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Home My WebLink About2.b. City Hall Remodeling` CITY OF ROSEMOUNT EXECUTIVE SUMMARY FOR ACTION COMMITTEE OF THE WHOLE DATE: July 10, 2000 Staff seeks council direction on the proposed remodeling of City Hall. There are three possible scenarios for remodeling that will be presented at the work session. A cost estimate is included and a memo from Jeff May is included on financing the remodeling. If the City Council gives the direction to move forward the 2001 budget will be modified to reflect the change and upon council approval formal plans will be prepared for the remodeling for work to begin in the spring of 2001. AGENDA ITEM: City Hall Remodeling AGENDA SECTION: DISCUSSION PREPARED BY: Thomas D. Burt, City Administrator AGENDff 2 ATTACHMENTS: Proposed Plans, Financing Memo & APPROVED BY: Cost estimate MEMORANDUM DATE: July 6, 2000 TO: Thomas D. Burt, City Administrator FROM: Jeff May, Finance Director - SUBJECT: City Hall Remodeling In looking at the funding for the City Hall remodeling, there are a few factors that should be considered before proceeding: 1) There are.-3 years of debt currently left to pay on the original City Hall bonds Year 2000- $ 5,833 (8/1 Interest Payment) Year 2001 - $138,870 (2/1 P &I Payment & 8/1 Interest Payment) Year 2002 - $138,038 (2/1 Final P &I Payment — Taxes Collected in 2001) 2) There is current and future funding built into the Building CIP Fund that could be used for the remodeling: Year 2000 - $ 64,400 for City Hall Improvements Year 2001 - $110,000 for Lease - Purchase Payments on City Hall Improvements Years 2002 & On - $110,000 for City Hall Lease - Purchase Payments 3) We are looking at issuing Lease Revenue(L/R) Bonds or doing a Lease- Purchase(L/P) to fund the remodeling. At the end of 1999, 10 -Year L/R Bonds were estimated to be issued at 5.5% and 15 -Year L/R Bonds were estimated to be issued at 5.75 %. 10 -Year or 15- Year L/P's were estimated at 6.0% to 7.0 %. 4) The total cost of the remodeling is estimated at $2,000,000. 5) Annual payments on 10 -Year or 15 -Year financing would range from a low of $200,000 to a high of $266,000 if the whole $2,000,000 was financed. Those payments could be lowered if a portion of the total cost was bought down. This has been discussed by using water and sewer utility funds to contribute towards the cost of the remodeling. Another possibility would be to use General Fund reserves to buy down the total. y_ V City Hall Remodeling Page 2 At this point there are different options that are available in proceeding with this project. In giving these options, I am making the assumption that we are going to do our best at minimizing the impact on the taxpayers. In making these assumptions I am also going to assume that the Water Utility Fund and the Sewer Utility Fund would each contribute $100,000 and the General Fund would contribute $300,000 to the cost of the remodeling reducing the total financing needed to $1,500,000. Following are some of the options that have been looked at: 1) Proceed forward in 2000 and complete the project issuing L/R Bonds or doing a L/P. First payment would not be until 2001 and we would use 2000 & 2001 General Fund and Building CIP Fund monies encumbered/budgeted during those 2 years, to make the 2001 payments (adding necessary funding to the 2001 CIP to make up any difference in final payment). The years 2002 and beyond payments would be made as part of the Build CIP Fund budget and would increase the taxes for only the difference between the lease - purchase payments and the $138,000 that we levied in 2000 for the final 2001 collection (2/1/2002 payment) for the original City Hall bonds. This is because the original bond issue for the City Hall would be paid off and replaced by the levy for the remodeling. This option would have as minimal an increase in taxes that I can see. Also, we would look at the Water Utility Fund and Sewer Utility Fund each contributing a yearly amount if they do not contribute a lump sump payment up front(much like the Public Works building expansion project). 2) Get an estimate of each cost of the phasing that the architects have come up with and incorporate those costs into future CIF's and pay for the project as we go. This would be difficult to do because of the vaned phasing costs and could take many years to complete. City Hall could look like it was under constant construction for 5 to 10 years. At this point in time, it would appear to me that Option #1 above would be our best choice. We would finance $1,500,000 to complete the work, issuing the debt sometime in the fall of 2000 and the first payment coming sometime in 2001 using funds budgeted/encumbered from 2000 & 2001. Years 2002 and beyond payments would be from Building CIP levies that will be made that replace the original City Hall bond issue. The taxes should increase minimally for the citizens because of the remodeling project. F Rosemount City Hall Expansion and Remodeling Budget Cost Review 7/7/00 Tom Burt, City Administrator Robert Vanney, Architect Todd Christopherson, Amcon Costs are budgetary and are based upon preliminary drawings by Vanney Associates for Phases I through Ili. Drawings Dated 5/8/2000. Notes: 1. Remodeling costs for Phase I include sprinkler system for entire existing building. Assumes adequate flow and pressure available in right of way near building. 2. Costs based upon similar materials, finishes, and systems. 3. Electrical upgrade in Phase I is sized for Phases 11 and 111. 4. All estimates are based upon 2000 costs plus 3% for inflation allowance for year 2001. 5. No winter conditions or soil corrections are assumed. 6. Estimates for Phases 11 and Iii assume they are done simultaneously with Phase I. If done later, increase for inflation and for additional mobilizations and smaller projects. 7. Existing mechanical systems are assumed functional and are not replaced or upgraded in these budgets. New systems are assumed to be similar type. 8. ' There does not appear to be any asbestos issue associated with this project, however, an independent expert should evaluate this if necessary. 7n100 Rosemount City Hall Expansion and Remodeling AMCON TJC 1 of 1 Jum 00 Cast Estimates - summary t- Area (SF) Est. Cost Subtotals Phase 1 Lower Level Garage 1,802 81,068 Existing Council Chambers 1,889 103,903 Remodeling 3,935 149,525 Upper Level Offices over garages 3,245 415,411 New Council Chambers 1,540 184,800 ,Remodeling 6,338 221,830 Site Improvements 120,000 Upgrade Electrical for all 3 Phases 35,000 Sub -total Construction Cost 1,311,537 Project bevelopment Cost 236,000 FFE Contingency = 92,000 Total Project Costs - Phase 1 1,639,537 1,639,537 Phase II Lower Level Garage Addition 3,585 154,155 Upper Level Storage Addition 3,585 283,215 Sub -total Construction Cost 437,370 Project Development Cost 79,000 FFE Contingency 31,000 Total Project Costs - Phase H 547,370 547,370 Phase III Lower Level New stair to upper level 12,000 Upper Level Finish Offices over garage 3,585 96,795 Sub -total Construction Cost 108,795 Project Development Cost 20,000 FFE Contingency 8,000 Total Project Costs - Phase N 136,795 136,795 f Total ftlect Costs - Phases &M $2,323,702 AMCON TJC 1 of 1 Jum 00 Cast Estimates - summary t-