HomeMy WebLinkAboutItem 3h - Change Order for Plan Check ServicesG- L
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DATE
TO:
July 21, 2015
Honorable Mayor and City Council
STAFF REPORT
Development Services Department
FROM: Jason Kruckeberg, Assistant City Manager /Development Services Director
By: Phil Wray, Deputy Director of Development Services /City Engineer
Don Stockham, Building Official
SUBJECT: CHANGE ORDER IN THE AMOUNT OF $70,000 FOR ADDITIONAL
PLAN CHECK SERVICES THAT OCCURRED IN FISCAL YEAR 2014 -15.
Recommendation: Approve
SUMMARY
Due to the increase in development activity throughout the City, the pass- through funds
budgeted for Building Services Plan Check expenses for Fiscal Year 2014 -15 will be
exhausted with the payment of May invoices. It is recommended that the City Council
approve a $70,000 increase of the Building Services Plan Check budget to pay for
additional plan check services rendered in Fiscal Year 2014 -15. The cost increase will
be offset by a commensurate revenue increase associated with charges to the applicant
for these services.
BACKGROUND
One million dollars ($1,000,000) was budgeted for Building Services Plan Check
expenses for Fiscal Year 2014 -15. This was based on an expectation that development
activity would increase slightly from the preceding fiscal year. Although a slight
increase was accurate, the submittal of the hotel project at 130 W. Huntington Drive, the
medical office building at 205 N. Santa Anita Avenue and numerous single - family
homes submitted within the last quarter of Fiscal Year 2014 -15 increased plan review
costs by nearly seven percent (7 %). As a result, the final budget for Plan Check
Services in Fiscal Year 2014 -15 is $1,069,767.16 and the additional appropriation is
necessary.
DISCUSSION
Building Services contracts for plan check services with three firms: VCA Code Group,
Scott Fazekas & Associates, and Armstrong Walker. The consultants are paid on a
pass- through basis. "Pass- Through" means that plan checks are paid for by the
applicant at the time of submittal, and the consultants are paid after they perform the
Change Order for Plan Check Services
July 21, 2015
Page 2 of 2
plan checks. For plan checks that are referred to a consultant, approximately 40% of
the plan check fees are retained by the City to cover administrative costs, and the
remaining 60% is provided as payment to the plan check consultant. For Fiscal Year
2014 -15, $1,000,000 was budgeted for Building Services Plan Check expenses and
$930,232.24 has been paid to the plan check consultants for their services through
May. The June invoices from the plan check consultants total $90,316.11. The
proposed additional Change Order of $70,000.00 will allow for the June invoices to be
paid and to complete payments for services in Fiscal Year 2014 -15.
FISCAL IMPACT
The increase of the budget for plan check services will have a positive impact on
General Fund revenue in Fiscal Year 2014 -15. As was mentioned, because plan check
expenses are paid on a pass- through basis, applicants pay consultants for their project
work and revenue is provided to the City. For every plan check referred to a
consultant, the City retains approximately 40% of the fee to cover administrative costs,
and the remaining 60% is for payment to the plan check consultant. For Fiscal Year
2014 -15, the revenue to the City derived from Plan Check Services is $378,427.08.
RECOMMENDATION
It is recommended that the City Council approve a Change Order for Plan Check
Services of $70,000 for additional Plan Check Services that occurred in Fiscal Year
2014 -15 for the Development Services Department.
Approved-
D�rninic Laz�are�t�
City Manager