayetteville.org City Council Water & Sewer Meeting Minutes Sept 28, 2005 Page 7 of 8 Alderman Jordan moved that staff investigate the matter further. Alderman Ferrell seconded the motion and it carried unanimously. 8. Water/Sewer Operations Center Update David Jurgens said substantial completion of the operations center was reached September 19. Furniture and equipment is being moved into the new facility. By the end of October the process should be complete. 9. Elkins Contract Review Steve Davis said staff had provided Elkins with a contract last week. They have met and discussed the contract and e-mailed their comments back to staff late this afternoon. There hasn't been much time to review them. Mayor Ladyman and other representatives from Elkins are at this meeting. Mayor Ladyman spoke to the committee and said that his committee had passed a revised copy of the contract with the comments e-mailed to Mr. Davis just this afternoon. Steve Davis said that staff would need to review the comments before they are comfortable making any recommendations. This contract is essentially based on a contract agreed upon by the City Councils of Elkins and Fayetteville agreed to in 1981. It was a 40 -year contract. We are taking this opportunity to amend some of the provisions with which both cities have issues. One of the issues is the 100,000 gallons max. average day flow from Elkins to Fayetteville. The contract is also silent on what has to be done after that maximum average day is met. Where does the wastewater go? For the last three years, we have maxed out the flows from Elkins. In 2003 we were 125% of the annual flow. With the flood in 2004, we were at 155%. And through our billing in September 2005 we were at 103.85% of the max. flow. We need to remove that provision of the contract because it is meaningless. There are no options for what Fayetteville or Elkins can do when the average flow exceeds 100,000 gallons a day. The negotiating teams have opted instead to go with a contract that has no limit but does have provisions for either an impact fee that Elkins would collect or a surcharge on the rate per thousand. In the contract Elkins has returned today, they are opting for the surcharge. In response to a question from Alderman Ferrell, Mr. Davis said that this contract does not obligate the City of Fayetteville to provide any services beyond our current capacity. More discussions will need to be held with the negotiating team to work through the contract comments from Elkins. 10. Farmington Contract Update Alderman Cook said the negotiating team met with Farmington last night (Sept. 28) and had a very good meeting. His problem with the Farmington negotiations is the policy decision on whether we want to take on anther town's sewer system. He feels the conversation should start with that decision. He is tempted, and wants input from this committee about whether to bring a resolution to the City Council asking that question. Farmington wants us to take over the system, and at this point so does Greenland. Steve Davis said he met with Mayor Yoes from Greenland and the Greenland City Attorney. On Sept. 12 the Greenland City Council passed a resolution instructing mayor, staff and consultants 113 West Mountain 72701 (479) 521-7700 (479) 575-8257 (Fax) accessfayetteville.org City Council Water & Sewer Meeting Minutes Sept 28, 2005 Page 8 of 8 to work with Fayetteville toward the prospect of taking over the Greenland sewer system, acknowledging that they will pay impact fees (both the wastewater impact fee that Fayetteville has and an impact fee for any capacity needs within the City of Greenland). In both the 1993 contract with Greenland and the 1994 contract with Farmington, we are contractually bound to provide the same level of service in those two cities that we provide to our citizens. So when we do sewer system rehab in Wilson Park, we are contractually bound to do sewer system rehab in Farmington and Greenland, under the same conditions to the same extent. The difference is, both contracts say there is cost participation by those cities for any pipe that is replaced greater than 15'. That makes for a pretty difficult field accounting problem. Fixing sections of pipe at a time involves jurisdictional questions and judgment calls that could cause some pretty serious problems. If we own the system, we just fix it like we would fix our own and the jurisdictional issues don't come into play. After further discussion on this issue Alderman Ferrell moved that the subject be brought before the Council for discussion. Alderman Jordan seconded the motion. Alderman Ferrell asked that some rates and projections on whether the system will be able to pay for itself be provided to the Council. Steve Davis said, in response to a question from Alderman Jordan that there is no sewer rehab issues to address in Greenland according to an RJN study and we know that the sewer rehab issues in Farmington are limited to about $700,000. And we have already committed to pay $250,000 of that as part of our mediation. 11. Scheduling the next Water/Sewer Committee Meeting A meeting of the Water & Sewer Committee will be set at a later date. 113 West Mountain 72701 (479) 521-7700 (479) 575-8257 (Fax) accessfayetteville.org