Board of Directors Regular Meeting Agenda


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Meeting Date: 01/27/2016  

SUBJECT MATTER:
Receive, consider and act upon plans for the renovation of Northshore Park;
FISCAL IMPACT:
$96,000 was included in the 2015 Capital Improvement Budget for design and consulting services related to the renovation of Northshore Park. The amount allocated is 8% of the 2016 approved construction budget of $1.2 million.   The Township budgeted amount does not include any amount designated for a new boat house/rowing facility. The rowing clubs have indicated a willingness to provide capital support for the aspects of the project related to the design and construction of a boat house/rowing facility. Per the revised design (Attachment A) below, the cost estimate from Burditt is $1.195 million (Attachment B), which includes a 10% contingency ($107,995), which is within the currently budgeted amount.
 
If a boat house/ rowing facility were to be added to the renovation of the park, it is estimated to cost between $414,000 and $921,000.  Various financial models and considerations have been prepared which range from  no financial commitment for the Township to funding 100%  of the boat house /rowing facility.
BACKGROUND:
At the April 22, 2015 meeting, The Woodlands Township Board of Directors approved the scope of services for a Request for Proposal for a consultant to provide comprehensive design, bidding and construction management services for the renovation of Northshore Park.  After initial public input which included a public survey, meetings with the Panther Creek Village Association and several public and stakeholder meetings initial concepts were presented to the Board at their October 28, 2015 meeting. From this meeting Burditt and staff received direction to revise the plans with more specific attention being paid to the concerns about sound and the impact on neighbors, restrooms, need for parking, location of the play area and costs.
 
Presentations to the Board have been made with various revisions made to the plans at the October and December meetings.  At the conclusion of the December meeting, the Board of Directors directed to revise design A-2 (stage structure facing Northeast), remove the sound wall and improve the sound attenuation characteristics of the stage and enhance the reforestation on the western edge of the park.  This revised design and probable costs have been included in Attachments A and B.
 
A key component of the re-design of the park is the enhancement to the rowing facility within the park. Over the years the Rowing Club of The Woodlands constructed a temporary facility.  In 2011/2012, Paratti Rowing broke off from RCTW to form a separate club, however both are located within the existing facility. Seeing that the facility is not conducive to the park’s esthetics and that there is potential for a Township public use for the facility such as boat storage rental and paddle boat rentals,  the Board requested a basic layout be included in the design process.  No funding was approved for the design or construction of this facility.

 A  joint proposal presentation from the rowing clubs has been received (Attachment C) that outlines their concept for the size and type of a facility needed and how the facility would be financed.  Staff and the clubs met several times during the months of October- January to discuss the design and financial options.  Per their building concept three financing options are recommended by the groups.  A 3,600 square feet concept was used as a placeholder in the meetings in October and December, however upon further discussion with the clubs about their current and future needs the following concept is proposed:
  • 100’ x 60’ covered storage space which would be split equally (3,000 square feet each)
  • 20’ x 30’ uncovered/fenced in area for safety launches (600 square feet)
  • 20’ x 30’ covered storage area for Township needs (rentals-storage, peddle boats), park storage space)
  • Minimal electric and water needs
  • Overall total 7,200 square feet
Overall, this larger foot print of the facility does have an impact on the park design through the following aspects:
  • Parking Spaces: Loss of 7-9 parking spaces; down to 140-142 spaces; (this is due to maintaining emergency vehicle/trailer turning radii for access)
  • Pavement: Increase demo of existing parking lot to account for Boat House; increase of landscaping  (2,000 SF approx. of area)
  • Tree Line: Loss of 1,600 SF to 2,000 SF of additional existing landscaping buffer
  • Additional Fill: Potentially building over substantial amount of clay, sand, organic material (buffer area), and a shallow water table.  To be conservative, it is being assumed that a deep foundation is warranted thus increasing the base cost of the facility. A geotechnical report is warranted to confirm these issues.
  • Montgomery County Permits would be required since there would be development in a floodplain, since all construction permitting is under their jurisdiction.
 By increasing the space, the cost has increased but also the cost per square foot has increased. For a base model, $100 per square foot has been factored, but due to the issues identified above, a minimum of $125 per square foot should be used to construct financial models. These per square foot prices increase to $115 and $135 once landscape, testing, contingency and increased fees for Burditt are included.
 
The three financing options presented in Attachment C are: 100% Township financed and rented to the clubs;  50% clubs financed and leased to the clubs; 100% clubs financed with a long-term park use agreement.  Each of these models has positives and challenges for both the clubs and The Township. These models use a factor of $3 or $4 per square foot per year for a rental fee and a 2% cost of capital for discounting purposes.  The three models proposed are as follows:

Traditional Rental- Township builds the facility at its cost and rents the facility to the clubs at a rate to be determined by the Board. This rate could be fixed to some market rate or based upon a rate that amortizes the  capital cost over some period of time such as 20 years.
  • Positives-
    • Offers the most control to The Township
    • Establishes a landlord/tenant as opposed to a lessor/lessee relationship
    • Monthly revenue stream, depending on the rental rate identified, if any
  • Issues -
    • The Clubs do not have a financial interest, besides paying rent.
    • Township would need to determine how a rental rate is established
    • Need to determine a term (5 years, 10 years)
50% Prepayment- The Township would build the facility and the Clubs would finance 50% of the cost.  In discussions, with the Clubs each club has the ability to provide this level of financing either through a line of credit or a committed donor.  Using a $3/$4 model the capital expenses would be amortized at 13 years.
  • Positives-
    • The Clubs have a financial stake in the success of the operation of the facility/club
    • Mid length term (13 years)
  • Issues-
    • Township would need to determine how a rental rate is established, which in effect determines the term.
100% Prepayment- The Township would build the facility and the Clubs would finance 100% of the facility.  Using the Club’s $3/$4 model the capital expenses would be amortized at 29 years.
  • Positives-
    • The Township has no financial risk related to the building of the facility
  • Issues -
    • This model has the longest term -  does the Township want to enter into an agreement that has duration of 44 years?
    • Does this model account for any value to The Township and community at large of having a rowing facility and club, i.e.. economic benefits of regattas, healthy activity, opportunities for youth
    • There may also be legal issues involved in a long-term lease which would not be presented by a short-term lease, even if it is a recreational use.
Staff  developed a financial model (Attachment D) which uses the per square footage rates above, factors in utilities, and facility maintenance and attempts to identify the 10 and 20 year “neutral cost per square foot” price. The neutral cost per square foot is defined as capital cost plus yearly operational cost minus revenue and divided by the number of square foot.  For the 7,200 square foot facility, the net rented space would be 6,600 square feet as 600 square feet has been earmarked for Township purposes.  From these models, the neutral rate is as follows:
  • 10 year- $16.36 per square foot per year
  • 20 year- $9 per square foot per year
     
    Using the $16.36 per square foot per year rate and a schedule and if the Clubs were to contribute $100,000, the effective rental rate would be discounted to $14.53 per square foot per year, for $200,000-$12.39, $300,000-$10.85.  If a 20 year term were to be used and $100,000 were to be contributed the effective rental rate would be $7.99 per square foot per year, $200,000-$6.98, $300,000-$5.97. For a complete schedule please see Attachment E.
If the Board, were to move forward with the rowing facility and there was an interest in having a financial commitment from the rowing clubs, other important issues need to be addressed include but not limited to:
  • Cost Overruns-If the facility was to go over the estimated cost, who would be paying for these?
  • Financial Commitment- The financial commitment of these clubs must be documented (letter of credit/donation agreement) before an agreement would be executed. Secondly, what if one club can secure the commitment and the other cannot?
  • Lack of Financial Commitment- If the financial agreement cannot be properly documented, thus the facility would not be built, what would become of the current facility?

Park Renovation Schedule
One of the largest challenges of this project or any park renovation project is to attempt to maintain some level of park access. It has been determined that park access will need to be maintained especially in light of large events that rely on the water (CB&I Tri, Memorial Hermann Texas Ironman, the 4th of July, and the Dragon Boat Festival) and maintaining public and lake lot owner access to Lake Woodlands.  It is currently envisioned that the project would be done in sections: restroom, pavilion area, playground/picnic area, promenade area, parking lot and rowing facility (if approved).  This many increase the cost of the renovation as various trades may need to come back to the park more than once.  With this understanding the following schedule of renovation is  presented:
  • Approved design- January 2016
  • Construction Drawings Development- February/March 2016
  • Bidding- April/May 2016
  • Award of Bid- June 2016
  • Construction Starts- July 2016
  • Construction Complete- Spring/Summer 2017
RECOMMENDATION:
Approve the design concept for the renovation of Northshore Park as presented and authorize Burditt to proceed with construction drawings and bidding; Board of Directors to determine if a rowing facility of 8,000 square feet is to be included and if so, provide direction on the desired financial model to be used for an agreement with the rowing clubs; and if such action is taken,  direct legal counsel to review the legal issues related to this matter and to develop the appropriate agreement with the Rowing Club of The Woodlands and Parati Competitive Rowing and return to the Board for review and approval, authorize the President/General Manager to amend the professional services agreement with Burditt to include design and construction administration services for a rowing facility and increase the Northshore Park Renovation Budget to include the amount for the design and construction, as determined by the Board, with funding being allocated from the Capital Reserves Fund.
Attachments
Attachment A - Northshore Park Renovation Plan
Attachment B - Northshore Park Opinion of Probable Cost
Attachment C - Rowing Clubs Proposal Models
Attachment D - Boat House Financial Model
Attachment E - Impact of contributions to rental rates


    

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