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The city of St. Charles is assuming road maintenance responsibilities for the Reserve of St. Charles subdivision because city officials say developers are refusing to complete needed street repairs in the second phase of the development.
City Council members at their Oct. 2 meeting voted to authorize Mayor Lora Vitek to demand payment under the developer’s letter of credit and to authorize a construction contract with Geneva Construction Co. for street pavement work in the subdivision.
City Administrator Heather McGuire said the city has been in communication with developer Omni-tech LLC. She said the developer told the city it will not be completing the scope of work and is willing to have a $343,249 line of credit pulled to pay for the maintenance.
The motions were approved in a unanimous vote as part of the consent agenda without discussion. The line of credit will be obtained from the bank to complete the streets and will be paid to Geneva Construction for the scope of work.
Approval of the contract with Geneva Construction is contingent upon the city successfully obtaining the letter of credit funds. Once the funds are obtained, the contract will be signed and Geneva Construction will schedule the work.
Geneva Construction’s estimated cost of construction is $363,000, which would leave the city with a deficit of about $20,000.
McGuire said the goal is to complete the street repairs within the letter of credit budget and if a deficit occurs, the city will have to decide where the additional funds will come from. Options include drawing from the city’s general fund or pursuing the developers in court.
Government Operations Committee members previously moved to recommend approval of the motions at a Sept. 18 meeting after Planning and Development Committee members voted against recommending the same motions at a Sept. 11 meeting.
Since the previous meetings, staff reviewed options for alternate construction methods to reduce the cost of the street work. In a revised proposal, the amount for curb replacement was reduced, lowering the cost from $385,000 to $363,000.
The final cost will be based on actual work and will not be known until the work is completed.
Because construction season is almost over, the ability for the contractor to schedule and complete the work this year is weather‐dependent. Geneva Construction has indicated it will attempt to fit the project in this year, according to the agenda item from community development director Russel Colby.