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08/23/1988 City CouncilC EDMONDS CITY COUNCIL MINUTES SPECIAL MEETING AUGUST 23, 1988 C\ SE MINUTES SUBJECT TO TEMBER 6, 1988 APPROVAL A special meeting of the Edmonds City Council, prior to City Council Committee meetings, was called to order at 7:00 p.m. by Mayor Larry Naughten at the Library Plaza Room, 650 Main St., Edmonds— All present joined in the flag salute. PRESENT STAFF Larry Naughten, Mayor Jim Barnes, Parks & Rec. Div. Mgr. Bill Kasper, Council President Art Housler, Admin. Svc. Director, Laura Hall Jack Weinz, Fire Chief Roger Hertrich Bobby Mills, Public Works Supt. Jo -Anne Jaech Mary Lou Block, Planning Div. Mgr. Steve Dwyer Bob Alberts; City Engineer John Nordquist Bob Bower, Treatment Plant Supvr. Jack Wilson Jerry Hauth, Hydraulics Engineer Dan Prinz, Police Chief Scott Snyder, City Attorney Jackie Parrett, City Clerk Margaret Richards, Recorder Mayor Naughten announced that the meeting would commence with the Executive Session first to discuss labor negotiations and contract parameters regarding the wastewater treatment plant for approximately thirty minutes. The Council recessed to the Executive Session at 7:01 p.m. The meeting reconvened at 8:10 p.m. AWARD OF BID FOR CONSTRUCTION OF SECONDARY TREATMENT FACILITIES Gordon Culp, CWC-HDR, Inc. reported that on August 16, 1988, the City received five bid proposals for construction of the new wastewater treatment plant, including the outfall pipeline and a pipeline for METRO. A responsive bid package and proposal included the bid document, as well as all required attachments, certifications, and bond(s). After Staff reviewed the five bid packag- es, the bid package submitted by Wright Schuchart Harbor Company of Seattle, Washington was found to be missing one of the required attachment forms. This bid, in accordance with the Project Manual, is nonresponsive, although they submitted a low bid price of $24,721,455 plus sales tax. The bids have been reviewed and discussed with Mr. Thomas H. Wolfendale from the law office of Preston, Thorgrimson, Ellis & Holman. Mr. Culp noted that all bids were less than the engineer's estimate. He said Wright Schuchart Harbor Company miscalculated the tax and failed to include Attachment "B" - Statement of -Compli- ance with SBE, MBE, and WBE Utilization Requirements. The miscalculation of fhe.tax has been resolved. He said the Bidding Requirements clearly state that failure to include Attachment "B" with the bid renders the bid nonresponsive. Mr. Culp said the remaining four bids are complete, accurate and responsive. The lowest respon- sive bidder, Kiewit Construction Company, is a large, national construction firm with consider- able construction experience of utility projects. Mr. Culp said recent Northwest projects in the $10 to $50 million range include the Bremerton Wastewater Treatment Plant, Metro Effluent Pumping Station, and the City of Tacoma Central Treatment Plant. He said their bid is $623,000 lower than the next responsive bid. Mr. Culp said CWC-HDR recommends award of the bid, contingent upon DOE and EPA approval, to Kiewit Construction Company as the lowest, responsive, responsible bidder. Councilmember Jaech read the Council's finding into the record as follows: "The Staff has for- warded to the Council the bids of four bidders to construct the wastewater treatment plant. The Staff has rejected the bid of Wright Schuchart Harbor Company as nonresponsive due to their fail- ure to include a required attachment_ The Council explicitly declines to exercise any discretion to accept or decline this bid. It is the policy of the Council to accept the bid of the lowest responsive bidder and the Council, therefore, accepts the bid of Kiewit Construction Company in the amount of $25,203,000 plus 7.8% sales tax in the amount of $1,965,540, contingent on the following: the acceptance shall not be final until five business days from the date hereof in order to provide for protest in accordance with the bid documents. And if a timely protest is filed, this acceptance shall be contingent upon confirmation of Kiewit Construction Company as the lowest responsive bidder through final resolution of available protest and appeal proce- dures. In the event that the bid of Wright Schuchart Harbor Company is determined to be respon- sive, the contingent acceptance shall be withdrawn and Wright Schuchart Harbor Company shall be awarded the bid". COUNCILMEMBER JAECH MOVED, SECONDED BY COUNCILMEMBER DWYER, TO ACCEPT THE BID OF KIEWIT CONSTRUC- TION COMPANY BASED UPON THE CONDITIONS AS SET FORTH IN THE COUNCIL FINDINGS. MOTION CARRIED. ADOPTION OF PROPOSED ORDINANCE 2678 APPROVING WASTEWATER TREATMENT PLANT BOND ISSUE ($9,990,000) /' Because of the recent changes in the discount rate and prime rate, Staff recommended that the City issue the bonds as quickly as possible. Because of the urgency, the Council was provided with the required documentation to review as quickly as possible. * Administrative Services Director Art Housler noted stated that Richard Ehlers, of Dain Bosworth, Incorporated, and Mary Hughes, of Yeasting & Hughes Associates, were at the meeting to make pre- sentations. Mr. Ehlers reported that the rating report was delivered to the City that afternoon and the City has maintained its "A" rating. Councilmember Jaech inquired why the City's rating was not increased. Mr. Ehlers said the City's rating was not increased because of the increase in debt combined with the way the 1987 revenues, as unadjusted, related to the current outstanding debt. Councilmember Kasper inquired why the Water/Sewer Revenue Bonds were rated "A" but the City's General Obligation Bonds were rated higher, "A-1". Mr. Ehlers said the Water/Sewer Revenue Bonds have been rated "A" since 1983 and Moody's Investors have just continued that rating, as they have with the General Obligation Bonds. Councilmember Kasper inquired if Mountlake Terrace's rating had any effect on the City's rating. Mr. Ehlers said he did not believe so. Mr. Ehlers said he, Mr. Housler, and Ms. Hughes met to review the pricing of the issue and re- viewed options for restructuring the bond issue, among which was to shorten the issue so the final maturity retired in 2,008 rather than 2,013. Mr. Ehlers said the City will save approxi- mately $2.5 million in interest over the life of the issue by shortening the issue. Councilmember Hertrich inquired what effect the shorter bond issue would have on rate payers. Mr. Ehlers said the rate structure would not change. Mr. Ehlers said the bond issue was placed on the market with interest rates ranging from 6.35% for bonds maturing in 1991 to 7.95% for bonds maturing in 2,008. He said the average interest rate is 7.718%. Mr. Ehlers said the purchase document states that Dain Bosworth will purchase all the bonds at the interest rates set forth and at the price set forth. Ms. Hughes submitted a letter to the Council, which she reviewed. Ms. Hughes reported that the Municipal Bond market was very stable from April through early Au- gust of this year. Last week, however, as the discount rate and prime moved upward, Municipal Bond yields increased approximately 20 to 30 points. Ms. Hughes said the interest rates in Dain Bosworth's offer are lower than the estimates that Yeasting & Hughes Associates used in 1988 in its conservative computer planning model. Ms. Hughes said the bonds are callable at par beginning the loth year. She said the bonds are bank qualified (resulting in interest rates approximately 20 basis points lower than for compara- ble non -qualified issues) since the City will be issuing less than $10 million of bonds in 1988. Ms. Hughes said the bonds are rated "A" by Moody's. She said the City's rates are in line with rates on similar quality bonds. Ms. Hughes said Yeasting & Hughes recommends that the City accept the purchase offer of Dain Bosworth for the purchase of the bonds. She said it was her opinion that they have done an excel- lent job of underwriting the issue. Mr. Housler noted a change to the proposed ordinance on page 11, section 4, line 4 to delete the word "sewerage". Councilmember Kasper suggested that the term "drainage" be used. City Attorney Scott Snyder suggested that Staff's recommendation be accepted because he said a definitional problem could be encountered if the wording was more specific. * See Council Minutes of September 6, 1988 EDMONDS CITY COUNCIL MINUTES Page 2 August 23, 1988 COUNCILMEMBER JAECH MOVED, SECONDED BY COUNCILMEMBER DWYER, TO APPROVE PROPOSED ORDINANCE 2678 AS AMENDED ON PAGE 11. MOTION CARRIED. COUNCILMEMBER JAECH MOVED, SECONDED BY COUNCILMEMBER DWYER, TO APPROVE THE PURCHASE AGREEMENT AS TENDERED. MOTION CARRIED. The meeting adjourned at 8:45 p.m. THESE MINUTES ARE SUBJECT TO SEPTEMBER 6, 1988 APPROVAL. A, JACQUELINE G. PARRETT, City Clerk LARRY S. NAUGHTEN, Mayor EDMONDS CITY COUNCIL MINUTES Page 3 August 23,.1988 C AGENDA EDMONDS CITY COUNCIL PLAZA MEETING ROOM -LIBRARY BUILDING 7:00 - 10:00 P.M. CITY COUNCIL COMMITTEE WORK MEETING (Fourth Tuesday of each month) August 23, 1988 SPECIAL MEETING PRECEDING COMMITTEE MEETINGS 1. CALL TO ORDER 2. FLAG SALUTE 3. AWARD OF BID FOR.CONSTRUCTION OF SECONDARY TREATMENT FACILITIES 4. ADOPTION OF -PROPOSED ORDINANCE 2678 APPROVING WASTEWATER TREATMENT PLANT BOND ISSUE ($9,990,000) 5. EXECUTIVE SESSION - LABOR NEGOTIATIONS (FIRE) COUNCIL COMMITTEE MEETINGS 1. ADMINISTRATIVE SERVICES COMMITTEE (A) DISCUSSION ON ESTABLISHING A COMMUNITY SERVICE FUNDING COMMITTEE AND BUDGET POLICIES (B) RECOMMENDATION WHICH LLOWS EMPLOYEES' HEALTH BASIS (C) DISCUSSION ON COURT CONSOLIDATION TASK FORCE (D) REVIEW WARRANTS, PETTY CASH, AND CREDIT CARD EXPENDITURES FOR JULY-AUGUST 2. COMMUNITY SERVICES COMMITTEE (A) DISCUSSION WITH WSDOT REGARDING REPAIR PROJECT OF SR524 AND DETOUR PLAN (B) JOINTDISCUSSION OF RESOLUTION AGREEMENTTS BETWEENSOUTHSNOHOMIINTENT T SHCOUNTYCITIES LAND OP ISNOHOMISNTERLOCAL COOPERATION H COUNTY (C) UPDATE ON SHELL CREEK FACILITIES DESIGN (D) UPDATE ON COMMUNITY SERVICE/PUBLIC SAFETY BUILDINGS AIR CONDITIONING (E) UPDATE ON STATUS OF BRACKETT'S LANDING PROJECT 3. PUBLIC SAFETY COMMITEE (A) REVIEW OF PROPOSED SKATEBOARD ORDINANCE The three City Council committee meetings are work sessions for the City Council and staff only, and are not public hearings. All committee meetings, however, are open to the public. PARKING AND MEETING ROOMS ARE HANDICAPPED ACCESSIBLE