STAFF REPORT
Operations Committee, November 5, 2009

Cary Community Arts Center Bid Award (PR10-12)
Consideration of Bid Awards for Cary Community Arts Center Project
Speaker:  Ms. Mary Henderson

From:  Mary G. Henderson, Director, PRCR
Prepared by:  Doug McRainey, Parks Planning Manager, PRCR
Approved by:  Benjamin T. Shivar, Town Manager
Approved by:  Mike Bajorek, Assistant Town Manager

Executive Summary:  On October 20, 2009, construction bids were opened for the TCAP-Cary Elementary Renovation Project (PR1109).  New Atlantic Contracting, Inc. from Winston-Salem was the low bidder with a base bid of $7,780,000, about $5 million under the engineer’s estimate of $12.8 million.  Upon approval of the construction contract, it is anticipated that work will begin in January 2010 with an expected completion date in mid 2011.

Background:  The genesis of the project was the 2003 PRCR Facilities Master Plan and the 2006 Town Center Civic & Cultural Arts District Study. In particular, the Town Center Civic and Cultural Arts Study provided the framework for implementing a cultural arts district within downtown Cary.  The first step in the implementation of the plan was the renovation of Old Cary Elementary into a cultural arts center.  In May of 2007, the architectural firm Clearscapes of Raleigh was hired to complete the design for Cary Elementary.

Council approved the Program Plan for this facility in December 2007.  Based on the approved Program Plan, final design concepts were developed and approved by Council in October 2008.  On August 13, 2009 the site plan for the Cary Community Arts Center was approved.

The Cary Community Arts Center Project includes the renovation of an existing 41,000 square foot three-story masonry building with the addition of approximately 6,000 square feet for a total of approximately 47,000 square feet. The existing school structure will be re-purposed as a community arts center providing classroom, studio, rehearsal, performance, and office space for visual arts, ceramic arts, and performing arts, including the addition of a stage with a flytower to the existing media center which was originally the school auditorium.  

The interior design will reference and celebrate the history of the building as a school while functionally providing for its new use as a community arts facility.  Each level of the building will provide a mix of classroom, studio, office, and multi-purpose/rehearsal spaces while mixing the programming vertically through the facility.  Restroom facilities will be distributed throughout the building to provide convenient access to all program spaces.  Public art will be integrated throughout the building including the flytower, lobby, and outdoor plaza.

Review of Bid:  Contractors were pre-qualified since Old Cary Elementary is a historically significant building and the scope of the proposed renovation work was considered complex.  Contractors were required to complete applications to ensure they had experience with historic renovation projects similar in scope and scale to the Cary Community Arts Center. This occurred during July 2009.  Of the 24 applications submitted, eight contractors were selected as qualified to bid on the project. 

On October 22, 2008, 8 bids were received. The low bidder is New Atlantic Contracting, Inc. with a base bid of $7,780,000.

Contractor Bid Amount
New Atlantic Contracting, Inc. $7,780,000
Rodgers Builders, Inc. $7,819,000
DS Simmons, Inc. $7,847,700
TA Loving Construction Co., Inc. $7,923,000
CT Wilson Construction Co., Inc. $7,959,810
LeChase Construction Services $8,179,000
Riley Contracting Group $8,226,000
Barnhill Contracting $9,400,000

The bid for the Cary Community Arts Center also included 13 alternates which are included in the full bid sheet.  The purpose of these alternates was to provide the Town with options in case the bids came in over budget.  While the acceptance of any of these alternates would reduce the total project cost even further, staff believes deleting any of these alternates would negatively impact the function, maintenance or aesthetics of the facility. 

In terms of compliance with bid requirements, four of the bid submittals were non-compliant since they did not, or only partially submitted, information related required minority participation.  Because these firms failed to submit the good faith documentation, they are considered non-responsive and these bids are recommended to be officially rejected.

Fiscal Impact: 
Operating Impact:  The business plan for Cary Community Arts Center was initially developed as a part of the Town Center Civic & Cultural Arts District Study and refined by staff as the facility program was approved during the design phase of the project.  The budget and operating plan will again be refined in preparation for the actual opening of the facility expected in mid-2011.

While Cary Community Arts Center provides the opportunity for expanded programming, several components of the existing program will be transferred to CCAC.  These areas include all of Jordan Hall operations, Applause! Cary Youth Theatre, Marvelous Music Series, Cary Performs, as well as the activities involved with the coordination and facilitation of community groups.  The facility will be staffed by the transfer of six current staff and the addition of three staff.  The current functions within Cultural Arts that will be transferred to CCAC have a net impact or cost to the Town of $507,335. 

With additional space for expanded programming, CCAC is projected to generate $704,963 in revenue through classes, ticket sales, rent, sponsorship and concession/point-of-sales.  Operating expenses are projected to be $1,276,835 including personnel (regular and temporary employees), program expenses, general administrative costs, utilities, service contracts and other public works maintenance.  The net operating costs are projected to be $571,872.  The chart below details the estimated annual operating budget revenues and expenses.

Estimated Revenues 
Instructional Programs $412,313
Ticket sales $  66,870
Rental $163,130
Concessions/Point of Sale $  51,650
Sponsorship $   11,000
Total Estimated Revenue $704,963
 
Estimated Expenses 
Instructional Program $241,450
Performances $  90,890
General Administrative $  90,000
Regular, Full time Staffing $462,500
Temporary Staffing $  91,995
Building/Site Services $300,000
Total Estimated Expenses $1,276,835
 
Estimated Net Operating Costs ($571,872)
Reduction in Current Net Operating Cost* $507,335
 
Total Net Estimated Cost ($64,537)

Any net costs associated with future decisions to program, maintain, or otherwise staff Jordan Hall after all of today’s operations have been transferred to the new Cary Community Arts Center have not been factored into these cost estimates.

Capital Funding
To date, $17,115,000 has been appropriated to the PR1109 Cary Community Arts Center project, and $1,365,123 has been encumbered/expended leaving an available balance of $15,749,877 to complete the Cary Community Arts Center project.

The following funds are required  to construct the facility as designed:

Base Construction Bid Amount $  7,780,000
Construction Contingency (15%) $  1,167,000
Offsite Parking Allocation $     980,000
Fabrication of Public Art $     615,000
Furniture, Furnishings, & Equipment $     500,000
Construction Administration $     422,000
Construction Testing $     200,000
Technology Services/Utilities $     120,000
Total Remaining Project Costs $11,784,000

Whereas the initial cost estimate for the base construction of the Cary Community Arts Center was estimated to be $12,848,500 or approximately $5 million less than the apparent low bid, due to the potential cost of the off-site parking lot as well as the 15% contingency, there will be $3.9 million remaining. A further description of these costs is below:

The construction contingency is based on the base bid amount.  Given the size and scope of this historic renovation project, it is recommended that it be 15%, or $1,167,000. 

Construction of an offsite parking lot is a requirement of the approved site plan, which included a 50 car parking lot near the intersection of Walker Street and Walnut Street, to be located on Town-owned land.  This parking lot was not part of the base bid and will be bid separately.  While the parking lot must be completed prior to the opening of the Cary Community Arts Center, staff continues to explore other alternate options for parking expansion, especially due to the delay of the implementation of the Streetscape Project.  The funding allocation for parking provides flexibility for locating additional parking areas however, if the original parking plan is ultimately unchanged, an additional $500,000 will remain unspent. 

As previously reviewed and approved, public art will be integrated throughout the building with special fabrication/installation requirements.  It is not included in the general construction bid.  The majority of the work is infrastructure related to the flytower, lobby and outdoor plaza. 

The funding for construction administration covers the cost for the design team to administer the construction.  Funding is also included for construction material testing during the construction period.

Funding is also necessary for voice-data cable installation as well as security for the doors and locks.  This work will be bid separately and completed by the Town. In addition, funding will also be required for Progress Energy to install new lines and relocate light poles.

A summary of the funding for the Cary Community Arts Center is as follows:

Total Project Funding Approved $17,115,000
Expenditures and Encumbrances ($1,365,123)
Remaining Project Fund Balance $15,749,877
Funding Required $11,784,000
Remaining Project Funds  $  3,965,877

In terms of the remaining $3,965,877 in PR1109, it is recommended that it be returned to the Unrestricted General Capital Reserve Fund Balance where it can be available for appropriation to other general capital project needs.

Staff Recommendation:  Given Council’s direction to move forward with this project, staff recommends that Council:

1. Award the base bid for construction of the Cary Community Arts Center (PR1109) to New Atlantic Contracting, Inc. for $7,780,000.  This award by Council represents a preliminary determination as to the qualification of the bidder.  No legally binding acceptance of the bid or offer will occur until the Town has executed a written agreement.

2. Declare the following four bids non-responsive and reject them because of failure to submit the required good faith effort documentation
       • Barnhill Contracting
       • LeChase Construction Services
       • Rodgers Builders, Inc
       • TA Loving Construction Co., Inc

3. Redirect $3,965,877 in general fund transfer funds originally appropriated to Project PR1109 to the general capital reserve unrestricted fund balance and reduce the construction expenditure account within the project by $3,965,877.