HomeMy WebLinkAboutIFAC memo Highland Main 062119
Memorandum
REPORT TO: Impact Fee Advisory Committee
FROM: Shawn Kohtz, City Engineer
SUBJECT: Request to Alter the Street Impact Fee Schedule to Accommodate
Increased Costs Associated with the Highland and Main
Intersection Improvements
MEETING DATE: June 27, 2019
Committee Members:
The purpose of this meeting is to ask for your consideration and endorsement of a change to the
2018-2022 Street Impact Fee Capital Improvement Plan (CIP) to allocate additional funds from
the street impact fee program to the Highland & Main Intersection Improvements (SIF112).
The Developer of the Heebs Project, East Main Investments, LLC, entered into an agreement
with the City to install improvements to the Highland and Main Intersection. That agreement is
attached for reference. The agreement commits $120,000 to the Highland & Main Intersection
Improvements described in Street Impact Fees Project Number SIF112. Those funds are
available for reimbursement to the developer upon completion of intersection improvements.
The attached letter from East Main Investments, LLC describes a request for additional funds for
improvements to the intersection at Highland and Main. The original estimate for the work was
$241,781. The actual cost of the project is much higher (approximately $1.1 million). The
Developer provided a summary of the actual project costs in a submittal titled “Highland
Boulevard & Main Improvements Design & Cost Breakout”, which is attached.
The primary reason for the higher project cost is that Montana Department of Transportation
(MDT) required significantly more improvements to the intersection than originally anticipated.
The City and Developer met with MDT in 2016 to review the intersection preliminary design
concept and had verbal agreement from MDT on the layout, resulting in the $241,781 project
cost estimate. Upon submittal of the detailed design, MDT required substantially more
improvements, and multiple additional meetings with MDT followed beginning November, 2017
through summer of 2018 to arrive at a final design. The final design resulted in the $1.1M
improvement cost.
I met with City Management to discuss the Developer’s request for additional funds. We
reviewed the Street Impact Fees CIP to determine available funds to help offset the additional
cost of the project. Public Works Staff and the City Manager agreed to propose $130,000 in
additional impact fee credits to the Developer. This proposal is now brought to the Impact Fee
Advisory Committee for consideration.
The Developer requested a much higher participation from the City Impact Fee Program at an
additional $630,000. However, the request of $630,000 cannot be accommodated without
removing another project from the priority list in the CIP. The City is not obligated by
agreement to participate in the intersection costs at a level greater than the original $120,000
committed to the project.
The items that were not included in the original budget, which are additional scope items include
the following:
Alterations to the northern leg of the intersection
New signal poles and mast arms
Alterations to the eastbound lane configuration
Alterations to the signal heads and electronic control systems
Additional engineering to alter the original design
Additional construction administration, inspection, testing & oversight to accommodate
the altered project
The Developer presented a summary of the scenario to the City Commission in December, 2018
when requesting a variance to the timing for completion of the intersection. The Commission
Video of the presentation can be viewed here.
Engineering, Public Works, and City Management staff are supporting this request to offset
additional costs associated with this project that benefits the community. Staff are proposing an
additional $130,000 in impact fee credits to be committed to reimburse the Developer for the
increased costs of the project. If approved, the Impact Fee Payment Agreement between the City
and the Developer will be amended to reflect the impact fee credits proposed.
Encl. Copy of City of Bozeman Impact Fee Payment Agreement between City and East Main
Investments, LLC
Letter Request from East Main Investments, LLC, dated May 9, 2019, “RE: Blackmore
Bend – East Main Street and Highland Boulevard Intersection Upgrades”
Submittal from East Main Investments, LLC, dated 1/11/19, “Highland Boulevard &
Main Improvements Design & Cost Breakout”
Street Impact Fee Project Number SIF112 Summary