Pella Chronicle

December 11, 2013

Power Plant deconstruction project moving forward

By Clint Brown The Chronicle
The Pella Chronicle

---- — A resolution Fixing Date for a Meeting on the Authorization of a Loan Agreement and the Issuance of Not to Exceed $4,000,000 Electric Revenue Capital Loan Notes was approved by Pella City Council last week.

This resolution establishes December 17, 2013 as the public hearing date for authorization of a loan agreement and the issuance of not to exceed $4,000,000 Electric Revenue Capital Loan Notes for proceeds of which will be used to provide funds to pay the costs of improvement and extensions to the municipal electric utility. This includes demolition of the existing power plant, acquisition and installation of control systems upgrade for the diesel plant, conversion of a portion of the electrical overhead distribution system to an underground distribution system, construction of the underground distribution system, and related site improvements.

Said bonds will not constitute general obligations or be payable in any manner by taxation, but will be payable from and secured by the net revenues of the Municipal Electric Utility.

In a related issue, the council also approved a resolution regarding the Power Plant Deconstruction Project.

This resolution awards the contract for deconstruction of the City’s power plant to NCM Demolition. In May of 2012, the City began to receive 100 percent of its energy from Missouri River Energy Services and as a result, the City’s power plant is no longer supplying energy for the City. Over the last several months, Bums and McDonnell has been working with City staff to develop plans and specifications and contract documents for the removal of the City’s power plant from its current site and restoration of the area to green space.

On October 29, 2013, a bid letting for the project was held. Bids were presented to Council at a public hearing on November 19, 2013, when Council adopted plans, specifications, form of contract and estimate of cost for the project.

The base bid for the project requires a substantial completion date of July 7, 2014 while the alternate bid allows for a substantial completion date of September 3, 2014. Likewise, the alternate bid with boilers is the additional project cost in the event asbestos abatement is necessary for the boilers. The engineer’s estimate for the project was $3.9 million.

Engineer’s Recommendation

After reviewing the bid proposals, the project Engineer, Bums and McDonnell, recommended awarding the contract to NCM Demolition for the base bid amount of $1,388,000. In addition, the engineer is also recommending the lump sum asbestos abatement, if needed, for the power plant boilers for an additional cost of $327,200. If asbestos abatement is needed for the boilers, the total contract price would be of $1,715,200 ($1,388,000 plus $327,000 = $1,715,000).

City Staff is proposing issuing a $3.5 million Electric Revenue Bond with a ten year term to assist in funding in the projects (Power Plant Deconstruction, Southeast Electrical Underground Conversion Project, Diesel Plant Control System Upgrade). The tentative timeline for completion of the project would be July 7, 2014.

‘Award of Contract’ simply denotes the City’s intention to award a contract with NCM Demolition for this project contingent upon the contractor securing the necessary bonds and insurance certificates as required in the proposed contract. The next step will be for council to consider approval of the contract and bonds with NCM Demolition at a later date.