HomeMy WebLinkAboutItem 2g - Change order for relocation services for businesses at 101-159 North Santa Anita AvenueGgLI F O
3
of STAFF REPORT
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Development Services Department
DATE: August 6, 2013
TO: Honorable Mayor and City Council
FROM: Jason Kruckeberg, Assistant City Manager /Development Services Director
SUBJECT: AUTHORIZE A CHANGE ORDER WITH OVERLAND PACIFIC &
CUTLER, INC. BY ALLOCATING $16,807.50 TO COMPLETE PAYMENT
FOR RELOCATION SERVICES FOR BUSINESSES AT 101 -159 NORTH
SANTA ANITA AVENUE
Recommendation: Approve
SUMMARY
The Arcadia Redevelopment Agency (ARA) contracted with Overland Pacific and Cutler
(OPC) to provide a relocation plan and relocation services for tenants and businesses at
101 -159 N. Santa Anita Avenue. The cost of relocation exceeded the original contract
amount, and allocation of funds to pay for this work was complicated by the dissolution
of Redevelopment. The outstanding costs are not eligible to be paid by the Successor
Agency to the ARA. As a result, it is requested that Economic Development Contract
Services funds be utilized to pay the amount due of $16,807.50.
BACKGROUND
At the July 20, 2010, meeting, the former Redevelopment Agency Board authorized
staff to purchase the properties at 101 -111 and 121 -159 N. Santa Anita Avenue and
pursue the assembly of parcels necessary to effectuate a development project with
Rusnak Mercedes Benz. Relocating the existing businesses in the buildings on these
properties was a necessary part of the process of preparing the properties for future
development. A contract was established with OPC to help the 16 businesses on site at
that time to find new locations, and to assist them with the process of relocation. A
contract of $62,700, with a 10% contingency, was approved by the ARA on April 5,
2011. Overland Pacific and Cutler developed a relocation plan and assisted with
relocation of the tenants for a number of months in 2011 and 2012.
Overland Pacific & Cutler Change Order
August 6, 2013
Page 2
DISCUSSION
Under former Redevelopment law, the cost of relocation of tenants was often a moving
target, due to open negotiations with businesses, unique moving costs based on varied
land uses and requirements, discretionary "goodwill" payments, and other complicating
factors. The relocation of tenants in the Santa Anita buildings proved to be more difficult
than OPC had estimated in their bid, and this led to the project going over the budget.
With the approved 10% contingency, the total amount of the contract was $73,920.
Invoices received from OPC exceed the contract by $10,087.50.
Rather than addressing this issue immediately through the General Fund process,
Development Services Department staff attempted to find a way to pay these invoices
through the Successor Agency process. Because of the dissolution of Redevelopment,
there was a great deal of uncertainty during this time period over how contracts were
being addressed, and what would be allowed by the Department of Finance in terms of
payments on past contracts. Ultimately, the Department of Finance denied the City's
request to include the expenditures as a recognized obligation of the former ARA and
led to a long delay in addressing the shortfall. The request to pay the invoices through
the City's General Fund now will close this project. The Santa Anita buildings have
recently been abated and demolition is nearly complete.
FISCAL IMPACT
The original contract for OPC to provide relocation assistance and a relocation plan was
for a maximum of $73,920 ($67,200 + 10% contingency). The current amount owed is
$16,807.50. The original contract was paid for with funds from the then - active Arcadia
Redevelopment Agency. The requested amendment would be funded through existing
Economic Development Contract Services monies, which has a Fiscal Year 2013 -14
Budget of $107,800 and includes funding for such activities as the promotion of the
"Shop Arcadia" program, holiday decorations, Downtown marketing and promotion
efforts, assistance with special events, and marketing for the Breeders' Cup. All of the
programs within the Economic Development budget will continue as planned, but will
include slightly less funding in each case.
RECOMMENDATION
Authorize a change order with Overland Pacific & Cutler, Inc. by allocating $16,807.50
to complete payment for relocation services for businesses at 101 -159 North Santa
Anita Avenue.
Approved-
Dominic LazzarAd
City Manager