Highlights of the Fort Smith Board of Directors Meeting 12/19/23
At the Fort Smith Board of Directors meeting held 12-19-23 and led by Vice Mayor Rego in the absence of Mayor McGill, the Board voted unanimously with no discussion from the Directors to approve a request from the Fort Smith Housing Authority to abandon the right of way on part of Lexington Avenue as part of the development of a new housing subdivision at the site of the old Bailey Hill Reservoir. The matter was discussed at the 12-5-23 meeting.
The Board voted unanimously in favor of adding zoning for 6.19 unzoned undeveloped acres at 7600 Wells Lake Road to allow for development of The District, a mixed-use development consisting of 5 commercial and 6 multi-family residential lots and a detention pond with a fountain.
The Board voted unanimously in favor of an amendment to the Unified Development Ordinance that would reduce the size of the lot required to build a single or two family residence from the current 50 ft wide and 5000 square ft in area to 35 ft wide and 3500 square ft in area. The Planning Commission proposed the change to help with infill and to be able to provide for more affordable housing using existing infrastructure and save property owners the hassle of having to apply for a variance to build on the smaller lots. The change will potentially affect 500 lots in the city, some of which are vacant lots that are in older subdivisions that were platted smaller a long time ago.
Director Morton said that other cities have also viewed minimum lot sizes as a barrier to construction of affordable housing. He called the change a “good idea.”
The Board was set in the agenda to vote on whether to put a .5% sales tax to fund water utilities on the March primary election ballot for the public to vote on. The tax was estimated to bring in $14 million annually in revenue and that revenue would be spent on water projects with half of it being used for bonds and half for pay-as-you-go projects. City Administrator Geffken said the money would be “to pay for generation projects” including the 48 inch transmission line from Lake Fort Smith. The tax and proposals for increased water rates were discussed at the 12-12-23 study session.
Fort Smith resident Andy Posterick spoke saying that the vote to put the tax on the ballot “felt really rushed” to him and that he would like to have longer to study why the tax would be necessary and to study alternative options.
Director Good said that while the public might seemed rushed, to Board members it hasn’t been rushed. He said funding water projects and rate adjustments have been talked about for years, but nothing was done, but the City is “at that point where we can’t wait any longer.”
Director Morton said “We are rushing too fast” and that it might be fine to wait 90 days or a year. He requested a study session be held for Hawkins-Weir to discuss the water availability study they conducted in detail including discussion of short-term projects that might alleviate the problems with being able to provide adequate water to the entire city. He also asked to be provided with the entire water rate study that the summary of which was presented at the 12-12-23 meeting. He called for a special study session to discuss that in-depth look at the data from the study. Geffken said both discussions will be held at meetings at the end of January at the earliest.
Director Morton mentioned that residential water use is only 27.7% of the water revenue for 2023, with the other 72.3% coming from industrial, commercial, and contract customers. He said that the proposed residential rate increase might not provide the best impact on water revenue.
Director Christina Catsavis agreed with Director Morton. She suggested that the state Attorney General be consulted as to whether the residential rate increases might be considered “arbitrary and capricious.”
Director Settle says that he receives calls about water pressure. He expressed support for a sales tax because “half of it is paid by outsiders.” But he said he is “not in favor of bonding. Pay-as-you-go is the way to go” saying that interest from bonds means money going to bonding instead of projects. He expressed support for an 8 or 10 year limit on the tax and waiting to put the tax on the November election ballot.
Director Martin said he felt they are “rushing into this”. He said that the Board needs a consensus they do not yet have on the issue “to be able to go to our boss” (meaning the citizens) and said “Let’s talk it through and let’s work it out.” He said “Data is going to be key”.
The Board voted unanimously to table the vote regarding the sales tax for water indefinitely.
The Board voted unanimously to approve the 2024 base budget .
Director Martin called the budget “a little more on the expense side than what I am comfortable with” but said that he still supports it because the City always tend to do better in actual spending than what they put in the budget.
Director Settle reminded “Budgets, once they’re approved, can be amended at any time.”
The Board was slated on the agenda to also vote on approving the top 21 prioritized items on the new needs budget, but instead voted unanimously to table the new needs budget vote and scheduled a study session for Thursday 1-18-24 to discuss the new needs.
The Board voted unanimously to contract with RJN Group for $115,846.80 for design service for consent decree sewer work.
The Board voted against approval for a contract with Vortex Services for $21,856,895 for consent decree required sewer repair and capacity improvement work including 55,774 feet of pipe and 624 manholes. The Vortex contract was tabled at the 12-5-23 meeting because of a memo received from some local contractors who did not bid on the project because of concerns about their ability to finish it in time but were now interested in it. No companies originally bid, but Vortex was the only bidder through another procurement process. City Administrator Geffken asked the Board to table the item and have the project rebid before the end of the year. The contract with Vortex was put back on the agenda as a result of discussion at the 12-12-25 study session in which the Board was informed that Vortex would be working in partnership with local company Royal Ridge. Royal Ridge would be performing 50% of the work. The Board was unaware when they tabled the measure originally that a local company was involved.
The Board expressed some concern that the estimate for the Vortex contract is almost $7 million higher than the engineering estimate. Utilities Director McAvoy said that he consulted with utilities outside the area and that the consensus was that “engineering estimates are worthless” at this time and that projects are frequently coming in significantly higher than estimated.
BJ Kirstens with Vortex and Johnathan Griffin with Royal Ridge spoke. Kirstens mentioned that Vortex recently completed a project for the City that they finished at a 17.6% savings over what they bid. Kirstens said that Vortex has done hundreds of consent decree sewer projects throughout the country. He mentioned that hundreds of hours over the last several weeks have been put in by Vortex and Royal Ridge because they were working on the project under the belief that they were moving forward “like it was happening.” Kirstens said that it if the contract is not approved it will put Royal Ridge “in a bind.” Griffin agreed. They also expressed their view that because the bid tabulations were already released, to have it rebid now puts Vortex and Royal Ridge at a disadvantage because their competitors have already seen their line-item details.
Director Settle expressed skepticism about one company’s ability to complete the project on time, calculating that to finish on time would mean 15 ft of pipe and 1.75 manholes per day. He said “We should have split this up.”
Director Morton suggested splitting it up into 2 or 3 contracts and extending the one year deadline by 6 months and that companies could opt to bid on each of the contracts individually or bid on the whole combined set of projects. He said that the time extension would allow for Vortex to “come up with a bid no one’s seen.”
Director Good suggested the City “try our best to negotiate.” and said the City needs to bundle the project as advised by the EPA and DOJ. He said that if rebid Vortex could be underbid. Good said Vortex assures they can do it on time. He said the “right thing to do is move forward as intended.”
Director George Catsavis asked if Vortex acted in good faith when they bid. McAvoy said that they did. He added that their performance on the previous project was good. Director Catsavis expressed concern that Vortex and Royal Ridge had already invested thousands of dollars in anticipation of receiving the contract.
Purchasing Director Bahsoon said that in the past when some things were rebid it did create an undue advantage for new bidders to be able to have already seen their competitor’s previous bid details. He said it would not be a “fair and equitable process” to not approve the contract.
Director Morton said the “City owes it to the taxpayers” to have a conversation with attorney Paul Calamita who is handling the consent decree legal matters to hear his view on the contract and spending a higher amount of money to finish the project on the short timetable. Morton called companies spending money out of pocket on a contract before officially being approved “disturbing.”
Director Settle said that the issue should have come directly to the Board for further consideration of all of the options when the project first received no bids.
The contract was not approved with all but Director George Catsavis and Director Good voting against the contract.
The Board voted unanimously to approve the Capital Improvement Plans for IT, Solid Waste, Police, Water, Wastewater, and Consent Decree sewer work. These CIP plans were discussed at the 11-28-23 study session.
Fort Smith resident Edward McCurtain spoke regarding a water leak at his house that the City has not fixed. It resulted in a $246 dollar bill that the City only reduced by $7 and $15. Vice Mayor Rego said that that issue was not directly related the agenda item regarding CIP plans but that Deputy Administrator Dingman would get all of McCurtain’s information and respond to the matter.
Director Morton expressed that with the “dire condition” on water, he wanted to be mindful of the spending on water and non-consent decree sewer work. Saying “Every dollar we have, we need to save.” , he suggested that equipment replacement be limited to “emergency replacement only”, that only fire hydrants “that are critical” be replaced, and that meter projects be reined in. He said that with his calculations and proposed cuts he could get the water spending down to $23 million, not $30-35 million. He also expressed a preference for getting the Utilities Department into a situation where they could qualify for an Arkansas Resolving Loan Fund loan rather than using bonds because of its low interest rate and the ability to pay it off at any time.
Director Martin expressed his desire to show taxpayers “we’re being good stewards of their money.” and that the Board “need to start dialing back a little where we can.” He questioned the spending to move from traditional meter reading where trucks drive and read meters by hand once a month to an AMI system where it is read remotely. Geffken said one of the benefits of AMI is that it providing near real-time usage data will help customers identify leaks earlier instead of having to wait until the monthly bill arrives.
The Board voted unanimously to contract with Van Horn Construction for $12,924,243 and Hawkins-Weir Engineers for $1,236,377 for work on the Maybranch Outfall culverts. Director Martin asked if FEMA money was coming to help with some of the costs from the project related to the flood. Engineering Director Snodgrass said that $5.6 million is hopefully coming.
The Board voted without discussion to accept bids from APAC, River Valley Quarries, and Mid-Continent Concrete, Eagle Ready Mix, and Emery Sapp to allow for the purchase of aggregates, sand, concrete, and asphalt material.
The Board voted to contract with Crafton Tull for design for the new Creekmore Pool bath house and diving well and assessment of the existing pool equipment for a total of $567,800. The Board had voted at the 5-16-23 meeting to approve a contract with Crafton Tull for design but Parks Director Deuster said that there was an “error in the resolution” that was approved that did not correctly express that that was mostly ($148,000) for assessment of the existing pool equipment like pumps and piping and now the Board would need to vote on a contract that includes the cost of the entire engineering of the project including the actual design of the facility at a rate of up to 6.5% of the total project estimate.
Director Settle said that the matter should have been brought to the Board as soon as the error was noticed. He also said that the same plan used for Parrot Island bath house could be reused at Creekmore. Director Settle also suggested considering building a new public pool at Parrot Island where there is already a bath house and demolishing the Creekmore Pool and bath house entirely instead of building a new bath house at the Creekmore Pool.
Deuster said that the 6.5% rate is a good price for the design work, with that type of work typically costing 12%.
Director Morton said that he called Crafton Tull and spoke with the engineers and they clarified that the project includes not only the bath house, but also a permanent enclosure building for the diving well, so it is “really two big projects.” Director Morton said “After that conversation, I felt better about this.” but also said “Six million dollars is a lot of money.”
The Board voted to approve the contract with all but Director Settle voting in favor.
The Board voted unanimously to contract with Crawford Construction Company for $616,073.50 for realignment of 328 feet of concrete encased 66 inch steel casing pipe to accommodate I-49. The total cost of the project will be reimbursed in full by ARDOT.
The Board voted unanimously without discussion to contract with JA Riggs Tractor for $115,731.94 to have a re-manufactured engine installed in the Caterpillar compactor at the landfill that is in need of engine replacement. The repair will give the compactor an additional 2 years of life. To buy a new compactor to replace the existing one instead would cost $1.3 million and would be expected to last 5 years.
