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 The Ferndale City Council approved an interfund loan from its general fund cash reserves to its auto parking fund that’s not to exceed $2 million to cover the costs of a previously unpriced portion of “The dot.”

The Ferndale City Council approved an interfund loan from its general fund cash reserves to its auto parking fund that’s not to exceed $2 million to cover the costs of a previously unpriced portion of “The dot.”

File photo by Patricia O’Blenes


Ferndale council approves up to $2 million loan for unpriced ‘dot’ construction

By: Mike Koury | Woodward Talk | Published July 6, 2020

FERNDALE — The Ferndale City Council approved at its June 22 meeting an interfund loan that will cover the costs of a previously unpriced portion of the Development on Troy, also known as “The dot.”

The council approved a loan of an amount not to exceed $2 million from its general fund cash reserves to its auto parking fund. City Manager Joe Gacioch noted at the meeting that the general fund cash reserves are not the same as the general fund’s operating fund.

The loan will be repaid over a five-year period at an interest rate of 1%. With interest, the general fund is expected to get back $2,051,250.

“That would suggest that we don’t understand the final loan value, but it won’t exceed $2 million,” he said. “The goal would be to minimize the loan value as much as possible.”

At the beginning of the year, it was discovered that the eastern portion of the fourth floor of The dot was not priced in the original bid documents. At its Feb. 10 meeting, the council approved spending up to $1 million on the floor. That $1 million approval was only a portion of what was needed for The dot, and it is included in this most recent approval.

The dot was on schedule to be completed by the spring. However, the COVID-19 pandemic hit Michigan and forced the stoppage of construction.

“We initially presented City Council with an unexpected change order request in February that we knew would be very disruptive to the project budget,” Gacioch said. “We presented initial options and we’ve since then moved through those options. However, compounded on top of that has been the COVID-19 implications towards the parking fund and just the downtown system in general, which certainly has had also additional adverse effects which are yet unknown on the performance of the parking system till the end of the year.”

According to city documents, the economic and financial disruptions to the project caused by the COVID-19 pandemic, as well as the construction and commercial limitations resulting from Gov. Gretchen Whitmer’s stay-at-home order “have also continued to be factors in project progress and unanticipated cost adjustments.”

City Councilwoman Laura Mikulski said she’s excited to see the project wrap up, but disappointed that it’s taken this long to get to this point.

“I do think that the intentions behind the project were noble, and I think, overall, it’s going to be a huge asset to our city,” she said. “It’s just regrettable that with any sort of large, novel project, something that just really hasn’t been seen within Michigan, it’s regrettable that it takes longer and costs more, but ultimately it’s going to be a better fit for the city of Ferndale.”