Engineering firms attempt to clean up confusion over Fifth Street Road project

 

[March 04, 2020] 

At the Monday night meeting of the Lincoln City Council engineers involved with the Fifth Street Road project were on hand to field questions and try to calm concerns about the financial aspects of the project.

On hand to speak were Stan Hansen and Amber Knox of Crawford, Murphy & Tilly; Julie Shipp with Hanson and Associates, and Chris Isbell with the Illinois Department of Transportation.

The visit to the council chambers by the group was the result of discussions that were held at the last Committee of the Whole meeting when City Administrator Beth Kavelman requested that the council approve an invoice from CMT in the amount of approximately $60,000 for additional land appraisal work and other tasks associated with land acquisition for right-of-ways along Fifth Street.

At that time, Alderman Kevin Bateman expressed his distaste for the project saying that the city and the county have worked for more than 20 years on “the road to nowhere,” and had gotten nowhere. In the meantime, the road was getting worse, and nothing significant has been done to make the road more drivable for local residents.

Bateman said he would really like to know how much money has been spent on this project over the last 20 years. This prompted additional discussions about reimbursements for IDOT and record keeping by the city.

City Clerk Peggy Bateman said that there were eight parcels of land that had been acquired that she did not have the proper paperwork on. Other than that, she felt that all the land transfer documents were in place. At the same time, there seemed to be a lack of knowledge as to when bills were submitted to the state for reimbursement and if those bills had been paid.

There was also a concern about invoices issued to the city, and whether or not with all the changes in administration over the more than 20 year span, had everything been paid.

Bateman was also curious about the $59,841 that specified it was for land appraisal and acquisition. It was understood that all that work had been done quite some time ago, so he wondered why the city was just seeing this particular invoice.

Tuesday evening Stan Hansen was the first to come forward to speak with aldermen. He began by clearing up some of the confusion over the invoice for $59,841 from CMT. He said first of all, this was not an invoice, ie not a bill to be paid right away. It was rather an addendum to the original contract for work to be done in the future. He said the council needed to approve the addendum and the cost of the work beforehand. The CMT group will then perform the additional duties and will invoice the city progressively as work which applies directly to this addendum is completed.

Bateman commented that he had asked the city to “pause” the Fifth Street project until there had been ample opportunity to review the billings and reimbursements. Bateman said it appeared that the city has not sought reimbursements for work performed. He said he would not vote to approve the addendum until these issues were resolved.

Tracy Welch asked Hansen to clarify that the addendum was adding costs on to the top of the original contract and establishing a new cap. That cap would then not go any higher. Hansen said that was correct. The dollar amount attached to the total contract can only change if and when the engineers request an addendum and the city approves it.

Kavelman also apologized for the misunderstanding regarding the dollar amount. She said that while she might have referred to the document as an invoice, she had intended all along to let aldermen know that it was an addendum with no money due at the moment.

Julie Shipp with Hanson Professional Services was the next person to come to the speakers table. She said she really had nothing to report to the council, but was on hand to answer any of their questions.

Kavelman said that there had been a lengthy email exchange between herself and Ship late last week. She had provided copies of the email to all the aldermen. With Shipp at the table, Welch asked her to go through the email and explain it for the public.

Shipp said that the email had discussed the varied funding sources for the Fifth Street project. She said that there were multiple federal and state grants. The county had a grant for part of their share, plus they were putting in money from their motor fuel tax, and the city was putting in money.

Shipp said that the city's share would be $890,000, which is 16 percent of the total project.

To clarify, this is a multi-million dollar project and the city has to provide a local match to grant funds, with a few exceptions related to the bike path that were dubbed 100 percent city funded. The bike path has since been removed from the plan.

Shipp also said that in the last 10 years there had been five updates to the original plan for the road and each one had costs attached. Updates equaled changes in the original plan that required additional engineering and consultation from the firm.

Questions also came up about separate invoices from Union Pacific Railroad in the amount of $3,637.68. It was explained that the invoice was paying for consultants from UP who had come to Lincoln to review changes that would be needed to the spur line that runs behind International Paper and crosses Fifth Street just to the west of the factory. Shipp reviewed that visit and talked about the need to relocate the access road to the Lincoln Industrial Park that is extremely close to the crossing. She also noted that the current invoices are for a visit completed, but there will be an additional “force account’ that will include the costs of additional work done by the railroad. That would work much like the addendum being sought by CMT. The council would approve the amount but it would be paid out at a later date.

Ship also shared that the sitting council in 2016 had approved the engineering costs for Union Pacific.

Ship said that the city had four possible options:

1. Keep to the original plan for a three lane road

2. Remove the bike path

3. Drop the project down to a two lane road

4. Abandon the project.

All these options have been previously discussed by the council and the decision had been made to drop the bike path (Option 2). But, because the bike path had been added officially, there were now additional engineering costs to take it back out.

Shipp said that taking the bike path out meant new plats had to be drawn and some of the land previously required would no longer be needed. To that end, new appraisals had to be done for the land that was being sought because many were smaller parcels.

Going back to the UP force account (Railroad), Kavelman said that the account was established at $219,000. However, when the project began years ago that figure was estimated at $92,000. She wondered why there was such a difference.

Shipp said she never saw the original agreement. She might imagine that some of that increase was inflation, but she really did not know. Kavelman said that there would be a request for review made to the Interstate Commerce Commission (ICC). Shipp also noted that the original force agreement (the one for $92,000) was never signed. The council will have to approve the current agreement and sign it.

Chris Isbell with the Illinois Department of Transportation came to the table and spoke more about the grant funding for the project.

He said that there are three federal grants involved, two state grants, county money and city money.

He said that two of the three federal grants are going to eventually lapse and will not return. The two state grants could also lapse. He added that the county money has a lapse date attached to it as well.

He warned the council that the Federal Highway Commission is becoming less flexible with long term projects. He said the projects have to show progress and right now “ours is on the radar.” Isbell said that the funding is available right now, but that could change if the project doesn’t continue to move forward.

He said also that changes to the master plan were a red flag for the funding sources. Minor changes would be overlooked but large changes would be under a lot of scrutiny. He added that because the bike path was never part of the federal grant agreements, taking it back out would not put the funding in jeopardy.

He went back to the four options defined by Shipp and said if the city chooses option four (abandon the project) it will have to give back about $650,000.

Steve Parrot asked about the ‘lapse’ time table.

Isbell said that generally, the grant will permit 10 years from the most recent extension. That last extension was given to the project about four to five years ago, so there was probably five to six years remaining on the current extension. The next request for extension could be at risk of not being granted.

Kavelman asked about the county grant, saying it was an HPP grant.

Isbell said the county had an $800,000 grant plus they have set aside more than $400,000 from their motor fuel tax.
 

Kavelman wondered if that approximately $1.2 million was drawing interest. Isbell said the MFT maybe, but the HPP is a reimbursement grant, so if any money has been paid out, it is for expenses already incurred.

Welch asked how many parcels of land were still to be acquired.

Amber Knox with CMT answered that question from her seat in the gallery. She said there were 14 parcels to be purchased. Welch asked if those 14 were included in the “eminent domain” project the city had authorized. Knox said they were not, because no official offer had been made to the owners.

She explained that with the deletion of the bike path, new appraisals needed to be done. New offers needed to be made to the landowners. The landowners then needed to have the opportunity to accept or reject the offer. When all those steps were completed, then the eminent domain process could move forward. What that then boils down to is that CMT isn’t going to be able to perform the new appraisals and make engineering adjustments to the master plan until the city approves the $59,841 addendum. So, the project is again at a standstill until the city makes a decision on the addendum.

Isbell was still at the table. City Treasurer Chuck Conzo asked how many dollars have been reimbursed to the city over the years.

For the right-of-ways, Isbell said $235,080.25. He would later share that the city has also been reimbursed $411,468.84 for preliminary engineering.

Conzo asked if there were any requests for reimbursement invoices unpaid by the state. Isbell said that he didn’t have that information. However, he could tell the council that the first request for reimbursement for the city came to the state in 2016 and the second, and as far as he knows last, request came in 2017. Kavelman added that on February 27th she put in a request for $111,270 for reimbursement. She added that she didn’t know what that covered, it was an amount she had been given by Conzo.

Welch said that with all this, he felt that the city needed to discuss this further at the next committee of the whole. He said he wanted all the numbers put together so the aldermen could see where they stand on this project.

Later in the evening, the issue of the $59,841 to CMT came up for vote. Aldermen approved the addendum with a 7-1 vote. All eight aldermen were present with Bateman being the single “no” vote. Aldermen Sam Downs, Jeff Hoinacki, Kathy Horn, Ron Keller, Colby Leith, Steve Parrott and Tracy Welch voted “yes.”

A vote regarding the invoice for Union Pacific in the amount of $3,637.68 was tabled for the second time because aldermen were not satisfied with the details provided on the invoice. They questioned what was meant by “overhead” costs and why that portion of the invoice made up more than $2,000 of the total. It was mentioned that a portion of that could have been air travel and motel stays, though it wasn’t precisely spelled out. Aldermen asked that the company be contacted for further explanation.

[Nila Smith]