By Bill Short
The Millington Board of Mayor and Aldermen has voted unanimously to reject bids and return a state grant for construction of the Discovery Nature Park.
Board members took the action during their March 12 regular monthly meeting on a motion offered by Alderman Thomas McGhee and seconded by Alderman Mike Caruthers.
City Finance Director John Trusty recalled that, in April 2016, the board approved Millington’s application for a $500,000 Local Parks and Recreation Fund Grant from the Tennessee Department of Environment and Conservation.
The grant request was for a $1 million project with a 50-percent local match, and Millington was selected as a grant recipient.
The city had planned to provide matching funds of the appraised value of land donated by the Millington Industrial Development Board. The remaining match was to come from not more than $500,000 in Capital Projects funds, minus the appraised value of the land and “in-kind” or donated services, materials and/or equipment use.
Because the land was valued at $385,000, the city had expected its local match would be $115,000.
Trusty said that, after a “lengthy process” of design, development and review by TDEC, Millington advertised for construction bids that were due on Feb. 5.
Because it got “no responses,” the city re-advertised and received four bids on March 8 that ranged from $1,351,000 to $1,529,000.
Trusty said accepting the low bid, along with a $90,000 design contract and the appraised land value, would increase the total cost of the project to $1,826,000. Subtracting the state grant and the land value would leave $941,000 in cash that the city would have to pay.
“We budgeted $115,000,” he noted. “So, as a result of the bids we’ve just received, we’ve got an $826,000 shortage of funds needed from the city.”
Although Millington recently received a “very solid” bond rating, Trusty said the bond agency also indicated that “significant draw-downs” of the city’s fund balance would “negatively affect” that rating.
He also said there are no other “available dollars of this magnitude” elsewhere in the current budget that the city could reallocate.
So, Trusty recommended that the board reject the construction bids, notify TDEC that Millington will not be using the grant funds and then build the park in “segments” over a period of time with available funding.
“We have a very complete set of plans and specifications of what was to be done in the park,” he said. “We can do it over time using city funds and, in some cases, city staff and volunteers.”
But Trusty noted that a “veterans memorial” on the park site was also planned as part of the project.
“We want to move forward with that immediately,” he said. “We’ve already gotten $52,000 that was contributed by Shelby County to assist us in constructing this.”
When Caruthers asked what drove the cost of the project up so high, Trusty cited several factors.
Because there is currently “a lot of work” for contractors, he said prices are increasing in some cases while not in others.
Trusty also said contractors know what it is like to “deal with” this particular department of the state government.
If plans call for a chain to be 6 feet long, and it is 6 feet 2 inches, he said TDEC will make them change it. So, the contractors will “build in” higher estimates for the things they will have to spend extra time on.
And because this project included a certain amount of volunteer labor, Trusty said the contractors built in “some extra” to allow them to deal with not having all of the construction “under their control.”
In response to questions by Alderman Bethany Huffman, Trusty said he believes the “time line” for completing the project is within two years, and the city is now “down to about six months.”
But Alderman Don Lowry said returning the grant does not prevent Millington from trying to obtain the funds again at a later time.
He also noted that, if contractors have any “problems” with doing the work, they will include all the “extras” in their bids to make them as high as possible.
“They really don’t want to do the work,” he said. “That’s just plain and simple.”
In response to a question by McGhee, Trusty said the city cannot “modify the requirements” and still qualify for the grant.
“The state has told us that we will have to deliver what was in the original grant application,” he noted. “What’s in the bid specs is exactly what the state now expects to receive for its $500,000.”
City Manager Ed Haley agreed with Trusty that the veterans memorial part of the project should be completed and the remainder done in phases as money becomes available.
“Sometimes, you just can’t afford something,” he concluded. “And I think this is where we are if we set our priorities right now. As hard as it hurts me to say we ought to give some money back to the state, I think this is a time we need to do it.”
By Bill Short