Renovation project hits snag in Ely
Winning bidder rejects $2.2 million contract
Keith Vandervort

ELY – The Ely City Hall renovation contract was returned to the city unsigned by the winning construction company this week.

TL Construction was awarded the contract last month. Their bid of $2.2 million was as much as $1 million lower than the other companies that bid on the project.

“What that means,” said City Engineer John Jamnick, “is that we have two options. We can award the project to the second-highest bidder or reject all bids and re-advertise for bids for the project.”

The council voted to reject the remaining bids received for the project, noting that the first bidder defaulted on the contract, and to re-advertise for bids.

Jamnick discussed options with the council. He suggested the city hall renovation be included in the public library construction manager at risk process versus re-advertising the city hall renovation separately.

“We thought the other bids were quite high,” Jamnick said. “We went through the plans and identified almost $725,000 in savings through a sort of broad brush look at everything.” The project was budgeted at $2.4 million.

He thought some changes in the mechanical and electrical work needed on the building could realize substantial savings. He also mentioned exterior panels, flooring and council chambers furniture allowance as potential areas where savings could be realized.

“The mechanical, electrical and ADA access issues won’t be compromised as we look at other ways to reduce the (overall project) cost,” he said.

He explained that in the construction manager at risk process for the library construction, the construction manager would obtain subcontractor bids for various parts of the overall project, which the council will be able to review and amend. “We’ll be able to look at all the different options and proposals and look for savings.”

Council member Paul Kess expressed his concern about the city hall exterior panels and how the building will look if a less-expensive option is chosen. “When we added on to the Veterans Clinic (at the SATO building) it didn’t look so good,” Kess said. “I’m not suggesting we are going in that direction but I think that is a concern.”

Clerk-Treasurer Harold Langowski said he was surprised at the cost estimate for furniture for the council chambers. “I don’t see $65,000 worth of furniture but that is something we can look at. We can do what we can now and look at something down the road. It certainly is not a necessity in the project,” he said.

Jamnick said the timing for the library construction with the city hall renovation included should not be affected. “We will still have the groundbreaking this spring depending on the weather,” he said.

Boundary Waters Care Center

Mayor Ross Petersen continued the discussion on the city ownership of the Boundary Waters Care Center as proposed at last month’s study session.

“In my opinion, I just don’t think this is a project for the city to get involved with,” he said. “It was very 11th-hour or way past 11th hour. I have a feeling we would have a very hard time in finding partners in this. I have the feeling that there are many, many land mines that could happen here.” One thing that keeps coming up is that this won’t be a total loss of jobs. It might come back as assisted living and some of those jobs could be saved and those people will stay here.”

The management company for the facility proposed an Equitable Cost-Sharing for Publically-Owned Nursing Facilities. The program allows publically-owned care facilities to receive higher Medicaid rates if the city pays the state’s share of the cost of the rate increase. The cost to the city of Ely would have been about $100,000 per year.

Boundary Waters Care Center Board of Directors president Gary Larson said the publically-owned proposal was just one option. He said he is hopeful that pending state legislation will provide additional financial help. “We should know by the middle or end of May if that goes through,” he said. “It could stretch out for six months before funding could be available. We could manage it from a cash-flow standpoint but it would be tight.”

Petersen suggested the nursing facility keep the council informed on the funding proposals. “There may be something we can do down the road,” he said.

Water emergency

Langowski told the council that the Ely Utility Commission has been studying the Draft Water Emergency Policy and forwarded changes to the Customer Relations subcommittee for further study.

“We made it through the peak of the issue but I want to let people know that if their (water) lines did freeze to continue to run water,” he said. “With the weather we are having, I would not be surprised if they will have to run water into the second week of May. We will make a public announcement as to when people can stop running their water.”

He said the city continued to thaw fire hydrants this week. “It looks like most of the water services that are going to freeze have but we are getting other lines that are freezing. We are well over 200 (water line freezes) now. In many years we have had no freezes. Last year we may have had about 20. It is a considerable up-tick in freeze ups.”

Other business

• The Board of Appeal and Equalization will meet April 10 at City Hall from 5-6 p.m. A quorum of council members is required to conduct the meeting. “How many (appeals) we will have, I don’t know,” Langowski said.

•Approval was granted for the deputy city clerk to attend the Minnesota Clerks Institute for Year 2 in Brooklyn Center, April 28-May 2.

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