Meeting Minutes for May 2, 2007

OFFICIAL COUNCIL PROCEEDINGS
MAY 2, 2007

A special meeting of the City Council of the City of Harbor Beach was held on Wednesday,
May 2, 2007 at City Hall. The meeting was called to order at 7:00 p.m. by Mayor Swartz.

Present: Burkhard, Goniewicha, Kleinknecht, Wood and Mayor Swartz
Finance Officer Youatt and Engineer Bergdolt
Absent: None

Corrections/Additions to Agenda: Resolution # 2007-12, “Amended and Restated Resolution Authorizing Issuance of General Obligation Limited Tax Bonds, Series 2007,” was added to the agenda under New Business. It was moved by Kleinknecht, seconded by Wood to approve the agenda as amended. Motion carried. 5 yeas.

Citizen Comment: Lee Elliott questioned how the City was going to fill the vacancies for the
Water Plant Superintendent and Water Plant Operator positions. Mayor Swartz replied the City has advertised extensively for these positions, the deadline for applications was April 27, 2007 and no one has applied for the Superintendent position. Mr. Elliott questioned why Wade-Trim was the only firm being looked at to possibly manage the plant operation. Mayor Swartz stated the Administration Committee will be meeting soon to go over the process for filling the positions.

OLD BUSINESS: Resolution # 2007-11, “Tentative Award of a Construction Contract for Wastewater System Improvements,” was reviewed by Council. The Resolution would award the construction contract for the Sanitary Sewer Retention Basin project to the low bidder, RCL
Construction, Sanford, Michigan, in the amount of $ 3,674,400.00. Mayor Swartz read a letter from Joseph C. Schoenherr, Estimator, RCL Construction, dated April 27, 2007 regarding their qualifications for the work. Youatt read a letter from Chris Townley, P.E., Townley Engineering, LLC, dated April 25, 2007 regarding RCL’s qualifications. Following discussion regarding the original engineer’s estimate of $ 3,300,000.00 and regarding the procedure for change order approval, it was moved by Wood, seconded by Burkhard to adopt Resolution # 2007-11 as presented. Motion carried. 5 yeas.

Council reviewed a proposed Professional Services Agreement from Wade-Trim to provide construction engineering services for the City for the Sanitary Sewer Retention Basin project in an amount not to exceed $ 490,000.00. Council questioned Engineer Bergdolt regarding the cost for the project. Engineer Bergdolt stated that the reason for the higher cost than ususal was due to the large number of subcontractors on this project and the extra work load generated from the anticipated 80 to 100 submittals from the subcontractors and the contractor regarding the variety of work on the job, including but not limited to pipework, manholes, pre-cast and other concrete work and testing, mechanical, plumbing and electrical. Engineer Bergdolt was asked if the project ran smoothly if the cost would be lower than $ 490,000. Engineer Bergdolt replied that it would. Bergdolt also stated that there were monthly progress meetings scheduled which would help streamline the project.

Youatt reminded Council of the decision to apply for the SRF loan funding which was made a year and a half ago. Youatt stated the decision was made then to apply for the loan knowing that savings generated from the low interest of the loan (at 1.625 %) would be worth the extra time and cost for the extra documentation required by DEQ as part of the loan application process. Also informed Council that although Wade-Trim has completed design engineering services for this project, the City has not paid any bills for this part of the project, which cost approximately $ 90,000, as the City has not closed on the financing. Youatt noted that Wade-Trim has not, and will not require any interest payment on the approximate $ 90,000 design engineering cost.

Following further discussion, it was moved by Wood, seconded by Kleinknecht to approve the
Professional Services Agreement with Wade-Trim for construction engineering services for the Sanitary Sewer Retention Basin project at a cost not to exceed $ 490,000 and to authorize the Finance Officer to execute same on behalf of the City. Motion carried. 5 yeas.

NEW BUSINESS: Resolution # 2007-12, “Amended and Restated Resolution Authorizing Issuance of General Obligation Limited Tax Bonds, Series 2007,” was presented to Council. The Resolution would increase the City’s 2007 Bond issue from a not to exceed issue of $ 4,200,000 to a not to exceed issue of $ 4,600,000. Youatt explained that since the bids were received for the Sanitary Sewer Retention Basin project, the City would need the extra funds to pay for the project. Youatt stated that there would be no need to increase the sewer rates any higher than Council previously approved as the first increase takes effect July 1, 2007 (to $ 3.50 per 1,000
gallons) and the second increase takes effect July 1, 2008 (to $ 4.25 per 1,000 gallons). These rates will be reviewed by City financial consultant Tom Traciak in 2008. Although the first rate increase takes effect this July, the project will not be completed until June 2008 and the first major debt service payment is not scheduled until May 2009. Following further discussion, it was moved by Kleinknecht, seconded by Wood to adopt Resolution # 2007-12 as presented. Motion carried. 3 yeas. 2 nays (Goniewicha and Mayor Swartz).

Engineer Report: As stated above.

Finance Officer Report: The annual MML Region V meeting is scheduled for Friday, May 18th
in Sandusky. Bob and Leonard stated they would attend. The dredging project is on schedule and will be completed next week. The creek embankment repair project at North Park Campground is completed and looks good. The DPW crew has been painting the tree grates in the downtown business district and the project is almost completed.

Council Reports: Councilmember Kleinknecht reminded everyone of the May 19th Watercross Trail event at Bathing Beach Park. Councilmember Goniewicha stated the contractor did a nice job at North Park on the creek bank. Mayor Swartz stated a new business has opened downtown called “Heavenly Spa.” Also the Planning Commission will be taking up a site plan review for a new business coming to the City at their meeting on May 17th.

There being no further business, the meeting was adjourned at 8:12 p.m.

Tom Youatt, City Clerk