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HomeMy WebLinkAboutPD County Club Undergrnding Prjct�1 F PALM DESERT REDEVELOPMENT AGENCY STAFF REPORT REQUEST: INFORMATIONAL ITEM — COSTS ASSOCIATED WITH PALM DESERT COUNTRY CLUB UNDERGROUNDING PROJECT SUBMITTED BY: ARLA K. SCOTT, SENIOR FINANCIAL ANALYST DATE: DECEMBER 13, 2007 CONTENTS: SOUTHERN CALIFORNIA EDISON ROUGH ORDER OF MAGNITUDE (ROM) VERIZON COMMUNICATIONS ROUGH ORDER OF MAGNITUDE VERIZON COMMUNICATIONS ENGINEERING PROPOSAL MUNIFINANCIAL ENGINEERING PROPOSAL Recommendation: Receive and file. Discussion: Southern California Edison (SCE) and Verizon Communications were both asked to provide the Agency with a rough order of magnitude for undergrounding the Palm Desert Country Club (PDCC). Southern California Edison provided a rough estimate of $22,000,000. Verizon provided a rough estimate of $2,267,080.91. Due to increased costs we have projected their cost at $5,000,000. We are estimating the costs of issuing bonds at 20% of the total project. This estimate is based on similar undergrounding projects that have been done by the Agency in the past. The RDA portion could possibly go up to 50% of the total eligible costs of the project. Based on prior experience, that is estimated at 40% of the overall total of the project. This would include the cost of undergrounding arterial streets, such as California, Warner Trail, and other major arteries throughout PDCC. These are only preliminary estimates and are subject to industry changes. Southern California Edison $22,000,000 Verizon Communication $ 5,000,000 Costs of Issuance $ 4.400,000 Total $31,400,000 RDA Portion (40%) $12,560,000 PDCC Portion $18,840,000 Size of Bond Issuance $21,935,000 Approximate assessment $12,000 - $15,000 Approximate annual assessment $855 - $1,100 Staff Report Informational Item — Costs associated with PDCC Undergrounding Project Page 2 December 13, 2007 The only way to have accurate costs is by having the engineering design done by Southern California Edison, Verizon Communications and MuniFinancial. The estimates we are currently using are based on prior undergrounding projects. However, a more reliable cost calculation would be available after the engineering design has been completed. The cost calculations based on the engineering design are subject to public bid before the costs can be finalized. After the engineering design has been completed, MuniFinancial would be able to provide a more accurate cost to each individual homeowner (again noted this is a preliminary cost). This would give each individual homeowner a more reliable cost of what their assessment would be, and thus help them make an informed decision. Currently, we are waiting on the SCE engineering proposal. They have verbally communicated an estimate of more than $300,000 for their engineering deposit. MuniFinancial presented a proposal for engineering services of $48,500. Verizon's proposal for engineering services accounted for the $5,000 non-refundable deposit that they received on October 23, 2007 with a remaining balance due of $20,000. Therefore, it would cost in excess of $368,500 for the engineering deposit, with the understanding that this is only a proposal for the deposit and the actual costs could be more when the actual work has begun, depending on the findings of the engineering services. However, each deposit would count toward the overall cost of the undergrounding project, as long as the project was begun within the standard timeframe, which is usually two years. Upon receipt of the formal estimates and relevant agreements, a recommendation will be brought to the Agency Board for consideration. The Agency has funds in Project Area No. 4 to pay for the engineering design, with the understanding that if the project does not have enough support from the homeowners, the formation of the assessment district will not continue. The engineering design, if completed, can be used at a later date, if the homeowners decide to wait and pursue this district in the future. Submitted By: _ Arla K. Scott Senior Financial Analyst ent Carlos L. Ortega, Executive Director GArdaWrla Scott\Word Files\Staff Repts\PDCC Undergrounding-Engineering-Info Item.doc Department Head: David Yrigo*r� Director of edevelopment/Housing alzc,'i% Paul S. Gibson, Director of Finance �L&JBY RDA VERIFIED BY 1�J 11000 Original on file lnvi h City Clerk's Office SOL IHI H\ (. M 11UI2\IA EDISON To: Aria Scott Date: November 2, 2007 Subject: Rough Order of Magnitude (ROM) Proposed Rule 20b Assessment Underground Utility District for The City of Palm Desert, Palm Desert Country Club SCE has reviewed the proposed district and finds the boundary to be operationally acceptable for undergrounding existing overhead distribution facilities. SCE has also prepared a ROM cost estimate for the undergrounding of existing overhead Distribution facilities within the proposed district boundary. The estimate was prepared without the benefit of any engineering, and as such has an expected accuracy of plus or minus 40%. The estimated cost of $ 22,000,000, expressed in 2010 dollars, may be provided to the City for purposes of determining project feasibility. Due to the large magnitude of the project (1083) parcels we are recommending that the project be designed and construction in phases to ensure the availability of SCE resources. If you have any questions, feel free to contact me at 760-202-4211. Sincerely, Kathleen DeRosa Public Affairs Region Manager SMMIk\ ( AlII(W\IA EDISON To: Kathy DeRosa Local Public Affairs Manager Date: November 31, 2007 Subject: Rough Order of Magnitude (ROM) Proposed Rule 20b Assessment Underground Utility District for The City of Palm Desert, Palm Desert Country Club SCE has reviewed the proposed district and finds the boundary to be operationally acceptable for undergrounding existing overhead distribution facilities. SCE has also prepared a ROM cost estimate for the undergrounding of existing overhead Distribution facilities within the proposed district boundary. The estimate was prepared without the benefit of any engineering, and as such has an expected accuracy of plus or minus 40%. The estimated cost of $ 22,000,000, expressed in 2010 dollars, may be provided to the City for purposes of determining project feasibility. Due to the large magnitude of the project (1083) parcels we are recommending that the project be designed and construction in phases to ensure the availability of SCE resources. If you have any questions, feel free to contact me at PAX 12417 or (909) 820-5417. Sincerely, Mike Beard Distribution Project Management Organization Transmission & Distribution Business Unit cc: Tony Mathis Gloria Hocutt Chip Chapella November 14. 2007 Ms. Aria Scott C it- of Palm Desert 735 10 Fred Waring Drive Palm Desert, CA 92260-2578 \00000. �w verlLn 295 North Sunrise jWay Pa Subject: Underground District #2 VZ W.O. # 0549-8POAOCEi Deser¢[ RDA Dear Ms. Scott The estimated proposed cost of the work you have requested from Verizon, Inc. is 52,267,080.91. As stated this figure is an estimate and only covers the cost to underground our facilities into a customer provided conduit system. transferring the existing services and removing all aerial facilities. Your agreement with Verizon is to pay for the actual cost of the work, which may be greater or less than the estimated cost listed abo%e. If the actual cost is greater than the estimated cost, you will be billed the additional charges. If the actual cost is less than the estimated cost, you will receive a refund. In accordance with Verizon. Inc. and California PUC No. D&R governing the recovery from customers of the actual costs of facility rearrangements, Verizon is required to collect the full amount of the estimated cost of your work in advance before any work can begin. Estimated cost of requested work: $ 2,267,080.91 Deposit received $ 5,000.00 Remaining Balance: S 2,262,080.91 During our performance of the requested \york, an additional advance payment could be required should you alter the scope of �\ork, take other action which «ould cause us to incur additional costs. or if we encounter unforeseen events or field conditions. If you agree to these terms and conditions, please follow the items listed below: I Sign and date letter 2. Enclose a check. made paN able to Verizon in the abo\ c referenced amount Mail items 1 & 2 to Verizon Ncm ork En.;tnecrin`,. 295 N Sunrise Way Palm Sprin�11s. CA 92262_ A self-addressed cn\elope has been Included. Verizon Nyill attempt to complete the Nyork for \yhich it is responsible under this agreement Ayithin 90 days after receipt of payment and a fully executed coPy of this agreement and attached agreements are received. Ho\%ever. no damages or other liability shall accrue against Verizon's action or the action of other utilities, agencies, or other companies, which may have become involved in this project. The costs and engineering specification will be null and void if this letter is not signed and returned \\ ]thin 30 days from this date or if customer requests a nc\y engineering study. Ms. Arta Scott November 14, 2007 Page 2 Should you have any questions regarding this work_ please feel free to contact me. Thank you. Sincerely. Carole Weaver Contracting Engineer - Network Engineering 760/864-1581 c\XO ACCEPTANCE: Date: --.-.--- Date: __ October 29. 2007 \,0000 _ verizon 295 North Sunrise Way Palm Springs, CA 92262-5295 Ms. Aria Scott Cite of Palm Desert 73510 Fred Waring Drive Palm Desert. CA 92260-2578 Subject: VZ W.O. # 0549-8POAOCA Dear Ms. Scott: The proposed estimated cost of the work you have requested from Verizon, Inc. is $25,000.00. As stated this figure is a proposed estimate and only covers the cost to engineer the underground of existing facilities. Your agreement with Verizon is to pay for the actual cost of the work, which may be greater or less than the proposed estimated cost listed above. If the actual cost is greater than the estimated cost, you will be billed the additional charges. If the actual cost is less than the proposed estimated cost, you will receive a refund. In accordance with Verizon, Inc. and California PUC No. D&R governing the recovery from customers of the actual costs of facility rearrangements. Verizon is required to collect the full amount of the estimated cost of your work in advance before any work can begin. Estimated cost of requested work: $ 25.000.00 Deposit received $ 5,000.00 Remaining Balance: $ 20,000.00 During our performance of the requested work, an additional advance payment could be required should you alter the scope of work, take other action which would cause us to incur additional costs, or if we encounter unforeseen events or field conditions. If you agree to these terms and conditions, please follow the items listed below: Sign and date letter. Enclose a check. made pa-, able to Verizon in the aboN c referenced amount Mail items I & 2 to Verizon Nemork En-inecring. 29i N Sunrise: WIX Palm Springs. CA 92262. A self-addressed em elope has been included Verizon will attempt to complete the work for which it is responsible under this agreement within 90 days after receipt of payment and a fully executed copy of this agreement and attached agreements are received. However, no damages or other liability shall accrue against Verizon"s action or the action of other utilities, agencies, or other companies, which may have become involved in this project. The costs and engineering specification will be null and void if this letter is not signed and returned within 30 days from this date or if customer requests a new engineering study. Ms. Aria Scott October 29. 2007 Page 2 Should you have any questions regarding this work. please feel free to contact me. Thank you. Sincerely, Carole Weaver Contracting Engineer - Network Engineering 760/864-1580 CW tjw ACCEPTANCE: Date: Date: tZMuniFinancial October 23, 2007 Nis. Arla Scott N'ia 1"anail: Senior Yinancial analN,st ascottaci.nalm- desert. ca.us Cite of Palm Desert 73-510 Fred W'aring Drive Palm Desert, California 92260 Re: Proposal to Provide Assessment Engineering Services to the City of Palm Desert (Palm Desert Country Club Utility Undergrounding District) Dear Nis. Scott: As previously discussed, this engagement letter describes our proposed scope of services, staffing and project fee for providing the City of Palm Desert with assessment h.ngineering Services related to the formation of an assessment district to fund the Palm Desert Country Club utility undergrounding. SCOPE OF SERVICES NIuniHnancial and Willdan will participate with the project team to provide the folloving Services. DISTRICT FORMATION SERVICES TASK I: KICK-OFF MEETING A. Conduct initial kick-off meeting via conference call with Cite staff and consultants to discuss procedures and responsibilities. 13. ;lssist City staff and the financing team in establishing a project schedule. TASK 2: DATA GATHERING a. Gather information related to the project from the Cite, the Count), assessor's Office and auditor -Controller's Ofiicc, the financial advisor, and the Citv's Engineer. Information be gathered through meetings, correspondence, and follow-up phone calls to ensure accuracy and completeness. B. Review the received property opener petitions to verify that they are valid and that there is sufficient support to move forward with the formation of an Lin dergroundill g assessment district. Upon deternunation that sufficient petitions exist to Proceed, execute Certificate of Sufficiencv of Petition. C. Prepare a detailed parcel database showing assessor's parcel number, assessment number, lot area, front footage, assessed land and structure values, County land use, development status, ownership, property address, mailing address, and any other information necessary. The database will be used to calculate each parcel's assessment amount and to prepare a mailing list for balloting and notice requirements. Provide the Cite ,vith an electronic file of this data. 2-368 1 la hillipliia, . uile 110 1 eL (951) 58--3500 Tenn,ada, Calilornia 92590 rvxer✓niuu. rini Fax. (951) 58--)510 Ms. AMtNavl, (.7t) ol'Palm he.rerl Proposal to Protide .1 se,:vtienl 11,'q{ttteeriuq .Venn e.r (Pnbu I )eretl (.oturtr) Chib ( W#i ) t 'ndegmunding) Ocrobo— 23. 200- Atge n( r, TASK 3: REPORT METHODOLOGY A. Based on information gathered, prepare a preliminan• assessment analysis. The analysis will include assessment rates per land use comparisons, value -to -lien calculations, and overlapping tax analyses. 1. We will prepare an assessment roll and related computations from our database including: a. Determining; the boundary of the district, the assessor's parcels in the boundary and assigning each parcel an assessment number; b. Identifying the appropriate measurement factors on which to spread the assessment lien and assigning factors to each parcel; c. Computing the assessment lien for each parcel in the district based on the factors assigned to each parcel and the improvement costs determined to be of special benefit. 2. The assessment methodology will take into consideration the potential of land use, densith•, acreage and view aspects of the properties. The assessment methodology proposed will be designed to protect the bonds, as well as fairly assess properties expected to be in the district. B. Prepare an 18-inch by 26-inch assessment diagram that is suitable for recording, as well as in an 8-inch by 11-inch format that will include the following items: 1. Legal parcels that will exist at the time of district formation; 2. The assessor parcel numbers or tract and lot information for each parcel; and 3. The assessment number assigmed to each lot, corresponding to the assessment roll. C. Based on input from the City, the City Engineer, bond counsel, and our engineering analysis of general and special benefit; determine the improvements to be included in the district. Prepare a narrative description to be included in the Frigineer's Report. If required, additional improvement zones vgill be established and different methodologies can be developed to address the benefit one area receives from improvements or services that another area does not receive. D. Prepare a cost estimate of the improvement items, incidentals and issuance costs related to the district to be included in the Fngineer's Report. The project cost estimate, including incidentals, %will be coordinated with the Ciry Hngineer. The bond issuance costs will be discussed with the team to insure all appropriate costs have been included correctly; such as, capitalized interest, official statement printing, reserve fund level and any required bond security. F. Based on the boundaries of the district, develop the method of assessment, the improvements to be funded, the proposed development, and am effective tax rate limitations. To ensure all considerations have been addressed, the method will be discussed with the project team, and then finalized for the preliminary Engineer's Report and the final Engineer's Report. The method will be devised to specifically address general benefit, the special benefit that each parcel receives, the special and general benefit ascribed to public agency parcels, and the effect, both financial and political, on the homeowner or secondary property owners. TASK 4: REPORT PREPARATION A. Compile items from Tasks 2 and 3 ab0VC into the preliminary,, amended and final Engineer's Reports and submit five (5) copies each for review, and comment to City staff and additional copies to the financing; team. Submit up to ten (10) copies each of the preliminanv, amended and final Fngincer's Reports to City staff for filing with the City Council. If requested, we \krill present the report to Cite Council and field any questions received at the Public Ilearing. We will file the Engineer's Reports with the Superintendent of Streets. The Engineer's Reports will include the following components: I . A description of the proposed public facilities to be funded; 2. Plans and specifications (or reference to those on file); 3. A detailed cost estimate of the proposed facilities, including estimates of bond issuance and other incidentals costs; preliminary and final estimate of costs; 4. The assessment roll showing; assessor number, parcel identification, and assessment lien; 5. The method of assessment; G. The assessment diagram; 7. The maximum annual administrative add -on assessment; 8. A right-of-way schedule indicating right-of-way still to be acquired (if necessary); Right -of -Way Certificate; Certification of Completion; 9. 1931 Act information and tables; and 10. A public property schedule indicating the public property assessed in the district (if necessary). TASK 5: REVIEW AND/OR PREPARE RESOLUTIONS A. Review Intent ;Meeting resolutions regarding the proposed assessment. B. Review Public Hearing resolutions to be used if the assessment is approved and the district if formed. TASK 6: PREPARE AND MAIL NOTICES AND BALLOTS A. Prepare and mail the legal notice of Public Dearing and the protest ballots to conform to all current legislation. The legal notice wti ill include the time, date and place of the Public I Tearing and will also serve as an information mailer. The property owner ballots will include the assessor's parcel number, the property owner and mailing address (or the sites address based on discussions wtith bond counsel and City staff), the proposed assessment amount broken down by improvement tre, the method of assessment and the property's specific benefit as required by Proposition 218. B. Coordinate .with the Cite to tabulate all ballots. We have developed a software program that quickly and accurately tabulates all ballots. Fach ballot will include unique barcodes that can be scanned and tabulated within our program. Typically, we can tabulate approximately 600 ballots per hour. MEETINGS Throughout the formation process, we will attend meetings and participate, as necessar-, in conference calls with the Cith, to facilitate in a timely manner the completion of resolutions, the Engineer's lZeport and, as needed, the official statement to allow for bond issuance. This includes attending up to one (1) Property (honer Workshop, as well as two (2) City Council meetings to approve the Resolutions of Intention and the Public I fearing. Eased on our hourly fees, we «All attend additional meetings, such as utility coordination meetings, at the City's request. POST FORMATION SERVICES If the district is not formed, our senices are concluded. If the district is formed, we will notify property owners of their final assessments and prepayment amounts, assist the financing team with data required to fund the improvements, and record necessan, documents. TASK 1 : RECORDING OF DOCUMENTS l land -walk the assessment diagram and Notice of .lssessment through the City to obtain appropriate signatures and record the documents at the County of Riverside Recorder Office. TASK 2: MAILING OF NOTICE OF CONFIRMED ASSESSMENT Prepare and mail confirmed assessment apportionment and Notice of ,assessment to each property owner of record within the proposed district. The notice will sen-e as the beginning of the 30-day cash collection period and «All provide the discounted pay-off amount to property owners that wish to pay off their assessment prior to the sale of bonds. We will provide certification stating that this task has been completed. TASK 3: PREPARE PAID/UNPAID LIST :lfter the 30-dal' cash collection period, we will coordinate with the City on am, paNloffs and prepare the paid and unpaid list of assessments for the finance and final bond documents. TASK 4: PREPARE OFFICIAL STATEMENT TABLES As necessary, provide information and rc\-iew the preliminary official statement or state loan documents. Develop data tables for the official statement, including value -to -lien summaries, top owners, development status, and other data required by the financing team. TASK 5: PREPARE FINAL REPORT Prepare a final Engineer's lZeport that includes any cost savings from those originally estimated and to reflect parcels that paid off their assessments during the 30-day cash collection period. bile the final report with the Superintendent of Streets. TASK 6: MEETINGS AND OTHER COMMUNICATION Participate in up to two (2) meetings with City staff, bond counsel, financial advisor, bond underwriter, appraiser, and other project consultants. (We anticipate this will include two meetings with the financing team regarding the financing and issuance of bonds.) We will also be available to answer questions and provide information to property owners, project proponents, community association representatives, and other interested parties. CL/ENT RESPONS/B/L/TIES F or this project, the City of Palm Desert will need to provide the following: • Complete documentation and data related to the district, including electronic copies of pertinent information; • Cost estimate information and updates from the utilities as appropriate and • Opinions as requested from the City of Palm Desert Croy attorneys Office. LEGAL OP/N/ONS In preparing resolutions, petitions, notices, ballots, or other legal documents, Munil'inancial will provide our professional expertise. Since we do not practice law, we ask that your Cit}- ;lttorne�', or other designated counsel, review the documents. We will assist Votir attornet• in identifying any pertinent legal issues. STAFFING AND FEE FOR SERVICES I will serve as principal -in -charge for this engagement with responsibility for ensuring the quality' of all work products. Mr. Habib Isaac will sen•e as project manager and the Cit's day-to-day contact. We will provide the services described herein for a not -to -exceed, lump sum fee of $48,500. Please note the following: • Our fee will not be contingent on the outcome of the formation of the district. • "I'his not -to -exceed, lump sum fee includes direct expenses incurred during the course of work, such as travel expenses and materials, but does not include the costs associated with mailing of notices and ballots. ,kny direct expenses incurred ,brill be billed separately to the Cite, at our cost, with no overhead markup. • "1'he Cite will pat in advance any costs associated with printing and mailing, requested by the mailing house prior to the mailing drop date. • We will invoice the City of Palm Desert monthly based on percentage of project completion. HOURL Y RATES additional services or meetings may be authorized by the City and will be billed at our then - current hourly consulting rates. Our current hourly rates are. Division Manager $200 Principal Consultant $190 Senior Project Manager $155 Project Manager $135 Senior Project Analyst $120 Senior Analyst $110 Analyst $90 Analyst Assistant $75 Property Owner Services Representative $50 Support Staff $45 We appreciate this opportunity to assist the City of Palm I)esert and look forward to hearing from you. Please contact me directly at (951) 587-3528, or via email to chrisl(u)muni.com, if you have any questions regarding our proposal. Sincerely, NIUNWINANca \L l � Chris fisher, Principal Consultant Financial Consulting Services I)ivision