Wearying wear course headaches in Braham

City working with Horseshoe Meadows residents on how to assess funding for top-course road work

By Greg Hunt

When the economy went in the tank in 2008, one of the extending effects in Braham was a final wear course of asphalt was never laid down on certain roads in the Horseshoe Meadows developments. The question at the March 6 public hearing held by the Braham City Council was: who should be hit with assessments to get those roads fixed?

In the original agreement, Horseshoe Meadows developer Ivory Street Builders was in charge of completing all final layers of roads for the development on the southeast side of town. But Ivory Street went bankrupt when real estate sales dropped off, and the bank holding the corporation’s letter of credit on the vacant lots did not follow through with the development deal.

Now, the incomplete roads are showing signs of wear without the final course on top. At a Feb. 17 special meeting with the council, City Engineer Brian Miller shared his feasibility study which projected the costs for a final wear course on Appaloosa Court, Horseshoe Lane, Palomino Street and Pinto Circle to approach $226,000.

The problem is residents in the developments already paid assessments for a completed road plan when they bought their homes or townhomes. Speaking at the public hearing, they were none too pleased for getting hit up again. For the three streets in Horseshoe Meadows 4th Addition, assessment costs could be $3,300 if all lots are assessed.

If assessment is tied only to vacant lots in that addition (which will be on a tax-forfeiture sale this May), then the assessment could be $5,700 per lot.

Appaloosa Court in Horseshoe Meadows 2nd Addition is a different animal since it is a private cul-de-sac street. If all lots are assessed, the cost per lot could be $1,700. Kevin Schmitz asked if the residents could pursue their own paving bids since it was a private street, and Miller said that could work, but engineering inspection fees would still need to be tacked on.

4th Addition resident Gina Grams questioned why Ivory Street was not required to put money for the final course into an escrow which could have eliminated most of these headaches. “We as residents didn’t take the risk on the developer– the city did,” she continued.

Miller explained that prior to the economic bust, setting up letters of credit by developers was standard practice.

“Unfortunately, the developer allowed the letter of credit to expire. Many cities were caught in a similar situation after the economic downturn,” said Miller. “Cities may strictly go to escrow contracts from this point forward.”

The council’s next step is to work with City Attorney Joel Jamnik to get his interpretation of the assessing process. Advertising for bids for the final course will then take place, followed by a public Assessment Hearing on May 3.

2011 Audit Report

Prior to the public hearing and regular council meeting, City Auditor Mike Burkhardt presented the 2011 Annual Audit Report to the council who offered strong praise for City Administrator Sally Hoy’s records. The city’s pledge collateral is adequate at the bank, continued Burkhardt. He also highlighted the $46,000 profit the municipal Hometown Liquor Store showed for 2011.

“That’s head-and-shoulders above many municipal liquor stores last year,” he said. Wrapping up the audit, which was a little more complicated than usual because of the Waste Water Treatment Facility project funding on the books and the newer GASB 54 requirements, Burkhardt said, “You won’t need to be answering to the fed boys.”

In other action the council:

• Approved a $3,000 reimbursable procurement verification for the community center project.

• Approved $2,000 funding for flowers which will hang along Braham streets this summer. The Braham Garden Club once again offered to help with plant maintenance.

Next Meeting: Tuesday, April 3. At 7 p.m. a public hearing will be held regarding a business subsidy for Tusen Tack’s community center project.