The Marquette City Commission in three split votes Monday amended the scope of services for the project’s design work totaling $10,000, and approved two property purchase agreements.

All three votes on the hospital transportation project were 6-1, with Commissioner Sara Cambensy opposing, citing financial risk to taxpayers.

The city reached a deal with Jan and Linda Johnson for their duplex at 518 S. Seventh St. for an agreed upon cash payment of $290,000, funded through the Brownfield Plan for the Duke LifePoint hospital.

The purchase agreement was negotiated without the need for seizure by eminent domain, which the commission authorized in May when negotiations were not initially successful. Eminent domain is the right of a government to expropriate private property for public use, with compensation.

Construction is underway Tuesday at the intersection of Baraga Avenue and Seventh Street. The city of Marquette has approved the last of the property purchase agreements needed to complete the transportation improvements for the new hospital under construction on Baraga Avenue. (Journal photo by Rachel Oakley)

The Johnson sisters resisted selling their property, claiming the city’s third-party assessment of $153,000 was too low. The city also made higher offers of up to $250,000, officials said.

Linda Johnson claimed at the time the property was worth $500,000 as an income property.

The property is needed to complete the planned transportation improvements for the hospital replacement project.

Commissioner Mike Plourde thanked city staff and the city attorney for effective negotiations and avoiding eminent domain.

“I don’t think anybody on this panel wants to take any property on eminent domain, but we had to look at that as a possibility,” Plourde said. “I’m happy we don’t have to do that.”

Mayor Dave Campana commented on the high cost of the property.

“Had this went to eminent domain, there’d be litigation costs that would go on for who knows how long and then to bring the road developers back would be expensive,” Campana said. “So in the long run, this is advantageous to the city. We are saving money.”

The commission also approved a purchase agreement for a portion of property at 601 Fisher St. in the amount of $42,000, which will also be funded through the hospital Brownfield Plan.

The $10,000 amendment to the transportation project is due to design changes based on direction from the Michigan Department of Transportation, according to city documents.

City staff requested the increase to cover costs for the city’s consultant DLZ Michigan Inc.

Mayor Pro-Tem Tom Baldini said this is the second or third time the budget had to be amended due to extra requirements from MDOT.

“They gave us the permit for the project and they’ve been nickel and diming us,” Baldini said. “But they can control the final authorization so we have to go ahead and approve this.”

Commissioner Sarah Reynolds recalled an amendment a couple of months ago.

“The city manager said this would be the last time we had to amend the scope, but now the state of Michigan is requiring new things, so that’s why I seconded it and I’m voting for it, but it doesn’t necessarily make me too happy,” Reynolds said.

In December, the commission amended the scope of services for transportation planning to the tune $165,000 from the original $785,000 budget. The changes, which were required by MDOT to manage storm water runoff in the Whetstone Brook area among other issues, also added about $1 million to the total project cost, city staff said.

Cambensy expressed concern that there was only a letter from DLZ describing the need for the additional $10,000 and nothing from the state with any further explanation.

“When that’s missing I think perception can become reality, and I think a lot of people have the perception that we’re not being careful enough or we’re not being transparent enough with what the needs are,” Cambensy said.

Community Development Director Dennis Stachewicz said typically the city doesn’t get letters from the state.

“(MDOT) has an onsite inspector, several onsite inspectors, that coordinate with our staff on field changes that may be necessary,” Stachewicz said. “(These changes are) dealing with hydraulic challenges again, dealing with the stream, and we needed DLZ to get that done for us.”

Cambensy has consistently opposed the hospital deal, approved by the commission in 2014, which made the city responsible for transportation improvements on U.S. 41 and other streets.

The city has bonded $18 million for the just-completed Municipal Service Center on Wright Street, formerly located at the site of the new hospital, and plans to bond about $11.2 million for the transportation project this fall.

The projects are reimbursable through the Marquette Brownfield Redevelopment Authority via tax increment financing, with taxes captured from the for-profit DLP to be used to pay back the city’s public bonds.

The hospital deal has security measures in place, but taxpayers could be on the hook for about $10 million of the $30 million in bonds should the hospital declare bankruptcy or become a non-profit, non-taxable entity, city officials have said.

Mary Wardell can be reached at 906-228-2500, ext. 248. Her email address is mwardell@miningjournal.net.