Infrastructure project for Arbor Estates postponed

Ten contractors submitted construction bids for the second addition of the Arbor Estates subdivision, and although City of Newton officials see that as a positive outcome they still recommended council postpone awarding the contract until more information can be provided to Newton Housing Development Corporation.

The project covers the construction and installation of crucial infrastructure to encourage more homebuilding in the subdivision, including earthwork, sanitary and storm sewer, water main, 31-foot-wide Portland cement concrete streets, erosion control, seeding and other related items.

According to city documents, the new streets to be constructed with this phase include the East 23rd Street North extension to North 11th Avenue East, and the East 26th Street North cul-de-sac. Included as an add-alternate in the bid was the North 10th Avenue East cul-de-sac, running east from East 23rd Street North.

The recommendation to postpone any action on the agenda item came from Newton City Administrator Matt Muckler, who told council members at their meeting on Sept. 5 that staff have had conversations with NHDC about the bids, which came in between about $2.6 million and about $3.4 million.

Jennifer Cook, president of the NHDC Board of Directors, was glad to hear Muckler give the city council that suggestion and she hope they had “a chance to see the numbers and statistics” the board provided. Arbor Estates is a “good project,” Cook said, but high repayments would increase the lots “dramatically.”

Between the number of lots NHDC needs to sell and the price tags of those lots, the board believes it could not repay the loans in the time needed to so.

“After we had some time to digest this over the weekend, we talked about it on Monday and just didn’t feel like those dollar amounts would get us the results that we needed,” she said. “I’m glad that we can have more time to talk about this. That is great … I absolutely would recommend postponing this.”

Despite the postponement and the concerns about repaying back the loans, the engineer estimated the project’s base bid and the add-alternate to be more than $3.6 million, which means every bid came in under estimate. If it was approved by council, McAnich Corporation, of Des Moines, had the winning low bid.

The project would be paid for with American Rescue Plan Act funds, Housing Initiative Funds, remaining bond funds and new general obligation funds in the spring of 2024. Newton City Council members voted 6-0 to postpone the awarding of the contract to a future meeting.