The city of Wadena was appropriated $5 million in state bonding funds last spring to overhaul the utilities right alongside the reconstruction of Hwy 10. Unfortunately, the city can't get access to those funds until the city's portion of the work beings, which is scheduled for 2020.
"Once it starts, we can request reimbursement for the work that has been completed," City Administrator Janette Bower said.
Tuesday night, council members heard about a general obligation temporary utility revenue bond, funds the city can use to pay for their portion of the city's utility work and environmental cleanup in the meantime.
"Eventually all of the work reimbursement amounts will pay off the total amount of the temporary funding," Bower said. "MnDOT required us to "upfront" the money and then get reimbursed, which is why we have the temporary bond."
The temporary amount needed was $3,524,000. After interest costs over a two-year period ($176,441.37) are included, the total cost would be $3.7 million. Of that amount, the city will be paying the interest. Bower said the interest cost would likely be paid from general fund and utility's budgets. The interest rate was 2.5 percent and the purchaser was Wadena State Bank, with Northland Securities serving as city advisor. The maturity date was May 1, 2021.
Council members brought up the question of what would happen if the Hwy 10 construction was delayed further.
Bower was confident the construction would proceed this year. George Eilertson of Northland Securities said if the city wished to stretch the dates, that could be considered. Funds would be issued May 1.
The council unanimously approved a resolution, which allows for the issuance and sale of the bond required.
In other actions, the board:
• Approved authorizing submission of a 2020 Volunteer Fire Assistance Grant Application seeking $2,500 with the city matching those funds. The $5,000 would be used in the following: Wildland personal protective equipment - $1,000; wildland equipment - $1,000; water movement items - $3,000.
• Unanimously authorized submission of a grant application to Central Minnesota Housing Partnership, Inc. for participation in the Small Cities Development Program.
The Small Cities Development Program is a program in which the grants can be used to perform commercial, rental property, and owner occupied single-family home rehabilitations.
CMHP will work with the City to submit an application for the grant. If awarded, CMHP will also contract with the City to administer the grant. The grant usually runs for two and a half years from the date awarded.
The application process is two-step. The preliminary grant application is typically due in early November and if it is deemed to be competitive, the city will be allowed to submit the full application, which is typically due in mid-February (2020).
The cost for the preliminary proposal preparation is $2,250, which will be split between the Wadena Housing & Redevelopment Authority (WHRA) and the city. The cost for the full application is $2,250 and will also be split between WHRA and the city.
Once awarded, CMHP provides for implementation services, general, and field administration services for all applicable rehabilitation activities. A request for general administration funds will be included in the program budget and is paid to CMHP for their services. The City/WHRA is responsible for $8,000 to be paid to CMHP for administrative costs not covered by the grant. The payments are broken down as follows: $2,000 on October 15, 2020, $3,000 June 15, 2021, and $3,000 June 15, 2022. The $8,000 will be used as leveraged funds in the grant application and will be split between WHRA and the city.
• Approved a tattoo license for Urban Cuts, aka Bryniarski Tattoo. Jamie Bryniarski intends on opening a shop at 318 South Jefferson St, Ste 3. The approval of the license is conditional based on completion of items required by the State and the Wadena Code of Ordinances. In his application, Bryniarski noted he planned to provide his service from 8 a.m. to 4 p.m. Tuesday through Friday. Bryniarski attended the meeting and shared that he has not been involved in any illegal activities like a former tattoo artist that had his tattoo license revoked in Wadena in 2018. He currently tattoos in Alexandria.
• Accepted the donation of a tree wraparound bench in Tapley Park and authorized the Public Works Department to assist with construction of the bench. The donation and idea came from Wadena residents Vicki and Daryl Pearson. They have a construction deadline of May 15. The 10-foot by 10-foot bench would be built completely wrapping around a tree. It will cost just under $600. The bench is built in such a way that it can expand with the growth of the tree. The Pearsons were also seeking other volunteers to help build the bench.
• Authorized the city's participation in a commercial tax abatement committee which will consist of school, county and city board members and staff. Their purpose is to study the feasibility of enacting a tax abatement program for new commercial businesses.
The next regular city council meeting is set for 5 p.m. on May 7, a week earlier than the normal date.