Colby sees increases in construction materials
Increases in materials and fuel costs have members of the Colby City Council seeing red ink.
At Tuesday’s meeting of the Colby City Council council members received an update from city public works director Harland Higley and engineer Mike Voss of MSA on the impact of surcharges and repricing of materials which could dramatically increase the cost of public works projects in the coming year.
According to Voss, when Melvin Companies received the bid for the summer street project in January, they immediately began to place orders for the supplies needed. At the end of January they ordered the ductile iron pipe that is used for water mains and laterals. Last week, the company received a letter from the supplier that they are imposing a delivery fuel surcharge and that in addition they are not going to honor the pricing set in January but charge current pricing at the time the pipe is delivered.
Voss estimated the delivery charges would add about $6,000 to the price of the project and that if the supplier follows through with charging current pricing it would be an additional $18,000 in costs.
Voss said what is maddening is that Melvins moved quickly to lock in the prices in January rather than waiting. Higley said he still supported going with the iron pipe rather than switching to the C900 plastic pipe because of the longterm benefits to the ductile iron. He said the plastic pipe option has also increased in price with a $7,000 fuel charge. Of bigger concern is that the city still has things like fire hydrants and fittings to arrive and that other vendors will jump on board passing increases to the city.
“Why is it our problem?” asked city clerk Connie Gurtner. She noted the city had approved a construction bid from Melvin and that they had budgeted and borrowed based on the bid received. She objected to the cost being passed along to the city after the bid was already set questioning if this was allowed under their contract for the project.
“I don’t see how we should held liable for that problem,” said alderman Nancy O’Brien.
Voss said that is a question the city would have to take up with their attorney, noting the increased prices are being seen in other projects also.
“You can take it to the attorney and eat $20,000 up pretty fast too,” Higley said disagreeing with the suggestion to challenge the additional costs.
“If they don’t uphold their end of the bid why should we pay more?” Gurtner said. “We agreed to pay them X amount of dollars. Why would we pay more?”
TID 4
The city of Colby is looking to the future and the potential to assist with redevelopment of the former PCA prop- erty in the city. In order to be prepared for potential development efforts, Mayor Schmidt brought forward a request to start the process to create a fourth tax incremental district in the city.
In TIDs, taxes normally divided among overlying taxing entities on improvements in the district are retained by the city in order to fund development project expenses such as infrastructure upgrades or development incentives.
The proposed TID would include the PCA property as well as stretching along a portion of Hwy. 13 to include the Smith Brothers property and to the south as well as city-owned land in the industrial park. Altogether there would be 47 parcels in the district.
The mayor was asking council members to get the ball rolling by agreeing to hire MSA to do the formal preparation for the TID. This will include multiple steps with the first to notify the taxing entities of their intent and to having a planning commission meeting and a meeting of the joint review board made up of representatives from those governments as well as a community member. The tentative timeline is to have the meetings begin in early May and have it presented to council for approval with project plan boundaries on June 7 followed by an additional meeting of the joint review board to finalize the creation of the district.
Council members approved paying MSA $15,000 to coordinate the creation of TID 4.
