5. Discussion of City Attorney Opinion of BallfieldsAgenda -September 15, 1997
AGENDA ITEM 5 - DISCUSSION OF CITY ATTORNEY OPINION OF BALLFIELDS
BACKGROUND/CONSIDERATION: The City Attorney's opinion for voluntary work is
enclosed. Since receipt of this was prior to the last two Council Meetings and no discussion or
questions were raised at that time, I have signed the contract as directed by previous Council action,
with the engineers to design the youth complex. As you have probably read, there is a disagreement
within the legal arena about this opinion.
RECOMMENDATION: I believe the prudent way to proceed with this project is to complete the
plans and specifications for the complex. At that time we can determine what items can be completed
by the City and what may be done by "volunteer" work. "Volunteer" work is done throughout the
U.S. without any particular problem. I believe we can coordinate a project with a great amount of
value added to the project by "volunteers" (Both small projects and major portions of the project).
Protection of the City's responsibilities, minimizing our liabilities, and fulfillment of the community
vision should be the ultimate goal for all parties of this project.
ACTION REQUIRED: I don't believe that any action is needed on this item, at least at this time.
If you desire some type of action, please give direction to staff for this item.
CC! 0i Kjllvll
Incorporated 1892
Telephone (406) 758-7700
Douglas Rauthe
FAX (406) 758-7758
Mayor
Post Office Box 1997
Kalispell, Montana
Clarence W. Krepps
Zip 59903-1997
City Manager
8
August 12, 1997
City Council
Members:
TO: Clarence Krepps, Mayor
and Members of the City Council
Gary W. Nystul
Ward I
Cliff Collins
FROM: Glen Neier, City
WardI
eAtt
Norbert F. Donahue
RE: Kalispell Youth tic C plex
Ward II
Dale Haarr
I have been engaged in the review of a proposed contract with Carver Engineering, et Ward 11
al, as well as a proposed Agreement with Kidsports, regarding the construction and Jim Atkinson
operation of the Kalispell Youth Athletic Complex (KYAC). Attempting to reconcile ward III
the above proposed contracts with the Preliminary Design Summary has presented some wa d IlGranmo
strategic problems which cannot be resolved administratively,
Pamela B. Kennedy
Ward IV
The Preliminary Design Summary, dated. January 1997, estimates a total cost of
M. Duane Larson
construction at $1,707,454.94 for 26 baseball, soccer & softball fields. Additionally, Ward IV
construction design fees, only, total $123,454.00. Construction and Operation Phase
engineering under the proposed contract is based upon an hourly rate plus cost.
Amenities associated with the KYAC such as field accessories (bleachers) and
concession/restroom facilities total approximately $550,000. The Summary indicates that
Kidsports has agreed to cause construction of the amenities at their expense. Further,
Kidsports will be reimbursing the City for the annual lease payments to the Department
of State Lands for at least 20 years.
As of August 4' , the Airport TIF-Ballfields had cash available of $567,060.72 with
$75,000 reserved for the remainder of the Timmreck land purchase. It has been
presumed that the proceeds of the sale of the Daly Field complex would supplement
available cash for the KYAC, at least to the extent of reimbursing the Timinreck sale.
Therefore, approximately $592,060.00 may be available within the next few weeks for
engineering and field improvements. If we can assume the Carver, et al contract will be
in the neighborhood of $125,000 for design, there will be $467,060 remaining for
construction this year.
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The amount available for construction may provide for the cost of constructing important
infrastructure improvements on the KYAC. However, if the City installs infrastructure, the amount
left for grading, field development and irrigation will not be significant in total project terms.
The Carver, et al contract anticipates an "arms length" transaction for bidding and construction of
KYAC. Carver also expects that construction of the project would be orderly and proceed to
completion within a reasonable length of time. The problem is that it is unlikely, given the limited
money available through City involvement, that any construction will proceed in accordance with
the documents or be finished within a definite time period. Even if the City commits to expending
$1,000,000.00 on KYAC there will be remaining at least $700,000 of work to finish just a 26 field
complex. Kidsports and the City to a large extent anticipate relying on donated/volunteer labor and
materials to cover the shortfall. Reliance on volunteer labor and materials undoubtedly will result
in an expansion of time required to complete all or any part of the project. Further, scheduling
construction inspection for $700,000 in work to be completed by volunteers would render any
construction inspection cost estimate useless.
Montana law dictates that public contracts contain certain provisions for the protection of workers
and public entities engaging in certain activities. §§ 7-54302 and 18-2-301, MCA require that
construction contracts in excess of $25,000 must be advertised for bid. Bidders on public contracts
are required under the law to provide bid security in the amount of 10% of the amount bid to assure
hat the successful bidder will enter into a contract with the governmental entity.
§ 18-2-201, MCA dictates that contractor on a public contract execute and deliver a bond, or other
sufficient surety, in an amount necessary to assure the faithful performance of the provision of the
contract, payment of all labor, subcontractors, and material suppliers.
All Montana employers are required to carry Workman's Compensation Insurance on all
employees. Contractors on municipal contracts must also have general liability and property damage
insurance minimum of amounts of $1,500,000 per occurrence and $750,000 per person.
Finally, contractors on public works contracts under Title 18, Chapter 2, Part 4 Montana Code
Annotated must pay the standard prevailing wage. The Supreme Court of Montana has interpreted
the prevailing wage law broadly so that almost any work done on public land in any way financed
with public funds constitutes performance of a public contract and is therefore subject to the
standard prevailing wage. unter -vs- City of Bozeman, 700 Pd 184)
The above paragraphs present some very serious problems in relation to construction of KYAC .
Bonding, liability insurance, worker's compensation and prevailing wage all cost a contractor
money. Failure to comply with the legal requirements may result in liability on the part of the
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contractor. Under some circumstances, failure of the contractor to comply, may allow certain
penalties to be assessed against the City. Without assurances and proof from "volunteer"
contractors that they would comply with all applicable laws, the City would be ill-advised to allow
"volunteers" to undertake substantial work on KYAC.
On Thursday, August 7, Clarence Krepps, Mike Baker and myself met with Dennis Carver and
Bruce Lutz to discuss the engineering contract. The meeting resulted in instructions to Carver, et
al to present a contract for design with an emphasis on the creation of a softball/baseball pod in the
Southwest corner of the project area The design for the pod may be done within 30 days and if the
Council grants authority construction may be commenced yet this fall. Construction relating to the
pod would be accomplished utilizing City funds in total. Depending on the cost of the pod and
related infrastucture some funds may remain for additional work next year.
The basic problem with KYAC involves money. The City has not allocated sufficient funds to
accomplish the necessary work for field development in an orderly fashion. One million dollars will
not cover the cost of creating 26 fields on the site as outlined in the Preliminary Design Summary.
For the reasons stated above the utilization of volunteer labor and material is undesirable. Council
should be aware that failure to fund the elements necessary for development under the Preliminary
Design Summary may eventually leave the City with a design, upon which the City is unable to act.
Without a firm commitment to infuse funds into the project the City staff can only anticipate limited
3evelopment on the KYAC site.
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