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HomeMy WebLinkAboutMemoCITY OF MIAMI, FLORIDA INTER -OFFICE MEMORANDUM TO FROM: The Honorable Mayor and Members Of the City Commission Pedro G. City Manager ndez, PE DATE : FILE : SUBJECT: Interlocal Development Agreement with Miami -Dade County School Board REFERENCES or Law Enforcement Training Facility ENCLOSURES: The administration has been negotiating extensively with the Miami -Dade County School Board for the development and operation of a Law Enforcement Training Facility on the City -owned property located adjacent to Police Central Headquarters in Downtown Miami. At this time the administration is requesting the City Commission authorize the City Manager to: 1) finalize negotiations and execute an interlocal with the School Board for the design, construction, and funding of the Facility with funding for the design, construction and contingencies of the Facility not to exceed $37,470,000; and 2) finalize negotiations and execute a lease and operating agreement for the operation of the Facility; and 3) finalize negotiations and execute any other related agreements necessary to establish the ongoing responsibilities of both parties for the construction, funding, contingencies, maintenance and continued operation of the Facility. Background: On September 5, 2007, the Miami -Dade County School Board ("Board") authorized the Superintendent to finalize negotiations and execute an interlocal development agreement ("interlocal"), lease and operating agreement and any other related agreements necessary to design, construct and operate a specialty senior high school to be co -located with the City Police Department's proposed new College of Policing (collectively "Facility"). The High School will house approximately 500 student stations and provide specialized instruction for students in grades 9-12 seeking those particular career paths. Terms of the proposed Interlocal address the financing, design, construction, and subsequent use and maintenance of the Facility. The Facility will be located on City -owned land at NW 2 Avenue and NW 3 Street, directly south of the current City Police Department Headquarters Building. Portions of the High School and College are to be jointly used by the parties, as generally discussed in this agenda item, with those terms to be defined in a separate Lease and Operating Agreement. Page 2 RE: Law Enforcement Training Facility The City previously secured the services of Spillis Candela DMJM to design the Facility, and construction documents have been completed. The Board will assist the City in commissioning a Construction Management (CM) at -Risk contract with the Board assigning certain of its rights, responsibilities and obligations under the contract for construction to the City subsequent to a determination of the Guaranteed Maximum Price for the project. The Facility will be approximately 112,316 square feet in size, with the High School portion to encompass approximately 45,400 square feet, or 41% of the overall square footage. As such, the Board's commensurate share of design and construction costs of the Facility (excluding expenditures for due diligence and movable FF&E and associated items), will not exceed 41% of such costs, or $14,300,000, whichever is less. The City will bear all other costs for construction and ongoing operations of the Facility. Each party shall be responsible for any elective changes it makes. It is anticipated that construction activities would commence by January, 2008, with the Facility to be completed by June, 2009. All costs for the future operation and maintenance of the Facility shall be split 59%/41% with the City paying 59% and the Board paying 41%. Proposed Interlocal Development Agreement Terms of the proposed Interlocal are substantially as follows: the term shall commence upon full execution of the Interlocal and completion of the School Board's due diligence, and shall terminate effective with the commencement date of the Lease; the Board's share of Facility design and construction expenses shall equal 41% of the total costs or $14,300,000, whichever is less (movable FF&E, due diligence costs and associated items for the High School are to be purchased separately by the Board). A not -to -exceed amount of $886,998, covering the Board's portion of the Facility design fee, is included in the Board's total potential design and construction obligation of $14,300,000; the City's share of the Facility construction is $19,697,002; the Interlocal may be canceled by either party in the event of a default, which default is not cured, or an inability of the parties to agree on a Guaranteed Maximum Price for construction of the Facility by December 19, 2007, or a determination by the Board (as a result of completion of all required due diligence) that the site is incompatible with the operation of the High School and the City is unable or unwilling to mitigate the issue. In all other events, should the Board cancel the agreement, the Board will be obligated to reimburse the City for the design fee (not -to -exceed $886,998), as well as the cost for the City to redesign the Facility for its sole use (in an amount not -to -exceed $1,000,000); the City shall retain ownership of the site and all improvements at all times; Page 3 RE: Law Enforcement Training Facility the City will be responsible for the design of the Facility, and shall retain jurisdiction for coordination of plan review and approvals, construction inspection services and final sign -off for construction of the Facility; the Board shall assign a Project Manager to act as the Board's representative in all matters dealing with the design and construction of the Facility. Likewise, the City will also designate a Project Manager; the Board and City shall jointly negotiate and agree on the Guaranteed Maximum Price for the project, with the Board to then enter into the Construction Management (CM) at - Risk Contract. Subsequent to the Board executing the contract, the Board shall assign, and the City shall accept, the certain rights, responsibilities and obligations under the Contract for Construction; the City and Board shall indemnify and hold each other harmless against any claims or actions arising from the Interlocal, to the extent of the limits of Florida Statutes; if either party defaults under the Interlocal and fails to cure, the non -defaulting party shall be entitled to all remedies available at law or in equity, which may include, but not be limited to, the right to damages and/or specific performance; and the Superintendent of Schools and the City Manager, or their respective designees, shall be the parties designated by the Parties to grant or deny any and all approvals required by the Interlocal dealing with the design and construction of the Facility; the Superintendent of Schools and the City Manager, respectively, shall be the party designated by the Board and City Commission to terminate this Interlocal in conformance with the provisions of the Interlocal. Proposed Lease and Operating Agreement Terms of the proposed Lease are, substantially, as follows: - a 40 year term, to commence upon substantial completion of the Facility, at a cost to the Board of $1 per year; four 10-year option periods, at the Board's sole option, provided the parties come to a mutual agreement regarding any needed capital expenditures that may be required to extend the useful life of the Facility; A Joint Use Committee shall be established, comprised of the High School Principal and Chief of Police, or their designees, to coordinate all issues impacting the routine operations by the parties within the Facility, including establishing, monitoring and modifying the scheduled use of joint use facilities, maintenance, utilities and other shared expenses; other than for default, which default is not cured, or in the event of Damage and Destruction, as enumerated below, neither party may cancel the Lease during the initial 40 year period; Page 4 RE: Law Enforcement Training Facility the High School and College will share use of portions of the Facility, as mutually agreed upon. The locker room facilities within the High School and College, and the firing range located within the College, shall at no time be shared; the Board and City shall each provide all routine janitorial, custodial and maintenance functions within their portions of the Facility. All routine building -wide system maintenance and repair within jointly used and common areas of the Facility shall be provided by the City, with the Board to reimburse the City for 41% of such cost. The Board shall be responsible for reimbursing the City for 41% of the cost of operating the Facility, including utilities and miscellaneous expenditures; the Board shall be responsible for reimbursing the City for 41% of the cost of major building system maintenance or replacement, including roof, generator and cooling system replacement and exterior painting; the City, at no cost, will provide approximately 15 parking spaces in the adjacent Police Department garage for Board staff use, subject to meeting applicable indemnifications and security requirements as may be imposed by the City; the Board shall have the right at all times to construct non-structural interior improvements within the High School, without the prior approval of the City, provided such work is done in compliance with all applicable codes and will not negatively impact the weight bearing capacity of the floor or the building's electrical/air conditioning consumption or otherwise create an operational cost impact that was not already contemplated; the City will schedule the building under its Master Property Insurance Program for the full amount of the premises. The City may, at its sole option if it is economically viable to do so, elect to provide an individual property policy covering only the Facility. In the event of Damage and Destruction to the Facility, the City will use insurance proceeds to repair such damage. Should there be insufficient proceeds to make the repairs, the City will have the option of canceling the Lease without penalty, with a portion of the insurance proceeds to be disbursed to the Board; during such time that all or a portion of the Facility is untenantable or unfit for the purposes of the Board, all of the Board's obligations under the Lease, including the payment of Facility operating and maintenance expenses, shall be reduced proportionately, unless such damage is caused as a result of the negligence of the Board, its agents, representatives or employees, or resulting from the Board's failure to perform its obligations under the Lease; if either party defaults under the Lease and fails to cure, the non -defaulting party shall be entitled to all remedies available at law or in equity, which may include, but not be limited to, the right to damages and/or specific performance; Page 5 RE: Law Enforcement Training Facility the Superintendent of Schools or designee shall be the party designated by the Board to grant or deny any and all approvals required by the Lease. In addition, the Superintendent of Schools shall be the party designated by the Board to terminate this Lease in conformance with the provisions of the Lease; The City Manager or designee shall be the party designated by the Commission to grant or deny any and all approvals required by the Lease. In addition, the City Manager shall be the party designated by the Commission to terminate this Lease in conformance with the provisions of the Lease. Items that remain outstanding for negotiation are as follows: 1) Clarifying certain definitions including, but not limited to, that the School Board's development contribution of $14.3 million does not include costs for due diligence. 2) Clarifying the items that shall survive the expiration of the Interlocal Development Agreement, ie. outstanding contractor payments and third party damage claims. 3) Defining the outside date by which either party may withdraw from the Interlocal Development Agreement. 4) Clarifying the process for approval of change orders, modifications to the plans and specifications, reimbursement by School Board and payments to contractor. 5) Clarifying the process for ensuring construction funds for the respective parties is available for use in construction of the premises. 6) Outlining rights of termination following a damage and destruction claim when there are insufficient insurance proceeds to rebuild and eminent domain provisions. 7) Clarifying School Board's right to terminate in the event of title issues discovered during their due diligence investigation. 8) Finalize negotiations and execute the lease and operating agreement. 9) Finalize negotiations and execute any other related agreements necessary to construct and operate the school, including but not limited to, acceptance of assignment from the School Board of certain rights to the construction manager at -risk contract and construction escrow agreement, if required. It is recommended at this time that the City Commission authorize the City Manager to finalize negotiations and execute an interlocal development agreement, lease and operating agreement and any other related agreements necessary to design, construct and operate the Facility so that the high school may be open in time for the 2009 school year. PGH:LS:LB:memo CC 9-11-07 (3)