City street coffers may see trouble
By HEIDI DESCH/Hungry Horse News
Road work on Talbott Road and Veterans Drive could begin by mid-month, but the city's funding source for all its planned road projects may not come through in time.
The Columbia Falls City Council on Monday approved a bid by Schellinger Construction for just under $594,000 to complete the work. About 10,500 lineal feet of road will be reconstructed.
"I think all of this will start coming together pretty rapidly," City Manager Bill Shaw said.
The city has planned to loan itself the money for a $1.1 million road-improvement project through its Cedar Creek Trust fund. But selling the property that puts money in the fund is proving to be a challenge.
Early concerns were that reconstruction might be much more costly. Talbott was reassessed because of concerns that the road might need to be completely reconstructed because of below-standard subgrade.
Engineers have since examined the site again and feel the project cost should be close to previous estimates.
"We think the project is viable and we expect it might be less than the bid price," Shaw said.
A fair amount of waste will have to be removed from the site. Depending on the amount that could lower the actual cost by $20,000 to $30,000,Shaw noted.
Expected increases in cost meant leaving out plans to widen both turnouts into the Columbia Falls Junior High School. If the project comes in under projected cost, those plans could be added back.
FUNDING OF THE work is part of $1.1 million levy approved last August.
The loan itself has been set to come from the city's Cedar Creek Trust fund. The funding method has been expected to save the city about $25,000 in bond insurance.
The fund has been established with the sale of land along the city's Cedar Creek Reservoir. But selling all the lots has proven to be difficult. Some of the parcels have sold, but eight remain.
ReMax Mountain View agents Bill Dakin and Allen Jacobson presented the council Monday with a proposal to lower the price of the remaining lots.
They recommended reducing the lot prices by 10 to 15 percent. The city in October 2007 approved a price reduction of 10 percent to the current list prices.
Lots range in price from $137,500 to $239,500. A reduction of 15 percent would bring the lots down to $117,000 to $203,600.
"We're finding the competition for vacant land to be in excess," said Jacobson. "At 15 percent we feel we could be competitive."
The council Monday rejected the proposal by not taking any action on the request.
"Sometimes reducing the price isn't the issue. The issue is the right person comes along," said councilman Dave Petersen.
THE CITY COULD temporarily borrow the money from another source if the lots don't sell. Currently there is about $499,000 in the principal of the fund.
City Finance Director Susan Nicosia said the city could use an interim cash flow loan to fund projects.
The city would borrow the money at a 4.25 percent interest rate over 20 years to finish the projects. Then once the Cedar Creek lots sell it would pay off the loan.
RECONSTRUCTION ON TALBOTT will include redoing the railroad crossing there.
The Council approved an agreement with Mission Mountain Railroad and the Montana Department of Transportation to install a crossing signal and improve the crossing. Under the agreement, MDOT will pay $28,000 for the signal and its installation.
The city's walk path at the railroad crossing will also be moved back from the street.
"You'll see a lot of improvements by September," said Shaw.
An agreement is expected to be signed with Schellinger Construction within the next 10 days. The company will then have 70 days to complete the project.
Shaw said the city will encourage Schellinger to complete the work before Aug. 27, prior to school starting.