Special Meeting of the Mazeppa City Council
Tuesday, December 27, 2022
The regular meeting of the Mazeppa City Council was called to order at 6:05 PM by Mayor Chris Hagfors.
The Pledge of Allegiance was said.
Present: Mayor Chris Hagfors. Council Persons Steve Liffrig, Mike Hammes, Dustin Wiebusch, and Erica Young.
Others Present: City Engineer Matt Mohs and City Administrator Clerk Karl Nahrgang.
Motion by Wiebusch, second by Liffrig to approve the agenda. All in favor, none opposed. Carried.
City Engineer Matt Mohs reported on funding progress. He said that after the initial design meeting on December 21, 2022, the City received news that the funding would be awarded. Mohs also stated that more than one State level agency may be involved to make the total funding package affordable to the City. Completing the Letter of Conditions and having the funding allocated before January 1, 2023, locks in the lower interest rate and is ahead of the deadline when restrictions on origins of materials would increase the cost of the construction. Mohs said that if interest rates drop before the end of the project when the loan would be closed, the rate can go down, however it cannot go above the rate that is locked in by getting the letter of conditions approved before January 1, 2023.
Mr. Mohs said that after the engineering plan is reviewed and approved the plan would be treated as 2 projects. One for the collection system and one for the plant. Requests for bids would go out for each. The treatment plant project would be much more specialized and will have a longer treatment timeline. The collection system project process would have a shorter timeline.
Mr. Mohs also explained that the funding also requires the City to build a short-term asset reserve. This means that the City needs to plan for enough funding to build funds for replacement parts for the new system. This would be about $35,000 per year above annual payment and operation costs. The rate and tax plan that the City has put in place does account for this short-term asset reserve.
Mr. Mohs answered concerns about the proximity of the new facility to the elevation of the flood plain. These concerns have been addressed in the pre-engineering phase and engineering plans.
Motion by Wiebusch, second by Young to authorize signing the Request for Grant Funds Obligation form with USDA rural development for $6,036,000. All in favor, none opposed. Carried.
Motion by Liffrig, second by Wiebusch to authorize signing the Request for Loan Funds Obligation form with USDA Rural Development for $6,253,000. All in favor, none opposed. Carried.
Motion by Wiebusch, second by Liffrig to authorize signing of the Letter of Intent to Meet Conditions with USDA Rural Development. All in favor, none opposed. Carried.
Motion by Young, second by Wiebusch to approve Resolution 2022-47 accepting the loan obligation from USDA Rural Development. All in favor, none opposed. Carried.
Motion by Liffrig, Second by Young to adjourn the meeting. All in favor, none opposed. Carried.
Meeting adjourned at 7:50 PM.