Adopting a Resolution approving second amendments to the 2026 Water Utility Capital Budget totaling $1,573,300, including an additional $488,000 for the Country Club Road Water Main Extension Project, City Project J7862, increasing total authorized project funding from $1,200,000 to $1,688,000, and an additional $1,085,300 for the Kalmar Booster Station project, increasing total authorized project funding from $2,150,000 to $3,235,300.

On September 9, 2026, the Common Council approved amendments to the 2026 Water Utility Capital Budget that included $1,200,000 for the Country Club Road Water Main Extension Project and $2,150,000 for the Kalmar Booster Station project. Since that approval, construction bids have been received for both projects and additional budget authority is required to proceed.

Country Club Road Water Main Extension

The Country Club Road Water Main Extension Project, City Project J7862, extends public water main along Country Club Road SW from West Circle Drive to 45th Avenue SW in coordination with City of Rochester Public Works sewer improvements. The project will support the proposed Del Webb residential subdivision being developed by Pulte Homes of Minnesota LLC and the West Meadows subdivision being developed by ML Group I LLC.

The original project authorization was based on an estimated total water main project cost of approximately $1.2 million. Construction bids have now been received, and based on the bid results, RPU's required funding for the water improvements is expected to total approximately $1,688,000. This represents an increase of $488,000 over the previously authorized amount.

Bid prices exceeded the original estimate primarily because of higher-than-anticipated costs for the temporary stream diversion system, trench dewatering, and 12-inch ductile iron water main.

On September 29, 2026, the RPU Board authorized an additional expenditure of $488,000 for the project and recommended that the Common Council approve a corresponding second amendment to the 2026 Water Utility Capital Budget.

Kalmar Booster Station

Continued growth in northwest Rochester has extended development into higher elevations beyond the existing Northwest High pressure zone, requiring formation of a new pressure zone to provide adequate water service and support future development. The proposed Kalmar pressure zone will serve approximately 1,700 acres and requires construction of a booster station near 60th Avenue NW and Kingsbury Drive within the Pebble Creek subdivision.

On April 28, 2026, the RPU Board authorized expenditure of up to $250,000 for engineering design services for the Kalmar Booster Station. On August 25, 2026, the RPU Board approved and recommended Common Council approval of an amendment to the 2026 Water Utility Capital Budget providing $2,150,000 for the project.

RPU solicited construction bids for the Kalmar Booster Station on August 13, 2026, with a bid opening on September 11, 2026. RPU received one responsive bid from Rice Lake Construction Group of Deerwood, Minnesota, in the amount of $2,540,300. The construction bid, together with project design, construction administration, communications and instrumentation, financing, and contingency costs, results in a revised total project budget of $3,235,300.

The revised project budget is $1,085,300 greater than the $2,150,000 previously authorized. The increase reflects construction bid results as well as costs associated with the completed project scope, including backup power generation until elevated water storage can be constructed within the new pressure zone.

On September 29, 2026, the RPU Board authorized award of the construction contract to Rice Lake Construction Group contingent upon Common Council approval of the proposed budget amendment and recommended that the Common Council approve an additional $1,085,300 amendment to the 2026 Water Utility Capital Budget.

Approval of the requested amendments will provide the additional budget authority necessary for both projects to proceed based on the construction bids received.

The Country Club Road Water Main Extension and Kalmar Booster Station support RPU's responsibility to plan for reliable water infrastructure as Rochester grows. Both projects provide infrastructure needed to serve planned development and support long-term water distribution system reliability.

The projects support the City's strategic priority of maintaining reliable, sustainable infrastructure through long-term planning for Rochester's water distribution system.

September 8, 2025: Common Council allocated $113,000 from the Water Connection Fund for design expenses associated with the Country Club Road Water Main Extension Project.

October 28, 2025: RPU Board approved the Water Fund 2026/2027 Capital and Operating Budget.

December 1, 2025: Common Council approved the Water Fund 2026/2027 Capital and Operating Budget.

April 28, 2026: RPU Board authorized expenditure of up to $250,000 for engineering design services for the Kalmar Booster Station.

August 25, 2026: RPU Board authorized expenditures of up to $1,200,000 for the Country Club Road Water Main Extension Project and approved the related Water Extension Improvement, Petition and Waiver, and Reimbursement Agreements.

August 25, 2026: RPU Board approved and recommended Common Council approval of $2,150,000 in 2026 Water Utility Capital Budget authority for the Kalmar Booster Station.

September 9, 2026: Common Council approved amendments to the 2026 Water Utility Capital Budget that included $1,200,000 for the Country Club Road Water Main Extension Project and $2,150,000 for the Kalmar Booster Station project.

September 29, 2026: RPU Board authorized additional project expenditures of $488,000 for the Country Club Road Water Main Extension and $1,085,300 for the Kalmar Booster Station and recommended corresponding second amendments to the 2026 Water Utility Capital Budget.

Approval would second amend the 2026 Water Utility Capital Budget by $1,573,300, consisting of:

•    $   488,000 for the Country Club Road Water Main Extension.
•    $1,085,300 for the Kalmar Booster Station.

The projects would initially be funded using available Water Fund cash reserves. Subject to Common Council authorization of the proposed short-term borrowing, RPU intends to use borrowing proceeds to reimburse the Water Fund for eligible expenditures.  Interests expense would be increased by $86,532 per year if the total amount is debt is funded at a short-term rate of 5.5%

The Common Council could decline or defer approval of the 2026 Water Utility Capital second budget amendment. Doing so could delay RPU's ability to award the Country Club Road Water Main Extension, and Kalmar Booster Station on schedules intended to support planned development.