HomeMy WebLinkAbout113023 email Concerns Regarding the Proposed New Aquatic Center ProjectALERT: BE CAUTIOUS This email originated outside the organization. Do not open attachments or click on links if you are not expecting them.
Dear Commissioner Dean,
I would like to express some concerns that I have regarding the proposed new aquatic center, in particular, the matters pertaining to the project budget. I had an opportunity to discuss
and address some of my concerns at the community/ BOCC meeting in Brinnon last Tuesday evening. Commissioners Eisenhour and Brotherton attended that meeting, so they are aware of my
concerns; I am cc'ing this email to them as well as a reminder of the points that I made during that meeting.
As an introduction, my wife and I are District 2 county residents. We have lived here for 32 years. I have owned and operated my general contracting business here since 1995, and my
business specializes in commercial, residential, industrial, agricultural, and municipal construction of various types and magnitude. My signature projects are the Port Townsend Aero
Museum complex of buildings, consisting of approximately 32,000 sf of facilities built at the JeffCo International Airport and built for under $7 million dollars and without any taxpayer
funding, and the Port of Port Townsend New 2,500 sf Administrative building built in the Port of Port Townsend Boat Haven for $1.2 million; the initial project budget was around $900K,
with the additional $300K being driven by owner requested job-adds. I have performed other municipal projects of varying complexities and scale for the City of Port Townsend, Jefferson
County, the Washington State Department of Corrections, the USGS, and the Department of Defence/ US Navy.
I would like to begin by thanking you for your years of public service, serving all of the citizens of Jefferson County in a thoughtful and dedicated manner. Being that this is my first
communication with you, that indicates that our county is being managed, through your leadership, as well as the leadership of Commissioners Eisenhour and Brotherton, effectively and
efficiently. I particularly appreciate the more recent efforts you have all made to facilitate improvements at DCD, bringing key people on-board in the positions of Director, Head Land-use
Planner, and Building Official/ Fire Marshal. The DCD is where I interface the most with county affairs, and I speak for many locals in the construction trades in saying that we are
appreciative of these changes and improvements.
My budgetary concerns with the proposed new aquatic center project stem from my review of the current documentation available from both Opsis Architecture and DCW Cost Management. I
am concerned that based on the current project site plans, floor plans, renderings, and cost evaluation spreadsheets, this proposed project as currently estimated is significantly under
budgeted. The current "for-construction" budget is listed as being $37.1 million (for the purpose of this email I will stick to what is documented, i.e. not considering the public showers
as is currently suggested/ proposed). This amount includes both the soft costs at $9.2 million for design, project management, permitting, third-party testing, etc., leaving $27.9 million
for the hard costs to construct the facility. This $27.9 million also includes contingency funds at approximately 10%, which is listed within the spreadsheets as approximately $2.0
million. The current budget also includes cost escalation funds on materials and labor carried out only to 2025. These are the areas where I addressed my first concerns.
I have attached to this email an estimated schedule for this project that I have put together based on my experience with projects that are municipally based, that require public and
private funding, that require municipal bond acquisitions, and that are complex in nature. The estimated schedule identifies that the realistic and likely start date for construction
would not begin until late January, or early February of 2027. This would indicate to me that the currently budgeted cost escalations are potentially significantly inaccurate and need
to be revised to reflect a start date two years later than as proposed. There are too many issues that could significantly affect higher costs on materials and labor looking towards
2027, so, it is reasonable to assume that costs will be higher, not only for the hard and soft costs, but possibly for lending rates as well.
The contingencies monies allocated are significantly light. The DCW plan shows contingency monies at 10%, approximately $1.7 million for building-works line items, and approximately
$250k for sitework line items, totalling $1.95 million. Based on the project complexity and current design, I believe the contingency should be applied to the current total construction
cost represented at $27.9 million at a percentage basis of no less than 15%. So, 15% of $27.9 million is $4,185,000. This brings the project total estimated budget for hard costs to
roughly $32.1 million.
To elaborate further, in the DCW plan, the demolition numbers are low, especially in that there are no monies allocated for hazardous materials abatement; the report stating that "No
work anticipated" for this line item. This is a significant omission, as abatement will very likely apply given the age of the existing facility and the materials that were used back
then for construction. The hazardous materials abatement cost could be as much as $250K to $1 million, depending on the types and amounts of materials likely to be found. The higher
amount added to the $32.1 million brings the total to $33.1 million.
Construction of the stormwater system needed to accommodate the large surface areas shown, for what would be considered to be impervious surface impacts for the parking, sidewalks, buildings,
etc., will require a substantial system design for stormwater management as required by the currently adopted Washington State Stormwater Manual. This system will require treatment/
filtration, detention/ retention, flow controls, and a design for overflows. The existing soils at the Mountainview site are not conducive for infiltration, as below the thin layer
of organic top-soil type material, glacial-till/ hard-pan conditions are present, and again, that do not accommodate infiltration. The system designed could cost, on the low side, $1.25
million, and may even cost as high as $3.5 million. The DCW plan shows a line item for storm sewer costs at $150,000, and is shown as an allowance. (Note: Any items in a cost analysis
listed as an allowance implies there was not enough information/ research done to determine the true costs, which makes these line items susceptible to huge change order activity during
construction, which would need to be paid for by the owner.) Therefore, adding the possible $3.5 million to the $33.1million brings the new total to $36.6 million.
Finally, money for contingencies in a project budget is not supposed to serve as a stop-gap for not performing thorough due diligence for the initial project design considerations. My
concern is that this initial budget analysis as provided to review the project feasibility has holes, and does not present reliable project budget cost information for moving forward
with a new capital facilities project/ campaign, let alone the formation of a new taxing district to support it. There is not $9 million in the budget for contingencies as was suggested
by a member of the JAC at Tuesday's meeting in Brinnon. As stated earlier, there is less than $2 million, and I would have to assume that the confusion over the $9 million is that,
again, the $9.2 million is a soft cost, not a contingency amount. These are two totally different budget items that should not be confused/ misinterpreted in public presentations by
any of the stakeholders. With a more realistic 2027 start date, the revised escalation costs would be around $1.8 million. This amount along with the contingency money as applied above
and included in my estimated new project cost total from the previous paragraph, and with the addition of the $9.2 million in soft costs, brings the estimated total project cost to
$47.6 million, or rounded up, $48 million. That is a potential $10.9 million discrepancy/ shortfall for the cost to build, which should be and is very concerning.
It is my opinion that the project feasibility should therefore be based on this revised $48 million amount, not the $37.1 million as is currently proposed. How does that amount figure
into the .2% increase in sales tax revenue needed to fund the facility construction, service the debt, and pay for some of the proposed operational expenses year over year? If this
project were to move forward based on the currently budgeted cost information, I am concerned that, with the inevitable cost overruns, and the debt that will still need to be serviced,
the only way out for the newly formed PFD for servicing the debt will be through a property tax increase, as the county-wide property tax payers will have to serve as the guarantors
for the initial debt secured. Where else is the money for these potential construction cost overruns and even operational expense shortfalls going to come from?
Also, if there are numbers available that express in a detailed, line-item for line-item, true costs analysis for renovating the existing pool, I have not seen them yet. It would be
very helpful for the evolution of the new project feasibility review to see this information. We have been told that the existing pool and the structure(s) surrounding/ enclosing it
have fallen into disrepair, and that the costs to renovate would be prohibitive. This may be true, but all the detailed analysis substantiating this claim needs to be made available.
Based on my limited understanding of the existing facilities, and based on my experience in dealing with various types of renovation projects, it is hard for me to not consider that
there may be renovation options that need to still be considered. We are told the roof needs to be replaced at a cost of $1 million. OK, that's $1 million. Then let's assume a new pool
liner at $1 million, new pool equipment at $1 million, new seismic upgrades/ retrofits at $2 million, $1 million for accessibility improvements, $1 million for in-place hazardous materials
abatement, and another $3 - $5 million for other possible pool modifications, contingencies, project management, design, and permitting. My assertion is that the existing pool could
be renovated for between $10 - $12 million. Again, it would be great to see what has been analysed and compiled to imply that the renovation of the existing pool facility is supposedly,
not possible.
Thank you Commissioner Dean for your review of this email. I know that you have many emails to read and many other county issues to consider. I would appreciate any thoughts that you
may have regarding this information, so please feel free to call me at my cellular number or email me to discuss this information further. One last point of clarification. I do believe
that a pool facility/ aquatic center is an important asset for any community to be able to offer for its citizens, but only if that facility can be built practically, affordably, equitably,
and in a way that it does not become a fiscal burden for the taxpayers now and for generations to come.
Sincerely,
Mark L Grant
Mobile - 360-301-4340 <tel:360-301-4340>
E-mail - grantsteelbuildings@gmail.com <mailto:grantsteelbuildings@gmail.com>