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Home My WebLink AboutCRPS-05-048 - CMF - Additional information arising from Mar 7/05 FCS Cmte mtg. ~ Report To: Date of Meeting: Submitted By: Prepared By: Ward(s) Involved: Date of Report: Report No.: Subject: Mayor C. Zehr & Members of Council April 4, 2005 Consolidated Maintenance Facility (CMF) Steering Committee G. Sosnoski, General Manager, Corporate Services & City Clerk All March 21 , 2005 CRPS-05-048 CMF - ADDITIONAL INFORMATION ARISING FROM MARCH 7, FCS COMMITTEE MEETING. RECOMMENDATION: None at this time - for information only BACKGROUND: At the March 7, 2005 Finance and Corporate Services Committee meeting, a number of questions were raised by members and these are addressed in the report below. At that meeting, Councillor G. Lorentz also gave notice that he would introduce the following motion at the April 4, 2005 Finance and Corporate Services Committee meeting. It was also indicated that any recommendation arising from the April 4 meeting would be directed to the Special Council meeting the same date for ratification. "That subject to the City receiving confirmation of receipt of the required Federal Gas Tax revenue, staff be directed to proceed with construction of a Consolidated Maintenance Facility (CMF) at the Strasburg - Huron site for occupancy in the Summer of 2007, as outlined in the CMF business case dated November, 2004; and further, That not withstanding the above proviso in relation to the Gas Tax revenue, staff be directly to immediately begin the preliminary design process to facilitate project completion by the Summer of 2007." REPORT: Third Partv Review of CMF Business Case and Anticioated Efficiencies Councillor Galloway had raised a question concerning the third party reviews conducted to date and the possibility of a further, more in-depth review of the business case and anticipated cost savings and efficiencies. Brent Arlitt of Giffels Associates Limited was contacted and an estimate of the feasibility and practical value of a further in depth review was requested. Specifically, he was requested to comment on whether further study is advisable given what has been done to date and indicate the estimated time and cost to complete a further review. Mr. Arlitt advised that it is possible to undertake additional study to document expected efficiencies under both a one and a two facility model. He did not anticipate this would necessarily change the outcome with respect to the recommended CMF option, though it would yield more detailed information on the expected savings and efficiencies. A rough estimate indicates it would likely cost between $20,000 to $40,000 to complete the study over a period of a month or so, depending on the amount of data readily available on the City's end. This does not include staff time to identify, provide or otherwise gather data for use by the consultant. Aside from the cost, there is also the issue of consultant availability. If we were to use Mr. Arlitt, who is most familiar with the business case having conducted the peer review, he could in May of this year, as he is booked solid until then. Another person at Giffels can undertake the review with Mr. Arlitt's assistance and could begin as early as April 5, 2005. In order to give Council a better idea of the type of data this sort of study would yield, an outline of areas of anticipated savings resulting from construction of a CMF is attached. These were provided by Mr. Arlitt as part of the peer review and are based on his firm's extensive experience with this type of facility. In preparing the business case, staff took into consideration about twelve of the twenty-six areas identified in the outline. The assumption was that a more thorough analysis would, if anything, yield further evidence of savings, efficiencies and areas of cost avoidance. With regard to the costing of efficiencies for a two-facility model, an assumption was made that there would continue to be duplication compared to a single-facility model on the basis that vehicles would still have to be transferred to the second site for repair or maintenance by Fleet and that some duplication in stores, tool cribs and specialty work areas would be required. As well, a two- facility model would not achieve all the efficiencies recognized in a single-facility model such as reduced vehicle maintenance for some of the first response vehicles, improved deployment of emergency response vehicles and more effective and efficient deployment of staff. The following outlines the third party reviews that have already taken place: · Hanscomb Limited - this is a Toronto firm with expertise in construction costing and facility space estimating. They were asked to review all of the costs, including unit costs, used by the City in budgeting for CMF; and, in addition reviewed the entire budget for completeness and the accuracy of the figures. The review conducted by Hanscomb was in relation to six of the options reviewed by the Steering Committee, including the Strasburg-Huron site as well as the two-facility model. They were provided with a description of each of the options as well as the detailed costing worksheets for each. Several adjustments were made to costing and square footage figures as a result of this review. · Giffels Associates Limited - Brent Arlitt conducted a peer review in two stages: the first stage when the CMF Business Case was in draft form; and, the second phase involving a comprehensive review of the completed business case. A detailed review of the building size and costing, space allocations and land requirements was conducted as well as an evaluation of the organization, thoroughness and logical consistency of the business case and the appropriateness of the Steering Committee recommendation that the City pursue a single-site model. In addition, Mr. Arlitt suggested a number of areas (approximately 26 in total) where the City could expect to realize efficiencies and cost savings through the construction of a single consolidated facility, many of which would apply to a lesser degree to a two site CMF. The Steering Committee pursued a number of these, but did not have time to quantify everyone of the expected areas of efficiency. At the end of the review the Steering Committee was satisfied, on balance, that there would be greater overall benefit in constructing a single as opposed to a two-facility model. A copy of the peer review and a letter from Mr. Arlitt which was included in the appendices to the business case is also attached as information. · Contracting and engineering firms conversant with the local construction and costing environment - L. Proulx had informal discussions with the President of Dakon Construction as well as Sze Straka Engineering to compare information received from Hanscomb and Giffels to their understanding of the local (Kitchener) market to further validate some of the assumptions made by staff. · Additional professional assessments of the pros and cons of the various sites was conducted by Caldwell Banker Peter Benninger Realty - Real Estate Services Team (comprised of XCG Consultants Inc.; GSP Group; TSH Engineers, Architects and Planners). IRC Building Sciences Group Inc. provided audits and appraisals of the existing facilities. Land evaluations were provided by the City's Real Estate/Marketing Consultant and well as City Management and Appraisals Ltd. Clarification of Caoital Cost Fiaures · Councillor Gazzola requested clarification of the $25 M and $32 M figures referred to in the business case with respect to the two-site model and one-site model respectively. The $32.6 M figure is the 2004 estimated capital cost before inflation, with this figure increasing to $34.6 M once inflation is added. The $25.5 M figure is the 2004 estimated capital cost before inflation, $27 M is the figure with inflation added. Neither of these amounts take into consideration the sale of municipal lands, the estimated revenue for these being $6.7 M for the one-site model and $3.2 M for the two-site model. The net cost for the one-site option is then $27.9 M and $23.8 M for the two-site option, being a differential of $4 M. It should be kept in mind that the differential in cost between a one and two facility model is predicated on certain assumptions with respect to land acquisition costs for a two-site model and does not include costs to incorporate Facilities Management at the Snow Dump location. Next Steos Several members of the Committee asked for a schedule of major project stages and timing between now and the Summer of 2007. A high level chart showing this information is attached. The first steps will involve selecting a consultant to facilitate the preliminary design process; and, detailing the level and nature of staff involvement in that stage of the project. It would be the intention of staff to report back to Council at intervals advising of process and progress. Green Buildina Councillor Vrbanovic had asked that staff consider the feasibility of constructing a building which is environmentally sensitive. Though these buildings usually cost approximately 10% more than conventional structures, there are grants available through the Federation of Canadian Municipalities and Natural Resources Canada which would contribute to offsetting the cost differential. Staff will investigate this option during the design phase (along with any grant funding opportunities) and implement those measures which are cost effective. If we were to proceed with the project, a report would be provided to Council at a suitable point in the process where decisions of this nature need to be made. G. Sosnoski General Manager of Corporate Services & City Clerk