City approves $6.35 million award for Korean West wastewater project to Smoothstone Construction

The City Council voted to approve a $6,351,389 contract award to Smoothstone Construction LLC for the "Korean West wastewater improvement project 2026," after Sunrise Engineering identified Smoothstone as the apparent low bidder and recommended award pending funding-agency concurrence.

A letter read to the council by a Sunrise Engineering representative said, "The apparent low bidder was Smoothstone Construction LLC with a base bid of 2,943,550. The total combined bid including bid alternates 1, 2, and 3 was $6,351,389." The letter, signed by Josh Nelson of Sunrise Engineering, stated the firm demonstrated compliance with bid requirements and that the bid appeared reasonable against the engineer's estimate and current market conditions.

The nut of the decision was funding and risk. Sunrise Engineering told the council that five of the six bids—when all alternates were included—exceeded currently available project funding, but the low bid allowed the city to accept the base bid and alternates 1–3 and proceed with an approximately 3.9% construction contingency. The consultant noted that typical contingency recommendations range from about 5% to 10% and said the city would pursue supplemental funding only if the contingency looked likely to be exceeded or as directed by funding agencies.

Sunrise Engineering also reported preliminary discussions with USDA Rural Development that indicated $200,000 to $400,000 in loan funding might be available; the letter added the city could pursue supplemental funding through DWQ. The letter further noted the city had previously approved a bond resolution allowing up to $3,900,000 in loans and currently had roughly $3,400,000 in loans outstanding, which would permit about $500,000 in additional borrowing without delay.

Mayor Shane Baton asked whether the low bidder's price warranted concern, noting a roughly $1 million difference between the apparent low bid and the next-closest bid. The Sunrise representative said such variation is not uncommon in construction procurement, pointing to factors such as contractor location, scope clarity and differing assumptions about site conditions.

On a motion to approve the low bid, the council voted in favor; no roll-call tally was recorded in the minutes, and the mayor announced "Motion carries." The council also approved sending the notice of award and indicated Sunrise Engineering would submit a supplemental funding application to USDA RD if necessary. Sunrise Engineering said it plans a bond-closing meeting next week and expected contractors to begin work as procurement and material lead times allow; the firm cautioned precast materials typically require six or more weeks for delivery.

The contract award is subject to concurrence from USDA Rural Development and the state Division of Water Quality, as noted in the engineering letter. The council did not set a start date at the meeting; Sunrise Engineering said work would begin once procurement and agency approvals are in place.