| ITEM #: 25. DATE: 08/29/2022 AI #:1053 |
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CITY COUNCIL ACTION REPORT
| SUBJECT: | FIRE STATION 188 EXPENDITURE AUTHORITY AND BUDGET AMENDMENT |
| STAFF PRESENTER(S): | Ed Pahl, Deputy Fire Chief; Mario Saldamando, Senior Project Manager |
OTHER PRESENTER(S):
Jason Santor, Director of Pre-Construction, Core Construction
SUMMARY
The action before the Council is to approve the expenditure authority for construction and other associated costs for Fire Station 188, located on the north-east corner of Citrus Road and Harrison Street, and approve budget amendments related to the increased cost of the project.
Recommendation
Approve expenditure authority for the total budget authorization of $19,429,600 for all the fees and costs for design, construction, related offsite improvements, equipment, furniture and fixtures for Fire Station 188, and authorize the necessary budget amendments in the amount of $2,816,000. (Ed Pahl, Deputy Fire Chief; Mario Saldamando, Senior Project Manager)
FISCAL IMPACT
The proposed project budget of $19,429,600 covers all fees and costs for the design, construction, and completion of Fire Station 188 and related offsite improvements, and equipment.
Project Budget Summary
Total FY23 Project Budget $16,613,600
Additional (Market Conditions/Escalation) $2,816,000
Total Project Budget $19,429,600
Expenditure Authorization Summary
Prior Expenditure Authorization $1,480,000
Current Expenditure Authorization Request $17,949,600
Total Expenditure Authorization Request $19,429,600
Project Budget Summary
Total FY23 Project Budget $16,613,600
Additional (Market Conditions/Escalation) $2,816,000
Total Project Budget $19,429,600
Expenditure Authorization Summary
Prior Expenditure Authorization $1,480,000
Current Expenditure Authorization Request $17,949,600
Total Expenditure Authorization Request $19,429,600
BACKGROUND AND PREVIOUS ACTIONS
The city’s new fire stations are the result of an assessment of community needs through the Operational Research Health (ORH) station study, identification of optimum station locations by staff with council guidance, budget approval by council, and collaboration with stakeholders to develop the most effective fire stations for the money.
On July 19, 2021, Council approved the expenditure in the amount of $1,480,000 for a contract to the Design-Build team of Core construction and Perlman Architects of Arizona for the design and pre-construction of Fire Station 188. Core was the general contractor of record for Goodyear Fire Stations 181 and 186.
On July 19, 2021, Council approved the expenditure in the amount of $1,480,000 for a contract to the Design-Build team of Core construction and Perlman Architects of Arizona for the design and pre-construction of Fire Station 188. Core was the general contractor of record for Goodyear Fire Stations 181 and 186.
STAFF ANALYSIS
Project Impacts
The planned location for Fire Station 188 is within a section of an existing city-owned 8.62-acre parcel in West Goodyear. The parcel is located on the north-east corner of Citrus Road and Harrison Street. The approximate area needed for the fire station is 2.5 acres. The unique site conditions of this location have been a major factor in the project costs, both on-site and off-site. Relocation of a Roosevelt Irrigation District (RID) well was originally estimated at $1.5 million, however the cost of this unique site issue has escalated to $2.7 million. Design evolution and proposals received have further confirmed the required site improvements and additional budget needed to complete the RID work.
The project is also impacted by numerous events and realities including the global COVID-19 pandemic, world events, and the ongoing labor shortage. These disrupting factors have stressed a fragile "just in time" network of goods and is reflective of the current state of the market. One strategy staff has implemented to help meet schedule and mitigate cost increases is the early procurement of materials with long lead delivery times. This project has executed contracts for early procurement of electrical equipment and for RID well items associated with the relocation. This will help manage the project’s schedule, while locking in prices.
Costs for the project are also being impacted by market escalations. Steel prices have more than doubled for material and installation of final goods since project inception. With a nationwide shortage of truck drivers shipping prices have also doubled from February 2022 to June 2022. The construction market continues to experience concrete supply shortages and delivery rationing; glazing costs have increased 40% since June 2022; pricing for doors and hardware equipment have increased 150% since 2020; the demand for copper is at an all-time high; and information technology supply stresses, compounded with sanctions on Russia have driven costs to record highs. The industry is also facing a shortage of skilled workers. Compound all these factors along with inflation and the result is an increase in the cost of construction in today’s market.
CORE, the Design Builder, has submitted their Guaranteed Maximum Price (GMP) for all of the remaining work. By accepting CORE’s GMP, and issuing a contract amendment, we will be transferring all potential cost escalation risks onto them as the Design Builder. With this approach, there will be no more cost increases for this project – any cost increases will be borne by the Design Builder.
Design & Construction
The station design is being developed through a participatory process involving fire department command staff, sworn personnel, subject matter experts from city departments, and our contracted Design Build team. The station design is using the recently completed Fire Station 181 features and floorplan as a guide, it has been designed as economically as possible with the intent of providing a safe environment for our firefighters to operate from. The project design phase will be completed in November 2022 followed by the construction phase. The construction phase includes all necessary permitting, construction of the facility, on-site development, and all required off-site work, quality assurance oversight and testing, furniture, fixtures and equipment, and project close out.
The site plan and design documents for Fire Station 188 have been submitted for permit review. Construction is scheduled to begin in December 2022 with a groundbreaking to be held on February 3, 2023. The project is planned for completion (beneficial occupancy by Fire Department staff) in October 2023, which is 4-months longer than originally anticipated.
The planned location for Fire Station 188 is within a section of an existing city-owned 8.62-acre parcel in West Goodyear. The parcel is located on the north-east corner of Citrus Road and Harrison Street. The approximate area needed for the fire station is 2.5 acres. The unique site conditions of this location have been a major factor in the project costs, both on-site and off-site. Relocation of a Roosevelt Irrigation District (RID) well was originally estimated at $1.5 million, however the cost of this unique site issue has escalated to $2.7 million. Design evolution and proposals received have further confirmed the required site improvements and additional budget needed to complete the RID work.
The project is also impacted by numerous events and realities including the global COVID-19 pandemic, world events, and the ongoing labor shortage. These disrupting factors have stressed a fragile "just in time" network of goods and is reflective of the current state of the market. One strategy staff has implemented to help meet schedule and mitigate cost increases is the early procurement of materials with long lead delivery times. This project has executed contracts for early procurement of electrical equipment and for RID well items associated with the relocation. This will help manage the project’s schedule, while locking in prices.
Costs for the project are also being impacted by market escalations. Steel prices have more than doubled for material and installation of final goods since project inception. With a nationwide shortage of truck drivers shipping prices have also doubled from February 2022 to June 2022. The construction market continues to experience concrete supply shortages and delivery rationing; glazing costs have increased 40% since June 2022; pricing for doors and hardware equipment have increased 150% since 2020; the demand for copper is at an all-time high; and information technology supply stresses, compounded with sanctions on Russia have driven costs to record highs. The industry is also facing a shortage of skilled workers. Compound all these factors along with inflation and the result is an increase in the cost of construction in today’s market.
CORE, the Design Builder, has submitted their Guaranteed Maximum Price (GMP) for all of the remaining work. By accepting CORE’s GMP, and issuing a contract amendment, we will be transferring all potential cost escalation risks onto them as the Design Builder. With this approach, there will be no more cost increases for this project – any cost increases will be borne by the Design Builder.
Design & Construction
The station design is being developed through a participatory process involving fire department command staff, sworn personnel, subject matter experts from city departments, and our contracted Design Build team. The station design is using the recently completed Fire Station 181 features and floorplan as a guide, it has been designed as economically as possible with the intent of providing a safe environment for our firefighters to operate from. The project design phase will be completed in November 2022 followed by the construction phase. The construction phase includes all necessary permitting, construction of the facility, on-site development, and all required off-site work, quality assurance oversight and testing, furniture, fixtures and equipment, and project close out.
The site plan and design documents for Fire Station 188 have been submitted for permit review. Construction is scheduled to begin in December 2022 with a groundbreaking to be held on February 3, 2023. The project is planned for completion (beneficial occupancy by Fire Department staff) in October 2023, which is 4-months longer than originally anticipated.