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Council approves $340,455 low bid for Taylor Street paving; panel discusses how to use surplus
Summary
The Common Council accepted a $340,455 low bid from Northeast Asphalt for the Taylor Street project — about $160,000 under the city's $500,000 estimate — and members discussed holding surplus funds for future road work subject to committee or council approval.
The Common Council of the City of Merrill voted Tuesday to accept a low bid of $340,455 from Northeast Asphalt for the Taylor Street paving project, the board reported.
Board of Public Works member Ehrke presented the bid results, saying, "We received bids last Thursday, 2 bids, 1 from Northeast Asphalt, 1 from American Asphalt. The low bid of 340,455 from Northeast Asphalt. Somewhere in the neighborhood of $160,000 below our estimate." Ehrke attributed the gap in part to lower asphalt prices, noting, "Last year they were $114 a ton, and this year, they're down to $81 a ton."
Why it matters: The bid comes in significantly under the council's $500,000 estimate, creating options for the council about whether to spend or reserve the difference. During discussion, an alderperson asked, "since you overestimated that cost, where does that money go that that you had over budget?" Ehrke said the city normally budgets and borrows on a multi-year cycle and that some funds could be carried forward: "We did apply our state grant to this project too so we're gonna have somewhere in the neighborhood roughly about almost $200,000 that we can hold over until next year and possibly use that on projects next year… but it would have to come back as far as, an approval from the committee or from this, from the council."
Council action and next steps: A motion to accept the low bid was made and seconded and the council approved the bid by voice vote. Ehrke said the bid award will be brought forward consistent with procurement rules and that any reallocation of remaining funds for other streets would require committee or council approval.
Context and budget detail: Ehrke told the council the city's $500,000 estimate used an average of recent years' prices; with the current lower per-ton cost the low bid was substantially under that estimate. He also noted the city typically borrows around $250,000 per cycle and that this cycle the city planned to borrow twice that amount, providing flexibility for future road work.
The council did not record a roll-call vote on the item; the approval was taken by voice vote. The board will move forward with the contract award to Northeast Asphalt under the terms presented to the council.
