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Charles City moving forward with $13 million Broadband project

Council approves motion to form municipal telecom utility board

  • City Council members Jerry Joerger (left) and Keith Starr listen in at a City Council regular meeting in Charles City on Monday. Press photo by Kelly Terpstra

  • Charles City Council members Dan Mallaro (left), Michael Hammond, DeLaine Freeseman and Mayor Dean Andrews attend a city council meeting on Monday evening. Press photo by Kelly Terpstra

  • City Administrator Steve Diers (left) and City Attorney Brad Sloter attend a City Council meeting in Charles City on Monday night. Press photo by Kelly Terpstra

By Kelly Terpstra, kterpstra@charlescitypress.com

Charles City is all in for fiber.

The City Council has taken the next step to create a $13 million city-owned broadband telecom after council members voted 5-0 on Monday to form a municipal utility board.

City Administrator Steve Diers said the final step for the City Council will be to approve a resolution that states the city agrees to the terms set forth with creation of the board.

One of the final pieces of the broadband puzzle is now in place. That means there’s likely no looking back now in the city’s effort to become the first community in the state to build a broadband system without using its own electrical utility as a funding mechanism.

Fiber could begin being laid as early as the coming spring, but first Mayor Dean Andrews will need to appoint that board of trustees that will have oversight of the operation and be responsible for the possible issuing of revenue bonds that could help pay for the project.

Diers has stated that the utility board would need to be in place prior to the issuance of any revenue bonds.

“I think this is going to be a step forward,” said Andrews. “We still have a lot of work to do, but I think it will be a good thing for our community.”

The council chambers was packed at the regular meeting in anticipation of the vote that will now transition the project from the design and engineering phase into build mode.

Council member Keith Starr made a motion in favor of creating the board and DeLaine Freeseman seconded it. All council members then voted to proceed to that next step.

The 14-year endeavor, which started in 2005 when Charles City voters approved a referendum that gave the city the authority to establish a telecommunications utility, has come a long way in that time.

Several members of the Broadband Commission and residents of Charles City voiced their support of the project. There was one individual that stepped up to the microphone before the vote took place who questioned the cost of the project and referenced a broadband initiative that was rejected in Decorah.

“Nobody wants to see this thing screwed up from that committee,” said Freeseman. “Everybody’s trying to do the best thing that we can. Had we had providers in this area that were willing to do what they’re supposed to be doing anyway, we may not be in this position. But they’re not and we’ve got a couple choices to make – either try and do something and make it positive or you sit back and kind of see what happens.

Freeseman said he understands the risks associated with a project of this magnitude.

“I’m really, really hoping that this is the right thing to do to move forward and I think it is. But there’s always that question in your mind, so … ,” he said.

Shortly after the council voted on moving forward with the broadband project, the council members went into a closed session to discuss purchase of property dealing with the location of the broadband’s utility.

The council came out of closed session and Starr made a motion to not purchase the subject property, which the council passed 5-0.

At last Tuesday’s Broadband Commission meeting it was revealed that the commission is recommending the city purchase 800 N. Main St., the Unggoy Broadband building, to house the telecom’s data center.

A $2,000 option to purchase has been offered to give the city time to buy the building.

“I was hoping to have an option ready for tonight and I don’t. We’re still trying to work out where that’s going to be,” said Diers.

In other business, Diers stated that the Avenue of the Saints Development Park has now been certified by the state.

“Now that it’s certified we can move forward with setting up the borrowing of those funds and issuing those and granting those to area development,” said Diers.

The industrial park is located on South Grand Avenue and the CCADC will maintain, market and attempt to sell the property after receiving $2.156 million from the city to be able to purchase it.

One of the requirements by the city was to have the site state-certified by Nov. 1. The City Council approved the extension by one month to Dec. 2.

Diers said he is hoping to transfer the property to the CCADC next month and close on it at the start of 2020.

• The development agreement between Charles City and Johnston developer Shawn Foutch to construct approximately 40 market-rate apartments in the 1930s portion of the 500 North Grand building was approved by the council Monday.

Part of that agreement will be the abatement of roughly 90 percent of the property tax owed over a 10-year period. The abatement amounts to almost $590,000.

• A recommendation from the Planning and Zoning Commission to amend an ordinance regarding the placement of accessory structures on lots without principal structures inside the city limits was approved for a first reading. The current zoning ordinance does not allow accessory structures to be built on a lot without principal structure.

The ordinance change would allow accessory structures such as a garage to be constructed on an empty lot if the lot is adjacent to the owner’s principal residence.

• A resolution was passed to hire Constructed Wetlands Group (CWG) to help with construction of reed beds at the $17 million WRRF (Water Resource Recovery Facility). CWG is a wastewater treatment company based out of Florida that helps in the handling of biosolids.

The company is contracted to do the work for $150,000 and that fee would be paid in installments. The cost would be covered by the funds used to construct the WRRF plant.

The construction of the WRRF will help eliminate nitrogen and phosphorus – two nutrients that have been identified by the Iowa Department of Natural Resources that are required to be reduced under the city’s most recent permit issuance in 2014.

The council also approved the city’s final application for the State Revolving Loan (SRF) program that will help fund the WRRF. The loan is for $17.17 million and the total project cost will be $19.5 million. The remainder of the project cost of $2.3 million will be covered with existing cash on hand.

• The council approved work to be done on two houses in the second phase of the CDBG (Community Development Block Grant) owner-occupied rehab program. A grant of almost $250,000 was awarded to the Charles City Housing Department in 2018 that could help rehabilitate at least six single-family owner-occupied homes.

The estimated cost to rehab a house at 313 7th Avenue was $24,000. The low bid for the work done on the house came in at almost $27,000 by Bob Koenigs and Family Construction of Stacyville.

The work done on the second house at 704 B Street was estimated at $28,715 and the bid by Koenigs and Family Construction was listed as almost $27,000.

The grants provide up to $24,999 in rehab and up to $5,750 in lead hazard reduction activity.

• An ordinance to approve 10- and 12-inch water meter access fees was adopted after a third and final reading was approved. The ordinance raises the out-of-town water rate over what in-town residents pay from 15 to 50 percent.

There has been an automatic annual increase each year of water rates for city consumers. The current code lists the prices of water that were in effect in 2014 and this rate change will be updated in this particular ordinance.

• A resolution was passed so the city can partner with the Iowa Agriculture Water Alliance (IAWA) for a future watershed project. The project would focus on best management practices in the lower, middle and Upper Cedar Watershed and would include an in-kind match of $500,000. The local match would be an urban sponsored project for in-town stormwater projects.

• The city passed a resolution to abate a nuisance property at 607 South Johnson Street. The owner has failed to comply with an order to secure a building permit to demolish the house. Action will be taken to declare the property abandoned.

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