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<br />1 <br /> <br />I <br /> <br />I <br /> <br />Council Meeting Minutes <br />July 8, 1986 <br /> <br />Council Business, continued <br /> <br />To protect the city from supplemental assessments, (a) assess- <br />ments could increase the amount of money mentioned in the <br />contract so that there was no reasonable possibility there would <br />have to be a supplemental assessment, or (b) an agreement to have <br />the Seminary pay cost overruns directly. Those options have been <br />discussed with the Seminary and they are uncomfortable with that; <br />they would like to have a cap on their financial obligations so <br />that they can make their arrangements with Pratt Homes. Seems <br />the risk is not particularly great, assuming the numbers are <br />reasonably accurate. <br /> <br />Regarding Change 2, LeFevere stated Proper had asked that the <br />language be changed. The escrow provides that the City Engineer <br />can draw on funds to pay for costs of settlement which accures as <br />a result of an accelerated construction schedule that would not <br />occur if a two-year construction schedule were undertaken. <br />Seminary has agreed to take the language out and, in turn, the <br />city would agree to assig its rights for their responsibility, if <br />any, for settling so that Proper would not have to make a <br />determination of whether the contractor or the construction <br />schedule was reasonable. If the Seminary had evidence the road <br />was not constructed according to specification, they would be <br />able to pursue the contractor. <br /> <br />Regarding Change 3, LeFevere stated it was neither illegal nor <br />illogical, but it is not consistent with the city policy. <br />Ordinarily the assessments are not reduced. If the council <br />decides to go ahead with the agreement providing for a reduction <br />in the special assessments, the agreement needs to be fine-tuned <br />to determine what the city's actual costs are. <br /> <br />Also, the second change in the agreement is 60 lots rather than <br />45 to be assessed and the Seminary has agreed it is necessary so <br />that supplemental assessments are valid. <br /> <br />Benke asked where we are in terms of timing for the action <br />tonight and the road. <br /> <br />LeFevere stated the city is not proposing to make bids until <br />August 8th and the city could put this decision off until then; <br />the Seminary has their own reasons for the council to consider <br />and act this evening. <br /> <br />LeFevere explained that, with the assessment agreement, the <br />Seminary is agreeing not to challenge the Assessment to that <br />cap. <br /> <br />Benke asked, if costs go over because of construction problems, <br />if the city can still levy a supplemental assessment -- does that <br />create a significant problem for us. LeFevere stated $10,000 per <br />lot that the Seminary is agreeing to is for sewer/water/street/ <br />curb/gutter. If council/staff is comfortable, we have no expo- <br />sure or risk. <br /> <br />Page Ten <br />