WILLMAR -- Funding has been approved to repair a major piece of the city Public Works Department's equipment.
A $17,000 bill to repair the transmission on the 2001 John Deere grader will be paid with unspent funds remaining in the department's 2009 budget.
The City Council's Finance Committee on Monday voted to transfer $17,000 in unspent funds from the department's 2009 budget to the department's 2010 budget to cover the repair bill. The budgetary transfer was needed because the unit broke down in 2009 but the repair was made in 2010.
The council's Public Works/Safety Committee had earlier authorized the use of the unspent funds, but the transfer required Finance Committee approval.
The repair cost had been estimated by Public Works Director Mel Odens at about $25,000, but the actual cost came closer to $17,000. In an interview, Odens described the transmission problem, which surfaced in mid-December, as premature wear. The unit was repaired at RDO Equipment Co., a John Deere dealership in Marshall, and has returned to service, said Odens.
The unit has front-wheel assist, similar to four-wheel-drive, to prevent slipping, said Odens. The unit is used for grading in the summer and plowing snow in the winter. The breakdown occurred before the Christmas snowstorm and an older model grader was used as a backup.
Odens said RDO worked with the city on the amount of the repair bill.
"They acknowledged they will cover some of the cost because of the premature failure,'' he said.
In other business, the committee voted to defer Willmar Fabrication's October, November and December payments on an economic development loan from the city. Steve Okins, city finance director, said the deferment could not be made until approval was received from the Minnesota Department of Employment and Economic Development. DEED gave the city a $400,000 economic development grant in January 2006, which the city lent to Willmar Fabrication, a manufacturer of fertilizer application equipment. Repayment of the loan with interest will be placed in a revolving loan fund for local economic development.
Willmar Fabrication requested the deferment of the $2,000 loan payments in September, citing current economic conditions.
The City Council had earlier approved the deferment, contingent on DEED giving its approval. At this point, the state department has received all the information it needs from the company in order to grant the city the authorization to defer the payments, said Okins.
He said the state is allowing the city to work out the details of possibly bringing the loan up to date, delaying the payments, extending the term of the agreement or amending the monthly payments to make up the three deferments.
Okins said the company did not ask for forgiveness of the payments. The loan matures in 2015 and the company has an unpaid balance of about $250,000.