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City opts to rebid downtown project

Tuesday morning, the Becker County Board advised the Detroit Lakes City Council to reject the bids for Washington Avenue construction and rebid the project. Tuesday evening, the city complied.

The City Council voted 6-3 to reject the existing bids and immediately start the rebidding process. If the new bids are low enough, the project will start either July 21 or Aug. 11, depending on which bid option the council accepts.

The new bid specs will include a number of changes that the city had hoped to negotiate with the original low bidder, Hough Inc. of Detroit Lakes.

An estimated $650,000 could be shaved off the city’s cost by reconfiguring existing traffic lights instead of buying new traffic sets, postponing reconstruction of an alley, and not replacing a water main installed on the 800 block when the mall was created in the late 1980s.

Some of that work will be included in the new bid-letting process as alternative options. If the price is right, they’ll be part of the project. If not, they will be postponed or not do at all.

The new bid specs will also do away with a number of the “stages and phases” restrictions that would have benefitted downtown businesses by improving access during construction, but slowed down the contractor.

The rebidding process will cost $5,000 to $10,000, said City Engineer Jon Pratt. If the new bids come in high and are rejected again, the project will be rebid this winter for the 2015 construction season, which will cost perhaps $1,000 more, he said.

Voting to immediately re-bid the project were council members Dan Wenner, Marty Waller, Ron Zeman, Madalyn Sukke, Dave Aune and Jamie Marks Erickson. Mayor Matt Brenk strongly supported the motion, though he has no vote.

A lot of planning by all involved has gone into doing the project this summer, and the city should stick to the schedule if at all possible, Waller said.

“I have an overriding concern that material and labor costs are just going to keep going up,” added Wenner, “and anything saved by waiting to bid will just get eaten up by higher costs.” 

Voting “no” were councilmembers G.L. Tucker, Al Brevik and Bruce Imholte.

“I’ve never seen a project yet where you hurry around and things go right,” Tucker said at a committee meeting earlier in the day. “It’s just not realistic.”

City, county and assessed businesses will only have a day or two to thresh out who pays how much of any higher cost, he added.

“You’re biting off a big elephant,” he said.

Imholte agreed, and said “we should get our ducks in a row and rebid it next winter. I’m concerned about costs. If we’re going to help with assessments, how will it affect the budget?”

Dallas Flynn owns a building on Washington Avenue that requires a basement to be partially filled in prior to the street project. He said he has not been able to find a contractor to do the work, and waiting until winter to bid the project would give him time to find a contractor.

Roger Price also owns a building that required a partial basement fill-in. He said the city acted like it had no money to spare in that situation, but doesn’t seem overly concerned about spending hundreds of thousands on a higher-than-expected bid.

Michael Norby, another downtown business owner, said the city will be sorry if it opts not to replace the water main on the 800 block to save $80,000. A similar situation happened 30 years ago, to the regret of all involved, he said.

Brenk said the city needs to move forward.

“Everybody is on board right now,” he said at the committee meeting.

“Merchants are on board, the county is on board, why would we want to wait until next year (without at least trying an immediate rebid)? I’m curious to hear.”

Taking the lead on the shared project, the city received bids for the Washington Avenue downtown project a couple weeks ago and realized they were much higher than the estimated cost.

Three contractors bid on the project, which was scheduled to happen this summer, with the low bid coming in at $2.7 million, about $1 million more than Pratt’s estimate.

The city council held a special meeting last week to discuss options, and then brought four of them to the county board Tuesday morning for some direction.

County Engineer Jim Olson said the first option was to award the bid to the lowest bidder and then negotiate the cost of the project — negotiations can’t be done until the bid is accepted he said — by eliminating some aspects of the project, including re-using the existing traffic signals rather than purchasing new ones and changing the staging of the project.

In the original bid, the project was limited to one block at a time, keeping accesses open. In the original bid, the contractors were also limited on the days they could do construction to avoid too much disturbance to downtown during WE Fest.

The second option was to reject the bids and rebid the project immediately, with the work to be done this summer.

The third option was to reject the bids and rebid the project in the winter when bids usually come in lower because construction companies are lining up their work for the following summer and their schedules haven’t filled up yet.

Olson said contractors are usually more aggressive and give lower bids in the winter months.

The main concern with that option was that MnDOT’s Highway 10 frontage road project west of town would be happening at the same time and cause too much road construction for one season in Detroit Lakes.

The fourth option discussed was rejecting the bids and delaying the project for a couple years. In that case, temporary repairs would be needed to keep Washington Avenue fit for traffic.

When informing the commissioners of some of the changes that could be made to lower the cost of the project, Pratt said he still was concerned because they were just estimates.

“There’s an element of risk of moving ahead and assuming we could get these savings,” he said.

According to his estimates, the project could be lowered $553,000 if they used the existing traffic signals, $86,000 to not install electrical outlets along the sidewalk, $200,000 by not doing the alley, $8,000 on decorative railing, $85,000 on the water main and 20 percent on changes to the sewer portion of the project. Pratt also estimated a savings of $30,000 if staging restrictions weren’t so stringent.

With those changes, he said the city’s share would be $647,000, which would be about $212,000 below the original estimate.

He also pointed out that some of the savings, like the alley for example, would simply be put off, not scrapped completely.

The total cost share for the county would be about $1.53 million, which would still be $260,000 over the original estimate.

Pratt proposed that the city use the $212,000 it saved to give the county $50,000 toward its overage and $80,000 to keep assessments lower.

The remainder, about $82,000, the city would keep to put toward the alley project in the future.

When asked what the city council’s opinion was on the options, City Administrator Bob Louiseau said, “Collectively, they were all over the board.”

Some, he said, want to rebid the project; some want to accept the bid and negotiate.

“They were split on to rebid immediately or in January in the normal bidding cycle,” he said.

Whether the city was to rebid the project immediately or wait until winter, the changes would have to happen to make the project more affordable.

“I think you should rebid it immediately and then go to the next option” if the numbers still aren’t good, Commissioner John Okeson said.

Pratt agreed. He said it could be rebid and still completed this summer.

Okeson also said that allowing the contractor to work the two-block project at once instead of block by block could shave off one-third of the construction time.

He added that it would be best to have the construction start after WE Fest and then “open it up” and let the contractors get in and do the work.

Commissioner Barry Nelson said there were too many uncertainties for him to accept the bid and hope for a more reasonable price because everyone’s idea of reasonable is different.

“You’re probably not going to get better numbers (this summer), but you’ll have certainty on numbers,” he said if they rebid the project.

He said that if the numbers come back really high again, he would recommend rejecting all bids again and rebidding it again in the winter.

He and Pratt agreed that the region is so saturated with construction that estimates will likely be high for several years.

Follow Pippi Mayfield on Twitter at @PippiMayfield.