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HomeMy WebLinkAboutStaff Report 3.D 04/03/2006&D CITY OFPETALUNIA,CALIFORNIA April 3, 2006 AGENDA BILL AEenda Title: MeetinE Date: April 3, 2006 Adopt Resolution Authorizing a Contract Amendment Relieving North Bay Construction, Inc., of Certain Specified Liability Concerning the Petaluma Municipal Airport Hangar Construction Meetine Time: ® 3:00 PM un Project, No. C100103, and Authorizing Early Occupancy by the El 7:00 PM City and/or Its Tenants of Certain Specified Portions of the Project (Buildings 14, 15, 16, and the North Side of 17 along with Related Site Improvements). CateLTory (check one): © Consent Calendar ❑ Public Hearing ❑ New Business ❑ Unfinished Business ❑ Presentation Department: Director: Contact Person Public Works ViAce �Iarengo Susan Lackie ( /l AA Cost of Proposal: $ 3,867,696.9Z v t AmountBud2eted: $ 6,153,000 Attachments to Agenda Packet Item: 1) Resolution 2) Location Map (Exhibit A) Summary Statement: Phone Number: 778-4404 Account Number: 3299-C100103 Name of Fund: FAA Funding; State Local Partnership; Debt Proceeds North Bay Construction, contractor for the Airport Hanger Expansion Project, C100103, has completed construction of hangar buildings 14, 15, 16, and the north side of 17, along with related site improvements (such as pavement striping, landscaping, etc.). Staff recommends the City Council adopt the attached resolution authorizing execution of a contract amendment relieving North Bay Construction of certain specified liability regarding the completed portions of Project C100103, and early occupancy by the City and/or its tenants of such portions. Doing so permits immediately leasing 44 of the 55 hangars and generating an estimated monthly revenue of $18,051.38 to be returned to the Airport budget to pay for the project loan. Building 17 is complete; however, only the north half may be leased at this time because of construction traffic working on building 18. The estimated total value of work completed thus far is $3,867,696.92 (including cost of City administration, design, construction management/inspection, and construction). The estimated value of construction completed thus far is $3,033,696.92 (approximately 65% of the total project cost). Recommended ON Council Action/Sueeested Motion: Council to adopt the resolution authorizing execution of a contract amendment relieving North Bay Construction of certain specified liability regarding the completed portions of the Airport Hangar Construction Project (buildings 14, 15, 16, and the north half of 17), and authorizing early occupancy by the City and/or its tenants of such portions. The estimated construction cost of the completed buildings is $3,033,696.92. R ievred by Finance Director: Date: Todav's Date: March 21, 2006 Reviewed bat City Attornev: V, U Date: Revision # and Date Revised: ADqrdV,VA,d by City Manaeer: y W, Date: File Code: S:\slackie\c 100103\city council\partial project acceptance\ CITY OF PETALUMA, CALIFORNIA APRIL 3, 2006 AGENDA REPORT FOR RESOLUTION AUTHORIZING CONTRACT AMENDMENT RELIEVING NORTH BAY CONSTRUCTION, INC., OF CERTAIN SPECIFIED LIABILITY CONCERNING THE PETALUMA MUNICIPAL AIRPORT HANGAR CONSTRUCTION PROJECT, NO. 0100103, AND AUTHORIZING EARLY OCCUPANCY BY THE CITY AND/OR ITS TENANTS OF CERTAIN SPECIFIED PORTIONS OF THE PROJECT (BUILDINGS 14,15,16, AND THE NORTH SIDE OF 17 ALONG WITH RELATED SITE IMPROVEMENTS) PROJECT NO. C100103 1. EXECUTIVE SUMMARY: North Bay Construction has completed construction of hangar buildings 14, 15, 16, and the north side of 17, along with related site improvements (such as pavement striping, landscaping, etc.) comprising part of the Petaluma Municipal Airport Hangar Construction Project C100103.. Staff recommends the City Council adopt the attached resolution authorizing execution of a contract amendment relieving North Bay Construction of certain specified liability regarding the completed portions of Project C 100103, and early occupancy by the City and/or its tenants of such portions. Doing so permits immediately leasing 44 of the 55 hangars and generating an estimated monthly revenue of $18,051.38 to be returned to the Airport budget to pay for the project loan. Building 17 is complete; however, only the north half may be leased at this time because of construction traffic working on building 18. The estimated total value of work completed thus far is $3,867,696.92 (including cost of City administration, design, construction management/inspection, and construction). The estimated value of construction completed thus far is $3,033,696.92 (approximately 65% of the total project cost). 2. BACKGROUND: On March 21, 2005 the City Council awarded the Airport Hangar Expansion Project, Project C100103 ("Contract'), to North Bay Construction. The work included construction of five (5) aircraft storage hangar buildings (approximately 70,731 square feet of buildings), new security fencing and gates, extension of fire mains and new fire hydrants, car parking areas, and improvements to the drainage system in the area. The buildings have the same general architectural features as the hangars that were recently constructed at the airport. At present, there are 103 fully occupied City hangars, with little turnover. 140 pilots, who have each put down deposits of $400, are on the current waiting list for additional units. Revenue from the planned hangars, as well as the existing units, will not only help to finance the project, but will assure the long-term viability of the airport. 3. 4. Construction of buildings 14, 15, 16, and the north side of 17, along with related site improvements (such as pavement striping, landscaping, etc.) are complete and ready for occupancy. ALTERNATIVES: a. Adopt the attached resolution authorizing execution of a contract amendment relieving North Bay Construction of certain specified liability regarding the completed portions of Project C100103 (buildings 14, 15, 16, and the north side of 17, along with related site improvements, such as pavement striping, landscaping, etc.) and early occupancy by the City and/or its tenants of such portions. Doing so permits immediately leasing 44 of the 55 hangars and generating an estimated monthly revenue of $18,051.38 to be returned to the Airport budget to pay for the project loan.. b. Do not adopt the attached resolution relieving North Bay Construction of specified liability, and permitting early occupancy and generation of rent revenue. FINANCIAL IMPACTS: Revenue Source(s) Estimated Costs General Fund Overhead Administration Fund FAA; State Local Partnership Debt Proceeds; Capitalized Interest Cost Design Construction Management Debt Service Construction (est) Contingency TOTAL Amount Budgeted. $0 $207,000 $257,000 $220,000 $564,000 $4,640,000 $265,000 $6,153,000.00 Estimated Costs Attributable to Buildings 14,15 16, and the North Half of 17, Along with Related Site Improvements $0 $135,000 $168,000 $144,000 $369,000 $3,033,696.92 $0 $3,849,696.92 Acceptance of buildings 14, 15, 16, and the north half of 17 will yield 48,137 square feet of rentable space at $0.375 per square foot for a total of $18,051.38 per month revenue. The remaining south half of building 17 will yield 7727 square feet of rentable space at $0.375 per square foot for an additional revenue of $2,897.63 per month. Building 18 will yield 14,867 square feet of rentable space at $0.50 per square foot for an additional revenue of $7,433.50 per month. The total monthly revenue for both buildings will be $10,331.13. rd Once all hangars are complete and leased, the total monthly revenue will be $28,392.51 per month, or $340,710.12 annually. 5. CONCLUSION: Adoption of the attached resolution would authorize execution of a contract amendment relieving North Bay Construction of certain specified liability regarding the completed portions of Project C100103 (buildings 14, 15, 16, and the north side of 17, along with related site improvements, such as pavement striping, landscaping, etc.) and early occupancy by the City and/or its tenants of such portions. Doing so permits immediately leasing 44 of the 55 hangars and generating an estimated monthly revenue of $18,051.38 to be returned to the Airport budget to pay for the project loan 6. OUTCOMES OR PERFORMANCE MEASUREMENTS THAT WILL IDENTIFY SUCCESS OR COMPLETION: Leasing 44 of the 55 hangars earlier than would otherwise be possible and early generation of corresponding lease revenue. 7. RECOMMENDATION: Council to adopt the resolution authorizing execution of a contract amendment relieving North Bay Construction of certain specified liability regarding the completed portions of the Airport Hangar Construction Project (buildings 14, 15, 16, and the north half of 17, along with related site improvements), and authorizing early occupancy by the City and/or its tenants of such portions. 814140_1 5 RESOLUTION AUTHORIZING CONTRACT AMENDMENT RELIEVING NORTH BAY CONSTRUCTION, INC., OF CERTAIN SPECIFIED LIABILITY CONCERNING THE PETALUMA MUNICIPAL AIRPORT HANGAR CONSTRUCTION PROJECT, NO. 0100103, AND AUTHORIZING EARLY OCCUPANCY BY THE CITY AND/OR ITS TENANTS OF CERTAIN SPECIFIED PORTIONS OF THE PROJECT (BUILDINGS 14, 15, 16, AND THE NORTH SIDE OF 17 ALONG WITH RELATED SITE IMPROVEMENTS) WHEREAS, by resolution No. 2005-038 adopted March 21, 2005, the City Council of the City of Petaluma awarded a contract for the 2005 Petaluma Airport Hangar Expansion Project ("Project"), C100103, to North Bay Construction, Inc., in the amount of $4,783,245.10, and authorized and directed the City Manager to sign such contract ("Project Contract") on behalf of the City; and WHEREAS, the City Manager signed the Project Contract dated April 13, 2005 on behalf of the City; and WHEREAS, the Project work consists of construction of 5 aircraft storage hangar buildings, new security fencing and gates, extension of fire mains and new fire hydrants, car parking areas, and improvements to the drainage system; and WHEREAS, the Project improvements referred to as Buildings 14, 15, 16, and the North side of Building 17, as well as related site improvements (such as pavement striping, landscaping, etc.) ("Completed Work") are complete sufficient for occupancy; and WHEREAS, there is currently a wait list of 140 pilots awaiting hangars at the Petaluma Airport, and revenue from rental of the completed hangars that comprise part of the Completed Work will help finance the Project and ensure the Petaluma Airport's long-term financial viability; options and recommends rejecting all bids at this time, and re -bidding the project this winter, thereby allowing time to secure needed additional funding. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Petaluma that the City Manager is hereby authorized and directed to sign on behalf of the City an amendment to the Project Contract substantially in accordance with the amendment attached to and made a part of this resolution as Exhibit A relieving North Bay Construction of certain specified liability regarding the Completed Work (buildings 14, 15, 16, and the north side of 17, along with related site improvements, such as pavement striping, landscaping, etc.) and authorizing early occupancy by the City and/or its tenants of such Completed Work. AMENDMENT 1 to the 2005 Petaluma Airport Hanear Exuansion Proiect Contract C100103 This Amendment dated for reference only to the 2005 Petaluma Airport Hangar Expansion Project Contract , C100103, ("Agreement") is entered by and between the City of Petaluma, a California charter city, ("City") and North Bay Construction, Inc., ("Contractor") WHEREAS, by resolution No. 2005-038 adopted March 21, 2005, the City Council of the City of Petaluma awarded a contract for the 2005 Petaluma Airport Hangar Expansion Project ("Project"), C100103, to North Bay Construction, Inc., in the amount of $4,783,245.10, and authorized and directed the City Manager to sign such Agreement on behalf of the City; and WHEREAS, the City Manager signed the Agreement dated April 13, 2005 on behalf of the City; and WHEREAS, the Project Work consists of construction of 5 aircraft storage hangar buildings, new security fencing and gates, extension of fire mains and new fire hydrants, car parldng areas, and improvements to the drainage system; and WHEREAS, the Project Work referred to as Buildings 14, 15, 16, and the North side of Building 17, as well as related site improvements (such as pavement striping, landscaping, etc.) ("Completed Work") are complete sufficient for occupancy; NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth and in accordance with provision 3.5 of the Agreement General Conditions, the parties hereby amend the Agreement as follows: 1. Contractor Relief. Upon written confirmation by the City that the Completed Work is entirely finished sufficient for occupancy, including all punch -list work, in accordance with all applicable Agreement requirements, the Contractor will be relieved of maintaining and protecting such Completed Work. Thereafter, except with the Contractor's consent or unless the Contractor has a duty to perform remedial or repair or other work on such Completed Work pursuant to the Agreement, the Contractor will not be required to perform further work on such Completed Work. In addition, upon such notice that the Completed work is entirely finished sufficient for occupancy, the Contractor will be relieved of responsibility for injury or damage to the Completed Work or portions thereof resulting from use by the public or from action of the elements or from any other causes; except that, Contractor will not be relieved of responsibility for injury or damage to the Completed Work or portions thereof resulting from the Contractor's operations or those of its privities, including, without limitation, the performance, negligent performance, or failure to perform the Project Work or the Agreement. 2. Limit on Contractor Relief. Except for the relief provided the Contractor pursuant to provision 1, above, all of the Contractor's duties under the Agreement, including, without limitation, the duties to maintain all insurance required pursuant to Article 10 of the Agreement, other than insurance required to protect the Completed Works, and to defend, indemnify and save the City harmless pursuant to Article 11 of the Agreement, remain unchanged and in full force and effect. For purposes of performance of the Agreement, and the requirements of California Public Contract Code Sections 7107, 9203, and 22300, as applicable, the Project Work will continue in accordance withtheAgreement as to Work other than Completed Work that is not subject to relief under this Amendment. Upon execution of this Amendment by both parties and written confirmation by the City that the Completed Work is entirely completed sufficient for occupancy, the City and/or its tenants may occupy the Completed Work, and such occupancy shall not constitute completion of such work pursuant to California Public Contract Code section 7107, or California Civil Code section 3086, except as may otherwise by required by law. 4. No Other Changes. Except as modified above, the Agreement and all of the parties' respective rights and duties under the Agreement, including, without limitation, the City's right to approve the Project Work upon final completion, remain unchanged and in full force and effect. CITY CONTRACTOR North Bav Construction. Inc By City Manager (CORPORATE SEAL) Steve Geney, President ATTEST: Attest: City Clerk Address for giving notices: 431 Pavran St.. Petaluma. CA 94952 0 APPROVED AS TO FORM: City Attorney APPROVED: Department Director APPROVED: Risk Manager APPROVED: Finance Director 814140 License No.: 357560 Agent for service of process: Steve Genev EXHIBIT A