The Jenkins City Council withdrew from a cost share agreement with Crow Wing County for road work after months of consideration, according to a summary of the Monday, May 13, meeting provided by the city clerk.
The council and the county had a cost share agreement for improvements to County Road 145; however, the project included a higher cost share to the city than anticipated, leading the council to attempt for several months to renegotiate the terms.
The council felt that it had satisfied its part of the project through state Local Road Improvement Project funds received for the project on the city's behalf. The county did not agree, expecting the city to contribute approximately $75,000 of the cost estimate, though cost overruns could result in a higher cost.
The city and county discussed additional options, including financing. In April, the council offered to reach an agreement with the county on condition the city receive a 0% interest, five-year financing option from the county, that the county improve its County Road 145 intersection on Cemetery Road in its 2023 highway improvement plan, and that the county allow the city feedback on the intersection.
The council, however, requested that the city share be capped at $75,000. The county agreed to all terms except the last, according to documents in the agenda packet.
A letter from County Administrator Tim Houle said the county has no ability to predict cost overruns and could not set a precedent by accepting more than half of the cost of a cost share agreement.
The letter also says, "If the city is insisting that they will not agree to a cost share without this provision, then we are at an impasse and the county will need to proceed with the project on our own. As we have discussed, that has implications for the city regarding our willingness to partner with the city on future projects and is not our preferred outcome."
City Engineer Dave Reese prepared three options for the city: Concede to the county and sign the agreement; notify the county of the city's intent to withdraw from the project and await a response; or "propose an amendment to the agreement that would not cap the county's share of the engineering cost at 18% of the construction costs but would share engineering costs equally with the city based on the mutual benefits each would receive from this expenditure."
"The agreement clearly addresses how construction costs would be split whether they are more or less than what has been estimated; however, setting engineering costs based on percentage of construction can result in a fairness question," Reese's letter says.
The council voted 4-1 to withdraw from the project. Mayor Jon Lubke was the sole opposing vote.
In other business Monday, the council:
• Approved financial statements and the auditor's report.
• Passed a resolution requesting comprehensive road and transportation funding from the state. The council requested that the state Legislature and governor sign a funding package to permanently increase dedicated funding for transportation.
• Approved purchase of a new blower from AAA Rental for $539.96.
• Approved Widseth Smith Nolting engineering firm to provide Wetland Conservation Act administration services to the city.
• Approved a 20-year gas franchise agreement with the understanding the city can implement a service fee at a later date.
• Approved rezoning of 34773 Brown Boulevard from rural residential to agricultural.