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HomeMy WebLinkAbout2006-07-10MINUTES ADJOURNED REGULAR MEETING RIVERSIDE COUNTY PALM DESERT FINANCING AUTHORITY MONDAY, JULY 10, 2006 — 10:00 A.M. NORTH WING CONFERENCE ROOM — PALM DESERT CIVIC CENTER 73-510 FRED WARING DRIVE, PALM DESERT, CALIFORNIA 92260 I. CALL TO ORDER Commissioner Ortega convened the meeting at 10:00 a.m. II. ROLL CALL Present: Excused Absence: Commissioner Carlos Ortega President Jim Ferguson Commissioner Larry Parrish Vice President S. Roy Wilson Acting President Richard S. Kelly (Alternate) Also Present: Paul S. Gibson, Authority Treasurer Stephen Y. Aryan, Assistant to the City Manager Patrick Conlon, Director of the Office of Energy Management Dan Martinez, Deputy County Executive Officer, County of Riverside Timothy Miller, Assistant Director, Facilities Management, County of Riverside Leticia DeLara, Fourth District Supervisor Wilson's Office Rachelle D. Klassen, Secretary/City Clerk III. ORAL COMMUNICATIONS None IV. CONSENT CALENDAR A. MINUTES of the Adjourned Regular Meeting of the Riverside County Palm Desert Financing Authority (RCPDFA) of March 13, 2006. Rec: Approve as presented. Upon motion by Wilson, second by Kelly, and 4-0 vote of the Authority Commission Board, the Consent Calendar was approved as presented. V. CONSENT ITEMS HELD OVER None MINUTES ADJOURNED REGULAR MEETING OF THE RIVERSIDE COUNTY PALM DESERT FINANCING AUTHORITY VI. NEW BUSINESS JULY 10, 2006 A. DISCUSSION RELATIVE TO THE SELECTION OF BOND UNDERWRITER FOR FUTURE BOND ISSUANCE. Commissioner Ortega commented the County requested that the Financing Authority discuss the selection of bond underwriters, as once the County develops its list of eligible projects, bonds would need to be issued. He said that the previous underwriter for Authority -issued bonds was Kinsell, Newcomb and DeDios/Stinson Securities. Based on prior discussions with staff, their firm had already started some preliminary work on the next bond issuance; although, there was no formal contract in place for the underwriting at this time. He related that one year ago, the City initiated a process for reviewing about 20 underwriters' proposals and selected firms were approved. Mr. Gibson handed out a copy of page 3 from the June 22, 2005, City of Palm Desert Investment & Finance Committee Meeting Minutes, where an action was taken to approve the following firms for the City's investment banking pool: Citigroup Global Markets, Inc.; Stone & Youngberg; Piper Jaffray; Kinsell, Newcomb and DeDios/Stinson Securities; Wedbush Morgan Securities; and Newman & Associates (Housing only). Commissioner Ortega believed the County already did business with some of the named firms. He noted that Pam Newcomb of Kinsell, Newcomb and DeDios/Stinson Securities was in attendance at this meeting. As he was a newcomer to the Financing Authority and unsure about the background, Mr. Martinez remarked that he'd requested some more information about this process. He noted that normally the County would go through an RFP (Request for Proposals) process to make sure it's getting the best deal available on such services before acting on a proposal of this magnitude. Commissioner Ortega noted the City had done business recently with all of the named firms except for Newman & Associates, which was selected specifically to work with housing projects. He said the City had received good results from all the firms, further relating that the City's procedure included preselection of the group that would work on the bond issue, and depending on the type of issuance, it was a negotiated process. Alternatively, he said the competitive process would mean selecting the team and financial advisor, the bond documents would be put together and put out to bid. He went on to say the City's success with a negotiated process included a recent hybrid bond issue with both taxable and non-taxable 2 MINUTES ADJOURNED REGULAR MEETING OF THE RIVERSIDE COUNTY PALM DESERT FINANCING AUTHORITY JULY 10, 2006 bonds. Responding to question, he said Kinsell, Newcomb started working on a bond issue about two years ago when the County first brought forward a prospective list of projects. Commissioner Parrish offered that the County raised the issue as a means of clarifying the process, not objecting to it. With Authority Commission Board concurrence, it was agreed to utilize the City's approved investment banking pool: Citigroup Global Markets, Inc.; Stone & Youngberg; Piper Jaffrey; Kinsell, Newcomb and DeDios/Stinson Securities; Wedbush Morgan Securities; and Newman & Associates. B. DISCUSSION REGARDING LIST OF POTENTIAL PROJECTS TO BE FINANCED THROUGH A FUTURE BOND ISSUANCE. Commissioner Ortega stated that at various times, the County had presented the Authority with a list of projects it was considering for Authority financing. Mr. Martinez distributed the current list dated July 10, 2006, and said it represented a combination of items from the County CIP (Capital Improvement Project) schedule as well as other projects that had the highest priority for this area. Upon inquiry about the status of a new Sheriffs Station, Vice President Wilson said there had been a recent presentation of potential City -owned sites in Palm Desert and Rancho Mirage. He said everyone was sent back to the drawing board for additional figures on offsite costs, etc., and the Sheriff went back to work with his facilities staff about what would work best. That group would be meeting again soon. Authority Board Members discussed the parameters of the project and the general characteristics of the Palm Desert and Rancho Mirage sites. It was noted that the Palm Desert site (SEC Fred Waring Drive/San Pablo Avenue) could provide a 40,000-square-foot facility with underground parking, although that aspect would increase the cost of construction. Acting President Kelly commented that due to the escalating price of land, many public facilities were being planned as two-story. In answer to question, Mr. Martinez said the Sheriffs Station was the largest project on the list, and a final number would be necessary. He pointed out that the other projects on the list were in various stages of development, and they would also need to be more finalized in order to be funded with the bond issue. 3 MINUTES ADJOURNED REGULAR MEETING OF THE RIVERSIDE COUNTY PALM DESERT FINANCING AUTHORITY JULY 10, 2006 Acting President Kelly offered that he would be very supportive of the Bermuda Dunes Community Center and Park item on the list, which he felt would help alleviate some pressure from Palm Desert's parks. Vice President Wilson responded that the estimated cost of the Bermuda Dunes Community Center would have to be increased. He related that it was the site of the Christian School of the Desert, which was notified of being located in an unsafe area by the Airport Land Use Authority. He said the School had since identified and acquired a new site near Del Webb. Responding to question, he said the School site was approximately 10 acres; it included a gymnasium and small pool. He went on to relate that the Project List also included a couple of contingencies: Thermal Aviation, which housed the helicopter dedicated forthe Coachella Valley's use and would be located adjacent to the Thermal Sheriffs Station next to the Jacqueline Cochran Airport with taxiway access. Redevelopment funds would be used for construction of the Thermal Sheriffs Station; however, when the aviation component was considered, officials indicated their budget was insufficient, and it was added to the list being discussed. He added that the Berger Foundation had donated 20 acres for the Sheriffs Substation, aviation hangar, and youth aviation educational center. He went on to note that the list also includes Bermuda Dunes infrastructure upgrades (i.e., road and drainage improvements). Upon inquiry, he said that particular line item did not include any widening of Fred Waring Drive in the unincorporated area. Commissioner Ortega offered that the most recent analysis of the RCPDFA's bonding capacity indicated a total of $79 million to $80 million, which was sufficient to cover all the projects on the subject list. He explained that it was based on Palm Desert's reaching $11.8 billion in assessed valuation, and as the Project Areas grew, so did the amount of pass -through funding and respective financing ability. He stated that timing was key; interest rates were rising, but project costs had to be pretty well finalized before a bond issue could be contemplated. He said the list would have to first be adopted by the County, then presented to the RCPDFA Board for approval; most of the documentation would then already be in place. It was noted that costs shown on the list were recently provided by the Riverside County Economic Development Agency and were pretty accurate; the only one not updated was the Bermuda Dunes Community Center and Park. Additionally, the final estimate for the Sheriffs Station would depend upon the site chosen. Upon inquiry, Commissioner Ortega said the consultant's master plan forthe Sheriffs Station indicated a need for 70,000 square feet, all-inclusive, and 10 acres of land. He said it did not include Palm Desert's existing facility as part of the overall 70,000; and even if a master site was built somewhere 4 MINUTES ADJOURNED REGULAR MEETING OF THE RIVERSIDE COUNTY PALM DESERT FINANCING AUTHORITY JULY 10, 2006 else, Palm Desert would still want substation presence in its jurisdiction. He said there were approximately 25,000 square feet in the existing Palm Desert substation, and if the 40,000 square -foot alternative were pursued, it would provide nearly the total 70,000 requested, although in a different configuration than a 10-acre campus. He noted that the 70,000 square feet was a 30-year projection. Further responding, he said patrol could continue to operate from the present substation and support services could be moved across the street. It was noted that the Rancho Mirage site would require significant infrastructure construction; whereas, the Palm Desert site was ready to go. Vice President Wilson proposed that if the City of Palm Desert or the City of Rancho Mirage donated the land, the County could factor an annual credit for contribution of the facility into the lease arrangement, which would reduce costs and keep construction of the facility closer to $35 million. Commissioner Ortega commented that the Palm Desert City Council had authorized offer of the site across the street from the Civic Center, with the two alternative buildings: 25,000 square feet or 40,000 square feet. If the 25,000 square -foot alternative was chosen, it would provide a total of 50,000 square feet immediately. Acting President Kelly noted that as the cities grow, and with Rancho Mirage having significant area to be developed, it may want more law enforcement presence in the future. The additional area could be achieved in that way. Commissioner Ortega remarked that Palm Desert had two smaller substations in addition to its existing facility at the Civic Center: one on Washington Street, the other at the northwest corner of Highway 111 and Monterey Avenue (former Visitor Center location). Vice President Wilson stated most of the items being discussed here were already on the County's approved list, except the Homeless Housing project, where it was looking at a way to assist Palm Springs; and the Mecca Post Office, new item placed on the list by the Economic Development Agency. In answer to question, Ms. DeLara indicated the County would own the new Post Office building on the land it's currently on; the existing facility had been deemed insufficient to meet the community's needs and would be demolished. Upon motion by Kelly, second by Wilson, and 4-0 vote of the Authority Commission Board, it was agreed that the List of Potential Projects for Funding - July 10, 2006, be conceptually approved in total and that the Authority proceed with preparation of the necessary documentation, subject to finalization of the individual project costs. 5 MINUTES ADJOURNED REGULAR MEETING OF THE RIVERSIDE COUNTY PALM DESERT FINANCING AUTHORITY JULY 10, 2006 C. UPDATE ON THE COACHELLA VALLEY ANIMAL CAMPUS PROJECT STATUS. Mr. Conlon reported that since the County's January move -in to the Campus, a 36-page correction list was generated, identifying items the contractor needed to correct as part of his final inspection. He said they had been working on that list for the past six months, and according to his most recent conversation with the County's Doug Austin last week, the list was down to three items. However, the contractor refuses to address those three because he maintains they're not in the scope of work; that issue will be addressed later on the agenda with staffs negotiation request. He went on to say there were some warranty items on the project that the contractor needed to fix and follow up on; if the contractor fails to do so, there is recourse available by filing claims with the bonding company. He explained that warranty items were different than final inspection items. Mr. Martinez commented that earlier this morning Mr. Austin indicated he was still working on a punch list of numerous items and hoped to have it done by Wednesday. He said they were not warranty items. Vice President Wilson noted that the slope of the kennel floors for proper drainage had been an issue on the punch list. He said apparently, they'd gone in and just added epoxy to make the slope instead of adding concrete; but now the epoxy was peeling away. Mr. Conlon confirmed that the floor had been built up with the epoxy coating, which was done under the supervision of the manufacturer, and their method of correcting the issue was acceptable. He said the floors slope, but the problem was that the epoxy was coming up in some of the kennel areas; it was a warranty item that needed to be fixed by the epoxy company. Upon inquiry, he said during his last inspection, he counted four or five areas that were affected by the top color -coat of the epoxy peeling off, but it could be fixed. However, he was concerned to learn that a new punch list was being developed. Mr. Martinez affirmed that there was a list being worked on with several items, including installation of "Exit" signs above some of the doors. Responding to question about the air conditioning system, Timothy Miller, Assistant Director, Facilities Management, County of Riverside, said his department intended to go ahead with a temporary system in the shelter and had started the process of getting the contractor mobilized for it. Additionally, he said they also intended to correct system design flaws. 6 MINUTES ADJOURNED REGULAR MEETING OF THE RIVERSIDE COUNTY PALM DESERT FINANCING AUTHORITY JULY 10, 2006 Vice President Wilson noted that the County's Animal Director also had an issue of maintaining a 72° temperature with a system designed for 80°. Commissioner Parrish commented the 72° threshold was rather an arbitrary setting and wasn't a specifically approved policy; he felt it would be unrealistic in the desert-78° was more reasonable. However, as he understood it, the units on the facility were still undersized because the air had to be exchanged, meaning the units ran 24 hours/day. Commissioner Ortega offered that the last time the parties met at the Campus, the design engineers and County staff were going to meet and discuss the concerns. Mr. Conlon said he hadn't heard that the meeting had occurred; design engineers needed to review the building's design parameters with County staff. With regard to the units' inability to cool the facility, he noted that it was never meant for a 72° indoor temperature; it was designed for 80° in the kennel areas only. He said the existing units were 25-ton and provided 12 air exchanges/hour; they would have to be doubled to maintain 72°, and it would be prohibitively expensive. Relative to the units running 24 hours/day, they were designed that way in order to continuously bring in fresh air for the animals. Mr. Martinez remarked that the study indicating the units were inadequate was based on a 72° or 74° temperature, and the parameters were incorrect. Mr. Miller added that the Animal Director was now also inclined to accept the higher temperature. Mr. Conlon said the 12 air exchanges/hour were provided in only certain areas of the building —puppy rooms, cat areas —the isolation/quarantine areas, are provided with 100% outside air. He noted that the former Animal Services Director was concerned about the thermal shock for animals housed in the indoor/outdoor runs. He reiterated that later on this agenda was the Notice of Completion item that had been continued to this meeting; however, if there were additional corrective items needed, the item should be continued again. D. DISCUSSION ON TRANSFER OF CONSTRUCTION MANAGEMENT RESPONSIBILITY FOR THE COACHELLA VALLEY ANIMAL CAMPUS PROJECT TO RIVERSIDE COUNTY. Commissioner Ortega commented that since there were some pending items, it was being recommended that management of the project be transferred from the City of Palm Desert to the County of Riverside; that way, 7 MINUTES ADJOURNED REGULAR MEETING OF THE RIVERSIDE COUNTY PALM DESERT FINANCING AUTHORITY JULY 10, 2006 County operators could deal directly with the contractor on the items on the aforementioned punch list. Commissioner Parrish confirmed that was what had been discussed with and agreed to by County staff. Commissioner Ortega added that the City had taken the project as far as it could, but now there were warranty and operational issues. The contract remained in effect, responsibilities didn't change, it would just be a matter of changing the personnel who would be the point of contact. Vice President Wilson moved to, by Minute Motion, authorize the transfer of construction management responsibility for the Coachella Valley Animal Campus project from the City of Palm Desert to the County of Riverside. Motion was seconded by Kelly and carried by 4-0 vote. Responding to question, Commissioner Ortega said pursuant to the action just taken, he would write a letter to the County confirming the transfer. Upon further inquiry, Mr. Conlon noted that a complete set of the contract files had been transmitted to Michael Dickey of the County's Facilities Management Office. Additionally, construction management records would be available from Lisa Cox of WLC Architects and from the Authority's Secretary, Rachelle Klassen. VII, CONTINUED BUSINESS A. REQUEST FOR ACCEPTANCE OF WORK FOR CONSTRUCTION OF THE COACHELLA VALLEY ANIMAL CAMPUS (CONTRACT NO. RCPDFA 22130) (Continued from the meeting of March 13, 2006). Mr. Conlon suggested continuing action to the next meeting on the acceptance of work for the project. However, in Tight of the transfer of construction management above, he suggested a County official be authorized to negotiate the Settlement Agreement instead of the Authority's Chief Administrative Officer, as is specified in the staff report's recommendation number 2. County officials responded that their Director of Facilities Management would be the appropriate party. Mr. Conlon went on to recall for the Authority Commission Board that Wang Milestone Construction filed a claim with the RCPD Financing Authority for additional work it maintained it had done above and beyond the contract and wanted compensation. The claim was subsequently rejected 8 MINUTES ADJOURNED REGULAR MEETING OF THE RIVERSIDE COUNTY PALM DESERT FINANCING AUTHORITY J U LY 10, 2006 by the Authority Commission Board. Conversely, he said the Authority has a claim against the contractor for liquidated damages, $500/day, 195 days, totaling approximately $97,500. He acknowledged that it may be best if the negotiation authority was retained by City staff in light of work already done to this end. He went on to explain that the final punch list needed to be addressed, the Notice of Completion could be filed, and the Settlement Agreement needed to be executed between the filing of the Notice of Completion and release of the final retention check to the contractor, a 35-day time frame for final negotiations. He said any items on the punch list could be corrected before the final retention check is released; although, he was concerned about bringing a second punch list to the contractor at this point in time. He said that if the Settlement Agreement was not in place by the stated time, the Authority Treasurer would withhold the disputed value plus 50% from the final retention check. Commissioner Parrish felt City staff should complete the settlement process prior to the project being transferred to the County. Vice President Wilson moved to, by Minute Motion: 1) Continue to the next meeting the matter of accepting the project as complete and authorizing the President to sign and the Secretary to file the Notice of Completion; 2) authorize the Chief Administrative Officer/Executive Director to enter into negotiations with Wang Milestone Construction, Inc., South Pasadena, California, and execute a Settlement Agreement related to this contract. Motion was seconded by Kelly and carried by 4-0 vote. VIII. OLD BUSINESS A. REQUEST FOR APPROVAL OF AMENDMENT NO. 1 TO CONTRACT NO. RCPDFA 20680 — ARCHITECTURAL SERVICES FOR THE COACHELLA VALLEY ANIMAL CAMPUS. Mr. Conlon stated that WLC Architects was the architect of record and also the construction management firm. They had expended additional time on this contract in three areas: 1) $13,420 for additional time needed due to the delay of the project, which will be applied to the liquidated damages provision in the construction contract; 2) $7,680 for additional civil design work necessary for the Campus on -site grading due to a change in grading of the curb and gutters for new development east of the project; 3) $3,000 for preparation of the as -built drawings for the project, which will be forwarded to the County's Facilities Management Office. He confirmed that the second and third items were unrelated to the project's delay. With regard to liquidated damages on the construction project, he said the amounts that will be applied to that total will be the $13,420 specified above, $5,500 for furniture storage, and $3,500 for extended operation of the Cathedral City Shelter. 9 MINUTES ADJOURNED REGULAR MEETING OF THE RIVERSIDE COUNTY PALM DESERT FINANCING AUTHORITY JULY 10, 2006 Acting President Kelly moved to, by Minute Motion: 1) Approve of Amendment No. 1 in an amount not to exceed $24,100 to the subject contract with WLC Architects, Rancho Cucamonga, California, for additional construction management services, civil engineering, and preparation of "as built" documents for the Coachella Valley Animal Campus; 2) authorize the Treasurer/Director of Finance to appropriate $24,100 from the Unallocated Pass -through Funds for this purpose. Motion was seconded by Wilson and carried by 4-0 vote. XI. REPORTS AND REMARKS A. PRESIDENT None B. VICE PRESIDENT None C. MEMBERS OF THE AUTHORITY None D. STAFF None X. ADJOURNMENT There being no further business or discussion, and with Authority Commission Board concurrence, the meeting was adjourned at 11:01 a.m. RICHARD S. KELLY, ACTING PRESIDE ATTEST: RdCHELLE D. ASS WSECRETARY RIVERSIDE COUNTY PALM DESERT FINANCING AUTHORITY 10