Caradco CDBG Amendment No. 2_ECIATHE CITY OF
Dui
Masterpiece on the Mississippi
Dubuque
All- America City
II 111!
2012
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Amendment Number 2 for 2010 CDBG Grant Administration with ECIA
DATE: April 26, 2013
Economic Development Director David Heiar requests City Council review and approval
of the proposed amendment number 2 to the current contract with East Central
Intergovernmental Association to assist the City with grant administration for the 2010
Iowa Department of Economic Development Community Development Block Grant
(CDBG) for the Caradco Building, LLLP project and give authorization to the City
Manager to sign the proposal on behalf of the City.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
kr,„709,,,
Michael C. Van Milligen
MCVM:sv
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
Teri Goodmann, Assistant City Manager
David Heiar, Economic Development Director
Masterpiece on the Mississippi
Dubuque
kard
All-America City
'1111!
2007
TO: Michael Van Milligen, City Manager
FROM: David J. Heiar, Economic Development Director
DATE: April 26, 2013
SUBJECT: Amendment Number 2 for 2010 CDBG Grant Administration with ECIA
INTRODUCTION
This memo transmits for City Council review and approval, a proposed amendment to
the contract with East Central Intergovernmental Association (ECIA) to assist the City
with grant administration for the 2010 Iowa Department of Economic Development
Community Development Block Grant (CDBG) for the Caradco Building, LLLP project.
BACKGROUND
In 2010, The Iowa Department of Economic Development (IDED) awarded to the City of
Dubuque a Supplemental Community Development Block Grant (CDBG) of $8.9 million
to help fund the construction of 72 residential units at the Caradco Building, at 900
Jackson Street in Dubuque's Historic Millwork District.
The City of Dubuque worked with Caradco Building, LLLP in submitting two grant
applications totaling $8.9 million. The Iowa Department of Economic Development has
prepared one contract to cover both awards. The grant will assist with the development
of 72 workforce housing units: 42 two - bedroom units and 30 one - bedroom units.
Monthly rents are expected to range from $650 to $850. Income guidelines will apply
for a portion of the workforce housing units. Projects constructed with this funding will
likely result in mixed - income projects, in that, only a percentage of the total number of
units are required to meet the activity income and rent requirements (i.e., the "assisted"
units). The total estimated cost for the rehabilitation of the structure is $28.3 million.
The Carr, Ryder & Adams Company (Caradco) Main Plant Building, a former millwork
factory, occupying an entire city block, was built between 1880 and 1906. The
renovation of this building is expected to act as a catalyst for the revitalization of the
Historic Millwork District. With its foundation of historic, architecturally unique
warehouses, the district will become an urban mixed -use development containing
mixed - income housing, commercial space, and public gathering places, incorporating
sustainable and energy- efficient technologies.
In February of 2011, the City Council approved a contract with ECIA to assist the City
with the administration of the grant. The City would be billed for actual staff time up to
$7,500. The scope of work to be performed by ECIA included the following activities as
outlined in the attached Scope of Services.
• Conduct and review activities related to the compliance of federal regulations.
• Meet with General Contractor and subcontractors as needed to assure
compliance of federal regulations and in particular Davis Bacon regulations.
• Provide a report of project completion to City staff and provide all available
information for compliance audit.
Prior to the developer starting the Caradco Building Project, City Staff requested a
clarification from the IEDA on what part of the project would require Davis Bacon
prevailing wages. The directive from the State was that if the Developer was able to
separate the residential portion of the construction project from the Commercial portion
of the construction that Davis Bacon would only apply to the residential rehabilitation
work since the CDBG funds were provided for housing. In order to comply with this
directive, the Developer delayed the start of the project for nearly two months to rewrite
the bid documents. As the residential portion of the Caradco IEDA, the City, ECIA, the
Department of Labor, the Department of Housing and Urban Development (HUD) and
the developer about the necessity of additional CDBG program compliance
requirements beyond the original contract scope of the project.
Based on those discussions, it was determined that the DOL and HUD did not agree
with the information provided to City Staff by IEDA and that Davis Bacon prevailing
wages would also apply to the core and shell rehabilitation work. During these
discussions, it was also agreed that the IEDA would provide additional funding for the
extra costs associated with these compliance requirements. Therefore, on February 4,
2013 the City Council authorized an amendment to the CDBG Supplement Funds
award in the amount of $1,299,000 to cover the additional costs. The amendment
included CDBG funds to cover legal and administrative costs as well as a potential
contingency to cover unanticipated costs associated with these changes.
DISCUSSION
ECIA staff, in particular Mark Schneider, was very helpful in discussions and
negotiations related to changes in the Caradco Project. They participated in conference
calls, attended extra meetings in Des Moines and researched past practices. The
changes to the scope of work required a substantial amount of extra time to review
payroll records dating back to the start of the project. In an effort to finalize this project
in a timely fashion, ECIA Staff worked long hours including many weekends. There is
no question that their commitment and their expertise were invaluable to closing out this
project.
In February the Council approved the 1st amendment to the ECIA contract to
accommodate this extra work. City Staff was aware at this time that this was a
conservation estimate and that the final cost was still a moving target.
Now that the additional auditing and paperwork is completed, we are able to calculate
the actual labor cost and realize that we need to amend our contract with ECIA. We
have had conversations with the staff at the Iowa Economic Development Authority and
the State has agreed to cover these extra costs. Amendment Number 2 proposes to
increase the upper limit on this administrative contract from $32,500 to $42,500.
RECOMMENDATION
I recommend that the City Council approve the attached resolution approving
amendment number 2 to the current contract with ECIA to administer the CDBG grant
for the Caradco Building, LLLP project, and authorize the City Manager to sign the
enclosed proposal on behalf of the City.
Enclosures
F: \USERS \Econ Dev \CARADCO \RIO -CDBG Round 3 \ECIA Contract for Services CDBG Grant Admin\Amendment 2 \20130425
Memo ECIA Amendment 2 .doc
Prepared by: David J. Heiar, ED Director, 50 West 13th Street, Dubuque IA 52001 563 589 -4393
Return to: David Heiar, ED Director, 50 West 13th Street, Dubuque IA 52001 563 589 -4121
RESOLUTION NO. 133-13
A RESOLUTION OF THE CITY OF DUBUQUE APPROVING AMENDMENT NUMBER 2
FOR 2010 CDBG GRANT ADMINISTRATION WITH EAST CENTRAL
INTERGOVERNMENTAL ASSOCIATION
WHEREAS, THE CITY OF DUBUQUE, Iowa is party to the Agreement creating the
East Central Intergovernmental Association (hereinafter called the ECIA) and is a member
in good standing; and
WHEREAS, THE CITY OF DUBUQUE, Iowa wishes to engage the ECIA to provide
certain technical and professional services for grant administration of the City of
Dubuque's 2010 Iowa Department of Economic Development Community
Development Block Grant (Contract #08 -DRH -212) Program; and
WHEREAS, Articles II, III (12), and VIII (2) and (3) of the Articles of Agreement of
the East Central Intergovernmental Association gives the ECIA the authority to perform
services under consideration.
NOW, THEREFORE, BE IT RESOLVED, that the East Central Intergovernmental
Association is hereby authorized to provide staff assistance as prescribed in the attached
Contract for Services and Scope of Services.
PASSED, APPROVED, AND ADOPTED this 6th day of May, 2013.
ATTEST:
Ke I Firnstahl, City C erk
Roy Buol, Mayor
F: \USERS \Econ Dev \CARADCO \RIO -CDBG Round 3 \ECIA Contract for Services CDBG Grant Admin\Amendment
1\20130205 Resolution EICAAmend 1.doc
CONTRACT FOR SERVICES WITH
EAST CENTRAL INTERGOVERNMENTAL ASSOCIATION
Amendment #2: Dubuque 2010 Camden Building Renovation Project Administration Contatet
THE CONTRACT, entered into by and between the East Central Intergovernmental Association
(hereinafter called ECIA) and the City of Dubuque, approved by a Dubuque Resolution on February
22, 2011 authorizing ECIA's assistance in carrying out the City's Community Development Block
Grant Contract #08-DRII-212 and approved by ECIA on March 30, 2011 is hereby amended as
follows.
Revise the following Section.
SECTION 3. Method of Payment
Payment shall be due upon receipt of a monthly bill for services. The payment shall be based on the
actual costs incurredby the agency in administering the contract, including labor and overhead, all
according to OMB Circular A122. Total payment shall not exceed $42,500.
PASSED AND APPROVED:
Grantee: City of Dubuque
May 6, 2013
Date
Roy D. Biedl, Mayor
East Central Intergovernmental Association
/510
Date
Attest