Item 5.1 2026 Street Renewal Project
Request for
City Council Action
DEPARTMENT INFORMATION
ORIGINATING DEPARTMENT REQUESTOR: MEETING DATE:
Public Works City Engineer Wagner February 23, 2026
PRESENTER(s) REVIEWED BY: ITEM #:
Public Works City Administrator/Finance Director Flaherty 5.1 – 2026 Street Renewal
Project
STRATEGIC VISION
MEETS: THE CITY OF OTSEGO:
Is a strong organization that is committed to leading the community through innovative communication.
X Has proactively expanded infrastructure to responsibly provide core services.
Is committed to delivery of quality emergency service responsive to community needs and expectations in a
cost-effective manner.
Is a social community with diverse housing, service options, and employment opportunities.
Is a distinctive, connected community known for its beauty and natural surroundings.
AGENDA ITEM DETAILS
RECOMMENDATION:
City staff recommends the City Council adopt a resolution receiving a feasibility report and calling a hearing on an
improvement project.
ARE YOU SEEKING APPROVAL OF A CONTRACT? IS A PUBLIC HEARING REQUIRED?
No Yes, proposed to be held March 23, 2026
BACKGROUND/JUSTIFICATION:
The 2026 Street Renewal Project Feasibility Report, authorized by the City Council in October 2025, has been completed
and was presented for review and discussion at a Special City Council meeting on February 23, 2026.
The Feasibility Report outlined two proposed methods of reconstruction of 70th Street NE from Kadler Avenue west to
the intersection with 71st Street NE and for reconstruction of 71st Street NE within the I-94 West Industrial Park.
A Public Hearing to present the study to residents will need to be held to continue forward with the project with the
potential for assessments in accordance with Minnesota Statutes, Chapter 429.
The Capital Improvement Plan (CIP) included a budget in the amount of $486,375 for this improvement project. The
total estimated project costs within the Feasibility Report range from $522,034 to $1,351,228 and will be funded by
special assessments in an amount to be determined during discussion at the February 23, 2026, Special City Council
meeting, and the remaining balance of the project paid with funds from the City’s Pavement Management Fund.
SUPPORTING DOCUMENTS ATTACHED:
• Feasibility Report
• Resolution 2026-15
POSSIBLE MOTION
PLEASE WORD MOTION AS YOU WOULD LIKE IT TO APPEAR IN THE MINUTES:
Motion to adopt Resolution 2026-15 Receiving Feasibility Report and Calling Hearing on Improvement.
BUDGET INFORMATION
FUNDING: BUDGETED:
Fund 201 – Pavement Management
Yes
FEASIBILITY REPORT
FOR
CITY OF OTSEGO
2026 STREET RENEWAL PROJECT
RECONSTRUCTION OF:
70TH STREET NE (WEST END TO KADLER AVE NE)
OTSEGO I-94 WEST INDUSTRIAL PARK
71ST STREET NE
January 9, 2026
Prepared by:
3601 Thurston Avenue
Anoka, MN 55303
Telephone: 763-427-5860
I hereby certify that this plan, specification, or report was prepared by me or under my
direct supervision and that I am a duly Licensed Professional Engineer under State of
Minnesota Statutes Sections 326.02 to 326.16.
44985 January 9, 2026
Matthew Kind Reg. No. Date
TABLE OF CONTENTS
I. INTRODUCTION ....................................................................................... 1
II. PROPOSED PROJECT ............................................................................ 9
III. INITIATION ................................................................................................ 12
IV. FEASIBILITY ............................................................................................. 12
V. RIGHT-OF-WAY / EASEMENTS ............................................................... 12
VI. PERMITS .................................................................................................. 12
VII. COMPLETION ........................................................................................... 12
VIII. PRELIMINARY PROJECT SCHEDULE .................................................... 12
IX. ESTIMATED PROJECT COST ................................................................. 12
X. PROPOSED FUNDING ............................................................................. 16
XI. ESTIMATED ASSESSMENT ..................................................................... 16
XII. ASSESSMENT .......................................................................................... 16
XIII. CONCLUSION AND RECOMMENDATION .............................................. 18
EXHIBITS
A. 2026 STREET RENEWAL MAP ................................................................ 2
B. 2025 CITY PCI RATING MAP .................................................................. 8
C. TYPICAL STREET SECTIONS ................................................................. 10
D. ENGINEER’S ESTIMATE ......................................................................... 14
E. BENEFITING PROPERTY MAP ................................................................ 17
ATTACHMENTS
1. PRELIMINARY ASSESSMENT ROLL
1
I. INTRODUCTION
The purpose of this Feasibility Report is to present the City of Otsego with a
preliminary examination of municipal street improvements for the following list of
streets within Otsego, Minnesota. This report discusses the proposed scope of
improvements, preliminary cost estimates, and a project schedule.
For this project, two options are being considered for the reconstruction of
the proposed streets.
Option A1: Full-depth reclamation of both existing rural streets with no
additional improvements.
Option B1: 70th Street NE widening with right turn lanes at entrances of 71st
St NE. 71st Street NE adds curb & gutter, and storm sewer.
Funding for Options A1 or B1: 70th Street would be paid 100% by the City of
Otsego via the City Pavement Management Fund 201, while the funding source for
71st Street would be 100% assessed. Costs for stormwater improvements may be
covered via City Storm Water Fund 603. Apportionment of funding between
benefiting parcels and City for the entire project to be determined.
This report has been prepared in compliance with Minnesota State Statute 429 for
projects resulting in special assessments.
1. 70th Street NE (West End of 71st to Kadler Ave NE)
2. 71st Street NE
The following map shows the streets (highlighted in red) being proposed for
reconstruction and identifies the eligible assessable parcels numbered 1 to 10.
2
EXHIBIT A
2026 Street Renewal Map
3
The following table lists each street, with its respective Pavement Condition Index
(PCI) number, build year, and improvement year, if any.
Street 2025 PCI Built Overlay
70th Street NE (71st west entrance to Kadler) 42 1992 2008
71st Street NE 54 2001 -
The PCI rating for 70th Street NE has a rating of 42, from existing businesses.
An overlay was installed on 70th St only from 71st St to Kadler Ave in 2008 due to
accelerated wear from heavy trucks. 71st Street is about 25 years old and to date
has never been reconstructed. The road sections considered for this project have
an average PCI rating of 48, which is well below the average of all streets in the
City of Otsego. A PCI rating of around 50 shows that structural degradation will
accelerate and thus will require more frequent repairs. When repairs of low PCI
streets become a substantial annual cost to the City, it is recommended that the
street be reconstructed.
Existing street surfaces are 24-33 years old, with the one overlay being
nearly 18 years old. The pavements are experiencing block, alligator, edge, and
thermal cracking due to usage and aging. As shown in the provided photos (pages
4-7), the streets listed for this feasibility report have a high number of patches.
4
70th Street NE
5
70th Street NE
6
71st Street NE
7
71st Street NE
8
EXHIBIT B
2025 City PCI Rating Map
9
II. PROPOSED PROJECT
The 2026 Street Renewal Project is scheduled to reconstruct 2 municipal
streets. Currently both streets fall under the definition of a rural street section (no
curb) using ditches and culverts to convey storm water. For consideration, two
options will be presented.
Option A1: This option will use the full depth reclamation process, where it
will grind, mix, and place the existing asphalt and aggregate as the new road base
for asphalt paving. The resulting combined asphalt/aggregate base is thicker and
more robust than the original base, thus substantially improving the structural
strength of the road. This process typically results in the road profile increasing by
3.5 to 4.0 inches and will require driveway entrances to be modified to match the
road. This will require removal of a part of the existing entrance (minimum of 5 ft in
length) to suitable point where it can be sloped to match the new road. Concrete
drives will be left as-is with the street cross slope transitioned to match the driveway
edge. All driveway entrances will be rebuilt in-kind. Existing road widths for 70th
and 71st Streets are 28 ft and 40 ft, respectively. Each originally built with 2 ft gravel
shoulders. Typical sections provided in Exhibit C.
Option B1: This choice proposes upgrades to both streets to bring them up
to current City standards.
70th Street is proposed to be widened to a 42 ft wide surface with 2 ft gravel
shoulders and two right turn lanes constructed at both intersections of 71st Street.
Curb and gutter were considered for 70th, but topography and other mitigating
factors showed that it would be too costly and unnecessary.
71st Street is proposed to add curb & gutter and storm sewer, thereby
upgrading it from a rural to urban street. Ditches will be filled with proposed storm
sewer routed to existing ponds.
Full depth reclamation will be part of the process for Option B1 as well,
however, changes in centerline profiles will be minimal by using the excess reclaim
material for street widening.
10
EXHIBIT C
Typical Street Sections
70th Street NE
11
EXHIBIT C
Typical Street Sections
71st Street NE
12
III. INITIATION
The feasibility report was initiated by the City Council per resolution 2025-56
on October 27,2025 as the streets were included for the 2026 Capital Improvement
Plan. This was due to the PCI ratings being some of the lowest in the City and in
accordance with the City’s policy on the streets renewal program.
IV. FEASIBILITY
From an engineering standpoint, the project is feasible and the value of
existing businesses is positively benefited by accessing a bituminous paved street
in good condition. It can be conducted as proposed and need not be constructed in
conjunction with any other project. The City and the persons assessed should
review the project for benefit to determine the economic feasibility of the proposed
improvements. An appraisal will be performed to determine the benefit for the
assessed parcels.
V. RIGHT-OF-WAY / EASEMENTS
The existing streets and proposed street improvements are within the
existing right of ways (70th St NE - 100 feet, 71st St NE – 84 feet)
VI. PERMITS
No permits would be needed to complete the work for Option A1. NPDES
and/or Construction Stormwater permits may be needed for Option B1 depending
on the total area of disturbance for the project.
VII. COMPLETION
This project is proposed to be completed during the 2026 construction
season.
VIII. PRELIMINARY PROJECT SCHEDULE
The preliminary project schedule for the 2026 Otsego Street Renewal
Project has yet to be determined.
IX. ESTIMATED PROJECT COST
This report includes a detailed estimate of construction costs for both options
as described in this report.
13
OPTION A1 - RURAL RECLAIM
70th Street NE
Construction Cost $ 191,972.50
15% Admin, Legal & Engineering $ 28,795.88
Pavement Mgt. Fund 201 Project Total $ 220,768.38
71st Street NE
Construction Cost $ 261,970.00
15% Admin, Legal & Engineering $ 39,295.50
Assessed Project Total $ 301,265.50
Option A1 Project Total $ 522,033.88
OPTION B1 - RECONSTRUCTION WITH WIDENING (70th), CURB/STORM (71st)
70th Street NE
Construction Cost $ 518,248.00
15% Admin, Legal & Engineering $ 77,737.20
Pavement Mgt. Fund 201 Project Total $ 595,985.20
71st Street NE
Construction Cost $ 656,733.00
15% Admin, Legal & Engineering $ 98,509.95
Assessed Project Total $ 755,242.95
Option B1 Project Total $ 1,351,228.15
The quantities and unit prices provided shown in Exhibit D are estimates only and
are not guaranteed. Unit prices were derived from earlier similar projects.
Contractors will be paid only for work completed.
14
EXHIBIT D
Engineer’s Estimate OPTION A1
15
EXHIBIT D
Engineer’s Estimate OPTION B1
16
X. PROPOSED FUNDING
The funding for the CIP street renewal project is expected to be provided by
two sources: City of Otsego and benefiting property owners.
More specifically, 70th Street would be fully funded by the City of Otsego via
Pavement Management Fund 201, and 71st Street would be funded by benefiting
property owners. Costs related to storm sewer improvements for the entire project
could be sourced via the City’s Stormwater Fund 603 per the Public Improvement
Assessment Policy, Section 6.C.4.
XI. ESTIMATED ASSESSMENT
The estimated assessment for the 10 parcels on 71st St NE has been
calculated using the methods described in the City of Otsego’s Public Improvement
Assessment Policy dated 3/22/21. The policy describes 4 distinct methods to
calculate individual assessments. They are: “Adjusted Front Footage” method,
“Area” method, “Per Lot” method, and “Per Unit” method. For this project, the “Per
Unit” method uses traffic data to calculate the assessment.
For this study, the 4 methods were applied to the 2 project options as
previously described providing a total of 8 unique assessment values for each of
the 10 parcels on 71st St NE. All industrial zone properties were assessed at 100%
per the Public Improvement Assessment Policy, Section 6.2.a.(2).
The estimated total project costs for each option are:
$522,033.88 OPTION A1 - Rural Reclaim, and
$1,351,228.15 OPTION B1 - Reconstruction with Widening (70th), Curb/Storm
(71st), as shown in Section IX. The estimated cost per the 2026 CIP is
$486,375.00.
The four variations of the preliminary assessment roll are provided as
Attachment 1 at the end of this document.
XII. ASSESSMENT
The assessment values provided in Attachment 1 will be reviewed prior to
the final value assigned to the eligible parcels.
Assessments can be paid in full or partially prepaid once the assessment roll
has been adopted by the City Council after all costs are determined. Any unpaid
portion of the assessment will be added to the property tax of each property payable
starting in 2027. The length of assessment and the interest rate are determined by
the City Council and typically correlate with the City bond length and rate which the
City receives.
17
Exhibit E
Benefiting Property Map
A total of 10 properties within Otsego I-94 West Industrial Park will be included
in the 2026 Street Renewal Project. Only those properties addressed to 71st Street
NE will be assessed.
List of property owners is provided in Attachment 1.
18
XIII. CONCLUSION AND RECOMMENDATION
This report analyzed the feasibility of improving streets. The proposed
improvements are necessary, cost effective, and feasible from a technical and
engineering standpoint. The improvements also benefit the assessed properties
proposed as shown in the map and tables provided in Exhibit E and Attachment 1.
Attachment 1
City of Otsego
2026 Street Renewal Project
Preliminary Assessment Roll
REF # PID OWNER/TAX PAYER
Share of Total
Assessment
Reclaim Rural
OPTION A1
Reconstruct Upgrade
OPTION B1
1 118166001010 Trudell Family LP 31.49% 94,882.90$ 237,862.09$
2 118166002010 Knife River Corp - North Central 8.18% 24,630.22$ 61,745.55$
3 118169001010 Eudlid Chemical Company 8.16% 24,581.06$ 61,622.30$
4 118238001010 Minncomm Utility Constr. Co.7.87% 23,696.14$ 59,403.90$
5 118238001020 Acuity Land Holdings, LLC 4.31% 12,978.80$ 32,536.58$
6 118238001030 Ortiz Properties LLC 3.51% 10,569.86$ 26,497.59$
7 118238002010 Hippo Group LLC 6.20% 18,681.61$ 46,832.95$
8 118238002020 County of Wright - HWY 7.34% 22,122.96$ 55,460.07$
9 118402000010 City of Otsego*10.84% 32,643.65$ 81,834.42$
10 118402001010 Arns Enterprises LLC 12.11% 36,478.30$ 91,447.50$
TOTAL 100.00% 301,265.50$ 755,242.95$
*Costs shown is not an assessment to the City, but will be paid directly to the project.
REF # PID OWNER/TAX PAYER
Share of Total
Assessment
Reclaim Rural
OPTION A1
Reconstruct Upgrade
OPTION B1
1 118166001010 Trudell Family LP 31.28% 94,226.25$ 236,215.93$
2 118166002010 Knife River Corp - North Central 10.23% 30,834.32$ 77,298.61$
3 118169001010 Eudlid Chemical Company 8.36% 25,172.13$ 63,104.06$
4 118238001010 Minncomm Utility Constr. Co.9.05% 27,264.68$ 68,349.87$
5 118238001020 Acuity Land Holdings, LLC 3.25% 9,785.74$ 24,531.90$
6 118238001030 Ortiz Properties LLC 3.27% 9,847.29$ 24,686.18$
7 118238002010 Hippo Group LLC 10.21% 30,772.78$ 77,144.33$
8 118238002020 County of Wright - HWY 9.19% 27,695.50$ 69,429.89$
9 118402000010 City of Otsego*0.00% -$ -$
10 118402001010 Arns Enterprises LLC 15.16% 45,666.80$ 114,482.18$
TOTAL 100.00% 301,265.50$ 755,242.95$
*Costs shown is not an assessment to the City, but will be paid directly to the project.
71st STREET NE ASSESSMENT ROLL - "AREA" METHOD
71st STREET NE ASSESSMENT ROLL - "ADJUSTED FRONT FOOTAGE" METHOD
Page 1 of 2
City of Otsego
2026 Street Renewal Project
Preliminary Assessment Roll
REF # PID OWNER/TAX PAYER
Share of Total
Assessment
Reclaim Rural
OPTION A1
Reconstruct Upgrade
OPTION B1
1 118166001010 Trudell Family LP 10.00% 30,126.55$ 75,524.30$
2 118166002010 Knife River Corp - North Central 10.00% 30,126.55$ 75,524.30$
3 118169001010 Eudlid Chemical Company 10.00% 30,126.55$ 75,524.30$
4 118238001010 Minncomm Utility Constr. Co.10.00% 30,126.55$ 75,524.30$
5 118238001020 Acuity Land Holdings, LLC 10.00% 30,126.55$ 75,524.30$
6 118238001030 Ortiz Properties LLC 10.00% 30,126.55$ 75,524.30$
7 118238002010 Hippo Group LLC 10.00% 30,126.55$ 75,524.30$
8 118238002020 County of Wright - HWY 10.00% 30,126.55$ 75,524.30$
9 118402000010 City of Otsego*10.00% 30,126.55$ 75,524.30$
10 118402001010 Arns Enterprises LLC 10.00% 30,126.55$ 75,524.30$
TOTAL 100.00% 301,265.50$ 755,242.95$
*Costs shown is not an assessment to the City, but will be paid directly to the project.
REF # PID OWNER/TAX PAYER
Share of Total
Assessment
Reclaim Rural
OPTION A1
Reconstruct Upgrade
OPTION B1
1 118166001010 Trudell Family LP 23.66% 71,264.77$ 178,653.77$
2 118166002010 Knife River Corp - North Central 21.14% 63,689.92$ 159,664.36$
3 118169001010 Eudlid Chemical Company 10.60% 31,933.42$ 80,053.94$
4 118238001010 Minncomm Utility Constr. Co.7.75% 23,351.56$ 58,540.06$
5 118238001020 Acuity Land Holdings, LLC 2.41% 7,260.65$ 18,201.74$
6 118238001030 Ortiz Properties LLC 1.31% 3,945.72$ 9,891.53$
7 118238002010 Hippo Group LLC 6.95% 20,941.95$ 52,499.42$
8 118238002020 County of Wright - HWY 4.54% 13,667.52$ 34,263.12$
9 118402000010 City of Otsego*0.00% -$ -$
10 118402001010 Arns Enterprises LLC 21.65% 65,209.99$ 163,475.02$
TOTAL 100.00% 301,265.50$ 755,242.95$
*Costs shown is not an assessment to the City, but will be paid directly to the project.
71st STREET NE ASSESSMENT ROLL - "PER LOT" METHOD
71st STREET NE ASSESSMENT ROLL - "PER UNIT" METHOD VIA TRAFFIC DATA
Page 2 of 2
1
CITY OF OTSEGO
COUNTY OF WRIGHT
STATE OF MINNESOTA
RESOLUTION NO: 2026-15
RECEIVING FEASIBILITY REPORT AND CALLING HEARING ON IMPROVEMENT
WHEREAS, pursuant to resolution 2025-56 of the City Council adopted October 27, 2025, a report has been prepared by
Hakanson Anderson Associates, Inc. with reference to proposed Improvement No. 2026-01, the improvement of 70th Street
NE west of Kadler Ave NE and 71st Street NE within the plat of Otsego I-94 West Industrial Park, and this report was received
by the City Council on February 23, 2026; and
WHEREAS, the report provides information regarding whether the proposed improvement is necessary, cost-effective, and
feasible; whether it should best be made as proposed or in connection with some other improvement; the estimated cost of
the improvement as recommended; and a description of the methodology used to calculate individual assessments for
affected parcels.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF OTSEGO, MINNESOTA:
1. The City Council will consider the improvement of such streets in accordance with the report and the assessment of
abutting properties for all or a portion of the cost of the improvement pursuant to Minnesota Statutes, Chapter 429
at an estimated total cost of the improvement of $522,033.88 (A1) or $1,351,228.15 (B1).
2. A Public Hearing shall be held on such proposed improvements on the 23rd day of March 2026 in the City Council
chambers within the Prairie Center at 7:00 p.m. and the City Clerk shall give mailed and published notice of such
hearing and improvement as required by law.
2
ADOPTED by the Otsego City Council this 23th day of February, 2026.
MOTION BY:
SECONDED BY:
IN FAVOR:
OPPOSED:
CITY OF OTSEGO
__________________________________
Jessica L. Stockamp, Mayor
ATTEST:
__________________________________
Audra Etzel, City Clerk