South Lake Tahoe faces Harrison Avenue funding gap
February 19, 2014
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With six bids in hand for the Harrison Avenue project and all higher than estimated, the city of South Lake Tahoe and property owners who agreed to help pay for the work must decide what to do.
A possible contract award will be discussed as part of City Council's Feb. 18 meeting, but the issue might take more than one meeting to resolve, said City Manager Nancy Kerry.
City officials and property owners can scale the project back or come up with extra money to pay for it.
Sierra Nevada Construction submitted the apparent low bid of $3.814 million. Other bids were for $3.922 million and $3.959 million, with three bids for $4.2 million or more.
Those bids are for the base project to build a redesigned Harrison Avenue between Lakeview and Los Angeles avenues.
Even the lowest bid for that base project would leave South Lake Tahoe about $600,000 short for the project. The city has indicated it wants to break ground on the project in May.
Completing four additional project alternatives put out for bid separately means another $1 million in costs the city must find some way to pay for.
That work includes improved boat trailer and boat launch parking near Lakeview as well as landscaping and streetlights for side streets adjoining Harrison Avenue that also would be reconfigured as part of the project.
Diverting money from other capital improvement projects in the city, spending some of the city's reserves and borrowing money are some ideas to make up the difference, said Ray Jarvis, director of public works.
Jarvis said he's confident the city is getting a good price for the Harrison Avenue project with six bids submitted for the work and the three lowest bids varying by less than 4 percent — they just came in higher than an engineer's estimate.
"That's our only bit of disappointment. We think it's a good project in a key location for the city. It builds on the improvements done at Lakeview Commons. We have the campground, ice rink and rec center across the street. It's a key area in terms of economic development going forward. We're really trying to develop a sense of a district there and that's an important thing," Jarvis said.
"The staff report basically will recommend we award the whole project, but if the council wants to do that they will have to decide how to cover the costs."
Property owners along Harrison Avenue approved a business improvement district for the project. It creats a special assessment for them to pay for about $970,000 of the project over 20 years.
Duncan Sennott, owner of the Sno-Flake Drive-In, said he wants to see as much of the Harrison Avenue work done as possible so the area looks "entirely done rather than partially done."
Sennott said he remains optimistic after he and other property owners met with city officials last week.
"Overall, I'm real pleased with the meeting we had. I hope Feb. 18 goes as well and we can break ground on May 1 for a great project," he said.