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Knute Nelson's housing project rolls ahead

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news Alexandria, 56308
Alexandria Minnesota 225 7th Ave E
P.O. Box 549
56308

Knute Nelson's plans to build a 139-unit senior living campus rolled smoothly ahead at Monday night's Alexandria City Council meeting.

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Other noteworthy topics - a change order for the police station project, an overlay bid that was well over the city's estimate, the pothole problem at the post office and more.

The new campus - a planned unit development known as Grand Arbor - will be located along Pioneer Road (County Road 106) and 50th Avenue. It will consist of 73 independent living units, 30 general assisted living units, 18 enhanced assisted living units and 18 memory care units.

After a public hearing on the project didn't raise any objections, the Alexandria City Council approved the nursing home's bond and revenue note application to finance the $27 million project.

"This is a very exciting project," noted Mayor Dan Ness.

The process of issuing housing development bonds is known as "pass-through financing" and won't affect the city's tax levy, noted Jason Murray, director of the Alexandria Area Economic Development Commission, which recommended the action.

The city will receive up to $50,000 in administrative fees. The cap was also approved at Monday's meeting.

The project is expected to create 30 full-time positions and 35 part-time jobs. Pay will range from $9 per hour to the top administrator position of $28 per hour.

Work is expected to begin on July 1 and be completed in September 2011.

The project is expected to add $12.5 million in new value to the city's tax base and generate an estimated $156,000 in new taxes.

The project has already received tax increment financing (TIF), which requires that 27 of the units - 20 percent of the total - must be rented to individuals with incomes of 50 percent or below the county's median income level. For a household of two, this amounts to no more than $23,550 per year.

Forgotten basement found at police station site

In other action, the council:

•Approved a change order that will add $63,875 to the site preparation work on the new Alexandria police station that's being built along 3rd Avenue West.

When Mark Lee Excavating was clearing away the foundation of the old city sewer plant, it unexpectedly found a "basement beneath a basement" in a small pump room that had been filled in decades ago, explained City Administrator Jim Taddei.

The room wasn't included in the plans of the building the city reviewed before undertaking the project.

The material used to fill it will have to be hauled away and replaced because it contains conduit, pipe, wood and other materials.

The extra cost won't increase the overall cost of the project, according to ORB Management because the money will come out of a contingency fund that was set aside for such unexpected expenses.

Street surfacing bid is high

•Accepted a bid of $624,804 from Central Specialties of Alexandria to provide the overlay work for city streets and municipal state aid roads this summer.

It was the only bid submitted.

The original bid came in at $721,886 - much higher than the city's estimate of $545,314 - so the city deleted three street projects to reduce the cost. The deleted overlays include 6th Avenue from Cedar to Douglas Street; Jefferson Street from 6th to 5th Avenue; and 30th Avenue West (near the Alexandria Clinic) from Aga Drive to Highway 27/29.

The bid came in high primarily because of a lack of competition, according to City Engineer Tim Schoonhoven.

A likely bidder for the work, Riley Brothers Construction of Morris, was suspended from bidding on government projects after its founders pleaded guilty to tax fraud last year.

The price of asphalt mix has also increased significantly because of a spike in oil prices, Schoonhoven explained.

Council members Cindy Bigger and Sara Carlson said approving a bid so much over the estimate was stressful. They asked if it would make sense to rebid the work.

Schoonhoven didn't see much upside to calling for bids again since there is really only one company willing to take on the work. Another option - delaying all the overlays to next year - would also be risky and would likely cost even more, he said.

Pothole problem at post office

•Considered what to do about the complaints the city has been receiving about the potholes in the U.S. Post Office parking lot.

Council member Owen Miller raised the issue during the "other business" part of the meeting. He said he nearly lost a vehicle in one of the deep potholes.

Mayor Ness said he's called the post office to relay the complaints but his call wasn't returned. A letter to the post office also failed to get a response.

The council may try e-mailing the post office next to see if the potholes can be filled.

•Listened to an annual report of the Alexandria Area Economic Development Commission.

(See Friday's Echo Press for a story about the report.)

Lorsung resigns from economic development

•Accepted the resignation of Don Lorsung from the Alexandria Economic Development Board. Lorsung served for both city wards 3 and 4 for about 10 years.

The council accepted his resignation with regret and directed staff to send him a letter thanking him for his service.

Final plat approved for Washington Square

•Approved a final plat for "Washington Square," the site of the former Washington Elementary School that is being redeveloped as a 30-unit senior housing facility, The Village Cooperative.

Kenwood Street is being realigned as part of the project.

The plat contains two conditions.

A developer's agreement must be submitted listing a schedule for the proposed public improvements and arrangements for stormwater retention facilities.

The developers must also ultimately pay a park dedication fee of $8,500.

Dual use of building

•Issued a conditional use permit to Lee and Judy Backhaus to allow residential and non-residential uses in the same building.

The permit will allow the Backhauses to use the building at 1713 Nokomis Street as a professional office and for rental housing to two college students.

Three conditions were attached to the permit - a building permit is required; it must have five paved off-street parking stalls; and any exterior lighting must be hooded and directed away from public streets.

Fees for garbage haulers?

•Considered increasing the license fee for garbage haulers operating in the city.

The council is thinking about increasing the fee from $35 per year to $100 to help offset the wear and tear garbage trucks cause on public streets. There are currently four refuse collection license holders who provide residential and commercial collection services in Alexandria.

City staff contacted three of the companies and found that they operate an average of four trucks per day in the city limits.

The council didn't take any action Monday. Assistant City Administrator Marty Schultz said it would make sense to revisit the fee when all city fees are reviewed for next year's budget.

For more council news see Friday's Echo Press.

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