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HRA 03/31/1983 SPEC - 29375SPECIAL HOUSIl93, & REDEVELOPMENT AUTEURITY MEETING MARCH 31, 1983 CALL TO ORDER: Chairperson Caamers called the March 31, 1983, Special Housing & Redevelopment Authority meeting to order at 5:00 p.m. ROLL CALL: Members Present: Larry Canmers, Carolyn Svendsen, Elmars Prieditis Members Absent: Walter Rasmussen, Duane Prairie Others Present: Jerrold Boardman, Executive Director HRA Nasim M. Qureshi, City Manager William J. Nee, Mayor Edward Fitzpatrick, Councilman Edward Hamernik, Councilman Mark Burch, Assistant Public Works Director John Flora, Public Works Director Sid Inman, Director of Central Services Harold Skjelvostad - InterDesign, Site Planner /Landscape Architect. Jerrold Boardman - Executive Director HRA submitted the bid tabulation sheet for the Center City Plaza and Phase II Project. Mr. Qureshi, City Manager, asked for some indication fran the HRA on which bid along with modification is acceptable to HRA and he would like to present then to the City Council at the April 4, 1983 Council meeting. Mr. Canmers questioned this procedure and asked why it must be sent to the Council. Mr. Qureshi explained that this is required of the City Council because the HRA requested the City to assess the project. The City Council is the one who calls for bids and will be awarding then. He explained that it is the purpose of the staff to take the information and choices made by HRA to the City Council directly before awarding the bids. The HRA cannot call for and award bids unless they want to pay for a project directly and not use the special assessment procedure. Mr. Qureshi explained there are four elements involved in the development. They are: the parking lots (Civic Center and Office Building) 64th street realignments, water and sewer for the Office Building and the Plaza Development. Mr. Qureshi stated that in January of 1983, it was requested the City Council go ahead with the Parking Lot, 64th Street realignments and the Water and Sewer Bids. The numbers were sent to the HRA and they were comfortable with the numbers. Mr. Qureshi stated the Architect initially estimated the project costs in January 1983. The costs were then given to the HRA for their confirmation and got go ahead for the project bidding. The bid proposal request was layed out with base bid along with number of different alternates so that the HRA can pick and choose depending upon the bid cost and the amount of money budgeted so the HRA can get the best type of facility for the money. Mr. Mark Burch, Assistant Public Works Director, explained the different parts of the bid. Base bid included: Mark explained the base bids and the alternates for the Plaza: Alternative A -1 is for the fountains; A -2 is for the irrigation with plastic heads; A -3 is for irrigation with brass head; A -4 is to provide sleeving for irrigation; &-1 is to install wall lights; B-2 is for the Plaza lights with trash receptacles; B-3 alternate Plaza lights and B-6 is the electrical service connections. It was recommended that they award the base bid with the following alternates: A -1, A -3, Br-1, B-4, &-5 and B-6. The base bid included the landscaping f or the Plaza area. They are, Alternative 1 for the Landscaping for the office building, Alternate 2 is the landscaping for the 5th Street island, Alternate 3 is the landscaping for the Clinic and Alternate 4 is for the 5th Street boulevard. Mr. Qureshi stated the costs came in much too high when the bids were received. The fountains were estimated at $20,000 by the Architect but came • in at $87,000. The electrical was estimated at $20,000 and came in at $40,000. Mr. Qureshi explained how alternative material could be used in the construction of the fountains, such as changing the type of aluminum in order to bring the cost down. Mr. Qureshi stated there are alternatives and certain choices available to you for you to make determinations. Mr. Qureshi went over the project costs and bids for the HRA. Plans were submitted for their review during the discussion. The items that were discussed were the fountains, irrigation, wall lights, pylon lights, overhead lights and electrical service. The following alternates were recommended, bringing the alternates cost to a total of $163,960. Alternate A -1 Fountains $87,000.00 Alternate A -3 Irrigation 18,600.00 Alternate B-1 Wall Lights 16,740.00 Alternate B-4 Pylon Lights 3,000.00 Alternate Br5 Overhead Lights 35,595.00 Alternate Br6 Electric Service 3.025.00 $163,960.00 I r ] Mr. Ccnwers stated that this is a substantial increase. Mr. Qureshi then explained the landscaping bids. He felt that cuts should be made, however, those cuts should not destroy the integrity of the Plaza. He explained sane of the possible reductions: 1) 1 flag instead of 2, 2) delete some unnecessary walls, 3) eliminate recessed lights and provide satisfactory replacement lights and 4) eliminate 1 planter but leave shrubs. These reductions cane to a total of $61,551. Mr. Commers asked what is the "cost to the others "? Mr. Qureshi stated that those costs relate to the work around the office building, the clinic and the work on 5th Street. Mr. Qureshi stated that the alternatives with the base bid is the total cost for the whole project. These costs are then broken down and allocated to the specific items (like the office building, the parking lots, 5th Street and the Plaza). Mr. Qureshi stated that the office building and Civic Center parking lot was $140,000 and would be assessed to the HRA. This would include the paving, lights and irrigation related to that property. Mr. Commers stated that the initial cost of the parking lot was for $140,000 but he was not aware that this included anything more than the paving. Mr. Qureshi stated the bids for the similar Paving were let separately because all project items should be handled by the contractor best able to give a good product. Mr. Boardman stated the plaza and the parking lot and street bids were let separately as was the landscaping. This saves the HRA a lot by combining similar items in one bid. Mr. Prieditis questioned the Alternative B -1 bid for the wall lights. He asked if the recessed lights would be deleted and if they are recessed in the concrete and if there would be a credit. Mr. Burch stated that the concrete is fix and form and that the additional concrete work is included in the light bid. Mr. Qureshi suggested that the HRA members see the sheet regarding the possible deletions on the Plaza. He stated that a change order in the contract for $61,000 would be necessary if you want to award the base bid to came within the guidelines. Mr. Commers asked about the difference in fountains. Mr. Qureshi stated that the fountain is the highest area of cost discrepancy. The problem is the increase from the Architect's estimate of $20,000 to the . actual bid cost of $87,000. HOUSING AND REDEVELOPMENT AUTHORITY MEETIMI, MARCH 31, 1983 PAGE 4 jft Mr. Qureshi said that they were given a price from the Architect's estimate of the Plaza. This information was given to you in January. Mr. Commers stated his principal concern is about meeting the numbers and making sure that the HRA cash flow is adequate for the development in the area. Mr. Qureshi stated the costs of the Plaza with the suggested cuts and other contributions is $248,000. If you add in the contingency and finance costs, the project will be below $300,000 and would fall within the BRA budget. Mr. Qureshi stated there are two ways of doing it; 1) the HRA can choose to pay up front for the project or 2) the City can loan the money and have it then assessed to the HRA. Mr. Commers asked Sid what does that do to the HRA cash flow, Mr. Inman stated that it does not change the expense for the first twelve (12) months but reduces future assessment payments. Mr. Prieditis asked about the lack of contingency. Mr. Qureshi stated $52,000 include contingency and interest during construction, etc., is built into that $300,000 figure, • Mr. Conmers asked that if the HRA is assessed for the plaza costs that $52,000 is for interest and carrying costs and other contingency. Mr. Qureshi stated that this would be the cost if the HRA wants the assessment and the City finances the HRA during construction. Mr. Commers asked Mr. Iimian to give them some numbers on the effects of an outright payment for the plaza. More specifically, the effect of direct payment in 1984 & 1985. Mr. Inman stated that the original effect obviously would be to reduce the mount of cash available by $300,000. This would reduce the HRA's ability to earn interest at the same rate that the City would charge to loan that money. Therefore, the first twelve (12) months would cost the HRA just about the same irrespective of whether they were assessed or pay up front, From that point on, the immediate effect would be in the inability of the HRA to invest the $300,000, which would be offset by the additional assessment payment they would not be making. For the first two to three years the HRA would be behind in actual cash flow and after four years could potentially gain. It would really depend on the interest rate and the time. Mr. Carriers asked what the cash savings are and how badly does that hurt our cash flow over 15 years. r-7 LOA Mr. Qureshi asked Mr. Inman to coarse up with an estimate within the next ten minutes. Mr. Skjelvostad then explained the changes in the materials and design for the fountain and the sun dial. He explained the bids came in high. The bids from the contractor could be reduced by building 7 fountains instead of 9 saving $28,000, and by changing the number to five and the material they could save $30,000. Mr. Qureshi stated the reduction in number and having the same shape and use a different aluminum, with the hope that enough money can be saved to have at least seven structures. Mr. Boardman stated that each option saves money. Mr. Prieditis stated he would like to make sure no reflective, sound bouncing off the aluminum or whistling would occur. Mr. Cammers stated he is concerned with the maintenance of it in regards to the Public Works Department. Mr. Skjelvostad explained there should be no change as far as maintenance is concerned. He also explained that it is more reflective but not much. Mr. Prieditis stated he would like to maintain the numbers if possible. He would like to see a material change with the initial design. Mr. Qureshi stated another item was the deletion of the wall lights with a replacement of overhead lighting. This could reduce the bid by $20,000. They are nice to have but the bid costs came in too high. Mr. Commers stated that the carrying cost was never given to them. They thought that they were talking about a total cost of $300,000. Mr. Qureshi stated $30,000 would be the City's financing costs. Mr. Qureshi stated he wanted to make it clear that the construction costs for the Plaza came in at $300,000. That means that the total costs to be assessed to the HRA would be approximately $3601,000. If the HRA wants to bring the total costs under the $3001,000 figure, cuts would have to be made. If the HRA wants to pay the Plaza costs directly there would be a savings to the HRA regarding the carrying costs. Mr. Qureshi asked in what areas does the HRA want to make adjustments to and what guidelines do you want to give the City Council to aid them in awarding the contract. Mr. Com-iers asked Mr. Inman if he has had cash flow projects yet. 0 HOUSING AND RIDEVEIAPMENT AUTHORITY MEETING, MARCH 31, 1983 PAGFy 6 Mr. Imnan stated that the information that he would give them now was rough and that he would have to run it on the computer to be absolutely accurate. Generally speaking, at the end of 1983, the HRA would be approximately $450,000 less in their cash flow position than they would be if they did not pay the assessment up front. He further stated that at the end of 1984, they would only be approximately $160,000 behind the difference being the $300,000 they paid up front plus the loss of interest along with the assessment payment they would not be making in October and the additional interest they would earn on that. Mr. Commers asked Mr. Inman what the effect would be on his worst case model and Mr. Inman stated that the worst case model included no interest income anyway. Therefore, reducing the cash balance by $300,000 would not effect the worst case model. Mr. Burch showed brochures of the different types of lights. Mr. Qureshi stated that they should try to make rational changes. Tied to the guidelines as we feel the plaza will be used mainly in the summer time. That it is your choice if you want it assessed. Mr. Prieditis stated he preferred the recessed lighting over the other. Mr. Skjelvostad stated it is costly to add lights. Mr. Qureshi stated before the base bid is brought to the City Council, alternatives should be presented for approval. This should be done before we sign the document and award the bids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gIE MARCH 311 1983 HOUSING AND REDEVELOPMENT AUrIHORITY MEETING ADJOURNED AT 7:08 P.M. 0