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For comparison, the recent 2022 Arden Oaks Street Improvement (PMP) reclamation assessment <br />rate was $5,834.34 per unit. Arden Hills has not completed a recent mill & overlay project to <br />compare that assessment rate but City staff s opinion is that the proposed assessment rate is <br />reasonable. <br />Many cities set their interest rate for assessments at two (2) percentage points over the bond <br />interest rate. The City's assessment policy states that the interest rate used for the assessment <br />shall be designated at the prime rate plus two (2) percentage points. The council will decide the <br />assessment rate at the hearing proposed for April 8, 2024. <br />The current assessment policy states that the typical overhead for a public improvement project <br />is 37% of the construction costs. Staff believes this percentage is higher than necessary and <br />recommends that approximately 27% (exact dollar amount below) of the construction costs is <br />used as overhead when calculating the assessment rates. Staff has made this recommendation on <br />the past PMPs since 2021. The breakdown of the overhead costs can be found below. <br />Attachment C, Resolution 2024-012 declares the costs to be assessed and orders the Assessment <br />Hearing which would be held on April 8, 2024 at the Regular City Council meeting. Following <br />Council approval, notices will be sent to the properties seen on the as -bid Assessment Roll <br />(Attachment B). The construction contract is not awarded at tonight's meeting. Staff has had <br />experience working with the low -bidder and can confirm is a responsible contractor and has <br />completed similar projects. Staff and Bolton & Menk recommend using the low -bid to declare <br />the costs to be assessed. <br />Budget Impact <br />The estimated total project cost and funding sources based on the final plans and specifications <br />are summarized below. <br />Total Estimated Expenses <br />Construction: <br />$ 2,238,418.15 <br />Engineering Feasibility & Design: <br />$ <br />213,457.00 <br />Construction Mgmt: <br />$ <br />128.299.00 <br />Gen Admin & Legal: <br />$ <br />8,775.08 <br />Material Testing: <br />$ <br />30,000.00 <br />Const. Contingency: <br />$ <br />223,841.82 <br />TOTAL ESTIMATE: <br />$ 2,842,791.05 <br />Proposed project funding sources are a combination of the City's Permanent Improvement <br />Revolving (PIR) fund, utility funds, special assessments, and the Rice Creek Watershed District <br />Stormwater Grant for street improvements summarized in the following table: <br />Total Estimated Funding <br />PIR Fund: $ 1,010,113 <br />Special Assessments: $ 718,176 <br />Page 3 of 4 <br />