Garrett Neese/Daily Mining Gazette The Houghton City Council approved a change order and the use of other city funds to adjust the Lakeshore Drive Corridor Rehabilitation Project Wednesday after bids came in more than $1 million over budget.

HOUGHTON — There’s more than a $1 million difference between what Houghton budgeted for the Lakeshore Drive corridor redevelopment and what it’s expected to cost.

To close that gap, the city council approved a change order for the project and allocated money from other city funds at its meeting Wednesday.

The city budgeted $2.5 million for the project, which includes the demolition of the parking deck and the redevelopment of Lakeshore Drive with landscaping and surface parking. Of the $2.5 million, $1.5 comes from bonds, with another $1 million coming in grants from Michigan Economic Development Corp.

MJO Contracting of Hancock had the lowest of two bids at more than $3.3 million. Inner City Contracting of Detroit came in above $3.7 million.

“The bids were expected to be over given overall price increases in the construction industry, volatility of the markets and the nature of the work,” City Manager Eric Waara said.

The $1.16 million deficit also includes engineering costs from the Pewabic Street pedestrian work and the value engineering being done to make the project less expensive.

Working with the engineers and MJO, the city identified $441,953 in reductions and alternatives.

“We’re getting less sprinkles on the cupcakes, and we’re actually going to do some of the work ourselves — like we’re going to paint the lines in a parking lot instead of having a contractor do it,” Waara said.

Houghton will also use $720,000 from four other city funds: major street ($340,000), Downtown Development Authority ($80,000), parking ($150,000), sewer ($130,000).

In the major street fund, $250,000 of the money will come from a planned repaving project on west Lakeshore Drive. It may happen next year instead.

The other $90,000 will be from remaining unreserved cash.

The council had also been given the option of delaying a vote until next week’s budget hearing. During public comment, Jennifer Julien said a week’s delay would hurt downtown businesses that rely on tourism.

“An extra week at this point means a week longer into July or August, into the only time that many of these business owners have to impress tourists coming to this area, where locals are enjoying the downtown for the short season that we have … maybe it doesn’t feel that long in April, but it is certainly going to feel very long when you can’t sit on the KBC deck for a week in July,” she said.

Councilor Joan Suits agreed with Julien on the potential disruption to businesses.

“It would be nice if we moved on this,” she said.

In other action, the council:

• Approved applying for water and sewer grants through the Department of Environment, Great Lakes and Energy. The grants are expected to cover 25% of the cost for the projects. If approved, work would begin next June and wrap up in 2025.

The city will replace water mains on South and East Houghton avenues. Other improvements include improvements at the west high-elevation station and the replacement of lead service lines.

The total cost for water improvements is estimated at $4 million. The remaining additional cost for users should only be around $1.88 per month.

The city would also replace sewer mains in conjunction with the water project. Sewer rates would go up about 78 cents a month for the average user to fund the $1.3 million project.

• Scheduled a public hearing on May 10 for a revised version of the previously proposed animal ordinance.

Public feedback from the previous ordinance helped shape the new version. It raises the limits on rabbits and poultry to six and four per property, respectively. Rather than barring bee hives in non-agricultural zones, the new ordinance allows them with several restrictions, including a two-hive limit and a minimum property size of 11,000 square feet.

• Approved a request to use the facilities and electricity at East Houghton Waterfront Park for an LGBT+ pride event on June 3. A tentative lineup of bands includes Daarling, Bees! Bees! Bees! Bees! and Lena Maude. The event will also include a potluck and tables from non-commercial community organizations.

• Approved holding a joint meeting with the Planning Commission and Downtown Development Authority on May 31.