15.B.
City Council Meeting - FINAL
- Meeting Date:
- 07/15/2014
- Co-Submitter:
- Rick Compau, Purchasing Director
- From:
- Patrick Bourque, Public Works Section Head
Information
TITLE:
Consideration of Proposals: Purchase of Property for the Core Services Maintenance Facility (Consider proposals submitted in response to RFP 2013-44).
RECOMMENDED ACTION:
Reject all proposals as submitted for Request for Proposal (RFP) 2013-44 for the purchase of property for the Core Services Maintenance Facility and approve the McAllister Ranch property for construction of the Facility.
Policy Decision or Reason for Action:
There were a total of nine (9) proposals submitted for the RFP and Baylu Group, LLC (proposed property at the far north end of Cortland Blvd, near County Club and I-40 interchange) rose to the top as the highest scoring proposer. City staff, in conjunction with a local professional design firm, conducted extensive on-site/off-site infrastructure, design, review and construction cost analysis for both Baylu Group, LLC's Cortland Blvd. property and the McAllister Ranch property. Given the results of the cost of future building, Baylu Group, LLC's Cortland Blvd. property would be significantly more expensive to construct the Core Services Maintenance Facility than the McAllister Ranch property. Staff did not find any of the remaining proposals to be superior to McAllister Ranch
Financial Impact:
We will be committing the $14,000,000 bond money approved by the voters, as well as requesting the reinstatement of the $2.50 per ton surcharge at the landfill to pay for the Solid Waste portion of the new Facility. The reinstatement would produce revenue we could borrow against and that, coupled with what we currently have in our legal reserve fund for this project, would give us $5,500,000 for the Facility.
Connection to Council Goal and/or Regional Plan:
Address Core Services Maintenance Facility
Previous Council Decision on This:
In 2012/2013, Council rejected the F.W. Thompson (Wayne Thompson) proposed property because an acceptable agreement could not be reached and directed City staff to go back out and advertise through a new RFP.
Options and Alternatives:
1. Reject all proposals and approve McAllister Ranch for the site for the Facility.
2. Approve the Baylu Property for the Facility site.
3. Discontinue negotiations with the Baylu Group and enter into negotiations with the next highest ranking eligible proposer.
4. Go back out for RFP to see if there are any additional sites to consider to construct the Facility.
2. Approve the Baylu Property for the Facility site.
3. Discontinue negotiations with the Baylu Group and enter into negotiations with the next highest ranking eligible proposer.
4. Go back out for RFP to see if there are any additional sites to consider to construct the Facility.
Background/History:
In the spring of 2012, a bond question was approved to be placed on the November 2012 ballot for voters to approve $14,000,000 for a new Core Services Maintenance Facility. The voters approved this bond initiative and the City's Purchasing Section advertised an RFP for the purchase of property for the new Core Services Maintenance Facility. The City received one (1) proposal response from Wayne Thompson and negotiations began. Negotiations with Wayne Thompson continued into early 2013. With the parties unable to reach an acceptable agreement, negotiations were formally terminated and the proposal was rejected by the Council with discretion for staff to go back out with an RFP.
The City's Purchasing Section advertised a 2nd formal competitive RFP for the purchase of approximately 20 contiguous acres of developable land for a new Core Services Maintenance Facility for the Public Works Division. The RFP was structured to allow for the purchase only or purchase property and exchange City owned-property (specifically the current Mogollon property and the McAllister Ranch property) to assist in offsetting the purchase of any other proposed property. The RFP document also referenced the McAllister Ranch as a competing piece of property along with all other proposed property sites. The RFP was advertised on July 22, 2013, with proposals due on or before September 24, 2013. This time frame for advertising the RFP allowed for approximately nine (9) weeks for prospective proposers to be made aware of the RFP and submit a proposal response. The Purchasing Section held two (2) Pre-proposal Conferences to go over the project description/scope of work and evaluation criteria, as well as answer any questions from prospective proposers. The City received a total of nine (9) proposals involving eight (8) separate properties. One (1) of the proposals submitted involved two (2) different offers for the same proposed property. The RFP outlined four (4) evaluation criteria as follows:
The City's Purchasing Section advertised a 2nd formal competitive RFP for the purchase of approximately 20 contiguous acres of developable land for a new Core Services Maintenance Facility for the Public Works Division. The RFP was structured to allow for the purchase only or purchase property and exchange City owned-property (specifically the current Mogollon property and the McAllister Ranch property) to assist in offsetting the purchase of any other proposed property. The RFP document also referenced the McAllister Ranch as a competing piece of property along with all other proposed property sites. The RFP was advertised on July 22, 2013, with proposals due on or before September 24, 2013. This time frame for advertising the RFP allowed for approximately nine (9) weeks for prospective proposers to be made aware of the RFP and submit a proposal response. The Purchasing Section held two (2) Pre-proposal Conferences to go over the project description/scope of work and evaluation criteria, as well as answer any questions from prospective proposers. The City received a total of nine (9) proposals involving eight (8) separate properties. One (1) of the proposals submitted involved two (2) different offers for the same proposed property. The RFP outlined four (4) evaluation criteria as follows:
- Location (30%)
- Offer Price (25%)
- Quality of On-site and Off-site Infrastructure (25%)
- Functional Existing facilities that would support the Core Services Functions (20%)
- Public Works -- (2) evaluators
- Utilities -- (1) evaluator
- Managemnt Services/Finance -- (1) evaluator
- Economic Vitality -- (1) evaluator
- Community Development/Planning --(1) evaluator
- City Manager's Office -- (1) evaluator
- Flagstaff Chamber of Commerce -- (1) evaluator
- APS -- (1) evaluator
Key Considerations:
City staff has spent extensive time and money on comparing Baylu Group LLC's Cortland Blvd. property and the McAllister Ranch property to determine the best choice for the City. Site plans were developed for both properties to determine if and how the facilities would fit on each site and costs associated with those facilities.
Both properties are capable of housing all Public Works' existing facilities. Both are capable of future expansion. However, the City would have to encumber approximately seven (7) acres of park land adjacent to the Baylu Group, LLC's Cortland Blvd. property for future expansion. City staff has taken into consideration not only location but also compared on-site and off-site infrastructure costs for each location as well as estimating the annual operational and maintenance costs associated with each site. In addition, since the Baylu property is at the end of a dead end street passing through a multi-family residential area, staff also investigated the possibility of an alternate route that could be used as a primary access to the property. A route was designed that would exit the east end of the property, travel through the floodplain in the proposed park and exit onto Country Club. The estimated cost of the road is $4,100,000 and would require the acquisition of two (2) pieces of privately owned property.
Appraisals were performed on the City's McAllister Ranch and Mogollon properties for purposes of calculating the resources available to the City to purchase land and build the Facility. An appraisal was also performed on the Baylu Group, LLC's Cortland Blvd. property to compare it to their asking price. Staff also communicated with the Baylu Group, LLC representative during the due diligence process as to our progress and timeline and shared with them the results.
Both properties are capable of housing all Public Works' existing facilities. Both are capable of future expansion. However, the City would have to encumber approximately seven (7) acres of park land adjacent to the Baylu Group, LLC's Cortland Blvd. property for future expansion. City staff has taken into consideration not only location but also compared on-site and off-site infrastructure costs for each location as well as estimating the annual operational and maintenance costs associated with each site. In addition, since the Baylu property is at the end of a dead end street passing through a multi-family residential area, staff also investigated the possibility of an alternate route that could be used as a primary access to the property. A route was designed that would exit the east end of the property, travel through the floodplain in the proposed park and exit onto Country Club. The estimated cost of the road is $4,100,000 and would require the acquisition of two (2) pieces of privately owned property.
Appraisals were performed on the City's McAllister Ranch and Mogollon properties for purposes of calculating the resources available to the City to purchase land and build the Facility. An appraisal was also performed on the Baylu Group, LLC's Cortland Blvd. property to compare it to their asking price. Staff also communicated with the Baylu Group, LLC representative during the due diligence process as to our progress and timeline and shared with them the results.
Expanded Financial Considerations:
The money resources for the Facility are $14,000,000 bonding authority, landfill fees, both debt and one time money, totaling $5,500,000 and the appraised values for McAllister Ranch at $2,178,000 and the Mogollon property at $2,256,000. It should be noted that the appraisal for the Baylu Group, LLC's Cortland Blvd. property is $5,200,000. Total resources: $23,934,000 available for the Facility.
The best and final offer from the Baylu Group, LLC is $5,200,000 and they will take in trade both City properties at their respective appraised values. This figure is compared to the McAllister property which is already owned by the City.
A local professional design firm, Shephard Wesnitzer, Inc., performed on-site and off-site comparison of costs associated with each property as well as building and construction costs. These costs are $22,553,679 for the Baylu Group, LLC's Cortland Blvd. property and $21,431,955 for McAllister Ranch.
Given the cost of the Baylu Group, LLC's Cortland Blvd. property at $5,200,000, the design, review and construction costs of $22,553,679 and the estimated $4,100,000 cost to build the primary access road, the total move-on cost for the Baylu Group, LLC's Cortland Blvd. property is $31,853,679.
$22,553,679 Design, Review & Construction (DCR) Costs
5,200,000 Property Purchase
4,100,000 Primary Access Road construction
$31,853,679 BAYLU TOTAL COSTS
- $23,034,000 TOTAL RESOURCES
$ 7,919,679 (Shortfall)
For the McAllister Ranch property, the property is owned by the City.
$21,431,955 Design, Review & Construction (DCR) Costs
0 Property Currently Owned
$21,431,955 McCALLISTER TOTAL COSTS
- 21,756,000 TOTAL RESOURCES
$ 324,045 Surplus
The best and final offer from the Baylu Group, LLC is $5,200,000 and they will take in trade both City properties at their respective appraised values. This figure is compared to the McAllister property which is already owned by the City.
A local professional design firm, Shephard Wesnitzer, Inc., performed on-site and off-site comparison of costs associated with each property as well as building and construction costs. These costs are $22,553,679 for the Baylu Group, LLC's Cortland Blvd. property and $21,431,955 for McAllister Ranch.
Given the cost of the Baylu Group, LLC's Cortland Blvd. property at $5,200,000, the design, review and construction costs of $22,553,679 and the estimated $4,100,000 cost to build the primary access road, the total move-on cost for the Baylu Group, LLC's Cortland Blvd. property is $31,853,679.
$22,553,679 Design, Review & Construction (DCR) Costs
5,200,000 Property Purchase
4,100,000 Primary Access Road construction
$31,853,679 BAYLU TOTAL COSTS
- $23,034,000 TOTAL RESOURCES
$ 7,919,679 (Shortfall)
For the McAllister Ranch property, the property is owned by the City.
$21,431,955 Design, Review & Construction (DCR) Costs
0 Property Currently Owned
$21,431,955 McCALLISTER TOTAL COSTS
- 21,756,000 TOTAL RESOURCES
$ 324,045 Surplus
Community Benefits and Considerations:
The community around the current site on Mogollon will benefit because we will be moving our operations out of the residential area.
Community Involvement:
Inform
Expanded Options and Alternatives:
1. Reject all proposals and approve McAllister Ranch for the site for the Facility.
2. Approve the Baylu Group, LLC's Cortland Blvd. property for the Facility site.
3. Discontinue negotiations with the Baylu Group, LLC and enter into negotiations with the next highest ranking eligible proposer.
4. Go back out for an RFP to see if there are any additional sites to consider to construct the Facility.
2. Approve the Baylu Group, LLC's Cortland Blvd. property for the Facility site.
3. Discontinue negotiations with the Baylu Group, LLC and enter into negotiations with the next highest ranking eligible proposer.
4. Go back out for an RFP to see if there are any additional sites to consider to construct the Facility.
Attachments
No file(s) attached.