Wells upset over assessments
“It’s tough. I could not hold to this. I don’t know how to rectify this,” said Wells City Council member Brenda Weber, when it came to the decision of adopting the resolution to accept assessments of the Sixth Street Project, a project which totaled $2.3 million.
With one council member absent, the rest of the Wells City Council was hesitant on accepting the resolution after hearing from a number of concerned citizens during the public hearing on the Sixth Street assessments.
“Just for curiosity’s sake, what would happen if this resolution does not pass?” asked council member Crystal Dulas.
“If the council adopts it, it goes to the county and once approved by the county, it will show up on people’s property statements at the beginning of the year,” said city engineer Travis Winter, of Bolton & Menk. “If it does not pass, you would not be able to file this with the county so you would not be collecting the revenue from it next year, so you would have to come up with a new way to pay for $544,000 worth of project costs.”
“When does this have to be done, Travis?” was Mayor David Braun’s question.
“Tonight,” was the reply.
Winter stated the other issue with not accepting the resolution is that by statute and by law, the city needs to assess the minimum of 20 percent of the project based on the type of bonds the city took out for the project.
“If you don’t assess that, I don’t know what happens, I’ve never had a situation where that’s happened,” said Winter.
“Essentially, that would really affect our borrowing, our credit rating,” said city administrator CJ Holl. “We essentially went out into the market and borrowed the money and said, because of the type of bonds, we would follow an assessment policy and do this. If we were to not do that, it would seriously affect future projects and future financing for the city. That would be a pretty serious and drastic step to take.”
Over 20 members of the public were present at the council meeting to speak during the public hearing.
Concerns, besides the assessment costs which were allegedly larger than what residents had seen previously, included not being able to get to their homes during construction, the reassignment of sidewalks during the project, as well as the interest rate of the project not matching the current interest rates.
Shannon Savick, a resident on Sixth Street SW, had a number of concerns she addressed to the council.
“Why are we paying for contractor’s mistakes?” was one of Savick’s questions.
“You are not. Any mistakes, like a broken gas line, were not in your assessments,” responded Winter.
A number of residents mentioned their total assessment was not the same figure they had seen in previous proposed assessments. Winter and Holl did their utmost to explain to the citizens that the final assessment to their properties was different from the preliminary assessments.
“The assessments you have were based on final project costs and city policy. Notices were prepared and sent out to everybody as required by law,” said Winter. “The total project cost was $2,330,084. Our final assessments in the amount of $544,137.79. The street assessment came in at $68.78 per foot, the storm sewer assessment came in at $29.24 per foot, sanitary sewer assessment was $2,265.74 per residence, and finally, the water service assessment was $2,550.69 per residence. The way that was established was by city policy. With street and storm, the city pays 70 percent and assessments pay 30 percent. The cost for the trunk sewer in the alley as well as the oversizing cost for the sewer main in the street were subtracted out prior to the 30 percent split. That amount was about $133,000 that was not included in the calculation.”
“I would encourage the city of Wells to mimic the policy of Blue Earth’s most recent project,” was Steven Lorenz’ response to his total street assessment. “Their interest rate was only 4.2 percent while we have a 5.25 rate.”
“We have the best rate we can get with the credit rating we have for a municipality of our size,” stated Holl. “Blue Earth bonds their projects differently, and in the future, if that is something the city wants to adopt, we can do that.”
“But that doesn’t help us,” responded Savick.
“We’re paying a huge amount of money but we are not satisfied with the work,” stated Ethel Aranda-Rodriguez. “I saw guys standing out there for hours doing nothing.”
“Contracted workers are paid per foot of completed product, not by the hour,” said Winter. “The preliminary assessments were at $508,000, and final assessments are at $544,000. We were actually very close with our projected assessments. We are at step 10 of 10. You have a great product that will last upwards of 50 years.”
“From the highway up to Eighth Avenue, if we did not do this project, some of you would have had serious sewer backup issues in your basements if a pipe were to fail,” remarked street foreman Mike Pyzick. “We could barely get a camera through the sewer pipe in the beginning. I know you’re upset but I bet you would rather have this than sewage up to the top level of your basement. I’m saying it so you all know, we saved a heap of mess and issues by being proactive about this street project.”
With further back and forth between council members, with a few public interruptions during their decision making process, the council finally made a motion to approve the resolution with Weber being the only council member in attendance to vote against the resolution.
In other portions of the meeting, the Wells City Council:
Approved the final pay request for the Wells Business Park at $30,034.21.
Finalized an annexation agreement of certain real property into the city of?Wells.
Agreed to a 2011 A Bonds refunding opportunity which would save the city some dollars by refinancing a bond that would expire within nine years.
Approved the report of special assessments to the county.
Set their next regular meeting on Monday, Dec. 9, at 5 p.m. This meeting is also the city’s Truth in Taxation hearing.