The Minot City Council voted Monday to reject bids on the proposed Northwest Fire Station and cancel the contract still to be signed for the retaining wall.

The council took the action after City Manager Tom Barry reported that the battering of the economy by the coronavirus and tanking oil prices could cost the city $10.2 million in revenue. Anticipated Hub City funding from the state of $6.3 million could take a hit of $1.5 million to $3 million due to the decline in the state’s oil industry. Hub City funding was to provide $1.35 million toward the fire station and $2 million toward the retaining wall.

Additional Hub City funds were earmarked for equipment purchases and highway reserves. Most of the highway reserves are committed this year to the 31st Avenue SE reconstruction project that already has started.

The council looked at the fire station and retaining wall because those projects are at a decision point. In March, the council accepted the bid of $4.8 million from Strata Corp. to construct a new retaining wall. Bids had been received but none yet accepted on the fire station.

File Photo Replacement of a city hall retaining wall, shown behind city hall in March, has been in the works but will be delayed.

“We need to be very conservative in our estimates about what revenue we will have. We are at the very beginning of a wildly uncertain future,” council member Josh Wolsky said. “Given that environment, we cannot control our revenue. We can control our costs, and these are two significant high-spend areas where we can control our costs.”

There was support for staying the course, though.

“I don’t want to become stagnant in our city,” council member Paul Pitner said. “Both of these projects, I think, are long overdue. I’d hate to see both of them fall by the wayside.”

The motion to reject bids on the fire station and cancel the retaining wall project failed 4-3, gaining support from only Shannon Straight, Mark Jantzer and Wolsky.

“I believe that we do have the funding in place to do the retaining wall, and I think that we also have the opportunity to follow through with what we said we were going to do,” council member Lisa Olson said. ” All we need is a signed contract. We have the opportunity to invest in our city, invest in our infrastructure and put some people back to work that probably haven’t had a paycheck for a while. So I think that is our responsibility. I agree with alderman Wolsky when he says that we need to be conservative going forward. I think that we will look at different projects differently, knowing what our funding source is, but we do have the funds in place to do this. I think we need to follow through.”

The council then voted on each project separately and approved moving the retaining wall project to 2022 on a 4-3 vote, with Stephan Podrygula joining the supporters. Podrygula held his ground on the fire station, though.

“I just can’t in good conscience put off the fire station for one more year. We’ve been trying to get better protection in Minot for probably close to a generation now,” Podrygula said. “I just don’t feel comfortable putting off the public safety part of it, and, again, I’m willing to sacrifice lots of other things and probably just about anything else.”

A motion to delay the fire station construction by a year passed 5-2, with all but Podrygula and Pitner in support.

Initially, the city had planned the fire station as a three-year project. The council, in budgeting for 2020, tapped reserves to accelerate the schedule. Jantzer noted the city accelerated the fire station because funds were available. Now those funds are strained.

“It seems to me like going back to what was the original schedule on this is not a terrible decision at this point,” he said.

“To go forward right now with all the variables that are out there, taking money from reserves to pay for this project, I think is not just short-sighted but I think it’s a little bit disconcerting. We’re in some very tenuous financial times,” Straight said. “I think everybody is mindful of the stress on the public, on wages and what we can pay for.”

The city will incur some costs with both projects in having come this far with them.

Delaying the retaining wall replacement to 2022 prevents a physical conflict with plans in 2021 to relocate nearby utilities in advance of the Maple Diversion portion of the flood protection project. Barry said a proposal will come to the council later for maintaining the existing retaining wall in the two-year interim.

Barry also said recommendations for dealing with a projected 25% decline in sales tax revenue will be forthcoming in the near future. The decline reduces the $6.8 million estimated to be collected for flood control by $1.1 million.

“The good news here is that should not delay the project because we are still continuing to use reserves,” Barry said. “What we would do is essentially continue to use those reserves, keep the project on schedule, hope to make this up in future years, or potentially if we can’t, then maybe something else like bonding – a little bit more, a little bit sooner – could also take place.”

Sales tax collections for tax relief, NAWS, infrastructure and economic development also would be affected. The potential tax relief reduction is $470,000 or 2.3 mills. Barry said there should be reserves to make up for the loss in tax relief dollars.

The sales tax impact to capital and infrastructure projects is about $800,000.

“We are looking at projects that we can potentially modify or delay or postpone,” Barry said. “Because we did collect a little bit more last year, again there is some opportunity to use some reserves, potentially, to offset reductions in projects at this point in time.”

He said the city entered 2020 with an extra $2 million in sales tax collections beyond the 2019 forecast. He added property tax is unlikely to be affected by the economic downturn this year, although the impact could be felt in 2021.

In other collections, highway funds are projected to be down 30%, parking facilities and state aid each 15% and the airport and building permits each 10%. Interest collections could be down $1 million.

“It’s possible they could be impacted a lot less than this and it’s possible that they could be impacted a lot more. We just really don’t know at the moment, but we want to be thinking this through and identifying approaches to how we could mitigate for this,” Barry said.

Because of restrictions on gatherings due to the coronavirus, the city is postponing the community conversation necessary to take the next steps toward curbside recycling. It also is postponing any next steps on the downtown gathering space following the completion of an environmental assessment on a third site.

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The City of Minot has developed a website portal to better enable residents to have their voices heard on topics before the Minot City Council.

In the form center at minotnd.org is a page for submitting comments on agenda topics or other items to council members. Comments need to be submitted by noon on the day of the upcoming council meetings. Using the form is an option to individually emailing council members.

“Certainly we are trying to continue accessibility in these meetings to the greatest degree we can while also socially separating,” City Manager Tom Barry said.