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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a Municipal Corporation, and the State of Colorado for the use and benefit of the Department of Local Affairs is hereby rescinded.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.