HomeMy WebLinkAboutINS-13-103 - Blair Creek Drive Bridge Credit/Refund Agreement
REPORT TO:
Planning & Strategic Initiatives Committee
DATE OF MEETING:
November 18, 2013
SUBMITTED BY:
Barbara Robinson, Director of Engineering Services, 519
741 2200 Ext 7410
PREPARED BY:
Binu Korah, Manager, Development Engineering, 519 741
2200 Ext 7974
Steve Ross, Assistant City Solicitor, 519 741 2200 Ext. 7266
Ryan Hagey, Director of Financial Planning, 519-741-2200
Ext. 7353
WARD(S) INVOLVED:
Ward 4
DATE OF REPORT:
November 6, 2013
REPORT NO.:
INS-13-103
SUBJECT: Blair Creek Drive Bridge - Credit/Refund Agreement
Request
RECOMMENDATION:
That Council authorize the Mayor and Clerk to execute a development charges
credit/refund agreement with Activa Holdings Inc. in respect of Activa Holdings Inc.’s
payment of the costs of the Engineering fees and the construction of Blair Creek Drive
Bridge project, to the satisfaction of the City Solicitor.
BACKGROUND:
The City of Kitchener is responsible for operating and maintaining the road network within its
boundaries. Therefore, it must be ensured that required improvements are completed in a
timely and efficient manner to accommodate growth within the Doon South Area. The City’s
2009 Development Charge Background study identified the need to establish a bridge along
Blair Creek Drive to connect between the Stauffer Wood Subdivisions Stages 1-11. Blair Creek
Drive is also one of the east-west collector roads used to convey traffic from the surrounding
subdivisions to the arterial roads.
As part of the Ontario Municipal Board hearing for the Doon South Community Plan Phase 2,
the developer completed an Environmental Study Report (ESR) for the Doon South Phase 2,
Official Plan Amendment Area, and Collector Road in November 2008. This document
recommends a bridge be built over Blair Creek (refer, Appendix A, Blair Creek Drive – Bridge
Location) to provide an appropriate connection between the subdivisions within this area.
Activa Holdings Incorporated, is initiating the development of Stauffer Woods subdivision,
30T-08203, within the Doon South area. These lands are considered as Schedule “B” priority in
the City of Kitchener Growth Management Plan.
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In accordance with the OMB process, “Blair Creek Drive Bridge” shall be constructed, as
required for the development of this plan to the satisfaction of the City’s Director of Engineering
Services. It is acknowledged that these works, including design expenses, are included in the
City’s Development Charge By-law 2009-091, as amended, and the City shall be responsible for
100% of the cost of these works.
REPORT:
Activa Holdings Inc. approached the City to initiate the credit/refund agreement to construct the
“Blair Creek Drive Bridge” to support their development. Activa Holdings Inc. had ongoing
discussions with City staff and at this time, they have submitted all required information to
process their application.
A project team from various City departments was set to review the credit/refund application.
The project team members include: Ryan Hagey, Director of Financial Planning, Alain Pinard,
Director of Planning, Jim Witmer, Director of Operations, Barbara Robinson, Director of
Engineering Services, Steve Ross, Assistant City Solicitor, Brandon Sloan, Manager of Policy
Planning and Binu Korah, Manager of Development Engineering. The project team met several
times internally and with the representatives from Activa Holdings Inc. to draft this agreement.
Project Costs
The total preliminary estimated cost of the Blair Creek Bridge is $3.75M. This cost estimate
includes the following items:
Engineering fees ($0.60M or 15% of the project cost)
o
Consultant fees for detailed design and contract administration;
Cost for City staff including project management, tender advertisement, permit fees and
administration;
Consultant cost for geotechnical and hydrogeological investigation, material testing, etc.
Blair Creek Drive Bridge Construction ($3.15M)
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Two lane bridge construction.
The developer will provide the funds in two stages:
Engineering fees ($0.6M) to be submitted to the City as soon as the credit/refund
agreement has been approved by City Council. The City will go through the normal
purchasing process to select the consultant for this project, including a contract which
will be awarded by City Council.
Construction funds ($3.15M) to be submitted to the City once the detailed design is
completed, but before the City tenders the construction work. The City will go through
the normal purchasing process to select the construction company for this project,
including a contract which will be awarded by City Council. Once the City completes the
tender process, but before the tender is awarded, the developer may be required to top
up the funds for this stage of work if the tender costs are higher than expected. If the
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costs are lower than expected, the unnecessary funds will be returned to the developer
before contract award.
If during construction any unforeseen things happen and sufficient funds are not available in the
project to cover this cost, the developer is responsible to provide the funds required to complete
the project. The City will provide the developer 3 weeks’ notice to provide the funds.
Operating and Maintenance Costs
According to the City of Kitchener’s approved 2013 Capital Forecast, the Blair Creek Drive
Bridge is scheduled to be constructed in 2022. Activa Holdings Inc. wishes to construct this
infrastructure earlier and have agreed to bear the additional maintenance costs as outlined
below:
1) General Subdivision Infrastructure
Unless specially noted below, the developer has agreed to maintain all infrastructure within
the subdivision for five (5)/eight (8) years instead of two (2) years. As per the City of
Kitchener standard subdivision process, the City will initially accept the services and reduce
the letter of credit to 15%. However, the City will only finally accept (Final Acceptance) the
underground and other related infrastructure for the Stages 1 to 4 in 2022 and Stages 5 to
11 in 2019. In 2022/2019, all infrastructure will have had to complete a minimum of two (2)
year warranty period in order for the City to assume it.
Definition of General Subdivision Infrastructure: Roads including curb and gutter, sidewalks,
boulevards including sod, trees, driveway ramps, traffic signs, storm/sanitary sewers and
related appurtenances, water & related appurtenances, parks, grass cutting, infiltration
galleries and storm water management pond & related appurtenances, culverts, and any
other City structure.
2) Bridge Maintenance Costs:
The developer has agreed to pay the maintenance cost for the Blair Creek Bridge until June
th
30 2022:
$250/Joint/year
$150 - Inspection cost/year
$250 - Staff cost to coordinate the work/year
3) Snow Clearance Costs
Activa is planning to develop their subdivisions in 11 stages. These costs increase with each
stage coming on line, not withstanding any changes in tax revenue.
Stage 1 to 4 - $21,611.34
Stage 5 to 11 - $40,090.35
The developer has agreed to pay the snow clearance cost for Stages 1 to 4 until June 30th,
2022 and Stage 5 to 11 until June 30, 2019. The development of Stages 5 to 11 is not
dependent upon the construction of the bridge. However since it is dependent upon the
construction of the pumping station and related works, the developer has agreed to pay these
costs until 2019.
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4) Watermain Costs
Watermain maintenance cost for the following ($5,000/year):
Water Valve Operating Checks
Dead End Main Flushing
Hydrant Operational Checks and Maintenance
Leak Survey
Water Quality Sampling – (actual cost of the water sampling will be determined and shall
be paid by the developer in addition to the above cost)
Staff cost
The developer has agreed to pay the watermain maintenance cost until June 30th, 2022.
ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN:
The Blair Creek Drive Bridge is aligned with the City of Kitchener Strategic Plan (refer to
Strategic Plan document, Community Priorities – Development, sections 1 & 3). Further, this
project is also one of the priority projects identified in the Kitchener Growth Management Plan,
as it provides service to lands identified as Priority B.
FINANCIAL IMPLICATIONS:
Capital Costs
The capital costs for this project will be borne by the developer. In accordance with Council
Policy I-537 (Development Charges Credit/Refund Agreements), the City will reimburse the
developer through development charge credits and refunds for significant growth related capital
items that are advanced by the developer.
Policy I-537 allows developers to proceed with such projects and be reimbursed by the City
through crediting, in this case, the sanitary portion of the Development Charge payable upon the
issuance of the building permit.
Policy I-537 also allows for a refund of the balance on June 30 of the year it appears in the
City’s capital forecast, but only to the extent the City has met its projected development charge
revenue targets, City wide. This ensures that there are adequate funds to cover the project in
the future. For example, if the City has only reached 60% of its anticipated Development
Charge revenue, throughout the City, then the developer is only entitled to 60% of the refund in
that year. Every year subsequent to that, the developer receives a refund calculated in the
same manner. Based upon this policy, a draft agreement is being prepared by Legal Services
in cooperation with legal counsel for the developer.
Operating Costs
In addition to outlining the details of the repayment by the City of the capital cost of the Blair
Creek Drive Bridge as described above, the agreement contains some new features that are in
addition to the strict requirements of Policy I-537. For example, in the agreement, the developer
covenants to pay the operating and maintenance costs of the Bridge until the item appears in
the City’s capital forecast. Further, the developer will be reimbursing the City for all estimated
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snow removal costs for each phase of the subdivision, once each phase is completed, until the
date the items appears in the City’s capital forecast. The developer will also be reimbursing the
City for all estimated watermain maintenance and flushing costs. The developer has also
agreed to maintain all other subdivision infrastructure until the date it appears in the City’s
capital forecast. These operating costs are not eligible for credit/refund from the City, unlike the
Bridge construction cost.
COMMUNITY ENGAGEMENT:
As part of the detail design for this project, the City will conduct a Public Information Centre to
present the study findings for this project. This will provide an opportunity for the public to review
the study findings.
CONCLUSION:
Activa Holdings Incorporated had ongoing discussions with City staff. At this time, Activa has
submitted all the required information to process their application and staff has had the
opportunity to review the application in detail. Activa Holdings Incorporated is proposing to fund
the cost of the Blair Creek Bridge. Further they have also agreed to pay the maintenance cost of
the subdivision infrastructure including snow clearance cost. As such, staff recommend that the
credit/refund agreement for the Blair Creek Drive Bridge be approved.
ACKNOWLEDGED BY: Pauline Houston, DCAO,
Infrastructure Services Department
Attachments
Appendix A - Blair Creek Drive – Bridge Location
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APPENDIXA
BLAIRCREEKDRIVE-BRIDGELOCATION
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