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<br /> <br />T FOR CITY COUNCIL AGENDA ITEM <br /> <br />Appropriation <br /> <br />( <br /> <br />Requested By: <br /> <br />Source of Funds: <br /> <br />Department: <br /> <br />Account Number: <br /> <br />Report: X Resolution: <br /> <br />Ordinance: <br /> <br />Amount Budgeted: <br /> <br />Exhibits: Memorandum with Exhibits <br /> <br />Amount Requested: <br /> <br />Exhibits: Draft Development Ae:reement <br /> <br />Budgeted Item: YES <br /> <br />NO <br /> <br />Exhibits: Draft TTtiJity Rxtenl>ion Agreement <br /> <br />SUMMARY & RECOMMENDATION <br /> <br />Prior correspondence to Council and the TIRZlRedevelopment Authority noted that the developer of Lakes at Fairmont Greens <br />could not secure financing for the development because of significant up front costs associated with the trunk sewer and lift <br />station, even though the TIRZ/ Authority could eventually reimburse the developer. With this cost center removed, the <br />developer was able to secure financing. During 05-06 budget preparation, Council approved $645,000 for the construction of <br />the trunk sewer and lift station based on the understanding that the TIRZI Authority would reimburse the City from future <br />increment. <br /> <br />The first agreement, between the City and TIRZIAuthority provides for the City to advance the funds ($645,000) for the trunk <br />sewer and lift station and act as construction manager for the TIRZI Authority. The agreement further provides for the <br />TIRZI Authority to reimburse the City in the future. <br /> <br />( <br /> <br />The second agreement is a Utility Extension Agreement (UEA) that establishes the City's oversight and control over the design <br />and construction of the trunk sewer and lift station. The design and construction contracts would be let/owned by the <br />developer with the City issuing joint checks to the developer/designer or engineer and developer/contractor as certain approvals <br />and milestones are met. <br /> <br />New cost estimates are being prepared by the developer's engineers. The agreements provide for the possibility that the <br />bids may exceed budgeted funds (see Section 8 of the UEA). <br /> <br />These agreements have been circulated for comment by the party's and by the City's attorneys. It is anticipated that the <br />TIRZIAuthority will consider approval at the May 24 meeting and the Council at June 12 meeting. <br /> <br />Attached are 3 approaches being looked at for this project. They each have advantages/disadvantages and of course there is a <br />wide cost differential and opinion on the appropriate final design approach. While the base proposal is the lowest, there is <br />some concern over long term maintenance trade-offs and some unanswered questions on the depth ofline segments near and <br />along McCabe Road. <br /> <br />For these reasons we are still working with the developer and design engineers on a final design approach. In fact we may <br />consider bidding alternates. <br /> <br />Therefore, certain terms of the UEA may change to cover these options. <br /> <br />The key issue is to reinforce what was noted in the February 27 presentation to Council. These costs upon final approach and <br />bid opening may exceed the original estimate that was provided and budgeted last year. <br /> <br />Action Required by Council: <br /> <br />( <br /> <br />A <br /> <br /> <br />7';~ <br /> <br />Date <br />