HomeMy WebLinkAbout2.d. McMenomy Waterline Assessment .
City of Rosemount
Executive Summary For Discussion
CONIlVIITTEE OF THE WHOLE DATE: January 6, 199'7
AGENDA ITEM: MCMENOMY WATERLINE ASSESSMENT AGENDA SECTION:
2. D.
PREPARED BY: THOMAS D. BURT, CITY ADNIINISTRATOR AGENDA NO.
ATTACHMENTS: CORRESPONDENCE APPROVED BY:
In 1985 the City entered into an agreement with Dakota Central Offices to install a water line from 145th Street
to their building. The developer installed this line, so they could remodel the lower portion of their building and
install a fire sprinkler system in the building. The agreement entered obligates the City to reimburse the developer
the cost of their improvement at the time future connections were made. In 1997 the future Erickson Park
shelter will be connected to the water line and the developer is requesting reimbursement.
On December 11, 1996, I responded to the request (attached). Mr. McMenomy has countered that proposal
(attached) and requests to split the cost of the improvements using the original cost of installing the water line.
Dakota Central Offices Limited Partnership is requesting a settlement of$6,687.50.
Staff seeks direction from the City Council on if the terms of settlement are satisfactory. If there is a consensus
at this meeting, staff will put this on a future City Council meeting for formal approval.
RECOMIV�NDED ACTION NOTES: '
- CiTY'O F ROS EM O U NT Z8�5-°TM�"s���
P.a eox s�o
Rosemourt.MN
Everytfiing's Coming Up Rosemountt! 5so6e�osio
Pfione:b12-423-4411
fax:612-423•5203
December 11, 1996
E.B. McMenomy
Mc.'Vtenomy Real Estate Appraisal Services
14450 South Robert Trail
Rosemount, Minnesota 55068
RE: McMenomy Water Connection
Dear Ed:
Pursuant to your request for reimbursement ofthe 1985 agreement concerning the water line I am
responding by way of this letter. The City Attorney and I have reviewed the agreement and there
were two issues that needed to be addressed. One issue is determining when is a benefit derived
- under the agreement and the other issue is what is the value of a benefit derived from connection.
� - We have deternuned there may be some benefit to the City when the proposed Erickson Park
shelter is constructed and connected to the system.
I had the City Engineer research what the actual cost of constructing an equivalent line in today's ,
dollars and he has deternuned the cost of constructing a line from 145th Street to the point of our '
connection to be $4,588. Since the benefit of this line is equally shared by yourbuilding and the ,
proposed park shelter, the cost of this pipe should then be divided making the City's responsibility '
$2,294.
I would like ta discuss this information with you at your earliest convenience. ,,
SincerelY, �I
i
Th m rt
o as D .
City Administrator
cc. Mayor& City Council
Charlie LeFevere, City Attorney
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._ A6REEMENIT
THIS A6REEMENT made and entered i nto th i s 17th day of September,
1985, by and between the CITY OF ROSEMOUNT, a Minnesota municipal
corporation, hereinafter referred to as the "City," artd EDWARD 6.
McMENOMY, hereinafter referred to a the "Developer."
YHEREAS, the Deveioper desires to construct a watermain across City
property to benefit his praperty.
NOW, THERfFORE, in consideration of the above and other good and
valuable consideration the parties hereto agree as follows;
1. The Developer shall construct the watermain according to plans
and specifications prepared by the City which are attached hereto and made �
a part of this agreement as Exhibit A.
2. The Developer shal'1 contract and pay for the materials and
installation of the watermain.
3. The City shall pay for the design and inspection of the
watermain and shall furnisli the Developer with a fire hydrant, hydrant
lead, valve and tee to be installed on Gity property.
4. The City shall own and maintain that portion of the watermain
� which is installed on City property and/or �asement.
5. If, for a period of fifteen (15} years after the installation '
of said watermain, there are any connections to the watermain constructed '
by the Developer and owned by the City as hereinbefore specified, th� City
- wili reimburse the Developer in an amount equivalent to the 6enefits ,
derived from the future connection.
IN WIT,�3S WHERE , he �'res hereto have hereunder set their
hands this � day of , I985. '
CITY OF ROSEMOUNT '
� X.��-- '�
Le S. Knutson
�
on . Da ing, Administrator
EDWARD B. McMENOMY �
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Edwar B. McMenomy . ��'
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. ' �
STATE OF MINNESOTA)
_ COUNtY OF OAKOTA )
The foreqoin nstrument was subscribed and swurn to before me this '
? day of I985, by Leiand S. Knutson, Mayor, and
Ty'�n F. Oar �nq, A m�n�strator, for the City af Rasemount on behatf of
the City.
.
tary u i .
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STATE OF MINNESOTA) =�`� �.�-�;;;�T�ou�a"��.:� 3
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COUNTY OF DAKOTA. ) '
The fore o�ing instrument was subscribed and sworn to before me this
g (� day of , 1985, by Edward 6. McMenomy to me �
personalTy kno to be t e persan described in and wha executed the ',
foregoing instrument, and acknowledged that he executed the same as his II
free act and deed. ,
�
otary Pu ic .
KApEN M. KELLY I
s� No'taa�r Pu�.lc-�m07'Jt :
DAKQTA COUNTY
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1996 RESIDENTIAL WATERMAIN EQUIVALENT ESTIMATE
- s
Project#243 Project#246 Project#251 Project#2 4
ITEM QUANTtTY UNITS UNIT PRICE UNIT PRICE UNIT PRICE UNIT PRICE r`
1. 8° D.I.P. 500 L.F. 12.00 13.00 14.50 17.00
2. Fittings 500 Lbs. 2.00 0.30 1.00 1.60
3. 8"Gate Valve 1 Each 440.00 500.00 480.00 435.00
4. H drant 1 Each 1,300.00 1,200.00 1 100.00 1 200.00 •
Totals $ 8,740.00 $ 8,350.00 $ 9,330.00 $ 10,935.00 `
Average Total $ 9,338.75 .
+ 5% Contigency 466.94
� Subtotal $ 8,805.69
+ 30�Administration 2,941.71
Total � 12,747.39
Total/500 L.F. $ 25.99
/2 $ 12.75
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iBFITOEST.70.8 7131D01s43 AM
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December 31,
1
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City of Rosemount
Thomas D. Burt . . �. r..-
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City Administrator
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875 145th
Street West
Rosemount, MN 55068
RE: Dakota Central Offices Water Connection
Dear Tom:
1996 re ardin the
December li , g g
Thank ou for y
our letter of ,
� .
above matter. The reimbursement due under the October ?, 1985
o Limited
agreement is the property of Dakota Central •ffices
Partnership°, which consists of 3 general partners (including
I�I me) and 6 additiona1 limited partners. Therefore, I thought I
�!i should respond to your letter in writing, rather than discussion
which you proposed, so that you and other decision makers at
City hall, can more fully understand the position of our 3
general partners.
As yau know, I have the benefit of getting facts from Ed Sr. ,
who was the person described as the "developer" in the 1985
agreement, and who in fact drew the agreement. Ta complete the
picture, I attach a copy of Ed Sr's. letter of October 15, 1985,
addressed to Don Darling (then City Administrator) . The letter
makes it clear that "benefits derived from future connection"
should be based on the cost of the facility installed at Ed
Sr's. expense and turned over by him to the City. The figure is
$13,375.00. Ed Sr. informs us that the City never questioned
this figure. I also am enclosing a copy of a letter dated
November 4, 1985, that acknowledges that the total construction
cost of the wateriine was $1b,665.00. The $13,375.00 figure was
derived from a proration of the $16,665.00 figure.
Ed Sr. states that the installation of the water pipe was
required to serve a city mandated sprinkler system, required to
be installed in order to complete the remodeling (the lower
level) of what was a former garage and now is "Dakota Central
Offices°. The remodeling began in 1980 on the upper level. Water
service was available ta the building under Highway #3 from the
West. No sprinkler system was required or installed. This
service is sti11 the source of water for the building, except
fo= the lower level �sprinkler system. No water has been- used to
date f=om the pipe that was installed in 1985 (except to water
the City flower garden, ice rinks and sod for the future pa=k
area) . The buildinq therefore has a sprinkler system on the �
lower level and none on the upper level.
Ed Sr. also points out that the City has enjoyed major fi.nancial
benefits, since 1980, f=om the remodeling. The project has
always been in the City's downtown tax increment district. When
remodeling began taxes were at the $3,400.00 level and now have !I
increased to the $2'I,000.00 level. I believe the tax increment
district continues until the year 2000: The financial benefits �I�
to the City will therefore exceed $175,000.00 over the life of
the district, Ed Sr. states.
e in the
The real question here is the application of the languag �
agreement - "the City will reimburse the Developer in an amount I
equivalent to the benefits derived from the future connection"
to the $13,375.00 cost.
We are willing to assume that there will be no additional I
connections during the 15 year period specified in the ,,
agreement. On this basis, two parties will derive benefits from
the project and each should pay one half. '
If we can settle on this basis, we are also willing to waive any I
claim which we may have for interest on the money.
Our settlement figure is therefore $6,687.50, if received within ,
a reasonable time. '
If you wish a meeting for further discussion, I will be '
available.
Sincerely,
l� �i� � l�'
Ed McMenomy, Jr.
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October 25, 1985 :� �'� `
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. City of Rosemou�nt .
Attn: Don Darling � . .
1367 I45th Street East
Rosemount, Miruiesota 55468
Re: Dakota Central Offices - City Watersnain • -
:Dear �Don: � -
� � : Thank you for delivering� me a signed copy of ths above
~Agreem�nt (dated by the City October 7, I985) .
- _ � .The copy v�l�ich. I received from y�ou did not have an rsxhi.b'it
��A attached, We assume that yoc� have not attached one to yccyur
. �;c:opy.of the Agreem�nt either (see my letter of September ��
�30,� 1985}. ,
:: In order to properly complete the Agreesaent, we have
, . ;:n s �pr�par�edrand: attached Exhibit A to our file _capy. We enclose '�,
� ;:: , ,,...,. � .,.; t; • .. . .. ..,. . ,,
3.'.
a s�.�`�ar Exhibi't A �for you to"`attach to the���City" copy.
} The contractor completed install.ati.on of the �ateriaain �
�on October 7, 1985. Therefore, the fifteen (15) year perivd
� mention�d in pa.ragraph 5 of the Agreement should begin on
. ...�that `date.
A _l . • . . . ., ' . . .. .
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� According��o the figui�es from our contractor, the aatual '
� . -;_: J-cost. of .that portion of the Katermain which the Gity owns : . � _
� ;jasder the..Agreement is �23,375.40 �rii.ch �e �wtll pay ta the-
_ =�ccritractor. Caaputation of pbenefits derived from the future :
:�::connection" (if any) should -therefore be based on 513,375.00�
::expended on October 7, 198S.
. This resolves the matters at issue bet�reen Dakota Central
�Partnership and the City with the exception of' the continuing
trespass from the N.S.F. e3ectric lines. Kindly 1et nie know `
the City's present position on this. As we stated fraa the
,
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beginning. the best'�resnit, so far as Me are concerned, �Zd ., �
be bur as mari of the 1 ines .as - �'
�ing y possible. If the new City �_ -
HaII is eonstructed. perhaps� the City will be taking a closer _
look at the po�rer li�e question in relatiozi to 'that pro j ect.
. ''
Very trul ours. .
Y Y .
. . . . . _-�
� FOR TF� FIRM
: 't,:
. ��,.
� - . . Edward B. 'McMenomy
• EBMikk ..
Enclosure
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November 4, 1985
Erickson Construction, Inc.
Attn: Don Erickson
23616 Pleasant Lane
� Burnsville, Minnesota 55337
Dear pon:
Jeff Nivala of Basic Builders has discussed the caatter
of payment for the waterline which you installed at Dakota
Centrai Offices. He states that your total bill for the wark
is �16,665.00. This is �,17,1fi5.00 (shown on the October 3,
I985 Work Order attaehed) minus $500.00 allowance related
to the change of Iocatian of the line into the building and
extra expense tc> Basic Builders within the building because
o€ this change in I�cation.
Jeff has a3.so inforned me that your workmen severec�
some electrical cables near 145th Street in connection with
doing the work. These cables were for electrical service
to the city street 1.ights and telephone service by Centel.
I understand that you have been billed $800.00 for the repair
of the street light cabZes and that �ou have not yet received
- a bil2 from Cente2. I further tmderstand fihat you clai�n that
you are insured and that your insurance company wi11 PaY
these 'biils. On behalf of Basic Bui..lders and ourselves as
. _� .�` o�aiers, xe, of course, ai-e takfag the pasition that you �should .;
. indemnify us and hold us harmless: from claims arising out .
of the severing of these cab�es. But for this problem, we
are very pleased �vith the work which you did. Jeff has informed
vs that he has �ecured apprnval fram the City Engineer's
offic� and that the work is accepted so far as the City is
cancerned.
� Herewith enclosed find Dakota Central Office•s check
to you in the amount of $25,000.0a. V+ie acknowledge additional
indebtedness to you of �1,665.00 and agree to pay this amount
to you as soon as you furnish us with proof that all claims
have been settled v�ith respect to the severance of the cables
above described. Thank you fcr your eonsideratian and coopera- -
tion. (Roxann Duffy of oszr office wi.�.l be in charqe of this
ti . �I
f �.
�r • �• �
.. . � i .T � �-. .. . � . . . . . . � � � . . '
... . . �t ,` � "+ . . . . . . .�I
��Wi1f��Qt... ii�• . � � � � � � .. � . . . � . .II
l�o�ts <�• 198'S � .
� '�
file. Co�ta�t her direct2y � proot af sett2asent of t.he
c�a2e sev�srano� c3sio is aEvailable aa�d she wi.i� �ee tl�a�
yva are paid the i1,665.00.)
very tr�Iy yo�urs,
�-
F+QR Ti� ��i
£dxard 8. Ml�t�my
F.BiE:kk
8'�cloa�re�
' cc: Basic B�iZ,der�, .Z�c.
Att�: J�rff D�ivsla
38� t�pper I43rd Str�+et
Ros�t, I+�t 55058