Loading...
HomeMy WebLinkAboutStaff Report 209-10TO: HONORABLE CITY COUNCIL FROM: CITY MANAGER DATE: APRIL 12, 2010 13 DEPARTMENT: ADMINISTRATIVE SERVICES CMR:209:10 SURJECT: (1) Library Construction and Bond Issuance Update, (2) Confirmation of Approval of Use of Available General Obligation Bond Proceeds to Pay for Temporary Facility Costs for Mitchell Park Library and Community Center; and (3) Preliminary Direction Regarding a Temporary Main Library RECOMMENDATION Staff recommends that: 1. Council confirm its December 7, 2009 approval to use available General Obligation (GO) Bond proceeds to pay for temporary facility costs associated with providing a temporary Mitchell Park Library and Community Center at the Cubberley Community Center. 2. Council provide input on making available a temporary Main Library at a location yet to be determined, and using available GO Bond proceeds to pay for those additional temporary facility costs. BACKGROUND On November 4, 2008, City voters passed Measure N which gave the City the authority to issue bonds in an amount up to $76.0 million for library and community center capital improvements. On March 2, 2009, Council adopted a "Resolution Declaring Intention to Reimburse Expenditures from the Proceeds of Bonds to be Issued by the City" for expenses incurred for the library and community center capital projects (CMR: 149:09) -Attachment A. On the same date, Council approved the capital projects and the funding necessary to move ahead with Measure N improvements. This marked the beginning of the more detailed design development phase. In the March 2 report (CMR: 149:09 -Attachment A) staff stated that proceeds from future bond sales would be used to: "reimburse the Infrastructure Reserve for the design work funding requested in this report and all costs incurred up to the time bonds are issued; construction of a new and expanded Mitchell Park Library and Community Center; renovation and expansion of the Main Library; and renovation of the Downtown Library." On December 14,2009 the Council approved additional funding for the temporary Mitchell Park Library and Community Center (MPLCC) facilities at Cubberley (CMR:463:09). In this report, staff listed the temporary facility costs that could be covered by bond proceeds. The Library Bond Oversight Committee has encouraged staff to confirm with Council its intent that bond proceeds be used to cover eligible costs for temporary facilities. To date all costs, those CMR209:1O Page 1 of5 considered bondable (covered by bond proceeds) and those considered non-bondable (not covered by bond proceeds) have been funded using General Fund Infrastructure Reserve resources. Bondable costs may be reimbursed from bond proceeds when the first series of bonds is issued in June. TIle final section of this report provides an update on the timeline for bond issuance. DISCUSSION 1. Temporary Mitchell Park Facilities In order to maintain adequate service levels during the construction for the new Mitchell Park Library and Community Center (MPLCC), the Cooncil approved construction of temporary facilities at the CubberJey Community Center. The temporary facility is currently under construction at the Cubberley Community Center, and is budgeted at $600,000. The December 14, 2009 staff report regarding the construction contract for these facilities made clear that many costs could be covered by bond proceeds, explaining: " ... staff directed bond counsel to further research the issue of construction costs for the temporary facilities. The bond counsel determined that, because the temporary library costs are necessitated by the project itself those costs can in fact be bondable (covered by bond proceeds) as a site improvement related to the greater library bond projects. Therefore, these construction costs can be recovered at the time of the bond sale for the MPLCC in the spring or summer of 20 I 0, although items such as furniture, fixtures, and similar equipment for the temporary library remain non-bondable." The report further detailed the temporary facility expenses that were eligible to be covered by bond proceeds, including construction, design, certain shelving, and security infrastructure. Thus, the report strongly implied, and may have even been the Council's understanding III approving the contract, that the listed costs would be covered by bond proceeds. The Library Bond Advisory Committee subsequently reviewed the issue on January 26, 2010 noting that Measure N is silent on whether temporary facility costs would be paid with bond proceeds. The Committee encouraged staff to request full and clear direction from the Council on whether bond funds should be used for these facilities. The Committee did not, however, take any position on whether these costs should in fact be covered by bond proceeds as such decisions are outside their scope of review. The text of Measure N was limited to 75 words and necessarily could not include each and every component of the project. In addition to the opinion from bond counsel that these costs are eligible, stafrs research confirms that use of bond proceeds to cover temporary storage and facility expenditures incurred while constructing or renovating new or existing buildings is common for such projects. In the City of San Jose, for example, temporary storage facilities for community libraries undergoing construction were covered by GO bond proceeds. In addition, the City of Millbrae paid for temporary facility costs with bond proceeds. Therefore, staff is recolrunending that the Council confirm its approval of bond funds for the temporary Mitchell Park facilities. CMR209:10 Page 2 of5 2. Temporary Main Library Faeilities Council has not yet approved construction of a separate temporary facility during the closure of Main Library. Staff is in the early stages of estimating costs for a temporary Main facility, so costs cited in this report are extremely tentative. There are two options that may be available in order to provide a temporary Main Library. One is to design, renovate, and provide construction management services for a leased retail space of approximately 8,500 square feet for 18 months. Costs for this option are preliminarily estimated at $685,000. A second option would be to lease trailers and install site utilities on City-owned property at an estimated at $960,000. The costs for either temporary facility could increase or decrease depending on the size and condition of leased facilities and availability of on-site utilities necessary for the trailers. Other variables that could push the costs for a temporary facility higher include: parking needs, accessibility requirements, seismic requirements, and modifications for lighting or circulation. The 18-month time frame includes the time needed to renovate the leased space or to install trailer utilities; to move staff and equipment into and later out of the temporary facility; and for additional time in the event the opening of the renovated Main Library is delayed. Like the temporary Mitchell facilities, many of these temporary costs for Main may be covered by bond proceeds. Although additional costs such as operational expenses and certain equipment cannot be covered by GO bonds (e.g., non fixed equipment such as chairs and desk top computers), those costs are relatively minor and can be covered by using existing shelving, computers, and furniture from the libraries undergoing construction, as well as the Library's operating budget. Temporary library facilities will allow the City to maintain service during construction of the permanent facilities. Staff is requesting Council input on providing a separate temporary library during the Main Library renovations. It is staff's intent to return to Council at a later date when costs are more clearly defined and Council can make an informed decision on whether to move forward with a Main temporary facility. Once again, given the current economic milieu and the competitive nature of the construction industry, staff anticipates that construction bids will be under projected estimates. How much will not be known until construction awards are made. Should (his oceur, there may be flexibility to cover temporary facility costs within the funding authority provided by the voters. 3. Next Steps In concert with the City's financial and legal consultants, a schedule for issuing bonds in mid­ June has been prepared. This schedule is in keeping with Council's desire to pursue an advantageous construction cost environment and the goal of eliminating any capitalized costs for property owners. This timeline facilitates placing the costs of the first series of two bond issues on the property tax rolls for next fiscal year. 'The current schedule is as follows: May 10,2010 May 11,2010 May 25, 2010 CMR209:IO City Council Action on Financing Documents to Issue Bonds Ratings Presentation to S&P and Moody's Ratings Received Page 3 of5 May 26, 2010 May 27, 2010 June 8, 2010 June 29, 2010 July 19,2010 Late July Bond Sale Notices Published Preliminary Official StatementlUnderwriter Bid Form Finalized and Circulated Bond Bids Received, Bonds Priced, and Bonds Awarded to Winning Bidder Close Bond Issue and Receive Bond Proceeds City Council Action on Establishing Tax Levy Send Property Assessments to County In terms of construction bids and schedules, staff anticipates the following: May 4, 2010 Bid Due Date for Downtown Library work June 7, 2010 Council Awards Construction Contract for Downtown Library Work June 8, 2010 Bid Due Date for Mitchell Park Facilities June 21, 2010 Council A wards Construction Contract for MPLCC June 28, 2010 Downtown Construction Begins July 12, 2010 MPLCC Construction Begins In order to meet the County's early August requirement for property assessment information, staff must completc the bond sale in early June. To sell the bonds in early June, staff will be returning to Council on May 10 for approval of the financing documents and a "not to exceed amount" on the first series bond issue. In selecting the not to exceed amount, staff will rely on what it believes are reliable design and construction estimates for Mitchell Park work. Proceeds for the first bond series will cover funds advanced by the City for these projects to date (including or excluding, depending on Council direction on temporary library costs for Mitchell) as well as construction costs for the Downtown Library, and estimated costs for Mitchell Park facilities. It is important to note that if bond proceeds from the first series of bonds are in excess of costs, they will be carried forward for the Main Library project and could potentially reduce the amount issued in the second bond series. RESOURCE IMPACT Council approval of use of bond funds for the temporary library at the Cubberley Community Center would result in a return of approximately $600,000 to the Infrastructure Reserve. Based on the current cost estimates, using bond proceeds for an additional temporary Main Library would translate into a tax of approximately $0.21-$.34 per $100,000 of assessed value (A V) for property owners. The original estimate for all projects that was placed on the Measure N ballot was $27 per $100,000 of AV. CMR 209: 10 Page 4 of5 It is critical to note that in the unlikely event pennanent facility design and construction costs should consume bond proceeds or that available proceeds fall short of actual temporary facility costs, the City's Infrastructure Reserve or GF would have to absorb the temporary facility expenditures. POLICY IMPLICATIONS Although temporary library costs were not considered in initial project estimates, covering such costs is legal and consistent with General Obligation Bond coverage practice. TIMELINE See Discussion section ENVIRONMENTAL REVIEW On July 21, 2008, the Council confinned the Director of Planning and Community Environment's (PCE) approvals of a Mitigated Negative Declaration (MND) for the Mitchell Park Library and Community Center and a 2007 Addendum to the 2002 final Environmental Impact Report (EIR) for Main Library. The Downtown Library project was detennined to be exempt from CEQA review pursuant to Section 15301, "existing fucilities." ATTACHMENTS Attachment A: CMR:149:09 "Adoption of (1) Resolution Declaring Intention to Reimburse Expenditures from the Proceeds of Bonds to be Issued by the City .... " Attachment B: CMR: 463:09 "Adoption of a Budget Amendment Ordinance in the Amount of $381,583 for Costs Related to Constructing a Temporary Library and Teen Center at the Cubberley Community Center .... " PREPARED BY: ty Directo , Administrative Services DEPARTMENT HEAD APPROVAL: ---."L-, __ ±--_::;;.L'------- Director, Administrative Services CITY MANAGER APPROVAL: -----t.--ro~-l.---'--+-'------ CMR209:IO Page 5 of5 ATTACHMENT A TO: HONORABLE CITY COUNCIL FROM: CITY MANAGER DEPARTMENT: PUBLIC WORKS DATE: MARCIl 2, 2009 CMR:149:09 REPORT TYPE: CONSENT SUBJECT: Adoption of (I) Resolution Declaring Intention to Reimburse Expenditures from the Proceeds of Bonds to be Issued by the City; and (2) Ordinance Amending the Budget for Fiscal Year 2009 to Establish Capital Improvement Program Project Number PE-09005, Downtown Library Improvements, and to Provide an Appropriation in the Amount of $411,056; Establish Capital Improvement Program Project Number PE- 09006, Mitchell Park Library and Community Center New Construction, and to Provide an Appropriation in the Amount of $3,390,309; Establish Capital Improvement Program Project Number PE-09010, Library and Community Center Temporary Facilities, and to Provide an Appropriation in the Amount of $79,525; and Approval of Contract C09130744 with Group 4 Architecture, Research + Planning, Inc., in a total amount not to exceed $3,827,280 for Architecture and Engineering Design Services for the Mitchell Park Library and Community Center, DOwntown Library and Library and Community Center Temporary Facilities EXECUTIVE SUMMARY Attached for approval is a design contract with Group 4 Architecture that will allow for the completion of construction documents for the Downtown Library, the Mitchell Park Library and Community Center; and Library and Community Center Temporary Facilities. This work is consistent with the work approved by voters as part of the Library bond measure, Measure N, in November 2008.. In order to fund this work, and to provide staff with the resources for miscellaneous small contracts, a BAO is also included for adoption. Since approval for this work is being requested outside of the normal budget adoption process, new Capital Improvement Project numbers need to be created to budget the funds provided by the BAO. Aqoption of the Resolution of Intention to Reimburse Expenditures will allow the City to l'eCOUp, from bond proceeds, project funds that will be advanced by the Infrastructure Reserve (IR) for the library and community center projects as described in this report. All design costs incurred prior bond issuance will be bome by the IR. Based on the project schedule, City staff intends to issue two series of bonds. The City intends to time the issuance of the bonds in order to ensure that the best bond market conditions exist. The first series, for an estimated $57.1 million, would CMR:149:09 Page I of8 be issued before construction begins in spring 2010. The second series, estimated at $18.9 million, would be issued in winter 2012. These estimates include future design, contract, construction, and issuance costs. RECOMMENDATION Staff recommends that Council: 1. Adopt a Resolution Declaring Intention to Reimburse Expenditures from the Proceeds of Bonds to be Issued by the City (Attachment A) ; 2. Approve the creation of a new Capital Improvement Project (CIP) PE-09005 for the Downtown Library (Attachment B); 3. Approve the creation of a new Capital Improvement Project PE-09006 for the Mitchell Park Library and Community Center (Attachment C); 4. Approve the creation of a new Capital Improvement Project PE-09010 for Library and Community Center Temporary Facilities (Attachment D); 5. Adopt a Budget Amendment Ordinance (Attachment E) in the total amoont of $3,880,890. Of this amount, $3,827,280 is to be distributed to the various CIPs as outlined under Item 6 below as well as $3,000 to CIP PE-09005, Downtown Library, for miscellaneous small contracts and $12,000 to CIP PE-09006, Mitchell Park Library and Community Center for miscellaneous small contracts. Additionally, $38,610 will be distributed to the various CIPs as outlined further below for plan check services. 6 Approve and authorize the City Manager to execute contract C09130744 with Group 4 Architecture, Research + Planning, Inc. (Attachment F) in a amount not to exceed $3,827,280 for architectural and engineering design services for the Mitchell Park Library and Community Center and for the Downtown Library, including a total of $3,483,080 for basic services and $344,200 for additional services. The funding shall be allocated in the fullowing proportions: -Downtown Library Design Fee = $367,206 Additional Services = $37,000 Total CIP PE-09005= $404,206 -Mitchell Park Library and Community Center Design Fee = $3,043,549 Additional Services = $300,000 Total CIP PE-09006 = $3,343,549 -Library and Community Center Temporary Facilities Design Fee = $72,325 Additional Services = $7,200 Total CIP PE-09010 = $79,525 CMR:149:09 Page 2 ofS BACKGROUND A General Obligation bond measure for library and eommunity center improvements, Measure N, was passed by City voters on November 4, 2008. This Measure approved a maximum amount of $76.0 million in bonds. Proeeeds from future bond sales. will be used to: reimburse the 'Infrastructure Reserve for the design work funding requested in this report and all ()osts incurred up to the time bonds are issued; construction of a new and expanded Mitchell Park Library and Community Center; renovation and expansion of the Main Library; and renovation of the Downtown Library. It is important to note that design work to date (which includes the feasibility study and preliminary design by Group 4 Architecture) has been paid (approximately $1.5 million) by the General Fund and these monies will not be reimbursed from bond proceeds. Detailed history of the design development can be found in past City Manager's Reports to Council, CMR:286:02, CMR: 119:06,CMR:343:06, CMR:434:06; CMR:225:07, CMR:32 I :08and a December IS, 2008 Informational CMR:473 :08, http://yrww.cityofpaloalto.org/knowzonelre.portslcmrs.asp The various site improvements are summarized as follows: -Downtown Library The progranunatic evaluation by Group 4 Architecture, Research + Planning (Group 4 Architecture) found that the existing services at this library adequately serve its service population and significant capital improvements are not recommended. By relocating technical services to the new Mitchell Park library, much of the current technical staff area will become public space as a result of interior reconfiguration. A small program room is planned. Systems upgrades, such as improved lighting and mechanical systems will also be provided. -Mitchell Park Library and Community Center The Mitchell Park Library and Community Center will be a joint facility, designed to the Leadership in Energy and Environmental Design level of Gold (CMR:309:08). The existing Mitchell Park Library is about 10,000 square feet and will be replaced with a new facility of 36,000 square feet. The new library will be two stories to accommodate an enlarged eollection, a children's area, an aeoustically separated teen area, group study rooms, staff areas and a program room. Increases in collection, seating, eomputers, children's area and programming space are planned to serve the needs of the projected population. Technical Services staff, currently locatcd at the Downtown Library, would be relocated to the Mitchell Park Library in order to facilitate the increased intake of new materials for the entire Ii brary system. The existing Mitchell Park Community Center is approximately 10,000 square feet and will be replaced with a new facility of 15,000 square feet. Similar to the existing eommunity center, the new building will be a one-story building attached to the new library. By sharing activity space, the joint facility will be smaller in size than two independent buildings and will create a more efficient use of the Iibrary/eommunity center site. CMR:149:09 Page 3 of8 -Main Library The Main Library improvements include small group study rooms that are acoustically separated from the rest of the existing building and a new program space that seats 100 people. To accommodate the new program space, the Main Library will expand by approximately 4,000 square feet from the current 21,000 square feet on the ground floor of the building (CMR:434:06). The interior of the existing library will also be reconfigured to make better use of areas that are vacated by reloeating certain materials into the new building. Lighting and other building systems will also be upgraded. All of the improvements will be made with consideration for the historic nature of the existing building. DISCUSSION New Capital Improvement Projects Approval of Measure N by votera in allowed the library design to begin before the mid-year budget approval, which is scheduled for April 2009. Approval of new CIPs for the Mitchell Park Library and Community Center, the Downtown Library, and Library and Community Center Temporary Facilities are needed in order to begin design work. This separation will allow funding to be properly allocated and tracked from the beginning of the project. A CIP for the Main Library will be presented as part of the normal Fiscal Year 2010·2012 budget process as construction is not expected to begin until 2012. Attachments B through D include the descriptions of the CIPs that are being requested for creation and approval. Funding for design work will be provided by the Infrastructure Reserve upon Council approval of a Budget Amendment Ordinance (Attachment E). This funding will be apportioned (see table below) into the new CIPs to pay for the design of each particular facility. This allocation will allow for clear tracking of all costs associated with each building. All funds expended in these projects will be reimbursed to the Infrastructure Reserve shortly after bond proceeds are received. A new CIP also is proposed for temporary library and community center facilities (Attachment D). Bond proceeds carmot be used to fund temporary faoilities, equipment or furnishings so funding from the Infrastructure Reserve will have to be identified to cover these costs. This may require a reallocation of funding from other existing or planned projects. Staff will be evaluating the impact of these costs as part of the Fiscal Year 2010-2012 budgefprocess. pesign Contract Conceptual designs for the three sites are now 35 percent complete and have been reviewed by the Library Advisory Commission (LAC), the Parks & Recreation Commission (PRC), the Architectural Review Board (ARB), the Historic Resources Board (HRB) and City Council. They were also presented to the community as part of the Measure N outreach efforts. The contract with Group 4 Architecture (Attachment F) will complete the design of the Downtown Library and the Mitchell Park Library and Community Center f!'Om the current 35 percent completion stage to final construction documents. The contract does not yet include funding for the construction administration phase of the project, which would be included for approval along with the construction contracts. A contract for the design of the Main Library will be presented in the fall of 2010 as that library is not scheduled to begin design until early 201l. The Downtown Library would be the first library advertised for construction bids, likely CMR:149:09 Page 4 of8 in the spring of 2010, followed shortly thereafter by the Mitchell Park Library and Community Center. ' In addition to design fees, staff is requesting a total of $15,000 be included in the BAO to be used for any miscellaneous unforeseen small contracts, printing costs, hazardous materials testing, and other incidentals that might. arise through the duration of thc project. Of this amount $3,000 would be used for the Downtown Library and $12,000 would be used for the Mitchell Park Library and Community Center. The City will also be entering into a contract with West Coast Code Consultants to provide plan check services for the Mitchell Park Library and Community Center and for the Downtown Library, which will help expedite the project. This contract will total approximately $38,000 and is within the City Manager's contract award authority. These costs are also reimbursable from bond proceeds and were included in the original budget estimates. Temporary Faci1itie~ The contract with Group 4 Architecture also includes design services for temporary facilities needed during construction of the libraries and community center. Temporary facilities cannot by law be funded by bond proceeds. The overall budget for temporary facilities that was established prior to the passage of the Measure N bond was $600,000, which would come from General Fund monies. In order to reduce the demand on General rood monies, staff is proposing to use existing spaces at the Cubberley Community Center Auditorium in Heu of leasing trailers or other spaces while the Mitchell Park library and community center is under construction. Improving existing City spaces instead of leasing trailers or other facilities would also help reduce future budget demands as the money for temporary facilities would be used to improve the Auditorium for library use (upgraded lighting, new paint, etc.). The estimated cost to improve the Auditorium and pay for associated moving and storage costs is $150,000. However, this cost will be refined as the design improvements are better developed. The Auditorium would be used as temporary space for Downtown Library Technical Services staff and would function as a temporary Mitchell Park Library, including a "homework help" area. The Teen Center, currently located at the Mitchell Park Community Center, would be given priority use of the Cubberley gyrrmasium for special events but would otherwise not require additional space. Staff intends to continue to provide similar services and programs to library patrons and teens during this interim period. Lease contracts currently in effect for the Auditorium will tenninate December 31, 2009, which wiD enable the needed improvements to be completed prior to the start of construction on the Downtown Library in the spring of 2010. There are currently eight primary users of the Auditorium. Staff is working with these users to identifY possible new locations at Cubberlcy that would be suitable to their programs or space at other City sites. Lost revenue for the Auditorium would be $80,000 per year. This lost revenue is less than the cost of leasing other temporary facilities even when combined with necessary improvement costs of$150,000. The Library Administrative Services section, which is currently located at the Downtown Library, will likely be placed in the lower level of the Lucie Stem Center. This area is already furnished with carpeting, desks, phones and other office equipment so improvement costs will be CMR:149:09 Page 5 of8 minor. The use and location of temporary facilities during the construction of the Main Library is still under discussion and findings will be presented at a later date. Outreach Staff has been working to develop an implementation strategy and structure for the projects that will facilitate the flow of information between staff, the community and key stakeholders (CMR:473:08). Three committees will be established for this effurt: the Technical Team (staff from multiple departments and Group 4 Architecture), the Stakeholders Committee (staff, community stakeholders and representatives from various boards and commissions) and an independent Citizen Bond Oversight Committee to provide financial oversight of the project. The Bond Oversight Committee was a specific requirement of Measure N. The Technical Team has recently completed their formal review of the 35 percent complete plans so that Group 4 Architecture can quickly begin incorporating any needed revisions. An initial Stakeholders Committee is planned for March 12,2009, to review the project to date and identity joint goals and objectives for outreach efforts during the constrtlction of the bond projects. Recommendations fur the composition and goals of the Citizen Bond Oversight Committee will be presented to Council as a separate item on or about March 16, 2009. RESOURCE IMPACT To complete design for the Mitchell Park and Downtown projects, a BAO in the amount of $3,880,890 is needed. The distribution of these funds is shown in the table below: Bond Funding Genera I)'nnd Bondable Mitchell Temporary & Downtown Park Library & Facility General Library Community Center Bondable Design Fnnd PE·09005 PE.09006 Subtotal PE-09010 I!!m! Group 4 Architecture $404,206 $3,343,549 $3,747,755 $79,525 $3,827,280 West Coast Code Consult. $3,850 $34,760 $38,610 $38,610 Miscellaneuus Small Contracts $3,000 $12,000 $15,000 $15,000 $3,801,366 . $3,880,890 Later, in the summer or fall of 2009, a contract for construction management services to supplement existing staff levels will be forthcoming. These later contracts will also be funded through the Infrastructure Reserve (IR) at the time that they are presented to Council for approval and will be reimbursed later from bond proceeds. Based on the proposed project schedule, it is optimal to issue two series of bonds. The first series of bonds would be issued just prior to the beginning of construction in the spring of201O. This issue would cover the design and contract costs cited above as well as the construction costs for the Downtown and Mitchell Park libraries and the Community Center. These project costs CMR:149:09 Page 6 ofB are estimated at $54.9 million. Together with the costs associated with issuing the bonds (e.g., underwriter, legal fees, and capitalized interest), the current estimated total fur the first bond issue is $57.1 million. The second series of bonds would be issued just prior to work on the Main Library in the winter of 2012. Current estimated costs for this project are $18.0 million. Including issuance costs, the second series of bonds is estimated at $18.9 miUion. The first and second series of bonds total $76.0 million. It is important to note that the costs cited above are still estimates and that project costs may ehange based on construction bids and other factors. While the City has the authority to issue up to $76 million in bonds, it will only issue an amount based on actual design and construction bid costs. Issuance costs are somewhat dependent on the principal amount required for the projects and will be determined primarily at the time of the bond sale. Interest costs on the bonds sold also will be known at the time of the bond sale. Since the first series of bonds is expected to be issued prior to the beginning of construction in the spring of 201 0, property owners can expect their first General Obligation bond assessment on their 2010-20n property tax statement. When the next series of bonds are issued some time in the winter of 2012, another ineremental and final assessment will be added to each property owner's tax bill. Measure N indicated that the estimated, total assessment (after all bonds are issued) would equal $27 per $100,000 of assessed value. At this time, staff believes this remains a realistic estimate. As stated in previous reports, this amount is subject to change based on the fmal amount of bonds issued and the interest rate incurred at the time of the bond sale. In order to make the bond issuance process clear and transparent, staff intends to have the City's Financial Advisor and Bond Counsel available at future meeting(s) as appropriate. Funding nceds for temporary facilities, equipment or furnishings are estimated at $150,000. Since these expenses cannot be covered by the bonds, they must be paid by the Infrastructure Reserve. In addition, all incremental operating and maintenance expenses resulting from the new fucilities and any new programs will have te be funded by the General Fund. Staff is working to identify funding plans for these items. POLICY IMPLICATIONS The projects discussed in this update are consistent with Council's prior policy direction and consistent with the establishment of the Library Facility Plan as a Top 4 priority for 2008. TIMELINE The consultant will begin design of the Downtown and Mitchell Park projects shortly after approval of the design contract. The approximate project schedule is as follows: • Approve eonsultant contract to provide construction management services for the Downtown and Mitchell Park libraries. Summer/Fall 2009 • Approve construction contract for temporary facilities in preparation for the remodel of the Downtown Library late 2009, early 2010 • Approve construction contract for Downtown Library & Mitchell Park Library and Community Center Spring 2010 CMR:149:09 Page? ofB • Approve construction contract for temporary facilities in preparation for the remodel of the Downtown Library late 2009, early 20 I 0 • Approve construction contract fur Downtown Library & Mitchell Park Library and Community Center Spring 2010 • Appruve consultant design contract for Main Library • Approve construction contract for Main Ubrary late 20 I 0, early 20 II late 2012, early 20\3 These timelines are only rough estimates at this point and will be refined as the design progresses. ENVIRONMENTAL REVIEW On July 21, 2008, the Council confirmed the Director of Planning and Community Environment's (PCE) approvals of a Mitigated Negative Declaration (MND) fur the Mitchell Park Library and Commwilty Center and a 2007 Addendum to the 2002 final Environmental Impact Report (EIR) for Main Library. The Downtown Library project was determined to be exempt from CEQA review pursuant to Section 15301, "existing facilities." ATTACHMENTS Attachment A: Resolution ofintent Attachment B: Description of New CIP PE·09005, Downtown Library Attachment C: Description of New CIP PE-09006, Mitchell Park Library & Community Center Attachment 0: Description of New CIP PE-09010, Library & Community Center Temporary Facilities Attachment E: Budget Amendment Ordinance Attachment F: Contract, Group 4 Architecture PREPARED BY: ..i.~-~ ... ~ Senior Engineer PREPARED BY: DEPARTMENT HEAD: ROBERTS Dir ctor of Public Works CITY MANAGER APPROVAL: CMR:149:09 Page 8 ofB ATTACHMENT B TO: HONORABLE CITY COUNCIL FROM: CITY MANAGER DEPARTMENT: PUBLIC WORKS DATE: DECEMBER 14,2009 CMR:463:09 REPORT TYPE: CONSENT SUBJECT: Adoption of a Budget Amendment Ordinance in the Amount of $381,583 for Costs Related to Constructing a Temporary Library and Teen Center at the Cubb'erley Community Center; Approval of a Contract with Johnstone Moyer, Inc., in a Total Amount Not to Exceed $227,463 to Convert the Cubberley Community Center Auditorium into a Temporary Library to Replace the Mitchell Park Library (Capital Improvement Program Project PE-09010) RECOMMENDATION Staff recommends that Council: 1. Adopt a Budget Amendment Ordinance (Attachment A) in the amount of $381,583 for remodeling the Cubberley Community Center auditorium into a temporary Mitchell Park Library, for future security alarm, telecommunications, shelving and other small contracts related to the temporary library and for upgrades to a classroom used as a temporary Teen Center during construction of the Mitchell Park Library Community Center. 2. Approve and authorize the City Manager to execute a contract (Attachment B) with Johnstone Moyer, Inc" in the amount of $227,463 for construction of improvements at the Cubberiey Community Center auditorium that will convert it into a temporary library facility to serve as a replacement for the Mitchell Park Library during its upcoming construction. The construction bid includes the price of bid alternates I through 4 that total $3,911. 3. Authorize the City Manager or his designee to negotiate and execute one or more change orders to the contract with Johnstone Moyer, Inc., for related, additional but unforeseen work which may develop during the project, the total value of which shall not exceed $34,120. BACKGROUND On July 7, 2008, Council directed staff to proceed with placing on the November 2008 ballot a library/community center bond measure. Measure N, whieh passed on November 4, 2008, includes funding for construction of a new and expanded Mitchell Park Library and Community Center (MPLCC), renovation and expansion of the Main Library and renovation of the Downtown Library. During construction of the Downtown Library and the MPLCC, staff and CMR:463:09 Page I of6 books would be moved into a temporary library that will be located at the remodeled auditorium of the Cubberley Community Center. Funding for a temporary library had been approved in Fiscal Year 2010 as CIP PE-09010, with an initial funding amount of $75,000. On March 2, 2009, Council approved a contract with Group 4 Architecture in the amount of $79,525 to identify a location for a temporary library and Teen Center and to provide conceptual layouts and costs (CMR:149:09). On September 14, 2009, staff and Group 4 Architecture updated Council on the Measure N library bond measure projects and prescnted design and construction management contracts for approval (CMR:368:09). At that meeting, Contract Amendment No.1 with Group 4 Architeeture in the amount of $92,034 was approved to complete the final design of the temporary library and to provide construction administration services (CMR:368:09). Incorporated into the Council's motion to approve the staff recommendations was an amendment directing Library staff and the Library Advisory Commission (LAC) to readdress some elements of the design tor the Downtown Library. As a result of this direction and after review by the LAC, shelving height was increased from 66" to 84", four additional 84" high shelves were added, along with two additional computer stations. It was also determined that Library Administration staff should remain at the Downtown Library (CMR:409:09). DISCUSSION Measure N Library Project Update Construction documents for the Downtown Library are approximately 90 percent complete and have been submitted to the Building Division for a building code compliance review. The design development plans (which outline the general design concept and details) for the Mitchell Park Library and Community Center (MPLCC) are 100 percent complete and have been reviewed by the Library Advisory Commission (LAC), the Parks & Recreation Commission (PARC), the Architectural Review Board (ARB) and the Art Commission. Plans were also presented to citizen focus groups, teen groups and to the community, the latest being a community meeting for the MPLCC on October 28th. Review by these committees will continue through at least January 2010 and additional community meetings will be seheduled for 2010, prior to the start of constructi on. Project Description Group 4 Architecture was initially contracted to study alternative locations and design options for a temporary MPLCC. Working with staff from the Public Works, Library and Community Services Departments, the Cubberley Community Center Auditoriunl was identified as the best location for a temporary library while a new Mitchell Park Library was being constructed. The auditorium is currently rented by various community groups whose rental agreements will expire on December 31, 2009. Staff has been able to accommodate these renters in other rooms of the Cubberley Community Center. An approximately 5,090 square foot temporary library with books, computer terminals and seating will be located in the main auditorium area. The Mitchell Park Library currently has approximately 83,000 volumes in the collection. The temporary library will accommodate approximately 45,000 volumes, 28 reader table seats, 10 study carrel seats, 18 computers and associated seats and 10 lounge seats. Used shelving and furniture will be taken from the Downtown and Mitehell Park Libraries and re-used in the temporary library whenever possible. Shortly after completion of the temporary library, some furniture and Technical Services staff currently located at the Downtown Library will be moved into what is now the kitchen area at the back of the auditorium. Once the Technical Services staff has been relocated to the auditorium, construction on the Downtown Library can begin. Later, when construction on the new MPLCC is ready to begin, additional furniture, books and shelving will be moved into the auditorium. Once the books from the MPLCC have been moved in the summer of 2010, the temporary library will be opened to the public and construction on the new MPLCC library will begin. Any remaining books not housed in the temporary library will be stored elsewhere. Technical Services staff will remain in the temporary library at the Cubberley Community Center until their new spaces at the MPLCC have been completed. Library Administration staff currently located at the Downtown Library will be moved to the Main Library for the duration of the Downtown Library renovation and moved back to the Downtown Library when that work is completed. The Teen Center now at the MPLCC will be relocated to a classroom at the Cubberiey Community Center just prior to demolition of the existing MPLCC. Bid Process A notice inviting formal bids for the Temporary Library project was sent to twenty-three contractors. 111e bidding period was 15 working days. Bids were received from 16 contractors on November 17, 2009, as listed on the attached bid summary (Attachment B). Bids ranged from a total low bid of $244,349 to a high of $450,444, which includes the cost of five bid alternates. Bid alternates 1 through 3 are for the removal and replacement of overhead lamps that contain small amounts of hazardous materials, bid alternate 4 is for the addition of overhead fans for summer cooling and bid alternate 5 is for painting the rooms and trim. Staff recommends that bid alternates I through 4 be approved, at a total cost of $3,911 and that bid alternate 5 be deferred until the temporary library is closed and furnishings removed. ummarvo 1 S fB'dP rocess Bid NameINumber IFB 134408 II!ll:1porary Library Improvements Project ........... Proposed Length of Pro' eet 4 months Number of Bids 23 Contractors Number of Bids Mailed to Builder's 12 Exchanges Total Days to Respond to Bid 15 Pre-Bid Meeting? Yes . Number of Company Attendees at 18 • Pre-Bid Meeting mumber of Bids Received: 16 Bid Price Range (inc!. 5 Bid Alts)* $244,349 to $450,444 "Bid summary proVided III Attachment C. Staff has reviewed all bids submitted and recommends that the bid of $227,463 submitted by Johnstone Moyer, Inc., for the base bid plus Bid Alternates 1 through 4 be accepted and that Johnstone Moyer, Inc., be declared the lowest responsible bidder. The bid is fifty percent below the engineer's estimate of $568,000 dollars. Staff contacted Group 4 Architecture in an effort to determine why the engineer'S estimate was significantly higher than even the highest bid CMR:463:09 Page 3 of6 received. The estimating subconsultant used by Group 4 Architecture does not typically e~1imate small scale projects such as the temporary library. That, combined with the economy which has spurred some contractors to bid jobs at-cost, resulted in a conservative engineer's estimate. Staff is working with Group 4 Architecture to negotiate a reduced construction administration contract that reflects the lower construction cost. A contingency amount of 15 percent is requested because renovations of older buildings tend involve more unforeseen conditions due to incomplete archival blue prints, as well as dry rot and termite damage which may be uncovered during construction. Staff confirmed with the Contractor's State License Board that the contractor has an active license on file. Staff checked references supplied by the contractor for previous work performed and found no significant complaints. RESOURCE IMPACT A BAO in the amount of $381,583 (Attachment A) is requested to provide funding for construction of the temporary library and to provide for future small contracts for a security system and related electrical and teleeommunications work and for new shelving and modular furnishings to supplement existing furnishings that will be relocated from the Mitchell Park and Downtown Libraries. It also includes an allowance to upgrade (add partitions, extend electrical and data for computer connections) a classroom formerly used by the JCC that will serve as a temporary Teen Center. Staff has been meeting internally and with bond counsel and the external auditor to detennine the most advantageous time for a bond sale, and the best way to eoordinate the sale of bonds with the construction schedule and funding. Staff has also been working with bond counsel to establish guidelines and a decision-making process to determine items for which bond funds may be appropriately used. In addition, at the October 27,2009, Library Bond Oversight Committee meeting, a question was asked as to whether costs for the temporary library were bondable costs. As a result of that query, staff directed bond counsel to further research the issue of construction costs for the temporary facilities. The bond counsel determined that, because the temporary library costs are neeessitated by the project itself those costs can in fact be bondable as a site improvement related to the grcater library bond projects. Therefore, these construction costs can be recovered at the time of the bond sale for the MPLCC in the spring or summer of 2010, although items such as furniture, fixtures, and similar equipment for the temporary library remain non-bondable. Based on the newly developed framework, staff plans to complete similar analysis as other new and unique cost issues arise. Costs for non-bondable expenses such as furnishings will be funded through the Infrastructure Reserve. Bondable expenses will be reimbursed to the Infrastructure Reserve at the time of the first bond sale in the spring or summer of2010. Bond Council has reviewed the following specific items related to the temporary spaces: Bondable Costs Temporary Library construction cost -Johnstone Moyer, Inc. Contingency (15%) Subtotal: CMR:463:09 $227,463 $34,120 $261,583 Page 4 of6 Temporary Library -Mise Contracts, Estimated Costs Security Systems & Access Card Readers -Infrastructure installation (conduit, wire, security keypads and panels) Library Shelving -Relocating and re-using certain shelving from Mitchell Park Library, leasing additional shelving units as-needed, seismically anchoring and removing all shelving when the temporary library is disestablished Telephone and computer data -Purchasing and installing new panels/switchboards for the telephone/data systems (OPX) Interior furnishings for Technical Services -Remove Pivot office panels at the Downtown Library and reinstall at the Temporary. Library. Purchase new Pivot panels and parts, if necessary Teen Center -Misc Contract, Estimated Cost Installing conduit and cables for telephone and computers Subtotal: Total Bondable Costs, PE-0901O: Non-Bondable Costs-Estimates Temporary Library Telephone -Purchasing new telephones compatible with the OPX phone system Subtotal Total Non-Bondable Costs, PE-09010: Total BAO: POLICY IMPLICATIONS Approval of this contract is consistent with City policies. TIMELINE $25,000 $30,000 $25,000 $30,000 $5,000 $115,000 $376,583 $5,000 $5,000 $5,000 $381,583 Construction on the temporary library will start shOlily after contract approval and is anticipated to be complete with staff within four months (approximately early May of 2010). The Downtown Library can begin construction after completion of the temporary library. ENVIRONMENTAL REVIEW This project is an interior renovation and is therefore categorically exempt. ATTACHMENTS Attachment A: Budget Amendment Ordinance Attachment B: Construction Contract Attachment C: Bid Summary CMR:463:09 Page 5 of6 PREPARED BY: DEPARTMENT HEAD: CITY MANAGER APPROVAL: KAREN BENGARD Seni or Engineer GLENN S. ROBERTS Director of Public Works JAMES KEENE city Manager r;;:;m:A.<1:oq------------------------Page 6 of6 -CMR:463:09