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Regular City Council Meeting Monday, Apri121, 2008 Page 13 discussed, and he encouraged the HRA to further research the marketplace, and update the City Council at their next quarterly report to the City Council. Further discussion included the lack of new apartment buildings in the community over the last ten years; lack of major rehabilitations of those multi-family units to- date, including changing configuration of those units to match the marketplace trends. Mayor Klausing thanked Board Members for their attendance and the good dis- cussion. 11. Public Hearings 12. Business Items -Presentations, Discussions a. Receive Report on Best Value Contracting Parks and Recreation Director Lonnie Brokke; Jeff Evenson; City Attorney Jay Squires; Public Works Director Duane Schwartz Parks and Recreation Director Lonnie Brokke introduced the discussion, noting that in February of this year, Park Project Coordinator Jeff Evenson, Public Works Director Duane Schwartz and City Attorney Jay Squires had attended the Arizona State University (ASU) designed best-value procurement training, or PII'S (Performance Based Information Procurement System), in preparation for the City's Skating Center project for geothermal energy sources. Each participant was present and discussed specific components of their recent training and City Attorney Jay Squires provided a brief presentation on the law and process for Best Value Procurement Methods as related to the Skating Center Arena Project for geothermal energy sources. This presentation was based on their February attendance, along with Public Works Director Duane Schwartz's attendance in February of 2008 of training with the Arizona State University (AU) on best-value procurement processes. City Attorney Jay Squires provided the legal perspective, based on newly adopted law in 2007, MN Statute 16C.02, and key provisions in the law and criteria used in specifications in addition to project price, based on weighting of the criteria and pricing, qualifications for use, and training requirements, including phasing of projects, with no more than one project per year in a three-year period. Public Works Superintendent Duane Schwartz provided comparisons for contract- ing in a low-bid environment versus best value procurement. Mr. Schwartz ad- vised that contracting in a low bid environment included: very low profit mar- gins compared to other industries, thus contractors attempt to make their profit through change orders; high incidence of operating losses; high failure and bank- ruptcy rates; with failure leaving unfinished projects and other liabilities for own-