TO: Mayor and Members of City Council
THRU: Douglas J. Hewett, ICMA-CM, City Manager
FROM: Adam Lindsay, Assistant City Manager
Jeffery Yates, Assistant City Manager
Kimberly Leonard, CLGBO, CLGFO, CPA, MPA, Budget & Evaluation Director
Rob Stone, PE, Construction Management Director
DATE: April 8, 2024
RE:
Title
Adoption of Capital Project Ordinance Amendment 2024-18 and Budget Ordinance Amendment 2024-11 to Appropriate Additional Funding to the Fire Station 4 Relocation Project Due to the Contractor Missing the Completion Date
end
COUNCIL DISTRICT(S):
Council District(s)
District 2
b
Relationship To Strategic Plan:
Goal III: City Investment in Today and Tomorrow
Goal IV: Desirable Place to Live, Work and Recreate
Executive Summary:
Council is asked to adopt Capital Project Ordinance Amendment (CPOA) 2024-18 and Budget Ordinance Amendment (BOA) 2024-11 to appropriate $1,500,000 to the Fire Station 4 Relocation project for litigation expenditures.
Background:
Fire Station No. 4 is an 18,442 SF public safety facility under construction at 4210 Bragg Boulevard, approximately 0.5-mile NW of the intersection of Bragg Boulevard and Sycamore Dairy Road. This new fire station will replace existing Fire Station No. 4, located at 406 Stamper Road, and provide enhanced service and response time to a larger area of the City via additional equipment apparatus and its strategic location on Bragg Boulevard. Construction began on August 29, 2022, with an original completion date of October 30, 2023. Approved time extensions extended the contract completion date to December 27, 2023. The general contractor has experienced delays due to workmanship and supply issues and is currently in liquidated damages due to not meeting the contractual completion date.
At its regular meeting on May 9, 2022, the City Council approved CPOA 2022-62 to increase the project budget from the original budget of $8,313,284 to $11,000,000 due to construction inflation experienced on a national level in the wake of the COVID-19 pandemic. Since the start of the project, higher than expected ancillary costs have occurred as well as additional costs due to the general contractor not being able to meet the contractual deadline, resulting in the need for additional funding. The additional $1,500,000 is to pursue litigation against the contractor for the additional cost incurred.
Issues/Analysis:
The general contractor has experienced delays due to workmanship and supply issues and is currently in liquidated damages due to not meeting the contractual completion date. The contractor has struggled with workmanship issues and will be several months late with the completion of the project and is currently in liquidated damages. This has resulted in the need to bring in third party legal advisors, additional architectural experts, and perform a variety of additional special inspections to ensure the proposed fire station is constructed per the approved plans and specifications. The expectation is that these additional costs will be the responsibility of the general contractor.
Budget Impact:
BOA 2024-11 and CPOA 2024-18 will appropriate $1,500,000 from the General Fund fund balance.
Options:
1) Adopt CPOA 2024-18 and BOA 2024-11 to move funds to the Fire Station 4 Relocation Project to cover litigation expenditures.
2) Do not adopt CPOA 2024-18 and BOA 2024-11 to move funds to the Fire Station 4 Relocation Project to cover litigation expenditures and provide further direction to staff.
Recommended Action:
Staff recommends that Council move to adopt CPOA 2024-18 and BOA 2024-11 to move $1,500,000 to the Fire Station 4 Relocation Project.
Attachments:
CPOA 2024-18
BOA 2024-11