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Page 2 of 3 Pursuant of Resolution 2022-006, bids were opened on March 9, 2022, after receiving 9 bids for the project. The four lowest bids are listed below. A full bid tabulation is provided in Attachment A. Company Bid Amount Astech Corporation $520,377.70 T.A. Schifsky & Sons, Inc. $522,711.61 Park Construction $526,500.62 Valley Paving $537,970.10 The low bid of $520,377.70, received from Astech Corporation, compares favorably with the construction engineer’s estimate which is $538,607. Further analysis of the low bid by adding overhead, the total project cost for the street improvements is $466,746.84. The total project costs were then used for the assessable cost which, as described in the City’s Assessment Policy, is half of the street project cost for residential properties. The results of this analysis are as follows: • Assessment Rate of $5,834.34 per unit as compared to the Engineer’s estimate of $6,131.10. Many cities set their interest rate for assessments at two (2) percentage points over the bond interest rate. The City’s assessment policy states that the interest rate used for the assessment shall be designated at the prime rate plus two (2) percentage points. For the 2021 PMP, the assessment interest rate was set at two (2) percentage points over the assumed bond interest rate which was based on current market conditions at the time, our AAA rating, plus 15 basis points. The result was an assessment interest rate of 3.15%. Our current assumed bond interest rate is 2.05% and the prime rate is 3.25%. Both of these could change by the time of the assessment hearing. The council should look at setting the assessment rate somewhere between 4% and 6%. The attached resolution is consistent with this recommended action. The exact amount can be decided on tonight or wait until the assessment hearing date. The current assessment policy also states that the typical overhead for a public improvement project is 37% of the construction costs. Staff believes this percentage is higher than necessary and recommends that approximately 27% (exact dollar amount below) of the construction costs is used as overhead when calculating the assessment rates. The breakdown of the overhead costs can be found below. Attachment B, Resolution 2022-013 declares the costs to be assessed and orders the Assessment Hearing which would be held on April 25th at the Regular City Council meeting. The construction contract is not awarded at tonight’s meeting. Staff has gathered contractor references, Attachment C, to verify the low-bidder is a responsible contractor and has completed similar projects. Staff and TKDA have reviewed the references and recommend using the low- bid to declare the costs to be assessed.