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  12.B.       
Meeting Date: 08/21/2019  
From: Daniel Gho

RECOMMENDATION
Authorize the City Manager to enter into an agreement with Avila Construction Company to construct the Library Renewal Project for an amount not to exceed $2,162,960, plus a 10% contingency.
DISCUSSION
The Library Renewal Project is an extensive remodel primarily focused on the interior of the Library. Through generous funding from the City, foundations, and members of the community, nearly $2.6 million has been raised to preserve and enhance one of the City's major assets. The Renewal Project will honor the historic nature of the Library building through restoring the original Carnegie - better integrating it with the later additions to the building - performing needed repairs and maintenance throughout the facility, and insuring the renewal prepares the building to provide library services for many years in the future. 

Updates were provided to the City Council in December 2018 and June 2019. In 2017, the firm of Karin Payson Architecture and Design was contracted to develop designs for the renewal Project. After several meetings with community stakeholders, a design was approved.  With generous funding from the City, foundations, and members of the community, nearly $2.6 million has been raised towards the Library Renewal Project, to preserve and enhance one of the City's major assets. On June 3, 2019, with 100% construction drawings and specifications completed for the Library Renewal Project, the City issued request for proposals for the construction services of the Library Renewal Project.  On July 19, 2019, the City received three proposals.
 
The bidding documents specified that all proposers provide the City with a base bid for Building Modernization, with three Add Alternates for the following: 1) Clerestories, 2) Existing furniture strip and refinish and upholstery, and 3) New furniture.  The City specified in the bidding documents that we would be awarding the contract on the base bid for the Building Modernization only.  The table below represents the proposer’s base bids and their total with the Add Alternatives.
 
Bidders  Base Bid Total with Add Alternates
Avila Construction Company
 
 $1,899,000  $2,162,960
Tombleson Inc. $1,920,000  $2,195,000
Selden & Son    $1,925,100  $2,172,400

As previously specified, 2.6 million has been raised for the project.  When comparing the raised funds with the proposals, it appears that funding is adequate to support the entire project, but additional project expenses have already been expended.  Additionally, with a building that has had multiple additions and numerous remodels, it is anticipated that there will be unforeseen project expenses.  Therefore, it is prudent to include a 10% contingency in addition to the contract to cover these anticipated costs.  

These tables represent project cost to date, anticipated temporary library relocation expenses and the library renewal cost with various options. 
 
Estimated Funds Held by City on 6/30/2019 $   478,993
Estimated Funds Held by the Friends or Foundation:    $1,923,105
Total Remaining Funds: $2,402,098

Option 1 Project as Designed
Anticipated Project Expenditures (Project as Designed):                            
Base Bid                                                                  $1,899,000
Add Alt Clerestories                                                 $121,000
Add Alt New Furniture                                              $66,960
Add Alt Refinish and upholstery                               $76,000
Contingency 10%                                                      $208,696
                        Total Project Cost:                             $2,371,656
 
Temporary Library Expenditures:                             
            Holman Lease:                                               $136,000
            Tenant Improvements Contingency:              $12,000
            Moving Expenses                                          $55,000
                        Total for Holman Move                      $203,000
 
Other Expenses:
            Remaining Architect Fees                              $28,000
            Shelving                                                         $90,000
            Storage of Art                                                 $2,000
                        Total Extras                                        $120,000
           
Option #1 Total Project Cost/Deficit
Total Project Cost                               $2,694,656
Remaining Fund Balance                   $2,402,098
Deficit Balance                                   ($292,558)
 
The Friends of the Library, the Library Foundation, and other supporters have embarked on this extensive fundraising campaign to obtain the necessary funding that is needed to support the Library Renewal Project.  Option 1, the project as designed, shows a project deficit of $292,558.  This number was presented to the Friends and the Foundation to consider allocating additional funding. On August 9, 2019, the PGPL Foundation Board and the Friends/Foundation Joint Investment Committee (JIC) met to discuss potential methods to work with the City to help meet the shortfall in the Library Renewal Project budget. 

Both the Foundation Board and the JIC unanimously agreed to recommend that the project proceed as designed (Option 1), and to expedite the process, also unanimously agreed to pledge half of the funding needed to complete Option 1 if the City is prepared to provide the other half.  If the Foundation and Friends allocate an additional $146,279 and the City contributes an equivalent amount, the project may be built as designed.  This is the project that has been presented to the community during the fundraising campaign.  If the City Council opts to allocate additional funding to construct Option 1, the project as designed, these funds would be derived from reserves.

However, there are options,  and this is why the City bid the project with Add Alternatives.  Strikethroughs indicate items that have been removed in the options noted below, with the total cost reflecting these changes.                  

Option 2:
Estimated Funds Held by City on 6/30/2019                             $478,993
Estimated Funds Held by the Friends or Foundation:            $1,923,105
Total Remaining Funds:                              $2,402,098
 
Anticipated Project Expenditures:                                         
Base Bid                                                                   $1,899,000
Add Alt Clerestories                                                  $121,000
Add Alt New Furniture                                             $66,960
Add Alt Refinish and upholstery                              $76,000
Contingency 10%                                                     $208,696
                        Total Project Cost:                            $2,250,656
 
Temporary Library Expenditures:                             
            Holman Lease:                                             $136,000
            Tenant Improvements Contingency:            $12,000
            Moving Expenses                                         $55,000
                        Total for Holman Move                    $203,000
 
Other Expenses:
            Remaining Architect Fees                             $28,000
            Shelving                                                         $90,000
            Storage of Art                                                $2,000
                        Total Extras                                       $120,000

Option #2 - Total Cost/Deficit
 Total Project Cost                              $2,573,656
Remaining Fund Balance                   $2,402,098
Deficit Balance                                   ($171,558)
 
Option 3
Estimated Funds Held by City on 6/30/2019                          $478,993
Estimated Funds Held by the Friends or Foundation:            $1,923,105
Total Remaining Funds:                              $2,402,098
 
Anticipated Project Expenditures:                                         
Base Bid                                                                   $1,899,000
Add Alt Clerestories                                                 $121,000
Add Alt New Furniture                                             $66,960
Add Alt Refinish and upholstery                              $76,000
Contingency 10%                                                     $208,696
                        Total Project Cost:                            $2,107,696
 
Temporary Library Expenditures:                             
            Holman Lease:                                              $136,000
            Tenant Improvements Contingency:             $12,000
            Moving Expenses                                          $55,000  City to Move: All PW and Library Staff
                        Total for Holman Move                     $148,000
 
Other Expenses:
            Remaining Architect Fees                             $28,000
            Shelving                                                         $90,000
            Storage of Art                                                $2,000
                        Total Extras                                       $120,000
 
Option #3 - Total Cost/Deficit
Total Project Cost                               $2,375,696
Remaining Fund Balance                   $2,402,098
Surplus Balance                                  26,402
 
Option 3 eliminates all the add alternatives and the City’s Public Works Department and Library staff will be performing the move.  There will still be costs associated with the move which are unknown presently, but will be primarily for renting carts and equipment to move. This will take an extensive amount of time by all staff thereby impacting City services and delivery levels.  It is estimated that the move would consist of approximately 3,500 boxes of books at 40-50 pounds per box.  In addition with option 3 the library would have to reuse the old equipment and furnishings once the renewal project is completed.  There will be no purchase of new furnishing. 
 
 
Summary of Options
  Option 1
(Recommended Option)
Option 2 Options 3
Description Project as designed Project without
clerestories
Project without clerestories and without moving expenses*
*(moving performed in house by PW Staff)
Cost Deficit
(surplus)
$292,558
($146,279 of which would be provided by the Library Foundation and The Friends of the Library)
$171,558
Note: It is anticipated that this deficit would be solely borne by the City.  
           ($26,402)
 
The City has Qualified Avila Construction Company as the lowest responsible bidder and recommends that the City Council authorizes the City Manager to enter into an agreement with Avila Construction to complete the library renewal project, proceeding with the project as bid.
OPTIONS
  1. Do not enter into an agreement with Avila Construction Company
  2. Direct Staff to move forward with option 2 or 3 and not move forward with the project as designed
  3. Do nothing and reject all bids
FINANCIAL IMPACT:
The Fiscal Year 19/20 General Fund ending fund balance is projected to be approximately $8.7 million, with an $8.3 million reserve policy goal. The projected amount available above the reserve limit is approximately $400,000. This fund balance could change based on final revenues and expenditures for Fiscal Year 18/19.  The City is currently seeing savings in some of the departments for Fiscal Year 18/19, which could contribute to a greater fund balance; however invoices and carry-forward contracts could still be pending. If the City chooses to pursue Option 1, the amount remaining above the reserve target would be reduced to approximately $253,721.  Additional considerations for amounts available above the reserve limit could include retaining funds to support capital projects that may come over budget in Fiscal Year 19/20, as well as pending labor negotiations.
  
GOAL ALIGNMENT: City Asset Stewardship: Repair, maintain and improve City assets, including streets, sidewalks, sewer systems, buildings, and parks and trails.
Attachments
Library Renewal Project Past agenda Report Links
Presentation


    

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