Low bids on projects mean savings for city

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Although the cost of this summer’s street reconstruction project in the Hastings Business and Industrial Park will be about 25 percent lower than the city estimated, property owners will still pay the same amount in assessments.

The Hastings City Council awarded three contracts for three different projects Monday night, all of which came in significantly under what was budgeted for them.

The contract for the industrial park project was awarded to Northwest Asphalt Inc. for just over $2.2 million. The city had estimated the construction cost at $3 million.

Public Works Director Tom Montgomery said cities scaling back or putting off large-scale construction projects is one reason for the low bid.

“There’s not enough work out there,” he said. “The firms that are out there are competing for less and less work.”

City Engineer Nick Egger said there was more interest in the project from contractors than he’s ever seen before.

The assessment rate that property owners will pay for the project, $47 per front foot, will stay the same. The low bid means the city won’t have to bond as much as it had originally expected, going from about $1.6 million down to $1 million. The city says keeping its bonded debt to a minimum helps keep city tax rates and the interest rate it pays on bonds, down.

The reason the assessments won’t change is that for municipal state aid roads, which Spiral Boulevard is, the assessments are set at 25 percent of the estimated construction cost, not the actual cost. Montgomery said this is done so property owners know what their assessments will be up front as the project moves through the city approval process.

The $3 million estimate was set by looking at similar projects from last year and adjusting them to account for market changes and inflation, according to Egger.

He said the city doesn’t get any deeper than that into economic forecasting when deciding on construction estimates, but he said it does in a round about way, because the city will base estimates for next year’s construction projects on actual construction costs from this year.

Site work for the industrial park project will begin as early as next week. The project will consist of reconstructing Spiral Boulevard from a two-lane road separated by a ditch to a more standard two-lane road. Street reconstruction will also occur on Industrial Court and parts of Millard Avenue, and curbs and gutters will be added to those streets.

Substantial work is planned to wrap up in mid-October. Egger said there may be some work, such as tree planting and restoration, that will have to wait until spring.

Another project that was awarded a contract Monday night was the repainting of the water storage tank located on North Frontage Road between Pleasant and Westview drives.

The Public Works Department originally budgeted $300,000 for the project because it thought the structure was going to have to be stripped of all existing paint before being repainted.

As design work for the project progressed, extensive testing of the existing paint showed it didn’t need to be removed and could be painted over.

Because of that discovery, the project will only cost $85,850 and will be completed by a company called Atcon. The tank, which is a light blue color today, will be repainted a tan color with green accents to match the water treatment plant that was recently built next to it.

The money for the repainting project will come out of the city’s water fund, which is funded by surcharges paid by residents for their water usage. Egger said the approximately $215,000 that’s left over from what was budgeted for the project will stay in the water fund and go toward future water-related projects, such as the replacement of water mains.

The start date for the painting project hasn’t been set, but is expected to be begin some time in late August. It should wrap up this fall.

The last project awarded a contract Monday night was the replacement of the East Hastings sewer lift station. The underground lift station is one of eight in the city that help move sewage to the treatment plant when there’s a topographical obstacle that makes getting it there with gravity impossible.

The budget for the replacement of the lift station was $200,000, with an actual estimate of $185,000. The bid from company that won the contract, Minger Construction Inc., came in at about $160,500. Like the painting project, the leftover money from the lift station replacement will stay in the sewer fund and go toward future projects, Egger said.

The lift station is located underground on Adam Street about a half-block north of East Second Street. The start date for that project hasn’t been set, but is expected to be sometime in late August. It should wrap up in late October.

Tags: industrial park project, local government, hastings city council, local news, east hastings lift station, news