Sundance developers infrastructure warranty required in agreement by Dickinson officials
In an effort to save Dickinson and its taxpayers money, city officials added a clause to a planned unit development agreement obliging the developer to warranty two subdivisions' infrastructure for five years once they're turned over to the city.
The clause was added to the Sundance Cove and Sundance Village developments because of some late-fall work, Mayor Dennis Johnson said Wednesday. The developer is Meyer Real Estate Group out of Dickinson.
The clause could also be introduced into other planned development agreements, officials said.
"It just depends upon how great the intensity for development gets and how long that intensity endures," Johnson said. "When there's so much pressure on these developers to get things built, they want to work as late into the construction season as they can."
In the agreement, infrastructure is defined as but not limited to streets, and water, sewer and storm drain utilities.
"If it isn't done well and you have to repair it earlier than normal, it costs the city money, it costs the taxpayers," Johnson said. "If we can make sure the developers do a good job and/or cover their costs if the job doesn't turn out to be so good, yes, it ultimately saves some money for the taxpayer."
The City Commission, minus Commission Vice President Gene Jackson, approved the planned unit development agreement at a special meeting Nov. 21.
Generally the city has required developers to warranty their infrastructure work for a year, and will likely increase that time, City Attorney Matt Kolling said.
"I think, in general, the city's probably going to move to a longer warranty period," Kolling said. "That was one of the things that was suggested by our consultant doing the comprehensive plan (Dickinson 2035: Roadmap to the Future) and I would anticipate the city is probably going to move that direction. It may not be as long as five years."
Concerns over the rate at which the city is growing, coupled with worries about craftsmanship, have brought about the longer warrantee period, he said.
There is a lot that can go wrong that is not the developer's fault, Koch Meadow Hills developer Mike Koch said.
"If it's something they're going to want to do on every development, that's going to be an issue," he said, adding he needed to look into the agreement more.
Bismarck-based Koch has other developments in the works in Dickinson.
Before the construction boom fueled by an oil boom, Dickinson would install any infrastructure in a development and then get those funds back through special assessment of the properties, Johnson previously told The Press.
While different methods for building infrastructure have been discussed by city staff, having the developer take responsibility has been the most fiscally sound method in this time of intense growth, Kolling said.
The city also has to update its current infrastructure, Johnson said.
"We just received the first draft of the comprehensive plan and in there, there's a lot of infrastructure that really should be put in place in the next two years or so," he said. "It's around $200 million or more that the engineers are recommending be done in the next two years. That's a lot to do and a lot to finance."