CCP 09-14-1998 - Laserfiche WebLink

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. CITY OF ARDEN HILLS . MEMORANDUM DATE: September 11, 1998 TO: Kevin Ringwald, Executive Director FROM: Terrance R. Post, Controller @!fl SUBJECT: Authorization to Reimburse Developer for $250,000 of Soil Correction Costs - TIF District No.2 Background At the October 14, 1997 meeting ofthc Arden Hills Economic Development Authority, the Commission considered a request from Welsh Companies for additional financial assistance on Phases II, III and IV of the Gateway Development. After discussion, the Commission adopted a motion to authorize additional TIF for soil corrections in an amount not to exceed $250,000 and that the soil correction cost positively correlates to an increase in the valuation assessment amounts in the Development Agreement. . Developer Reimbursement Request As per the Development Agreement, the developer (Welsh Companies) submitted a July 16, 1998, $250,000,00 reimbursement request to the Arden Hills Economic Development Authority (EDA) for soil correction costs incurred through May 15, 1998. The request is supported by $243,635,00 in subcontractor incurred costs (Rehbein Companies) and $31,090.00 in developer subsidiary (Welsh Construction Company) supervision, safety and general conditions items, The $31,090 in allocated Welsh Construction costs represents an overhead factor of 12,8%, Staff Audit Review of Reimbursement Reauest Staff has met with the developer on three (3) different occasions seeking a better understanding and level of documentation provided to support this reimbursement request. Following are staff observations ofthis material: I. From an audit trail standpoint, this is not an ideal situation because the soil correction costs were embedded into the overall approximate $1.2 million excavation contract with subcontractor Glenn Rehbein Companies, Because the soil correction portion was not bid separately, there are no specific invoices from the subcontractor for just the soil correction work. . (