City Commission approves contract for Michigan Street reconstruction, debates funding methods
A cohort of Michigan Street will undergo a full reconstruction this summer thanks to city commissioners’ approval of a $649,840 contract with a local company for the project.
Discussion over what would be the second phase of work on Michigan first came up last fall, when commissioners agreed to combine downtown streetscape design with the street rebuild, budgeting more than $762,000.
On Monday, Malley Construction, Inc., was given the green light to do the work. But commissioners dove into the project’s financial logistics, spurring debate over whether they should authorize City Manager Kathie Grinzinger to approve any additional costs up to $70,000 in the case “something unusual was uncovered” amid the project.
“You know there’s going to be problems. There always is with this kind of project,” said Commissioner Jon Joslin. “And it’s a very tight, constrained timeline on the project. We’re doing it in segments; we’re trying to keep the effects minimized.”
“All of that being said,” he added, “the biggest thing I have an issue with is the process of funding that we’re doing.”
With the first, commissioners would have only approved Malley Construction, capping funds at the contracted amount. The second left the “additional latitude” to Grinzinger to OK change orders up to 10 percent, or the $70,000, of the contracted budget.
The third option, which multiple commissioners favored, gave city staff leeway to move money between the Economic Development and Major Street funds. Moving forward with option three, as the “preferred” method, was approved by the commission in a 5-1 vote, with one absent and Mayor Bruce Kilmer dissenting.
But if the chosen method somehow is “not going to cut the mustard,” as Commissioner Nancy English put it, and jeopardizes the idea of revitalizing Michigan’s streetscape, commissioners additionally left the second option as a fallback.
“I like three because it seems to me that what you’re trying to describe is if we have a little bit of flexibility, we might be able to make some changes ... and still get basically the project we want (and) be able to move funds to keep us from going over,” said Vice Mayor Kathy Ling. “But we’re not sure that would be enough.”
Joslin argued any unforeseen, but necessary changes in street construction plans ought to come from a street fund, because transferring funds from the Economic Development Fund would be like taking money from “the wrong bucket.”
Kilmer agreed, expressing his preference to go with the city’s original recommendation.
“The best thing to do is to give the city manager the flexibility if a contingency arises to approve it,” he said. “If this would have come to us last time and the estimate had been $70,000 more, we would have approved it.”
According to city documents, the total cost of the Michigan Street project is estimated to be $756,855 when Malley Construction’s bid is combined with project management fees and engineering and design costs. The total amount only leaves a $4,100 contingency, or money available to handle change orders.
The city has a history with Malley Construction, which Public Works Director Roger Rousse said doesn’t include significant, last-minute changes mid-project.
Grinzinger said funding includes a $375,000 grant from the Michigan Department of Transportation, which processed the project’s bids. Last fall, she said commissioners decided the project would include landscaping and sidewalk and brick work to be visually equivalent to the rest of the downtown area.
The first phase of street work was completed in 2010. Construction is pegged on Michigan between Washington and Fancher streets and is set to be carried out over two four-week periods.
