The low bid of $2,061,478 for construction of the Community Center on Five Island Lake was accepted on 5-to-1 vote by Emmetsburg City Council. The seven bids for the project were opened last week and brought to the council for action Monday night.
"As you know, we received seven bids which would seem to indicate good interest and competition given for this project," Kirk Haack, a member of the community center strategic leadership team, told the council. "The bids came in very close to the projection with the exception of two line items: the mechanical construction (heating, ventilation, air conditioning) and the electrical construction.
"Those two items came in about $300,000 above our expectations. So we moved from having $180,000 in excess funds to seemingly being about $120,000 deficient. It's important for you to know that with a combination of cutting and rearranging, we do have funds today to complete the project," Haack said.
He outlined cost savings by changing how the sewage discharge and the accompanying lift station are handled, a savings of about $50,000. Another $5,000 could be saved by eliminating a second drive from the parking lot, which would also add a couple of needed parking spaces.
"Built into the contracts are $50,000 of funds for contingencies and change orders that are refunded to the city if they are to used," Haack continued. "In addition to the $100,000 cash operating reserves we had budgeted, there is an additional $100,000 budgeted for sidewalk and landscaping and another $150,000 for owner improvements. Both of these last items were budgeted with flexibility in mind regarding how much funding was available."
Haack stressed that fund raising will continue. "Obviously, the more successful we are in raising additional funds, the better we can address the finishing touches to the facility," said Haack. "We'd also like to have some extra funds available for any unanticipated contingencies or change orders."
Councilman Bill Burdick questioned the original price going into fundraising and the original goal for fundraising.
"I want to see this go and I'm very positive it's a great idea," said Councilman Mike Hermanson. "I think it's important that we expedite it as quickly as possible so we can make the season It would be nice before we make a decision that we could get those additional gifts to cover the difference in cost."
"I added up the numbers a little bit ago," said Burdick. "Of course our fundraising went exceptionally well, this helps a lot but we are almost $475,000 over budget at this point compared to the original estimate. I know fundraising is going really well, so we're not so far behind at this point. My biggest concern, we're over budget on a project that we haven't even started yet."
Councilman Corey Gramowski pointed out that the original estimate was based on a 600-square-foot building. Size of the building was increased after fundraising was begun, which increased the cost. He said there were added expenses in demolition of the old building for asbestos removal that was not anticipated.
"The square footage that was added, for the size of the facility and the number of people it was going to accommodate, the additional storage room was necessary," said Hermanson.
Questioning cost of architectural fees, Hermanson was informed that is a separate contract with the city.
"The contract we have is 8.25% of the actual construction cost," said Matt Barstad, AIBD, Project Manager with Cannon Moss Brygger Architects out of Spencer. "I believe that totals about $170,000 between the fees that we have already billed, which we capped at a certain amount, plus reimbursable expenses."
City Administrator John Bird said the funds for architectural fees will come out of fundraising. "I don't think there is any proposal that more city funding will go into it," he said.
Barstad outlined additional areas where costs could be cut, pointing to value added engineering aspects that can come into play. He has talked to the low bidder about this.
"We can look at different wood species for trim or most cost effective finishes," said Barstad. "There are a few detail elements we may be able to look at, some building materials or building assemblies to see if there is a better way to come up with cost effective measures. That is not an uncommon practice. We like to have a little extra breathing room."
Hermanson questioned the timetable going forward and was informed that the contractor's bid is good for 30 days.
"My major concern is we started out at $2.3 (million) and now we're at $2.9 (million)," reiterated Burdick. "We're $600,000 over before we even put a shovel to the ground."
Bertha Mathis questioned what is included in the base bid.
"The base bid is the actual construction of the entire building from excavation of the foundation, construction of the building all the way through interior finishes (heating cooling, lighting), finished doors, floors, walls, ceilings and cabinetry. It's up to the point where you'd want to be moving in your furniture.
"So refrigerators, furniture, tables, chairs is not included in this bid?" Mathis asked. "Does anybody on the council now who much that is going to cost?"
"Coolers, refrigerators, tables, all the bar, food prep, catering kitchen and portable heating, cooling tables, we've got two quotes on that so far and $41,000 is the low, answered Bird.
"So that needs to be added in to the overall cost?" asked Mathis.
Bird answered that $150,000 has been reserved to cover those items, plus another $100,000 reserved for sidewalks and landscaping around the building.
"How much money has actually been raised? " questioned Mathis. "We hear that you have so much over what you expected but I've never heard what the amount actually was that you are trying to raise."
With a $750,000 as the target, funds raised are $180,000 in excess of that.
When Mathis asked if those funds were to be given over a period of years, Haack answered there are some pledges up to five years.
Mike Scott addressed the council, noting," I think everybody's heart's in the right place here. We need to do something. But my concern, when this is all said and done, what I don't want to see happen is the taxpayers of Emmetsburg become the backstop financially, making up for negative cash flow. Fundraising is great but I just have a sense that this thing is not going to fly and I don't want to get stuck with the bill. I fact, if you want to take my name off the co-signers list, please do so now."
Hermanson stated, "This is going to be tough to pay for. It's going to take a lot of work. It's going to take some luck. The way it's going to work the best is if this community of 4,000 people gets behind it and supports it and promotes it and markets it."
He added, "I have my concerns about this project but I support it 100% and I hope this community will do the same. I don't know if it will make it or not. Do I want to pay higher taxes to support it? Yes. I think its that important to this city."
Hermanson stated he views the community center as a marketing tool to promote and draw industry. He also addressed taxes in the area, noting that Laurens pays $19 per thousand; Cherokee, $19; Pocahontas, $19; Emmetsburg is at $12; and Spencer is at $11.
Mayor Myrna Heddinger ended the discussion, "This community has always bonded itself together and presented itself as a unified front and I do believe that we can do it now and that's what I hope will happen for the future of Emmetsburg."
On the motion to award the bid for community center construction to Sande Construction & Supply Co. Inc., Humboldt, councilmen voting aye: Hermanson, Campbell, Gramowski, Kauten and Malm. Voting no, Burdick.