Feds renege on grant, city awards 32nd Ave. contract

• Major project will complete industrial park road

BROOKINGS – Sometimes, when you’re dealing with federal bureaucrats, it might not pay to be too honest.

At least that seems to be the takeaway lesson from Tuesday’s City Council meeting.

Old-fashioned, Midwestern honesty and an attempt to do the right thing cost the City of Brookings a half-million dollars when the Department of Commerce’s Economic Development Administration (EDA) officials rejected Brookings’ request for assistance with its 32nd Avenue project – because city staffers admitted the project had been bid once before.

Brookings nevertheless has moved on, and last night awarded an $871,000 contract to T&R Contracting of Sioux Falls for the 32nd Avenue Street Project, work that will extend the paved road to the Highway 14 Bypass.

The Sioux Falls contractor actually shaved $60,000 from its previous low bid for the roadwork, submitting a total bid of $870,950 for the construction. The final price tag is nearly 20 percent below the engineer’s preliminary estimate of $1.07 million.

The road is critical for development of the industrial park north of the Swiftel Center, but it’s an absolute necessity for the Bel Brands USA cheese making plant that will be located there. That company has already broken ground for what will become a $160 million manufacturing operation.

T&R was one of six contractors – two from Brookings – who bid on the street work.

The project involves nearly a half-mile of concrete pavement through the industrial park, from the South Dakota Newspaper Association building to the bypass. The heavier surfacing is necessary for the expected truck traffic.

Also included are curb and gutter, grading, gravel, drain tile, storm sewer and a detention pond for the western portion of the Foster Addition.

This is the second time around for the bidding, and that’s the reason the Economic Development Administration withdrew what city staff and council thought was an almost-certain offer of assistance.

The city first bid the project in April, but officials, learning that there could be a $500,000 development grant available to Brookings, rejected the first bids on April 24 and rebid it so contract provisions would meet all federal requirements. (Federally funded projects, for example, generally have wage-level requirements, among other specifications.)

The loss of the grant was a case of poor communication, said Mayor Tim Reed, and he placed the blame squarely on the federal agency. “This is typical for the federal government and its messed-up systems,” he grumbled Tuesday.

According to City Manager Jeff Weldon, Brookings had applied for grant assistance to the Department of Commerce’s Economic Development Administration (EDA) long before the bidding process began, “but we didn’t hold out much hope for it.”

Nevertheless, after it had sent out the first bid request, the city received word from the EDA that the municipality was eligible for the grant and, pending completion of some additional paperwork, would receive $500,000.

It wasn’t an absolute guarantee, but it was pretty much a done deal, Weldon told the council last month. He told the city leaders that rejecting the first bids would set the project back a month, but it would be worth the delay to secure the federal funding. The $500,000 would pay for much of the city’s cost.

But as the city moved to tie up loose ends with the EDA, federal officials balked.

“We found out that it was a good project, and they indicated they would approve it,” Reed said. “But when they found out that we’d already bid the project, they said, ‘We can’t give you the money.’”

The EDA argued that because the city had already taken bids, Reed explained, it indicated the city already had the money for the work and didn’t need the federal assistance.

Reed and City Manager Jeff Weldon tried to save the deal, even getting the state’s congressional delegation involved, but the federal agency wouldn’t budge.

Reed said that the EDA’s delay on the original application by the city – its poor communication – was what caused the city to move forward. It was a critical project that couldn’t be shelved.

“If we would’ve had the information,” Reed said, “we could have met their requirements.”

The 32nd Avenue extension has also resulted in a dispute with four current property owners along the new roadway, who argued that they were being unfairly burdened by their street assessments. The city’s bills for the four ranged from $64,000 to $75,000, and owners charged that they were paying for a roadway that will chiefly benefit Bel Brands.

On March 13, the council offered the four a discount of 25 percent on their assessments and then gave the road project the official go-ahead.

Based on the new project bid, those assessments will be recalculated, Weldon said, and council will be asked to approve the revised figures at its next regular meeting.

Contact Ken Curley at kcurley@-brookingsregister.com.