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Guaranteed Maximum Price Amendment #13

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Presentation given to Oak Harbor City Council during workshop on April 11, 2018.

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Guaranteed Maximum Price Amendment #13

  1. 1. Guaranteed Maximum Price Amendment #13 City Council Workshop – April 11, 2018
  2. 2. • Purpose • GMP #13 overview • Windjammer Park • Funding and Procurement Strategy • GMP #13 Cost • Impact to Clean Water Facility • FAQ Agenda 4/11/2018City Council Workshop 2
  3. 3. • Update City Council on the development of GMP #13 • Discuss the overlap between the CWF and Park Improvements • Discuss the cost development for GMP #13 • CWF project cost impacts / rate impacts • Discuss Windjammer Park Phase 1 options Purpose 4/11/2018City Council Workshop 3
  4. 4. • GMP #13 overview Agenda 4/11/2018City Council Workshop 4
  5. 5. • GMP #13 includes the following elements • Clean Water Facility Improvements (Must Have Items) • Mitigation / Restoration • Fencing • Paving • Water Main • Demolition • Windjammer Park Phase 1 improvements (Implement Windjammer Park Integration Plan) Guaranteed Maximum Price Amendment #13 4/11/2018City Council Workshop 5
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  9. 9. • Windjammer Park Agenda 4/11/2018City Council Workshop 9
  10. 10. 10 Decembe r 2015 Januar y 2016 February 2016 March 2016 April 2016 May/ June 2016 Council and CAG Process • Provide feedback on 3 concept alternatives • Present WPIP concept to community • Gather community feedback (Public Open House and Online Open House) • Review preferred plan to be presented to City Council • Provide final feedback • CAG forms • CAG provides feedback on design guidelines • Introduce CAG and WPIP to community • Gather community feedback (Public Open House) COUNCIL • Programming priorities • Approves CAG COUNCIL Report: Alternatives and Public feedback COUNCIL Approves plan COUNCIL CAG formation update and initial priorities list/ design guidelines 4/11/2018              City Council Workshop
  11. 11. What We Heard 4/11/2018 11 • “Given” elements must be included (e.g. – restrooms, kitchens, parking, playgrounds, waterfront trail, sport courts) • Family-friendly elements should be prioritized • Current RV park standards are not an efficient use of the park space • Views of the water are important • The ballfields should be relocated in the long term City Council Workshop
  12. 12. Proposed Phase 1 4/11/2018 12 Original Phase 1 To include part of Phase 2 & 3
  13. 13. Windjammer Park Phase 1 4/11/2018 13 • Includes Clean Water Facility mitigation and restoration • November 15, 2016 – City Council amended Carollo’s contract to include design
  14. 14. Windjammer Park Phase 1 Open House 1 4/11/2018 14 • 167 community members attended in-person and online open houses in January 2017 • 97 community members provided input on park character and theme City Council Workshop
  15. 15. What We Heard 4/11/2018 15 • Highest priority elements are restrooms, walkways, a nature play area, park furnishings, and a splash park • Participants preferred a natural, simple aesthetic • Park spaces should be flexible and multi-purpose • Thoughts on style inspirations for specific elements City Council Workshop
  16. 16. Windjammer Park Phase 1 Open House 2 4/11/2018 16 • 290 community members attended in-person and online open houses in August/September 2017 • 79 community members provided general comments, thoughts on the park design, and priorities for future park phases City Council Workshop
  17. 17. What We Heard 4/11/2018 17 • Excitement for the splash park • Appreciation for the future park’s design aesthetic • Requests to add pickle ball courts City Council Workshop
  18. 18. • Funding and Procurement Strategy Agenda 4/11/2018City Council Workshop 18
  19. 19. • Both Sewer and General Funds will be used • How do we distinguish which fund pays for what? • 7 bid packages • Base Bid = Sewer Fund • Bid Alternates = General Fund Funding and Procurement Strategy 4/11/2018City Council Workshop 19
  20. 20. • GMP #13 Cost Agenda 4/11/2018City Council Workshop 20
  21. 21. Element Sewer Fund General Fund Total Bid Items $8,072,220 $3,764,023 $11,836,243 Self Performed $1,169,774 $814,694 $1,984,468 NSS $223,156 $275,093 $498,249 Sub-total $9,465,150 $4,853,810 $14,318,960 GMP Risk Contingency @ 3.0% $283,955 $145,614 $429,569 Owner Design Contingency @ 2.0% $189,303 $97,076 $286,379 GMP #10 Allowance Adjustment $850,000 $0 $850,000 Specified General Conditions $165,000 $220,000 $385,000 Sub-total $10,953,408 $5,316,500 $16,269,908 GCCM Fee @ 4.28% $468,806 $227,546 $696,352 GMP Sub-total $11,422,214 $5,544,046 $16,966,260 Sales Tax @ 8.7% $993,733 $482,332 $1,476,065 GMP #13 Total w/Sales Tax $12,415,947 $6,026,378 $18,442,325 GMP #13 4/11/2018City Council Workshop 21
  22. 22. • Defer Maintenance Building to future phase • Reduce depth of top soil • Don’t line sewer manholes in CWF yard • Do not import soil to balance site • Select which general fund items are constructed with this phase Value Engineering 4/11/2018City Council Workshop 22
  23. 23. • Some value engineering items may not be realized until after award due to public works bidding Value Engineering 4/11/2018City Council Workshop 23
  24. 24. • Impact to Clean Water Facility Agenda 4/11/2018City Council Workshop 24
  25. 25. Clean Water Facility Financials 4/11/2018City Council Workshop 25 EXPENDITURES CONTRACTED/ESTIMA TED BUDGET PROJECT TO DATE ACTUAL BALANCE ACQUISITIONS 3,396,325.69 3,351,387.42 44,938.27 ADMINISTRATION 692,852.01 461,262.01 231,590.00 CONSTRUCTION 116,738,780.95 75,301,350.80 41,437,430.15 FINANCE 258,638.16 216,172.66 42,465.50 PROFESSIONAL SERVICES – DESIGN 10,191,581.88 6,830,374.85 3,361,207.03 PROFESSIONAL SERVICES – CONSTRUCTION 9,447,726.92 9,234,154.69 213,572.23 TOTAL PROJECT EXPENDITURES 140,725,905.61 95,394,702.43 45,331,203.18 CASH SURPLUS (DEFICIT) 5,223,392.09 2,489,402.93 2,733,989.16 TOTAL FINANCING/TSFR 3,798,088.98 2,489,402.93 1,308,686.05 ESTIMATED CASH REMAINING 1,425,303.11 0.00 1,425,303.11
  26. 26. • Funding needed: • Cash Available @ 3/31/18 $ 1,425,303 • Increase use of System Development + 1,000,000 • GMP #13 ($12,415,947 - $5,300,000) - 7,115,947 • Funds needed $ 4,690,644 Clean Water Facility 4/11/2018City Council Workshop 26
  27. 27. • Sewer Fund Cash Reserves • $4,690,644 can be used from fund balance • By using this it draws available balance from approx. $11.9M down to $6.4M • Reserved fund balance holds an additional $1.2M or 25% of expenditure budget How to pay for the increase 4/11/2018City Council Workshop 27
  28. 28. Windjammer Park – General Fund 4/11/2018City Council Workshop 28 FUNDING DETAIL 2017 2018 Proposed Total Program Income in WJP 382,235 1,500 383,735 General Fund - Sales Tax 915,574 177,633 1,093,207 126 Community Park 212,731 50,824 263,555 127 Park Impact Fees 63,985 39,258 103,243 311 REET I 87,500 120,525 208,025 312 REET II 87,500 101,435 188,935 Legislative Grant 727,500 727,500 Total Funding 1,297,809 1,358,349 312,042 2,968,200 Budgeted Expenditures in WJP 916,662 Cash Available 2,051,538 Full GMP#13 - GF Portion 6,026,378 Funds Needed (3,974,840)
  29. 29. Windjammer Park - Optional Items 4/11/2018City Council Workshop 29
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  31. 31. Feature Cost Hardscape, Landscape, Electrical $1,704,067 Splash Park $941,784 West Kitchen $1,168,904 Pavilion Structure $698,820 Maintenance Building $876,013 Landscape Maintenance $32,135 Picnic Tables and Litter Recepticals $66,427 Windjammer Park - Optional Items 31
  32. 32. • Balance in Stability Fund (before 12/31/17 adjustment) • $3,800,699 • Questions~ • How much should be left for the emergency fund? • Are there any other Council priorities that the stability fund might be used for? • Should use be covered under OHMC 3.09? Windjammer Park – Stability Fund? 4/11/2018City Council Workshop 32
  33. 33. Rates – January 2018 Estimated 4/11/2018City Council Workshop 33 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2010 Base Case $40.00 $42.00 $47.00 $52.00 $57.50 $64.75 $72.85 $81.95 $92.20 2010 Ord 1587 $40.00 $42.00 $47.00 $52.00 $57.50 $64.75 March '16 Estimate $77.70 $89.36 $102.76 $118.17 $135.90 2016 Ord 1760 $77.70 $89.36 $102.76 Sept '16 Estimate $77.70 $89.36 $102.76 $110.98 $119.86 Jan '18 Estimate $77.70 $89.36 $102.76 $106.36 $110.08 $77.70 $89.36 $102.76 $106.36 $110.08 $- $20 $40 $60 $80 $100 $120 $140 $160 ResidentialUtilityRate In January 2018, rates were checked with current funding and an Estimated Total Project Cost of $140M
  34. 34. Rates – April 2018 Estimated 4/11/2018City Council Workshop 34 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2010 Base Case $40.00 $42.00 $47.00 $52.00 $57.50 $64.75 $72.85 $81.95 $92.20 2010 Ord 1587 $40.00 $42.00 $47.00 $52.00 $57.50 $64.75 March '16 Estimate $77.70 $89.36 $102.76 $118.17 $135.90 2016 Ord 1760 $77.70 $89.36 $102.76 Sept '16 Estimate $77.70 $89.36 $102.76 $110.98 $119.86 Jan '18 Estimate $77.70 $89.36 $102.76 $106.36 $110.08 April '18 Estimate $77.70 $89.36 $102.76 $107.38 $117.27 $77.70 $89.36 $102.76 $107.38 $117.27 $- $20 $40 $60 $80 $100 $120 $140 $160 ResidentialUtilityRate Rates have been checked with current funding and an Estimated Total Project Cost of $147M
  35. 35. • Previously we planned to use Sewer Fund Balance for rate stabilization during this rate analysis • Expenditures were planned to exceed rate revenue and to use the fund balance so rates would not be artificially increased until fund balance was brought down • The use of fund balance to cover GMP #13 bid amounts could create a need for rate increase between 2020-2023 Rate Structure 4/11/2018City Council Workshop 35
  36. 36. • Things to keep in mind: • This is a check-in – when the project is completed we will use actual cost to determine rates • There won’t be changes to the rate structure until the CWF project is completed • The estimated Operating & Maintenance Budget is a conservative projection Impact on Rates 4/11/2018City Council Workshop 36
  37. 37. • Continued….. • If there is a growth in the customer base it may offset the need for a rate increase • Debt service is required to be 1.25x debt service coverage and we have that estimated as covered through 2020 • Further detail will be provided by Shawn Koorn on 5/1/2018 Impact on Rates 4/11/2018City Council Workshop 37
  38. 38. • FAQ Agenda 4/11/2018City Council Workshop 38
  39. 39. • What happens if we delay GMP #13 • Schedule delays (delayed CO) • Increased cost • May need to rebid • Material costs could go up • Change orders on existing GMPs • Mobilization / de-mobilization required to work in 2019 What do we do? 4/11/2018City Council Workshop 39
  40. 40. • Discussion Agenda 4/11/2018City Council Workshop 40
  41. 41. • Staff will proceed with VE efforts • Discuss potential funding sources • Ideas on how to fund optional items Discussion 4/11/2018City Council Workshop 41
  42. 42. • Continue to seek ways to keep project cost and rates down • Continue communicating with community Next Steps 4/11/2018City Council Workshop 42
  43. 43. What to Expect in 2018 4/11/2018City Council Workshop 43
  44. 44. Questions? 4/11/2018City Council Workshop 44
  45. 45. 4/11/2018City Council Workshop 45

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