Jackson CD 3

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Location: primarily Ewington and Alba Townships, but also includes sections of West Heron Lake and Rost Townships 

Size: provides drainage to approximately 15 square miles or 9,909 total acres 

Proposal: consists of cleaning/improving 3 open ditches, constructing 21 new tile branches and 19 new tile sub branches.

Status: The petition for outlet for the existing Lateral 1 was submitted to Jackson County. The Jackson County board held a hearing for this on November 21, 2017. The Jackson County Commissioners voted unanimously to grant the petition contingent upon the approval of the CD 3 improvement project. They also voted unanimously to adopt the benefits and outlet fees as recommended.

An appeal of the Redetermination of Benefits was filed with the court administrator on August 2, 2017. The Jackson County board held a hearing on December 7, 2017 to hear a request for a new Redetermination of Benefits on CD 3. The Jackson County Commissioners voted unanimously to deny a request for a new redetermination based on the fact that there is not reason to change it, that they approve of the method used, and that there is no reason that it is not correct.

The HLWD held Adjourned Hearing 2 on March 29, 2018. Based upon the evidence, the Board of Managers of the HLWD found that the detailed survey report and viewers' report have been made and other proceedings have been completed under Minnesota Statutes Chapter 103#; that the reports made or amended are complete and correct; that the damages and benefits have been properly determined; that the estimated benefits are greater than the total estimated cost, including damages; that the proposed drainage project will be of public utility and benefit, and will promote the public health; and that the proposed drainage project is practicable.

On April 17, 2017, the Board of Managers of the HLWD approved the Findings of Fact and Final Order Establish Drainage Project, Adopting and Confirming Viewers' Report of Improvement Benefits and Damages, Authorizing the Application of Separable Maintenance, and Direcint Construction of the Project.

Alba Grain, Inc. filed an Appeal from the Final Order for Jackson CD 3 with the Jackson County Auditor on May 15, 2018. Informational statements were filed with the District Court on September 25. A scheduling conference was held on October 2.

The judge's order, issued on October 8, stated: Depositions were to be completed on or before November 2. Discovery and disclosure of experts or rebuttal witnesses were to be completed in full on or before December 31. A motion hearing, dispositive or non-dispositive shall be held on January 15, 2019. A Pre-Trial Conference shall be held by phone on March 12, 2019. The court trial is scheduled for March 21 and 22, 2019. The alternative dispute resolution process of mediation shall be used in this matter and shall be completed in full on or before March 1, 2019.

Mediation for CD 3 was held on February 11, 2019 in New Ulm, Minnesota. Bruce Sellers, petitioners' attorney; Chuck Brandel, HLWD engineer; Louis Smith, HLWD legal counsel; and Jan Voit, HLWD Administrator were in attendance. A tentative settlement was reached. Louis Smith presented the proposed settlement to the Board of Managers of the HLWD during a closed meeting on February 19. The board approved the settlement when the meeting was re-opened.

The bid packets and advertisement for the Jackson CD 3 improvement project were mailed on May 17.
• June 11 – Bid Package 1 – Open Ditch and Pond
• June 14 – Jackson County Culverts
• June 18 – Bid Package 2
• June 25 – Bid Package 3
• July 2 – Bid Package 4
• Award on July 23 at HLWD meeting

The board tabled action on the bids at the July 23 meeting. Because of this, much time was spent in discussion with Bruce Leinen, Chuck Brandel, Bruce Sellers, and Louis Smith over the course of July 24 and 25. Bruce Leinen scheduled a special meeting for August 1. Action items include bids for CD 3 as well as short-term financing. The chronological history of the project was updated. Louis Smith sent correspondence to Sherry Haley, Jackson County Attorney on July 25.

Bruce Leinen and Harvey Kruger met with Jim Eigenberg and Cathy Hohenstein, Jackson County on July 29. A report on the meeting with Jackson County Commissioners will be given at the August 1 special meeting. Bruce Leinen, Louis Smith, and Jan Voit had a conference call on July 29. Louis Smith will draft a resolution requesting that Jackson County bond for the CD 3 project.

On July 30, a conference call was held with John Jaschke and Tom Gile, BWSR and Ray Bohn and Emily Javens, Minnesota Association of Watershed Districts (MAWD). Jan Voit gave them an update on the situation with CD 3. Discussion was held regarding statutory authority. There is no process in statute for a watershed district to relinquish drainage authority. Service contracts could be done for certain aspects that the HLWD would want the county to do.

On August 1, the HLWD held a special meeting to address the bids for CD 3. A report on the meeting with two Jackson County Commissioners was given. Bruce Sellers asked the board to accept the bids and proceed with the project. Louis Smith explained the resolution from Jackson County that requires the HLWD to relinquish drainage authority in order for the county to bond for drainage projects within the watershed. George Eilertson explained the possibility of short-term borrowing for CD 3 construction. Chuck Brandel again recommended awarding the bids. The board approved a motion that asked Jackson County to provide long-term financing, accepted the bids and awarded construction contracts, and authorized the District Administrator to work with George Eilertson to obtain short-term financing. A motion was approved to Authorize Northland Securities to obtain proposals for short-term financing. A motion was approved to continue discussion with Jackson County. A letter and the resolution were sent to Jackson County on August 1.

On August 6, Harvey Kruger, Bruce Leinen, and Jan Voit attended the Jackson County board meeting. The commissioners approved a resolution that they would bond for current projects “only upon receipt of a resolution of the HLWD Board of Managers acknowledging that its management of public drainage systems within Jackson County is in conflict with the priorities of the watershed district as set forth in its Watershed Management Plan, or is not beneficial to the public welfare or interests; requesting voluntary return of all drainage systems jurisdiction to Jackson County, as Drainage Authority, for the Jackson County drainage systems currently administered by the HLWD; and directing that future petitions for construction of new drainage systems or improvements of existing drainage systems in the watershed district be forwarded to the Jackson County Board for action after filing with the HLWD Board of Managers.”

In response to the HLWD’s request for a joint meeting, Steve Duncan, Jackson County Coordinator sent the following, “Per the request to have a joint Board meeting, the Jackson County Board would like to know what specific agenda items the HLWD wishes to discuss (in detail). I think there is a desire to not meet just to re-hash HLWD disagreement with the County's position or already covered ground. Assuming the Jackson County Board is agreeable to a meeting to discuss agenda items they feel might be productive for both entities, they would also like to have the other County Boards that make up the appointing bodies to the HLWD invited to join in such a meeting too. If you can discuss with the Board of Managers what would be the specific agenda items that they would like to discuss (again, I would stress that the topics be detailed and not overly broad), and whether they would be agreeable to trying to have the other counties involved in such a meeting, the Jackson County Board would be appreciative of this information in determining if they see value in holding such a meeting.”

After speaking with Bruce Leinen and Louis Smith regarding this response, a conference call was held with John Jaschke, BWSR; Emily Javens and Ray Bohn, MAWD; Louis Smith, and Jan Voit on August 14. John Jaschke’s recommendation was to facilitate a meeting with Jackson County. There is not a need to include other counties, since the HLWD is not currently working on any drainage projects outside Jackson County. He asked that Louis provide him with a letter that identified the items to be addressed. This information was provided to BWSR on August 16.

Mike LaMaack contacted Jan Voit on August 16 to let her know that Bank Midwest would not be submitting a bid. She informed George Eilertson. George called me later in the day to say that one bid had been received. It was from Bremer Bank for $9.3 million at 2.4 percent interest. He let Jan Voit know that he would inform Stephen Rosholt, bond counsel with Kutak Rock. Stephen submitted the award resolution and loan agreement on August 16. George Eilertson sent the financing agreement on August 19. The remaining paperwork was finalized on the afternoon of August 20 and presented to the managers at the meeting.

The Board approved short-term financing at their meeting on August 20. The loan closing is scheduled for September 16.

The memo regarding the CD 3 preconstruction meeting was reviewed and revised on September 6. ISG sent the meeting notices.

On September 10, Jan Voit had a phone conversation with Randy Serreyn, Bremer Bank. Discussion was held regarding the process for monthly draws on the short-term financing.

The preconstruction meeting was held on September 17. Chuck Brandel and Jacob Rischmiller gave a project overview. Contractors from Larson Contracting, Inc., Dirt Merchant, Inc., and Loo Con, Inc. were introduced. Landowners had the opportunity to ask questions. There were 43 landowners in attendance.

Several landowners have requested a cost estimate. Much time has been spent creating the assessment worksheet. The updated document, along with questions regarding several parcels, was sent to Kevin Nordquist, Jackson County Auditor-Treasurer and Ron Ringquist, viewer.

On October 10, Jan Voit spoke with a representative of the US Department of Commerce. CD 3 has been chosen from a random sampling to provide statistical information regarding the trend of construction in the US. They are sending an information packet.

Larson Contracting started construction in mid-October.

In order to finalize the assessment worksheet, Jan Voit met with Kevin Nordquist, Ron Ringquist, and Chuck Brandel on October 21. Ron and Chuck clarified landowner property questions. Jackson County will provide split information. Once the splits are done, the worksheets will be updated with the bid prices.

Chuck Brandel contacted Jan Voit on November 19 regarding Jackson County Road 63. He asked that the board be made aware that Jackson County has requested that their gravel County Road 63 be bored, not open cut. Previously all gravel roads in Jackson County had been open cut. This one is well traveled, so the highway department requires it to be bored. The board was informed about this development at the regular monthly meeting on November 19.

At a special meeting on December 2, Chuck Brandel explained that ISG received comments from the Minnesota Pollution Control Agency (MPCA) regarding erosion control. MPCA is requiring a bioroll around intakes near the pond, a stabilized construction exit, and a rock check dam. At this point, none of these additional items have been used and they may not need to depending on progress and timing. If needed they will be available for erosion protection/prevention.

Chuck Brandel and Jacob Rischmiller explained Change Order #1 on Bid Package 2. Until now, all gravel road crossings in Jackson County have been open cut. Jackson County Public Works is requiring County Road 63 to be bored. Road crossing costs are the road authority’s responsibility. Both of these change orders were approved.