Port of Dubuque Public Parking Facility Bid ExtensionPreparers Barry A. Lindahl, Esq. Address: Suite 330 300 Main Street Dubuque, IA 52001 Telephone: (5631583113
RESOLUTION NO. 484-07
APPROVING THE SECOND AGREEMENT BETWEEN THE CITY OF DUBUQUE, IOWA
AND KRAEMER BROTHERS, LLC EXTENDING THE BID FOR THE CONSTRUCTION OF
THE PORT OF DUBUQUE PUBLIC PARKING FACILITY
WHEREAS, City has heretofore approved plans, specifications and form of contract for
the Port of Dubuque Public Parking Facility (the Project) which, among other things, allow the
City up to 30 days to accept or reject bids for construction of the Project; and
WHEREAS, by Resolution No. 372-07 adopted July 2, 2007, the City Council authorized
the advertisement for bids for the construction of the Port of Dubuque Public Parking Facility
Project; and
WHEREAS, City opened bids for construction of the Project on July 25, 2007, and
Kraemer Brothers, LLC (Kraemer) was the only bidder that submitted a bid at such time; and
WHEREAS, Kraemer's bid expires on the 24th day of August, 2007; and
WHEREAS, Kraemer agreed to extend its bid through September 19, 2007; and
WHEREAS, City has made an additional request that Kraemer extend its bid through
October 19, 2007; and
WHEREAS, in consideration for City forbearing the rebidding of the Project, Kraemer is
willing to extend its bid on the terms and conditions set forth in the attached Agreement.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA AS FOLLOW:
SECTION 1. The Agreement attached hereto is hereby approved.
SECTION 2. The Mayor is authorized and directed to sign this Resolution on behalf of the
City of Dubuque.
Passed, approved, and adopted this 19th day of September, 2007.
~ ~~~
t•9ayor Pro-Tem
Attest:
eanne F. Schneider, City Clerk
THE CITY OF
DUB ~ E
Masterpiece on the Mississippi
MEMORANDUM
September 19, 2007
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Port of Dubuque Public Parking Facility
In connection with the sale of the bonds for this project, we requested a title search for
the development property estate where the new casino will be constructed. The title
search showed two mortgages on a portion of the development property, consisting of a
mortgage granted by Diamond Jo, LLC to WeIIs Fargo Foothill, Inc., and a mortgage
granted to U.S. Bank National Association, as trustee for the holders of other Diamond
Jo, LLC indebtedness.
Under the Minimum Assessment Agreement between the City and Diamond Jo, LLC,
the principal of and interest on the bonds is to be paid from the real property taxes paid
by Diamond Jo, LLC on the development property.
If Diamond Jo, LLC defaults on either or both of the mortgages for any reason, the
mortgagee would be entitled to foreclose on the development property. In that situation,
the City would want the mortgagee to be bound by the Minimum Assessment
Agreement, so that it would continue paying real property taxes on the development
property in the amounts necessary to pay debt service on the bonds. Because the
mortgages were granted prior to the Diamond Jo, LLC entering into the Minimum
Assessment Agreement, however, the mortgagees are, under Iowa law, not bound by
the Minimum Assessment Agreement. In order for the mortgagees to be bound by the
Minimum Assessment Agreement, it is necessary for them to execute a consent to the
Minimum Assessment Agreement.
When we learned about the two mortgages, we requested that the Diamond Jo, LLC
obtain the consent of the two mortgagees. The Diamond Jo, LLC has never objected to
attempting to obtain those consents but has now advised us that the consents will not
be forthcoming.
Under Section 2.3(3) of the Port of Dubuque Public Parking Facility Development
Agreement, as amended by the First Amendment, Diamond Jo, LLC acknowledges and
agrees "that the bonds shall be sold on such terms and conditions ... as City in its sole
but reasonable, good faith discretion, shall determine to be acceptable to it ...." Under
Section 2.4(3) of the Development Agreement, as amended, the City has no obligation
to Diamond Jo, LLC to issue the bonds or to fund the design or construction of the
Public Parking Facility if "City is unable to complete the sale of the bonds on such terms
and conditions as it shall deem necessary or desirable in its sole discretion; ..." In the
opinion of City Attorney Barry Lindahl and our bond counsel, Bill Noth, these provisions
make it clear that the City has discretion to determine whether or not to issue the bonds
without the consents from the prior mortgage holders.
The City has made it clear to the Diamond Jo throughout these discussion that the City
would accept no financial risk to build a 1,200 car parking ramp by the fall of 2008,
when the City already had plans to build a 750 car parking ramp by 2010. Therefore,
the City will not agree to the sale of the bonds because of the refusal of the mortgage
holders to consent to the Minimum Assessment Agreement.
However, the City has now offered to assume some risk through a general obligation
bond issuance, if the City is compensated for assuming that risk. To see if this new
arrangement can be renegotiated, the City and the Diamond Jo need some additional
time.
Kraemer Brothers has agreed to extend its construction bid for another 30 days to allow
the City and Diamond Jo time to negotiate an amended development agreement. If the
construction contract is awarded it will add an additional $284,000 to the cost because
of the additional delay.
I respectfully request Mayor and City Council approval of the 30 day extension of the
Kraemer Brothers construction bid.
Michael C. Van Milligen
MCVM/LW
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
Dave Heiar, Economic Development Director
William J. Noth, Esq
THE CITY OT
DuB E
Masterpiece on the Mississippi
MEMORANDUM
September 19, 2007
TO: Michael C. Van Milligen, City Manager
FROM: Steven Sampson Brown, Project Manage
SUBJECT: Port of Dubuque Public Parking Facility Project
(CIP 3601957)
INTRODUCTION
The attached agreement authorizes the second extension of the construction contract
award for the Port of Dubuque Public Parking Facility Project.
BACKGROUND
The Port of Dubuque Parking Facility will be a city-owned facility north of the new
Diamond Jo Casino, east of the new Durrant office building (former Adams Company),
and south of the planned mixed-use development along Fifth Street. The facility will
have entrances/exits to Bell Street and Ice Harbor Drive. A third entrance into the
garage will be located at the southwest corner and connect with the west end of the
Diamond Jo parking lot. The Diamond Jo will need to provide the City with a public
access easement for the entrance prior to construction.
The facility will accommodate 1,130 vehicles on four levels. Each level is approximately
126,000 square feet for a total square footage of approximately 508,000 square feet.
The levels are connected by speed ramps at the request of the Diamond Jo; and each
level will have direct connection to the Diamond Jo at two locations. The facility will
have connections to the mixed-use development at two locations on all four (4) levels
for people parking in the garage. The parking facility will have four (4) stair towers and
two (2) elevators for ease of access to each level.
Other amenities will include: public restrooms on the main level; a snow chute from the
top level to the main level for ease of snow removal; amaintenance/storage area under
the first speed ramp; and landscaping as part of the building facade on the main level.
The exterior of the facility will be a combination of brick, limestone, colored precast
concrete, and metal. The final facade treatment for the north and east faces will be a
temporary facade.
DISCUSSION
The original bid for the Port of Dubuque Public Parking Facility Project by Kraemer
Brothers was set to expire on August 24, 2007. The City and Kraemer Brothers then
entered into agreement that extended Kraemer's bid through September 19, 2007 at an
additional cost of $284,415.
In order to have additional time to negotiate the bond sale terms with the Peninsula
Gaming (Diamond Jo), the City has requested Kraemer Brothers to extend its bid for an
additional thirty (30) days.
To maintain the completion dates of Phases I (October 31, 2008) and II (January 16,
2009) for the facility, the City and Kraemer Brothers have negotiated the following
agreement terms and conditions:
- The City Council needs to enter into a contract prior to 5 PM Central Time on Friday,
September 21, to allow Kraemer Brothers to immediately start work on the deep
foundations and associated site work. This contract addition is in the amount of
$1,696,360. Failure to award this contract will result an increase in the contract sum
and additional project completion time.
- Additional delay costs for award extension of the base contract through October 19,
2007, in the amount of $284,414.
- Completion of miscellaneous shop drawing and design submittals by The Durrant
Group as listed in the agreement. (Note: Durrant has indicated that they will be able
to meet the review dates in the agreement.)
Based on the costs associated with the two extensions, the amended budget cost is
$19,260,830.
RECOMMENDATION
I recommend that the City Council authorize the second extension of the construction
contract award for the Port of Dubuque Public Parking Facility Project.
ACTION TO BE TAKEN
I recommend that the City Council approved the attached agreement extending the
construction contract award for the Port of Dubuque Parking Facility Project to Kraemer
Brothers in the revised amount of $19,260,830.
Prepared by Steven Sampson Brown, Project Manager
cc: Jenny Larson, Budget Director
Gus Psihoyos, City Engineer
Bob Schiesl, Asst. City Engineer
Tim Horsfield, Parking Manager
Dave Heiar, Enconomic Development Director
SECOND AGREEMENT
BETWEEN
THE CITY OF DUBUQUE, IOWA
AND
KRAEMER BROTHERS, LLC
This Agreement, dated for reference purposes the 19~' day of September
2007, is made and entered into by and between the City of Dubuque, Iowa (City)
and Kraemer Brothers, LLC (Kraemer).
WHEREAS, City has heretofore approved plans, specifications and form
of contract for the Port of Dubuque Public Parking Facility (the Project) which,
among other things, allow the City up to 30 days to accept or reject bids for
construction of the Project; and
WHEREAS, by Resolution No. 372-07 adopted July 2, 2007, the City
Council authorized the advertisement for bids for the construction of the Port of
Dubuque Public Parking Facility Project; and
WHEREAS, City opened bids for construction of the Project on July 25,
2007, and Kraemer was the only bidder that submitted a bid at such time, which
bid (with accepted alternates) was $18,692,000; and
WHEREAS, Kraemer's bid originally was to expire on the 24"' day of
August, 2007, however, the parties entered into an agreement in which they
agreed to an extension of Kraemer's bid through September 19, 2007 and an
addition to the contract price to cover increased costs due to such delay; and
WHEREAS, City has again requested Kraemer to extend its bid, seeking
an additional 30 days to proceed with the Project; and
WHEREAS, in consideration for City forbearing the rebidding of the
Project, Kraemer is willing to extend its bid on the terms and conditions set forth
herein.
NOW, THEREFORE, IT IS AGREED BY AND BETWEEN THE PARTIES
AS FOLLOWS:
SECTION 1. On or before September 21, 2007, the City may enter into a
contract with Kraemer to allow Kraemer to proceed with some of the Site Work
and Deep Foundation Work on the Project during the period from September 20,
2007 through October 19, 2007 (hereinafter, the "Site Work Contract"). The work
covered by the Site Work Contract shall consist of that portion of the site layout
and engineering, grading, earthwork, site utilities, partial installation of the auger
cast piling and pile caps and associated rebar fabrication and installation that is
completed on or before October 19, 2007. The Contract Price for the Site Work
Contract is set forth in Section 4 below.
In order to diligently proceed with the Site Work Contract, Kraemer must receive
the following information, by the designated deadline:
- Notice to Proceed prior to 5pm on 9!21!07
- Building permit on or before 9/24/07
- Redesign for auger cast piles and pile caps on or before 9124/07
- Approved shop drawings for reinforced steel on or before 9/24/07
in auger cast piles
-- Approved shop drawings for precast structures on or before 9/24/07
for site util'~ies
-- Approved concrete mix design submittal on or before 9/24/07
- Ten sets of construction plans and specifications on or before 9/25/07
- Retum of shop drawings for reinforcing steel within 3 days of submittal
SECTION 2. With respect to the remainder of the work required by the plans and
specifications for the Project (i.e., that work not performed under the Site Work
Contract) (hereinafter, the "Remaining Construction"), the Award of Contract date
as listed in the Contract Documents is hereby changed to October 19, 2007.
SECTION 3. Kraemer's bid for the Remaining Construction shall be increased
by the amount of $284,415 due solely to the costs resulting from the additional
extension of the bid through October 19, 2007. Kraemer agrees that the bid shall
be valid through October 19, 2007.
SECTION 4. The Total Price for the Project is $19,260,830. This Total Price is
itemized as follows:
Kraemer's Original Bid (with accepted alternates) $18,692,000
Delay costs for the extension through Sept 19, 2007 $ 284,415
Delay costs for the extension through October 19, 2007 $ 284,415
The Total Price will be broken into three components:
1. Auger Test Piles (previously issued) $ 38,595
2. Site Work Contract (see Ex. A) $ 1,696,360
3. Remaining Construction $17,525,875
Contracts shall be issued for each of these three components in the amount set
forth above.
SECTION 5. (a} If the contract for the construction of the entire Project is
awarded by City to Kraemer on or before September 21, 2007, Kraemer will
honor the bid of $18,976,415 and no additional cost or time will be incurred as a
result of the delay in awarding the contract.
(b) If the contract for the Remaining Construction is awarded by
City to Kraemer after September 21, 2007 but before October 19, 2007, the
contract shall provide that the Phase 1 completion date (for the North section of
the Project) remains October 31, 2008, and the Phase 11 completion date (for the
South section of the Project) remains January 16, 2009.
SECTION 6. The delay costs and completion dates for the Site Work Contract
and Remaining Construction, as set forth in Sections 4 and 5 above, are
contingent upon the following deadlines being timely met by City:
^ The deadlines identified in Section 1 of this Agreement, including
without limitation entering into the Site Work Contract on or before
September 21, 2007;
^ Contract for Remaining Construction executed by October 19, 2007
^ Notice to Proceed for the Remaining Construction issued by
October 20, 2007
Should these deadlines not be met, Kraemer shall be entitled to an increase in
the contract sum and contract time for the additional cost and time incurred as a
result of the delay.
SECTION 7. Except as set forth herein, all other provisions of the Contract
Documents for the Project are hereby raffled, confirmed and approved and shall
be binding on City and Kraemer, as the same may have been amended in writing
by the parties.
CITY OF DUBUQUE, IOWA
By:
Roy D. Buol, Mayor
KRAEMER BROTHERS, LLC
By: ~ ~, _
Its: S 5 T ~~ ~~~~7'
By:
Jeanne Schneider, City Clerk
EXHIBIT A
PORT OF DUBUQUE PARKIl~TG FACII.ITY
DUBUQUE, IOWA
Phase I Contract
Mobilization & Temporary Access Road
General Requirements ~ Supervision
Site Layout 8t Engineering
Grading, Earthwork ~ Site Utilities
Auget Cast Piles
Reinforcing Steel, Pile Caps
Underground Plumbing & Electrical
Shop Drawing Preparation for Lead Items Needed
to Remain on Schedule
Bond Cost
Conshuction Fee
13,775.00
43,350.00
45,955.00
485,515.00
481,045.00
386,370.00
119,000.00
13,000.00
12,350.00
96.000.00
Total 51,696,360.00