AgdaPkt 2004-11-08 - Laserfiche WebLink

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At this point in the process, numerous factors warrant a reexamination of the garage construction costs. During the course of the construction, the project has been subjected to certain delays and increases in cost of materials. The delays have been largely due to weather conditions, utility relocations, and design modifications. Although there have been cost savings in some areas, including mass excavation and changing the foundation design from piles to mat slab, the project cost exceeds the original estimates. The overall cost of the project has been affected by increases in material costs due to the shortage of steel in the global market. Concrete has also experienced increased costs. These increases in costs have increased the construction budget from $16,730,000 to $17,400,000 (4% increase). There are also increased costs for testing and inspection as well as Architectural/Engineering support. The developer has agreed to the revised not-to-exceed amount and any items that cannot be covered in the contingency allowance will be absorbed by the developer. Alternately, if there are any unexpended contingency funds, the developer will share in those savings 50/50 with the City/RDA. As an incentive, if the developer completes the parking garage and streetscape by November 18, 2005, he will receive all of the remaining contingency funds. Additionally, the City/Agency would like to appropriate an additional contingency of $460,000 for our use. This will be used for items not included in the above agreement which include exterior signage ($100,000), optional murals on the garage walls ($160,000), and a general contingency ($200,000). The City Council/Agency Board expressed a desire to keep the total cost of the parking garage below $20 million. With the increase in costs, the garage is still below that figure as shown below: Cost of construction Testing & Inspection Architectural/Engineering support Management Fee Initial Garage Design City Contingency (new, see above) Total $17,400,000 ] 245,500 $18,576,500 409,000 (Not to exceed parking facility 522,000 cost in agreement) 650,000 460,000 $19,686,500 At the time that this report was drafted, the parties had discussed an amendment to the Construction and Reimbursement Agreement, a copy of which is attached. The developer's attorney and lender had not, however, completed their review of the document. Any revisions to the amendment proposed by the lender and agreed to by the parties following the drafting of this report will be presented to the City Council and Agency Board in the staff presentation. 11 /3/2004 Page 2 of 3