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Min 10/29/1990 567 Wichita Falls, Texas Memorial Auditorium Building October 29, 1990 Item 1 The City Council of the City of Wichita Falls, Texas, met in called session on the above date in the Council Room of the Memorial Auditorium Building at 8: 30 o'clock a.m. , with the following members present. Michael Lam Mayor David Farabee - Charles Thomas - Angus Thompson - Councilors Paul Hughes - J. W. Martin - Don Kirkham - Jim Berzina City Manager Gregory D. Humbach City Attorney Wilma J. Thomas City Clerk Item 2 Mayor Lam noted that the purpose of this meeting is to consider some decisions on Phase III of Holliday Creek project. The meeting recessed into the Council Conference Room. Mr. Bonnett brought the Council up to date on past events surrounding these discussions. He stated that the dam elevation of 993 feet is satisfactory, and meets requirements of the Dam Safety Commission. It has also been approved by the Texas Water Commission. The Corps of Engineers want it to be at an elevation of 996 feet. He noted the presence of Congressman Sarpalius, stating he appreciated the congressional help. He noted a memorandum of agreement which had been signed by the City Manager and Corps of Engineers. He addressed concerns about the bid received in the amount of 3 . 8 million. The Corps estimate is now 2. 8 million. The City has expressed that they were flexible, and were willing to go the government ' s estimated cost of 2. 8 million. This offer has been on the table for three weeks. The decision of the Corps has been appealed to the Secretary of the Army. They are very sincerely trying to find a middle ground. Mr. Bonnett addressed questions concerning the distance from Southwest Parkway if the dam were 993 or 996 feet high. No residences will be affected, but mentioned apartment buildings on Lyons Circle. Property has been purchased to the dam height of 996 feet. He stated the Corps has never agreed to the 993 foot dam. The cost of $2,340,000 was twenty-five percent above the 993 foot height. Councilor Thomas noted that this is the first project we have had through the Corps of Engineers to get back some of our tax money. It was explained that when they met in Washington, the City made it clear they were not there to argue the height of the dam, but the money. It is unclear why this was not taken into consideration three years ago instead of waiting until now. It was noted that 996 is an elevation that the Corps of Engineers designs to. Colonel Lee Smith, of the Corps of Engineers, arrived. Mayor Lam pointed out that the City of Wichita Falls is very pleased with this project to date, stating it is a classic example of the City and the Corps working together to relieve a serious problem of flooding for the City. The City wants to see this project completed, and are willing to move forward to completion. 568 Colonel Smith stated they are dedicated to serving the citizens here in Wichita Falls, and throughout the United States. They are a problem solving agency. In cases such as this, they are asked to come in when a local project is identified. If the problem falls within their area of expertise, the Congress is asked to study and fund it. It is also up to the local sponsor to decide if twenty-five percent of the cost can be paid by the local people. He noted that this project is not a Corps project but a City of Wichita Falls project. They have no problem with coming up with their share of the 48 million project. He explained that he is the one who has to make the decision on what to do with the bids he received. Colonel Smith reviewed the bidding, and addressed the dam elevation of 996 feet. The cost of the 996 foot dam was established at 2. 8 million in October 1989. The basic cost of this dam should be 2 . 34 million, plus twenty-five percent. Total City cost for the project was discussed, stating the City got a better deal in Phase II. In Phase III , the government estimate was 2. 867 million, and the bids came in at 3 . 785 million. Options were presented by Colonel Smith. The bids were extended for 30 days. They can award Phase III , or let the bids expire. The issue remains open. He mentioned funding for McGrath and Plum Creek projects for a combined total of 10 million. He was unsure of what might happen if the local cooperative agreement were terminated on Holliday Creek. He noted that federal monies are hard to come by. The bid document says that the City has to pay 3 . 8 million on the dam. The City will pay the 993 foot cost, plus twenty-five percent of the difference. The difference is $600 ,000 today. If the three feet can be cost shared by the Corps on the Freeboard issue, the 996 cost could be reduced from 3 . 8 million to 3 . 2 million to the City. Mayor Lam stated we want to keep the project, and we are not wanting to terminate this agreement. When the first bid came in they were working with the same embankment costs. After it was re-bid, the low bid came in at 3 . 8 million for the embankment costs. The City wanted to cooperate on this estimate from $2 ,340 , 000 base, and add $500,000. We are trying to get there. The Council feels they have made some improvement. Phase II is completed, and they want to move into Phase III . He asked Colonel Smith what the figures would be if the Corps participates in the 996 foot elevation. Colonel Smith stated that he expects the answer this week. It was noted that we established in Phase II how we were going to distribute costs. We used bids for Phase II. They were prepared to continue to do that in Phase III . Colonel Smith explained that as a contracting or procuring officer it is required that he make a determination whether a bid is materially imbalanced. If it is imbalanced, he rejects the bid, and the Council would want him to do that. Sometimes it might be materially imbalanced, but not to their disadvantage, and the bids would not be rejected. Mr. Bonnett noted that he does not disagree with Colonel Smith' s presentation a great deal. He reviewed the process of how we got here in revising the City' s distribution. Phase II was not an imbalanced bid. It was a blown bid, and the contractor has eaten one million on it. He feels it is not appropriate to come back and redistribute the costs. This bid is probably the best bid that we will receive, and believes it is fertile ground for making a compromise. He is afraid the contractors may have heard something that was not said. i 569 Colonel Smith stated there was no one in the Corps that influenced any bidder, and if he finds anyone in his authority he will run them off. The contractor came to the conclusion that was what it would cost. His dilemma is now twofold. He has an agreement with the City that they will not award a bid for more than $2,340,000. If something is not done the bids will expire. He hopes the bids can be reduced to the $600,000 figure. He needs the City' s commitment to go with the bid, plus $600 ,000 of a 48 million project. Colonel Smith noted that they blew the government estimate on the bridge. Today it would be 1. 5 million. Our agreement is a two-party agreement, and an award of Phase III does not terminate that agreement. To back down to a 993 elevation would be a lengthy process, and a very low probability. It would be $800,000 more if they do not cost share the Freeboard. The Corps will pay $600,000 ; the City $200,000. Mr. Berzina requested that consideration be given to applying the additional costs of securing the land for the 996 elevation. The Corps will make an examination of the ability to cost share the Freeboard. They bring $600,000 to the table if it is possible. Councilor Thompson noted that the Council is made up of reasonable men, who have a spirit of cooperation. Colonel Smith noted that Dr. Steinberg is working on this, and he also has a spirit of generosity. Mr. Berzina asked about other alternatives being looked at by the Corps which may have a different solution than what has been discussed today. Colonel Smith stated there are no other options being considered. He also noted that he is of the opinion that the person who signs his name gets the final say. He would hate to see the City of Wichita Falls get caught up in whether it is a technical or policy decision. He further stated that his objective is not, and cannot be, to go seek out a methodology on the City' s cost being reduced. He has to seek out a methodology on being fair. They have been unsuccessful in the past three weeks to come up with a methodology on what has been discussed today. The rationale has to be defendable. Bids have been delayed for thirty days from today, October 29, 1990. Colonel Smith noted that they have 130 million in other jobs to be bid out. He hopes to have the answer to the cost sharing by the end of this week. Mayor Lam expressed appreciation for their attendance and presentation. The City Council reconvened at 10: 25 a.m. , and adjourned at 10: 27 a.m. PASSED AND APPROVED this Zl&day of 1990. Michael Lam, or ATTEST: r Wilma J. Thomas, CMC/AAE City Clerk