Source: Sherman Publications

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Council awards $497K contract to fix pothole hill

by CJ Carnacchio

May 21, 2014

It appears that by July, pothole hill will be no more.

Last week, the Oxford Village Council awarded a $496,578 contract to the Pontiac-based Asphalt Specialists, Inc. (ASI) to reconstruct the badly-deteriorated, pothole-ridden stretch of W. Burdick St. between Ashley Way and S. Waterstone Dr.

It's expected the road will be closed to motorists around June 10 and, according to village Manager Joe Young, the goal is to reopen it by July 4.

The village received a total of five bids for the project and the one from ASI was the lowest. The highest was $560,575 from Pro-Line Asphalt in Washington Township.

"We're familiar with Asphalt Specialists," said Chad Findley, of the Pontiac-based Nowak & Fraus Engineers, the firm that serves as the village engineer. "We've done a number of projects (together). I would say, myself, I've probably done four or five public road projects with Asphalt Specialists and they're a good contractor. They're as good as anybody."

ASI's bid was below Nowak & Fraus' estimate of $513,385 for the project. Two contractors, the Troy-based Ajax and the Clarkston-based Cadillac Asphalt, submitted bids ($512,330 and $514,631, respectively) close to the engineer's estimate.

"It was a very competitive bid," Findley said. "I was happy to see five contractors. I was happy to see a good grouping of prices . . . I was very pleased to see we got some good numbers."

The engineer's original estimate was $523,050, but approximately $10,000 was trimmed off following some cost-cutting changes.

Council also voted last week to hire Nowak & Fraus to do the project's construction engineering for $27,500.

The project includes reconstructing a 1,691-foot stretch of road from subbase to surface; installing concrete curb and gutter; and making drainage improvements to allow stormwater to flow off the roadway in a more effective manner. The road will be repaved with 9 inches of asphalt on top of a new 8-inch 21AA limestone base.

Additionally, cemetery hill will be lowered by up to 2 feet in order to improve stopping sight distance for motorists per state standards and the road will be widened from 24 to 27 feet as measured from the backs of the new curbs.

During the project, Findley indicated this portion of W. Burdick St. is proposed to be closed to motorists for between 21 to 35 days.

Findley said it's "likely the road closure won't happen until right about the time school is closed."

The Oxford school district's last day is June 10.

"I think (the road closure) will be right around there and that's if everything goes perfectly," Findley noted.

Motorists will be asked to use Dunlap Rd. as a detour route to travel between M-24 and Seymour Lake Rd., the latter of which becomes W. Burdick St. within the village limits.

According to township Supervisor Bill Dunn, the village and township are going to split the cost to grade and chloride this 2-mile stretch of Dunlap Rd.

"It will be chlorided twice during construction to keep the dust down," Dunn said.

In order to re-open W. Burdick St. as quickly as possible, village Manager Joe Young noted there will be financial incentives for the contractor to finish between 21 and 28 days and financial penalties if ASI goes over 35 days.

For each day that ASI finishes ahead of schedule, the contractor will receive $1,500 and has the potential to earn a maximum of $10,500, the manager explained.

Conversely, if ASI runs over the 35-day schedule and the road is closed longer than expected, the contractor will be penalized $900 per day.

"We want to expedite this project as quick as possible," Young said.

"We do expect that this is going to be an aggressively-built project," Findley said. "We looked at this as the contractor's going to be out there working hard, getting this thing done quickly. We don't expect to be out there a protracted length of time to get this thing built."

Because 516 feet of the 1,691-foot project will take place in the township, outside the village limits, the township board last week voted to pay up to $85,000 of it.

Between construction and construction engineering costs, the township's portion of the project amounts to $79,832.

That leaves $444,246 as the village's portion. Add in the $22,906 the village was charged for preliminary engineering and the municipality's total share of the project is $467,152.

How the village is going to fund its share hasn't been decided.

The village is still waiting to hear if it's going to be awarded $500,000 from the state's Roads and Risks Reserve Fund.

Council is prepared to finance the project with five-year bonds with an estimated interest rate of 2.5 percent.

At last week's meeting, council voted to approve a bond resolution with the notice of intention to issue capital improvement bonds for the W. Burdick St. and East/Edison Alley projects in an amount not to exceed $800,000.

The bond resolution and notice of intention make up the first step in the bond issuance process, which begins with a 45-day referendum period during which time a petition could be filed to require a vote of the people to issue the bonds.

After the 45-day period expires and no petition is filed, the village can proceed with the bond sale in late July and close in the first part of August.

The cost to issue bonds would be $24,060.

The estimated cost for the East/Edison Alley project is $241,543.

The East/Edison Alley project calls for constructing a two-lane, 28-foot-wide road, just east of M-24, from Ensley St. to the Holy Cross Lutheran Church's parking lot. Another 16-foot-wide, one-lane road would then be constructed from the alley's southern end to M-24. Both roads would contain bicycle lanes.

The alley needs to be built this year because Genisys Credit Union plans to break ground on a new 3,300-square-foot facility on the lots located at 114, 118 and 120 S. Washington St. The site plan was approved in March and it includes traffic being able to access and exit the site via the alleyway.

If the village were to finance both the W. Burdick St. and East/Edison Alley projects without using any of its internal funds, then the municipality would need to borrow $732,755, which includes the bond issuance cost.

However, if the village used $50,000 in funds from the Downtown Development Authority for the East/Edison Alley project and $32,755 from its major street fund, then the amount to borrow decreases to $650,000.

But just because council has approved a bond resolution and published a notice of intention, doesn't mean the village is obligated to issue bonds.

Council could decide to use a different funding mechanism such as the aforementioned state funds or an internal option.

Young has suggested council might also wish to explore borrowing the money from some of the village's internal funds.

He reasoned that borrowing internally could be done with a lower interest rate of 1.5 percent, save the $24,060 bond issuance cost, and involve a longer term to pay off the debt.