Bee Branch Stormwater Pumping Station (Phase IV of the Bee Branch Watershed Flood Mitigation Project) Project #5586500007 Copyrighted
August 7, 2023
City of Dubuque Action Items # 08.
City Council Meeting
ITEM TITLE: Bee Branch Stormwater Pumping Station (Phase IV of the Bee Branch
Watershed Flood Mitigation Project) Project#5586500007
SUM MARY: City Manager recommending City Council approve the application for a
U.S. EDA grant in the amount of$7,700,000 and pledging local,
matching funds in the amount of$19,012,000 for improvements
associated with the Bee Branch Stormwater Pumping Station Project
(Phase V of the Bee Branch Watershed Flood Mitigation Project).
RESOLUTION Approving a US Economic Development Administration
Disaster Relief Opportunity Grant Application and Pledging the Local
Match in The Amount Of$ 19,012,000 From General Obligation Bonds
orAn SRF Loan for Construction of a New Stormwater Pumping Station
at the 16th Street Detention Basin
SUGGESTED Suggested Disposition: Receive and File;Adopt Resolution(s)
DISPOSITION:
ATTACHMENTS:
Description Type
MVM Memo City Manager Memo
Staff Memo Staff Memo
Resolution Resolutions
Letter, Bond Counsel Supporting Documentation
Dubuque
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TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Bee Branch Stormwater Pumping Station (Phase IV of the Bee Branch
Watershed Flood Mitigation Project) Project #5586500007
DATE: August 1, 2023
City Engineer Gus Psihoyos is recommending City Council adopt the attached
resolution approving the application for a U.S. EDA grant in the amount of$7,700,000
and pledging local, matching funds in the amount of$19,012,000 for improvements
associated with the Bee Branch Stormwater Pumping Station Project (Phase V of the
Bee Branch Watershed Flood Mitigation Project).
The total project costs are estimated at $29,338,400. To fund the project funded in part
with a $7.7 million EDA grant, it will require the City to provide an additional $5,228,400
for the project. Even though the City currently has $8.9 million in stormwater utility
funding for the project, the application illustrates that the City could issue debt in order
to provide the matching funds for the grant. The City will know if its application for EDA
funding is successful in the fall of 2023 so that if successful, the City will be able to
consider how to best provide the additional project funding as part of the Fiscal Year
2025 budget.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
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Mic ael C. Van Milligen
MCVM:sv
Attachment
cc: Crenna Brumwell, City Attorney
Cori Burbach, Assistant City Manager
Gus Psihoyos, City Engineer
Jenny Larson, Chief Financial Officer
John Klosterman, Public Works Director
Teri Goodmann, Director of Strategic Partnerships
Deron Muehring, Civil Engineer II
Dubuque
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TO: Michael C. Van Milligen, City Manager
FROM: Gus Psihoyos, City Engineer
SUBJECT: Bee Branch Stormwater Pumping Station (Phase IV of the Bee Branch
Watershed Flood Mitigation Project) Project #5586500007
DATE: July 31, 2023
INTRODUCTION
The purpose of this memorandum is to request approval to apply for an Economic
Development Disaster Recovery Grant from the U. S. Economic Development
Administration (EDA) in the amount of $7,700,000.00 for the Bee Branch Gate
Replacement/ Pumping Station Project (Phase V of the Bee Branch Watershed Flood
Mitigation Project).
BACKGROUND
In November of 2013, the City Council passed Resolution 335-13 adopting the 2013
Drainage Basin Master Plan Amendment that outlined several improvements throughout
the Bee Branch watershed to mitigate the effects of future flooding and disasters.
Collectively, the improvements form the basis of the multi-phase Bee Branch Watershed
Flood Mitigation Project outlined below.
Table 1. Twelve phases of the Bee Branch Watershed Flood Mitigation Project
Phase Description Status
1 Carter Road Detention Basin Complete
2 West 32"d Street Detention Basin Complete
3 Historic Millwork District Complete
4 Lower Bee Branch Creek Restoration Complete
5 Flood Mitigation Gate Replacement Designed
6 Impervious Surface Reduction (Green Alleys) Initiated
7 Upper Bee Branch Creek Restoration Complete
g 22nd Street Storm Sewer Improvements Complete to N. Main St.
9 Flood Mitigation Maintenance Facility Initiated
10 North End Storm Sewer Improvements
11 Water Plant Flood Protection
12 17t'' Street Storm Sewer Improvements Complete to Heeb St.
On December 4, 2013, the lowa Flood Mitigation Board voted to award the City
$98,494,178 for the Bee Branch Watershed Flood Mitigation Project. On February 3, 2014
the City Council adopted Resolution 31-14 authorizing the execution of an agreement with
1
the State of lowa Flood Mitigation Board and authorizing the City's use of sales tax
increment funding for the Bee Branch Watershed Flood Mitigation Project.
The City has used a combination of stormwater utility revenue; local, state, and federal
grant funding; and debt in order to construct the improvements associated with the flood
mitigation plan. The state grant funding and the subsequent debt issuances allowed for
much of the protection to be provided sooner than otherwise possible. With a total
estimated cost of$250 million, the Bee Branch Watershed Flood Mitigation Project will
prevent an estimated $582 million in damages over the 100-year design life of the project.
With more than $163 million in funding assistance, for every dollar invested by Dubuque
citizens it will prevent almost seven dollars in flood damage.
The original scope of the Flood Mitigation Gate Replacement improvements involved
replacing the gate structure associated with the pumping facility on Kerper Boulevard, just
south of 16th Street, that functions as part of the floodwall/levee system. The FY15 and
FY16 CIP budgets identified $2,100,000 to replace the flood gates. In December of 2015,
the City Council authorized the hiring of IIW, P.C. (now Origin Design) for design and
engineering services for the project.
Due to the record rainfalls in 2010 and 2011 that resulted in flooding within the Bee Branch
Watershed, as part of the design process Origin Design was asked to investigate more
significant modifications to the existing 16th pump station infrastructure. Considering that
some of the facility elements (i.e., the two 90,000 gallon per minute pumps) pre-date the
construction of the floodwall/levee system completed circa 1974, staff from the Public
Works and Engineering Departments worked with Origin Design to further develop
improvements to the facility that would indeed improve drainage when the gates are open
and when operating under Mississippi "flood" conditions when the gates are closed. Of the
five alternatives analyzed, the replacement of the existing facility with a new stormwater
pumping station was selected. This Bee Branch Stormwater Pumping Station Project
alternative was selected because it would best handle the more recent severe flooding that
occurred between 1999 and 2011. And, in concert with the Bee Branch Creek Restoration
Project (including the Bee Branch Railroad Culverts Project), it would provide flood
protection for the 500-year rainstorm.
The cost to build a new flood pumping station capable of handling flows from the Bee
Branch Creek was initially estimated to cost approximately $10 million. To better afford the
project improvements associated with all the phases of the Bee Branch Watershed Flood
Mitigation Project, and in particular the increased costs associated with the Bee Branch
Gate & Pump Station Project, the City sought additional financial assistance. In December
of 2018, the City Council adopted Resolution 368-18, approving an application for
$4,000,000.00 in EDA grant funding for the new stormwater pumping station project. The
City was subsequently awarded $2,500,000.00 in EDA grant funding. In May of 2019, the
City Council adopted Resolution 152-19, authorizing entering into a Financial Assistance
Award Agreement with EDA as necessary for the City's use of$2,500,000 in EDA grant
funding for the pumping station project. The City Council also pledged "the amount of
$6,635,000.00 from state sales tax increment or local stormwater utility proceeds...." Per
the Agreement, the project was required to complete the improvements by April 11, 2024.
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In May of 2022, the City Council adopted Resolution 177-22, approving the plans,
specifications, form of contract, and estimated cost for the Bee Branch Stormwater
Pumping Station Project, in the estimated amount of$15,790,000.00. The estimate of
probable costs for the Project is as follows:
Construction Contract $15,790,000
Contingency 720,000
Engineering 2,400,000
Total Project Cost $18,910,000
The funding plan for the improvements was as follows:
State Sales Tax Increment Proceeds $9,614,000
Stormwater Utility Construction Funds 2,796,000
US EPA State Revolving Fund (SRF) Loan 2,600,000
US EDA Disaster Grant 2,500,000
DRA Distribution 1,400,000
TOTAL $18,910,000
DISCUSSION
In May of 2022, the City received two bids for the Bee Branch Stormwater Pumping Station
Project (the "Project"). The low bid was $24,650,000, which was 56.1% over the
Engineer's Estimate. The two bids were within 1.4% of each other, suggesting that the bids
reflect the true cost of the project such that rebidding the project with the same design
would likely result in similar results. Due to funding limitations, the City Council adopted
Resolution 222-22 rejecting the bids for the Project.
As outlined in the EDA grant agreement, the City was to complete the improvements by
April 11, 2024. The City had discussions with EDA about changing the completion date to
allow more time to complete the improvements. However, EDA representatives indicated
that the April 2024 deadline was a hard deadline. The City was aware that rejecting the
bids would likely preclude the City's ability to fund the project using the $2.5 million in EDA
grant funding. And in June of 2023, the City sent a letter to EDA rescinding the $2.5 million
EDA grant for the Bee Branch Stormwater Pumping Station Project.
The City maintained communications with EDA representatives throughout the grant
period up through the request to rescind of the grant. EDA representatives reiterated their
desire to assist the City with the Project and invited the City to reapply for EDA grant
funding for the project. As directed by EDA, working with ECIA with support from others
such as the Greater Dubuque Development Corporation, a new preliminary application
was prepared and submitted by the July 28, 2023 EDA deadline. To complete a full
application, the City must pledge to provide the necessary local matching funds should the
grant be awarded.
�
RECOMMENDATION
I recommend that the City apply for a U.S. EDA grant in the amount of $7,700,000 and
pledge local, matching funds in the amount of $19,012,000 for improvements associated
with the Bee Branch Stormwater Pumping Station Project.
BUDGETIMPACT
The estimate of probable costs for the Project has been updated as follows:
Construction Contract $25,440,000
Contingency (5%) 1,272,000
Engineering (Design) 1,265,400
Engineering (Construction) 1,360,000
Total Project Cost $29,338,400
If awarded the $7.7 million EDA grant, the cost to the City to fund the project would be
$21,638,400. The current project funding breakdown is as follows:
State Sales Tax Increment Proceeds $9,614,000
Stormwater Utility Construction Funds 2,796,000
US EPA State Revolving Fund (SRF) Loan 2,600,000
DRA Distribution 1,400,000
TOTAL $16,410,000
Therefore, to fund the project funded in part with a $7.7 million EDA grant, it will require the
City to provide an additional $5,228,400 for the project. Even though the City currently has
$8.9 million in stormwater utility funding for the project, the application illustrates that the
City could issue debt in order to provide the matching funds for the grant. The City will
know if its application for EDA funding is successful in the fall of 2023 so that if successful,
the City will be able to consider how to best provide the additional project funding as part
of the Fiscal Year 2025 budget.
Because the EDA grant is only related to construction costs, the City's match for the grant
is $19,012,000 calculated as follows:
Construction Contract $25,440,000
Contingency (5%) 1,272,000
Total Project Cost $26,712,000
EDA Grant $7,700,000
Grant Required City Cost Share $19,012,000
Project Grant Total $26,712,000
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ACTION TO BE TAKEN
I respectfully request adoption of the attached resolution approving the application for a
U.S. EDA grant in the amount of $7,700,000 and pledging local, matching funds in the
amount of $19,012,000 for improvements associated with the Bee Branch Stormwater
Pumping Station Project (Phase V of the Bee Branch Watershed Flood Mitigation Project).
Attach.
Prepared by Deron Muehring
cc: Crenna Brumwell, City Attorney
Jenny Larson, Director of Finance & Budget
John Klosterman, Public Works Director
Teri Goodmann, Director of Strategic Partnerships
Deron Muehring, Civil Engineer
�
Prepared by Deron Muehrinq, City of Dubuque Engineering, 50 W. 13th St. Dubuque, IA 52001 (563)589-4270
Return to Adrienne N. Breitfelder City Clerk City of Dubuque, 50 W. 13th St. Dubuque, IA 52001 (563)589-4100
RESOLUTION NO. 260-23
RESOLUTION APPROVING A US ECONOMIC DEVELOPMENT ADMINISTRATION
DISASTER RELIEF OPPORTUNITY GRANT APPLICATION AND PLEDGING THE
LOCAL MATCH IN THE AMOUNT OF $ 19,012,000 FROM GENERAL OBLIGATION
BONDS OR AN SRF LOAN FOR CONSTRUCTION OF A NEW STORMWATER
PUMPING STATION AT THE 16TH STREET DETENTION BASIN
Whereas, the City Council of the City of Dubuque, Iowa wishes to apply through the
Economic Development Administration (EDA), U. S. Department of Commerce for a Disaster
Relief Opportunity grant for the construction of a new stormwater pumping station at the 16th
Street Detention Basin, and
Whereas, the City Council, in support of the application for $7,700,000.00 in grant
funding, must pledge a local match estimated at $19,012,000.00 toward the activity as
identified in the application, and
Whereas, the City will use General Obligation bonds or a State Revolving Fund loan
as the source for this expenditure.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA:
Section 1. Approves the application for EDA Disaster Relief Opportunity grant
funding.
Section 2. Authorizes the Mayor to sign the application.
Section 3. Pledges the amount of $19,012,000.00 from GO Bonds or a State
Revolving Fund loan, if in fact, the Disaster Relief Opportunity grant is awarded by the
Economic Development Administration.
Passed, approved, and adopted this 7th day of August 2023.
Brad M. v nagh, Mayor
Attest
02e7C3r-'
Trish L. Gleason, Assistant City Clerk
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afways ahead
David D.Grossklaus
Partner
grossklaus.d avid@dorsey.com
(515)699-3287(0)
(515)441-1442(c)
July 28,2023
Jenny Larson
Chief Financial Officer
City Hall
City of Dubuque,Iowa
Re: Economic Development Administration of U.S.Department of Commerce Economic
Development Administration Disaster Relief Opporiunity Application
City of Dubuque,Iowa
Dear Ms. Larson:
We understand that the City of Dubuque, Iowa (the "City"), is applying for a loan or grant from the
Economic Development Administration ("EDA") U.S. Department of Commerce for a new culvert inlet structure,
stormwater pumping station and related improvements (the "Project"). As part of this application package, EDA
requires a preliminary opinion from bond counsel to the City with respect to the City's legal authority to issue public
debt for the purposes of the Project.
We are of the opinion that the City is a validly existing municipal corporation pursuant to the provisions of
Code of Iowa, 2023, as amended (the "Code"), and as such is authorized to issue its general obligation bonds and
revenue bonds pursuant to the provisions of Chapter 384 of the Code. These obligations, if issued, will be secured
in whole or in part from the net revenues of the system or from general obligation bonds payable from property
taxes. Under Chapter 384 of the Code of Iowa, the City has authority to issue general obligation bonds for
improvements and extensions to its municipal storm water utility system.
In order to be vested with authority for the issuance of this type of indebtedness, the City will need to
conduct a simple public hearing process, following the publication of a notice announcing the public hearing in a
newspaper of general circulation in Dubuque. After receiving public input at the public hearing, the City Council
will have the requisite authority to issue indebtedness in order to pay for its local match requirements for the project.
Given the broad array of lender availability for municipal general obligation debt in Iowa, including governmental
lenders such as the SRF program, local and regional banks, and access to the bond market,the City should have no
trouble accessing credit facilities for this type of issue. Based upon the available constitutional debt limit, the City
has capacity to issue the debt. The City's current constitutional debt capacity as of January 1,2022 is$153,633,209.
Additionally, the City has current approval from the SRF Program with a supplemental amount currently
approved on the IUP of$2,600,000 and a storm water utility fund line item budgeted amount of$8,912,000.
The statutory process required for issuing general obligation debt in Iowa should take no more than 90 days
to complete from the start of the public hearing process to the closing of the loan. This time frame includes the
identification of a lender and the negotiation of the terms of the loan. Thus,the City should be in a position to move
quickly and effectively from the point at which the local match amount is finally ascertained to the point at which
the City would need to borrow funds to meet the local match.
It should be noted that other types of bonds are available to the City for storm water related improvements,
including revenue bonds payable from the City's municipal storm water system.
Dorsey&Whitney LLP � 801 Grand Avenue I Suite 4100 � Des Moines,IA � 50309-8002 I T 515.283.1000 � F 515.283.1060 � dorsey.com
Page 2
If you have any additional questions or information needs, please notify me and I will update this
correspondence accordingly.
Sincerely,
Dorsey& it ey L
By:
David D. Grossklaus