06/11/13 - Laserfiche WebLink

Home

Alternatives Alternative #1 - Accept bids and award contract to the lowest responsible bidder, Douglas -Kerr Underground, LLC of Mora, Minnesota in the amount of $241,875.50 for the base bid improvements only. Based on the knowledge that these improvements need to be constructed (with some potential for parallel construction) before McDonald's will close on the parcel, and since construction of the temporary stormwater improvements as reflected in the base bid will allow for the greatest flexibility in development options in the future and will better allow us to meet the timelines specified in the existing real estate contract, this is staffs preferred option. Alternative #2 - Accept bids and award contract to the lowest responsible bidder, Douglas -Kerr Underground, LLC of Mora, Minnesota in the amount of $311,993.55 for the base bid plus alternate bid improvements. This alternative also addresses the fact that these improvements need to be constructed (with some potential for parallel construction) before McDonald's will close on the parcel, and it will still meet the timelines specified in the existing real estate contract. However, construction of the permanent stormwater improvements reflected in the alternate bid will provide the least flexibility in development options in the future. Therefore, this is staffs second preferred option. Alternative #3 - Do not accept bids or award a contract at this time. This is not staffs recommended alternative. Per the real estate contract, McDonald's possesses a right to cure provision so if the HRA does move forward with the improvements, McDonald's could essentially choose to still proceed to closing, hold land sale proceeds in escrow (at 1.5 times the cost of completing the improvements), and could choose to complete the improvements using said escrow funds. In addition, the real estate contract does specify that the HRA shall construct the improvements. Staff therefore advises the HRA, after discussion with legal counsel, that Alternative #1 or #2 will provide the HRA the most security and control over the installation of the improvements. Recommendation: Staff recommends that the HRA adopt Resolution 13 -06 -107 accepting bids and awarding a contract for the COR TWO (Sunwood Retail) Stage 1 improvements for the base bid improvements only, which provides for construction of the temporary stormwater improvements at this time which will reduce initial construction costs by over $70,000 while allowing for the greatest flexibility for future site development proposals. Funding Source: The lowest responsible bid for the base bid improvements is $241,875.50, while the lowest responsible bid for the base bid plus alternate bid is $311,993.55. Ultimately, funding for the improvements will come from land sale proceeds but at this time only McDonald's USA, LLC, has committed to purchasing a parcel so the project will require an interim funding source. Per the Real Estate Contract with McDonald's USA, LLC, the HRA must begin construction on the improvements prior to closing with McDonald's so an interim funding source must be identified at this time. The interim funding source is proposed to be the COR Revolving Fund. Based on this interim loan, the interim funding will experience a negative interest. The HRA can then pay itself back through additional land sales of the two remaining COR TWO parcels, with the intent being to split the construction costs for the Stage 1 improvements between the three parcels on a pro -rata basis, which McDonalds has previously consented to. Action: Motion to adopt Resolution #HRA -13 -06 -107 accepting bids and awarding a contract for the COR TWO (Sunwood Retail) Stage 1 improvements to the lowest responsible bidder, Douglas -Kerr Underground, LLC of Mora, Minnesota in the amount of $241,875.50 for the base bid improvements only, or in the amount of $311,993.55 for the base bid plus alternate bid improvements. HRAres IP13 -11 AcptBidsAwdCntrct Inbox Attachments Form Review Reviewed By Date