3. New City Hall/Wells Fargo Remodeling Project:.:..:.:..:....:...::::.:...........:...:.:.
...::..:.:.......::
......:::.:..:..:...::: ..:
Cl'*ty
...... ... . .. .... ............
..... .. ------
-----
Kalispell,
Post Office Box 1_ 7 ell Montana 59943-1997 Telephone 4 - - -----p ( 46} 758 7444 Fax (446) 758-7758
REPORT TO: Honorable Mayor and City Council
FROM: James H. Patrick, City Manager
SUBJECT: City Hall Bid Opening
MEETING DATE: November 13, 2006
BACKGROUND: In 2000 the City commissioned a space needs study which reflected a need
for 20,000 additional square feet of office space to meet City staff needs. At the same time, City
Council set a City Manager goal to "Resolve Space Needs" for City offices. Council desired to
"get out of leased space," "stay downtown," and "find a solution for the Police Department space
needs." Last year the City was approached by Wells Fargo who owned a 20,000 square foot
bank at the corner of I s' Ave. E and 2nd Street, one block away from current City Hall. Council
purchased the Wells Fargo downtown bank building for $1.1 million. It had been appraised for
$1.7 million two years before. Since the bank needed to sell in a short amount of time,
architectural plans and estimates were not possible at decision time. Grover/Cole and Russell
were selected as the architectural team to design and planning for the renovation. They have
modified the plans several times to insure the most economical design that still meets staffs
needs. originally it was anticipated to do this project in phases but due to the annual increase in
construction costs, staff is recommending proceeding with the entire project. While this is more
costly, it is cheaper overall and better for customer service and less work disruption. Chad
Grover will address the revised plans and cost saving measures we have built in (some
immediate savings were six foot high walls on the cubicles, reduction in the amount of doors,
elimination of the sky light, and reduction of hall space).
The plans were bid and those bids were opened Thursday afternoon. The bids ranged from
$1,2l 0,000 to $1,364,000 (excluding the three alternates). Chad will review the bids and will
brief Council on the lowest and best Monday evening. The total cost (property purchase and
remodeling) will be approximately $2.4 million or $120 per square foot. New office
construction is running in the neighborhood of $200 to $250 per square foot. A recent
appraiser's opinion on cost of land in the downtown corridor is $10.50 per square foot for
property one block off of Main Street. The land costs for new land would be the same as the
City paid for the building and parking areas.
Council requested Staff to recommend ways to finance the renovation. Council discussed Board
of Investment loan, Bank loan, and other options. Staff recommends taking a loan from cash
reserves on hand in enterprise funds and pay back over a period of years. If this is acceptable to
Council, the budget would have to be amended. Council would table awarding the bid at the
next Council meeting, and call for a public hearing to modify the budget with action being taken
at the December 4 Council meeting on the budget and contract award.
RECOMMENDATION: Council direct Staff to schedule a public hearing to modify the budget
and table the bids until the December 4th Council meeting.
FISCAL EFFECTS; This recommendation is the most fiscally prudent course of action that
still accomplishes the task of resolving space needs, gets the City Staff out of leased space, and
keeps City Hall downtown.
ALTERNATIVES: As suggested by the City Council.
Respectfully submitted,
ames H. Patrick, City Manager