NEW: CITY CLOSING IN ON $5M MAIN STREET PROJECT

City of Freeman closing in on $5 million Main Street project

Council approves $2.8M bond issue; was to meet again April 6

JEREMY WALTNER  – PUBLISHER

The wheels on the city of Freeman’s Main Street rebuild continue to turn fast as officials anticipate final approval of the $5 million project that would see a reconstruction of Freeman’s primary downtown roadway — as well as five adjacent blocks — within the month.

Less than one week after unanimously approving a sales tax bond issue in the amount of $2.8 million, the city council was expected to award the low bid for the $5 million project to Reede Construction in regular session Wednesday night, April 6.

The total bid from Reede Construction as submitted — one of four — was $4,746,714.19.

That includes a base bid of $4,054,721.35 for Main Street from Fifth to the North County Road and one block of Railway to the southwest;
It also includes an alternate bid of $691,992.84 for one block of Fourth and Third streets to both the west and east of the downtown roadway;
Not included in the bid are the engineering fees totaling $456,236.24 for Sayre Associates, the Sioux Falls firm that has spearheaded the project from the beginning;
Given the higher-than-anticipated cost of the project — the base bid was originally estimated at $2.9 million and later raised to $3.15 million — the council wants to trim expenses totaling about $200,000. Much of that savings could come in a change order for the historic lighting fixtures in the main business district. Rather than using what was included in the bid, the city is looking at alternatives that would cost less but still gain approval from the DOT;
All told, that brings the projected cost of the project to $5,001,078.73;
A $600,000 community access block grant through the Department of Transportation lowers the projected cash needed to $4,401.078.73;
The $2.8 million bond issue leaves about $1.6 million remaining, which the city will pay for using cash on hand.
Against the clock

City officials have moved quickly the past two weeks largely because of a ticking clock.

Not only does the city council have 30 days following the March 16 bid opening to award or reject a bid, an expected shortage of materials and possible delay in shipping has contractors eager to get going.

That resulted in a special meeting March 23 in which the council agreed to proceed with the full project — with the exception of several change orders — another special meeting on March 29 to hear about financing options, and yet another on March 31 to approve the resolution for the bond issue.

That bond will take effect 20 days after publication in this week’s Courier (see pages 8-9B) unless it is petitioned and goes to a public vote.

If everything goes as expected, the Main Street project will unfold in two phases: The primary business district and side streets would be done first with a target completion of July, and the roadway from Railway to the North County Road would follow with a target completion of November.

Financing

No additional tax revenue is being sought to help fund the project.

While a surcharge on utility bills and/or and opt-out were mentioned, the council agreed that the city’s sales tax revenue — which averaged between $50,000 and $60,000 a month in 2021 — is high enough to cover the bond issue over 20 years.

“It’s definitely doable and probably the fairest for all of the citizens of Freeman,” council president Blaine Saarie told The Courier. “And it’s not just the citizens who pay sales tax; everybody who is driving on our streets will help pay for it.”

The city agreed to issue a bond issue of $2.8 million to ensure the funds would be available should change orders increase the cost of the project; Saarie said he was told those overages can often be around 5%.

“There’s always the possibility of overrun,” he said. “We just felt like we should approach this a little more carefully.” The other reality behind the $2.8 million bond issue is that, while the city has more funds available in its reserves, councilors did not feel comfortable spending that balance down.

“We did not want to take our general fund down to a point where we feel uncomfortable,” Saarie said. “Freeman is fortunate and does have a lot of projects going on.”

Indeed, the city still has to fund a number of higher-ticket projects:

n 417,000 for the Westward View housing addition;

n 100,000 for the East Industrial Park;

n 120,000 for the removal of the former Shanard Elevator on Main Street (which will happen in tandum with the Main Street project);

n nd $150,000 for new ballfields that are still being proposed on the northeastern portion of the Freeman Public School campus.

But even using cash for a portion of the Main Street project and the others listed above, the city would still have about $1.7 million available in its general fund.

Careful consideration

The proposed Main Street project comes 13 years after the last major infrastructure project taken on by the city was started and completed — the rebuild of Sixth Street/Fifth Street from Highway 81 to Main Street. That project cost $2.4 million.

As was the case in 2009, careful consideration went into designing and planning for the project.

“Some of these (council members) have put extensive research into this, and it took some time, it took some special meetings, but we’re now hoping everything goes as planned,” said Saarie. “A lot of thought went into this process to make sure this was a project worthy of doing and one that shows we did it right.”

Saarie noted that on at least two other occasions — the last being 2012 — city officials considered rebuilding Main Street but elected not to. In the years since, prices have increased considerably.

“Just like all the other projects that don’t happen right away, you wait and what happens? Costs just keep going up,” he said. “Yes, you hear these numbers and they are scary, but they’re not getting any better.

“The number is going to be constantly growing and our infrastructure is key.”

And a brand-new Main Street will only enhance all that Freeman has going for it.

“Just the other amenities we have — swimming pool, parks, golf course, hospital, nursing homes, businesses; for a small town we’ve got so much to offer. You’ve got to drive around quite a bit to find something it compares with.”

And with all the other improvements coming, he said, the future looks bright.

“Freeman’s got a lot to look forward to,” Saarie said.