HomeMy WebLinkAbout07450ORDINANCE NO. 7450
AN ORDINANCE RESCINDING ORDINANCE NO. 7289 APPROVING EIAF GRANT CONTRACT
#4813 – PUEBLO - BESSEMER UTILITIES BETWEEN THE CITY OF PUEBLO, A MUNICIPAL
CORPORATION, AND THE STATE OF COLORADO FOR THE USE AND BENEFIT OF THE
DEPARTMENT OF LOCAL AFFAIRS AND AUTHORIZING THE RETURN OF THE INITIAL
$50,000 PAYMENT RECEIVED FROM THE DEPARTMENT OF LOCAL AFFAIRS
BE IT ORDAINED BY THE CITY COUNCIL OF PUEBLO, that:
SECTION 1.
Ordinance No. 7289 approving EIAF Grant Contract #4813 – Pueblo- Bessemer Utilities
between the City of Pueblo, a Municipal Corporation, and the State of Colorado for the use and
benefit of the Department of Local Affairs is hereby rescinded.
SECTION 2.
The return of the $50,000 initial payment received from the Department of Local Affairs
from Capital Project PL0504 is hereby authorized.
SECTION 3.
This Ordinance shall become effective immediately upon final passage and approval.
INTRODUCED February 27, 2006
BY Randy Thurston
Councilperson
APPROVED: — ,
President of City Council
ATTESTED BY:
CITY CLERK
PASSED AND APPROVED March 27, 2006
a s iN
I M 9 - EFE I I ! �
Background Paper for Proposed
ORDINANCE
AGENDA ITEM # li4' 3
DATE: FEBRUARY 27, 2006
DEPARTMENT: COMMUNITY DEVELOPMENT /JIM MUNCH
PLANNING DEPARTMENTMIM MUNCH
TITLE
AN ORDINANCE RESCINDING ORDINANCE NO. 7289 APPROVING EIAF GRANT
CONTRACT #4813 — PUEBLO - BESSEMER UTILITIES BETWEEN THE CITY OF
PUEBLO, A MUNICIPAL CORPORATION, AND THE STATE OF COLORADO FOR
THE USE AND BENEFIT OF THE DEPARTMENT OF LOCAL AFFAIRS AND
AUTHORIZING THE RETURN OF THE INITIAL $50,000 PAYMENT RECEIVED FROM
THE DEPARTMENT OF LOCAL AFFAIRS
ISSUE
Should City Council rescind Ordinance No. 7289 approving EIAF Grant Contract #4813
and authorize the return of the $50,000 initial payment to the Department of Local
Affairs?
RECOMMENDATION
Approve the Ordinance.
BACKGROUND
At the City Council meeting on July 26, 2004, the President of City Council authorized
the execution and delivery of an application to the Department of Local Affairs to fund
the utility separation and code upgrade for the property leased by the City from the
Bessemer Historical Society.
As a part of the purchase contract for the CF &I Headquarters from Rocky Mountain
Steel, the Bessemer Historical Society is required to separate and provide new utility
service to the facility. The existing utility services are integrated with the steel mill.
The City of Pueblo, in partnership with the Bessemer Historical Society, requested
funding from the Department of Local Affairs (DOLA) for the following tasks: 1)
Disconnect the Headquarters Buildings from the existing plant/mill utility network and
grid. 2) Create new service connections with all utilities with taps, drops, service lines,
meters, etc. 3) Bring all of the mechanical, electrical and plumbing systems in the
building into code compliance, which is required prior to connecting the new service.
The request was approved on November 15, 2004 and the City entered into a contract
with DOLA for EIAF #4813 — Pueblo- Bessemer Utilities on March 28, 2005. As a part
of the agreement, DOLA made an initial payment of $50,000 to the City of Pueblo
within thirty (30) days of the execution of the contract.
Paragraph 1 of Exhibit A — Scope of Services, Project Description Objectives and
Requirements within DOLA EIAF Contract #4813 describes the project as follows:
"The Project will consist of a portion of the cost of providing new utility service to the
Bessemer Historical Society's facilities at the former CF &I headquarters in the City of
Pueblo (Contractor). It includes the City's portion of providing new service connections
for all utilities, as well as bringing the mechanical, electrical and plumbing systems into
compliance. The City and the Bessemer Historical Society will execute an agreement
governing the use and ownership of the improvements."
The agreement governing the use and ownership of the improvements is required per
the Energy and Mineral Impact Assistance Guidelines identifying Eligible Recipients:
"If eligible local government recipients choose to provide a public service through a
non - profit corporation, the local government must assume responsibility for the
administration of any funds awards. The local government will be required to own any
real and/or tangible assets acquired with the funds awarded for ten years."
As required in the Scope of Services, the City entered into a delegation agreement with
the Bessemer Historical Society (BHS) regarding EIAF #4813. BHS subsequently hired
contractors and began working to separate the utilities and bring the current utilities
within the building up to code.
As the work has progressed, it has become apparent that it will be very difficult to
identify, and for the City to own, those portions of the utility connections and the utility
improvements within the buildings that are being funded through the EIAF contract.
Due to the difficulty in meeting the EIAF guidelines, compounded by the fact that BHS
has already begun the work and is incurring expenses, the City and DOLA initiated
discussions concerning rescinding the existing contact, taking the $500,000 in DOLA
funds committed to this project and transferring these funds to other DOLA projects
within the Pueblo community and taking the general fund monies committed to these
other projects and transferring the funds to the BHS project.
FINANCIAL IMPACT
In rescinding the contact, the City of Pueblo will be required to return the $50,000 initial
payment received by the City to DOLA. DOLA will in turn amend the following EIAF
projects in the following amounts:
EIAF #4925 HARP Gateway Park Phase III $161,000
EIAF #4726 Pueblo Downtown Improvements $100,000
El Centro Del Quinto Sol Community Center ADA Improvements $239,000
The City will transfer like amounts from Santa Fe Streetscape (Pueblo Downtown
Improvements), the El Centro Del Quinto Sol Community Center, and HARP Gateway
Park Phase III A -1 in General Fund monies to the BHS Capital Account PL0504.