HomeMy WebLinkAbout01242011 City Council Laydowns V9A ) C
Original Revised Proposed Committed Expended Balance
CONSTRUCTION COST ESTIMATE
MAXIMUM ALLOWABLE CONSTRUCTION COST(MACC) $ 9,801,761 $ 7,200,000 $ 7,300,000 $ 7,450,000
$ 247,024
DESIGN FEES AND CONSTRUCTION PHASE SERVICES 12% 864,000 $ 864,000 $ 480,728 $ 217,455 $ 263,273
35%DESIGN(14%) 14% 120,960 $ 147,000 $ 147,000 $ 115,000 $ 32,000
65%DESIGN(21%) 21% 181,440 $ 292,728 $ 292,728 $ 102,455 $ 190,273 $ 439,728
95%/100%DESIGN(38%) 38% 328,320 $ 805,720 $ 365,992 $ 300,000
BIDDING(2%) 2% 17,280 $ 41,000 $ 41,000
CONSTRUCTION(24%) 24% 207,360 $ 220,000 $ 100,000
FINAL(1%) 1% 8,640
ADDITIONAL SERVICES
$ 864,000 0% $ 880,728
PROFESSIONAL SERVICES $ 81,766
PROJECT MANAGEMENT 4% 288,000 $ 288,000 $ 288,000 $ 97,000 $ 72,761 $ 24,239
PLAN REVIEW/PERMITS/SPECIAL INSPECTION 50,000 $ 50,000 $ 50,000
GEOTECH 40,000 $ 20,000 $ 9,000 $ 9,005 $ 9,005 $ -
OTHER PROJECT COSTS
SITE ACQUISITON
SITE PREPARATION(DEMOLITION) - $ 30,000
CMGCDESIGN PHASE SERVICES 50,000 $ 50,000 $ 39,000 $ 39,000
REIMBURSABLE EXPENSES 45,000 $ 20,000 $ 20,000
FURNITURE,FIXTURES,&EQUIPMENT(FF&E) - 220,000 $ 200,000 $ 200,000
EXHIBITS(DESIGN AND CONSTRUCTION) - 500,000 $ 250,000 $ 100,000 $ 10,000 $ 5,000 $ 5,000
300 KVA TRANSFORMER - $ 40,000
RELOCATION COSTS $ 20,000
SUBTOTAL 9,257,000 9,847,720 9,271,720
PROJECT CONTINGENCY 8% 740,560 $ 730,000 $ 741,738
TOTAL PROJECT COST ESTIMATE: $ 9,997,560 $10,577,720 $ 10,013,458 $ 251,512
bond issue 40000
bond reserve 235000 $ 222,273
cap i 156632
Total bond costs $ 431,632
$ 10,445,090
-'wigt:O..zokWARl'z,;44.0.4i DATE Forecast Currently Available Comment
BUILDING COMMITTEE $ 200,000 In hand $200,000 $200,000
STATE GRANT $ 4,700,000 In hand $4,700,000 $4,700,000
CITY BOND $ 2,500,000 9/1/2011 $3,726,192
RASMUSSEN GRANT $ 1,500,000 8/1/2012 $500,000 Commited
NEH GRANT $ 600,000 8/1/2012 $600,000 anticipate commitment in Dec
MURDOCK GRANT $ 400,000 8/1/2012 $500,000 Need to write LOI
ADDITIONAL FUND RAISING $ 500,000 8/1/2012 $500,000
(TOTAL PROJECT $ 10,400,000 $10,726,192 $4,900,000
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SEWARD CITY COUNCIL
LIBRARY/MUSEUM FUNDING DISCUSSION
ESTIMATED (BEST-CASE)TIMELINE:
Timeline for Alcohol and Tobacco Tax Option:
February: Research Alcohol and Tobacco tax options
Research various mechanisms for taxing alcohol and tobacco
Present potential options to City Council in work session
Once specific mechanism is determined, research estimated tax revenues
March 7—Council work session to discuss potential taxation methods
March 14—Council selects specific tax mechanism
March 21 —advertise Ordinances to impose alcohol and tobacco tax
March 28—Ordinances are introduced
April 11 —Ordinances are adopted
April 15 - Staff submits application to Alaska Municipal Bond Bank
May 11 —Referendum period ends for new ordinances
July—Alaska Municipal Bond Bank Board takes action on bond application
September(or when cash flow is needed) Bonds are issued
January 1, 2012—New tax takes effect(to give time for businesses to prepare, etc.)
Timeline for Variable Sales Tax Option:
March 14—Council elects variable sales tax rate(the Council may not have a quorum in
February)
March 18—Staff submits application to Alaska Municipal Bond Bank(keep in mind that
as currently proposed,the variable sales tax falls short of covering operating costs of new
library/museum by$161,000 and weakens the City's application for financing)
April 14—Referendum period ends for variable sales tax
July—Alaska Municipal Bond Bank Board takes action on bond application
September(or when cash flow is needed)Bonds are issued
January 1, 2012—New sales tax rates take effect
Seward Library/Museum Funding Discussion Page 1
Important Considerations:
-. General Obligation bonds pledge the full faith and credit of the City, so if identified
revenue source is insufficient to cover costs, City must be willing to raise taxes to pay
bonds (or other take other measures necessary to make payment)
-. Bonds will be subject to the State's intercept provision which means that in the event
the City is unable to make bond payments, the State has the ability to intercept payments
coming to the City in the form of revenue sharing, raw fish tax, etc.
-. The City's application to the bond bank is weakened if:
. We fail to identify funding source to pay both debt costs and operating costs;
. We submit an application without having firm commitments in place for all
remaining construction funding(failure to have$500K Murdock and $500K
fundraising commitments in-hand will adversely impact application). The City
would have to show how it intends to reduce the project scope or fund shortfall.
-. The Bond Bank would like to package our deal with another City's funding request
due to the size of our proposed bond issue(economies of scale)
-. Tobacco alone, is not a strong pledge due to concerns about the elasticity of demand.
However,because the City's bond issue is a general obligation of the City, the Bond
Bank is protected by the pledge of the City against its taxation ability.
Council Questions/Answers:
-. It is possible for the City to issue bonds for a shorter period (say 7 years). This would
reduce interest cost to approximately 2%(down from the 4.5% estimated for a 25-year
GO bond). Annual payments would be$575,000; total interest costs over 7 years is
$290,000. This is compared to the total interest costs of$2,530,000 for the 25-year bond
option.
-. We can issue callable bonds to have the flexibility of paying bonds off earlier, but the
added costs of doing so are up to 100 basis points (1%), so rather than 4.5%bonds, the
interest rate would be approximately 5.5%. The added cost of this flexibility is
approximately$26,000 per year,with an overall additional interest cost over the life of
the bond, of$658,000.
-. As of 12/31/10 the Motor Pool has a balance of$300,684 (preliminary balance before
year-end adjustments). Existing outstanding capital leases of the motor pool include:
$309,888 (fire truck), $287,488 (loaders); $9,507 (fire air packs), for a total outstanding
debt of$606,883. You may recall that we reduced contributions to the motor pool by
half in 2010 and 2011.
Seward Library/Museum Funding Discussion Page 2
Additional Questions Currently Being Examined:
1. What is the impact on the Kenai Peninsula Borough, of a variable tax on
tobacco/alcohol by the City?
2. Is the Borough required to collect this tax on behalf of a City within the borough?
3. How much lead time is required by the KPB to implement a change in tax
structure?
4. What are the constraints on the City's ability to collect an alcohol/tobacco tax?
5. What are the various forms of alcohol tax and tobacco tax currently used in
Alaska?
6. What is the potential impact on tobacco/alcohol sales that can be expected from
imposition of a tax? (this is important in assessing the level of estimated revenues
to be collected)
Notes:
Keep in mind that this schedule presents the best-case scenario for timing of a bond issue.
If the Bond Bank requests additional information or additional funding guarantees, there
will be additional time needed to receive funding approval, which will push out the
timelines.
Seward Library/Museum Funding Discussion Page 3
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Short Term Revenue Funding Scenerios:
No: of vrs Compare to:
Sales Tax Type: Addl Rev/vr 3 T 5 7 25
6mo+1- 1% $ 348,000 $ 1,044,000 $ 1,740,000 $ 2,436,000 $ 8,700,000
3 Mo 1%+
$ 450,000
_-T$ 1,350,000 $ 2,250,000 $ 3,150,000 $ 11,250,000
12mo 1%+ $ 900,000 $ 2,700,000 $ 4,500,000 $ 6,300,000 $ 22,500,000
Alcohol/Tabacco Tax:
•
Property Tax:
Other: ----- --- -
L AN(bOv)ki
EIGHTH AGREEMENT TO EXTEND THE TERM OF MAINTENANCE AND 54"
P15
OPERATING AGREEMENT WITH SEWARD SHIP'S DRYDOCK
The Maintenance and Operating Agreement effective March 30, 2000, as amended
October 26, 2001 (the "Agreement") was entered into between the City of Seward, Alaska, an
Alaska municipal corporation ("City") whose address is P.O. Box 167, Seward, Alaska 99664
and Seward Ship's Drydock, Inc. ("Operator") whose address is P.O. Box 944, Seward, Alaska
99664.
WHEREAS, the Operator has been maintaining and operating the City's shiplift facility
since 1995, consisting generally of a Syncrolift Shiplift System, Ship Transfer System, dock,and
related rail systems(the "Shiplift Facility");and
WHEREAS, the Operator and the City have entered into a Lease Agreement ("Lease"),
to operate a vessel repair and construction facility on land adjacent to the shiplift facility; and
WHEREAS, the operator has taken steps toward completing the coating application on
the pipe pile and cofferdam cells but agrees that some additional coating remains to be applied ,
particularly to the mean low tide area of the pile and cells, and there are areas that need
additional surface preparation and possible reapplication of the coating to meet the
manufacturer's standards; and
WHEREAS, on June 22, 2009, the City Council adopted Resolution No. 2009-049
authorizing the City Manager to enter into an agreement for the Renewal of Term of the
Maintenance and Operating Agreement containing a temporary extension until September 30,
2010;and
WHEREAS, on September 27, 2010, the City Council adopted Resolution No. 2010-085
authorizing the City Manager to enter into an agreement for the Renewal of Term of the
Maintenance and Operating Agreement containing a temporary extension until January 31, 2011;
and
WHEREAS, additional time is sought by both parties to evaluate and update the
language in the Maintenance & Operating Agreement.
NOW THEREFORE,the parties agree as follows:
Section 1. The Operator will complete the application of coating on the sheet pile and
cofferdam cells during the period of this Amendment to mean low tide level, to the
manufacturer's recommendations, as set forth in Exhibit A to this Amendment and incorporated
herein by reference The City contracted with QA Services, Inc. to visit the site and inspect the
coating. The results of that inspection are attached as Exhibit B hereto. In case of a dispute
between the City and the Operator concerning the coating, the coating manufacturer or the
manufacturer's representative, at the City's expense, shall verify whether the coating has been
properly applied.
Section 2. The Operator agrees to diligently work with the Seward City Manager to
evaluate and update language in the Maintenance and Operating Agreement during the term of
this extension agreement.
Section 3. The Agreement Term as described in Section 2.01 of the Agreement is hereby
extended from January 31,2011 to August 31,2011.
Section 4. In consideration for an additional extension of time, Section 4 of the Sixth
Amendment to the Agreement is revised as follows:
Upon completion of the coatings, the term of the Maintenance and Operating Agreement
shall be extended for a full five year term and the City will withdraw its March 2009 notice of
default. The Agreement shall be amended to delete Section 3.02(b). Section 3.03 is deleted and
replaced with the following language: Section 3.03 — Operator's Administrative Overhead.
Amounts considered to have been expended by Operator for purposes of the Agreement and the
Lease shall include only Operator's direct costs for performing maintenance, and providing
replacements and improvements, without any allowance for markup or profit. Such amounts
may include an allowance for administrative overhead which shall not exceed 10%,provided that
the allowance may be increased to a maximum of 13.5% if Operator documents the basis for the
increased allowance to the City's satisfaction.
Section 5. The extension of time allowed by this amendment shall not constitute a waiver
of any rights of the City or Operator.
Section 6. All other provisions of the Agreement remain in full force and effect.
Section 7. This Agreement is subject to approval by the Seward City Council and shall
become effective upon the signatures of both parties.
DATED this 28th day of January,2011.
City: Operator:
CITY OF SEWARD SEWARD SHIP'S DRYDOCK, INC.
Phillip Oates,City Manager James T. Pruitt,President
ATTEST:
Johanna Kinney, CMC, City Clerk
Product Data Sheet FGI —6500 Corrosion Protection Coating
FGI — 6500 Corrosion Protection Coating
Unique Coatings — Extreme Results
Description
FGI -6500 is an extremely unique ultimate performance corrosion protection coating. An epoxy
resin polyamide coating especially developed to withstand extreme corrosive and abrasive
conditions which quickly destroy conventional type protective paint coatings. FGI — 6500 was
originally developed to prevent corrosion to steel surfaces. The chemical, abrasion and
undercreep resistance characteristics of this product have proven so outstanding that it is
considered to be the least expensive method to prevent corrosion. This product has been in
constant use for over 40 years in applications as diverse as offshore platforms to subways. FGI-
6500 is designed for adhering to almost any clean surface including: aluminum, wood, metals of
all types, concrete, plastic, brick, glass, and transites. The few surfaces FGI-6500 is not
recommended for are Teflon, high-plasticized vinyls, polyethylene, and silicone rubber. FGI-
6500 has excellent anti-corrosion qualities and hardness yet it remains extremely flexible so as
not to crack. This is the ultimate corrosion protection on hot steam pipes that have much
expansion and contraction of the metal. The flexibility of the FGI-6500 prevents it from cracking.
Outdoor durability and color stability is excellent. FGI-6500 is extremely Weather, UV, Chemical,
Salt, and Abrasion resistant providing for an unsurpassed durable wear surface with superior
adhesion properties that promotes a nearly indestructible coating surface. FGI - 6500 requires
little surface preparation thus reducing the time, labor and the TOTAL cost of your project.
ASTM Test Battery:
ASTM B117 500 hour Salt fog test—Passed
ASTM D-2240 Hardness 85 Shore Durometer
ASTM E108-91A UBC32-7 Class A Fire Rated
ASTM D-638 Tensile Strength 1393 PSI
ASTM E-96 Water Vapor Transmission 0.7 perms
ASTM G-53 500 hour accelerated weathering test,bend double with no cracking,highly flexible
ASTM 1640, D-92,D-1644A, D-2196,D-696, D-570,C-836, D-1652, D-1259
Flexibility is retained in sub—zero conditions(down to—92 F)
Features & Benefits
> Easy to Apply by Brush, Roller,Spray or Dipping on Dry or Wet substrates
> Can be applied over Wet Surface and remain under water
> Very Little Prep Work over Rusty Metal
Y UV,Weather,Chemical,Salt and Abrasion Resistant
Y Extreme Adhesion to Substrate, adhering to almost any clean surface including:
aluminum,wood,metals of all types, plastic,brick,glass,transites
Y Extremely Durable Wear Surface
> No Top-Coat necessary
> Contains No Zinc,Lead or Chromates
• Typical Applications: Marine environments, structural steel, welding repair, scaffolds,
automobiles, truck beds, tanks, pipes, industrial and farm equipment, lawn mowers, snow
plows, air conditioner parts, concrete floors and walls, decks, stairs, steps, railings, walls
and ceilings of subways and any metal surface.
Application Methods
FGI - 6500 may be applied by brush, roller, spray or dipping. Surfaces should be free of loose
rust, mill scale, paint, grease, oil and of any other film-forming foreign material. An example of
Rev.OG-30-08
L�h� bit
Product Data Sheet FGI—6500 Corrosion Protection Coating
the prep work needed is to water blast with high-pressure (3,000 psi MIN) water to thoroughly
clean off all debris, dirt, and other contaminates. The result shall be to have a clean tight
substrate. Optimum results are obtained if the surface is dry although entirely satisfactory
protection is obtained if the surface is damp and/or wet. Surplus water should be removed to
prevent excessive bubbling of the coating. No primer is needed on metal surfaces thereby
reducing total job cost. Airless spray is the most efficient application method for larger projects.
Brushes and rollers may be used for detail work such as edge termination, filling of voids,
pinholes, and small cracks.
MIXING: Thoroughly mix (1 to 1 ratio)activator(part"A")with base (part"B")for 5 minutes with a
power mixer until all streaks and/or lumps disappear and the mixture has uniform color and
consistency. Be sure to allow mixing blade to rub on sides and bottom of container to recombine
any settling. Allow to stand (or ingest) for 45 minutes to one hour before adding thinner or
application. Use of thinner increases possibility of sag and reduces dry film thickness. Thinner
also retards cure time. For best results, use just as it comes from the can. However, thinner(use
lacquer thinner) can be added to the product with no harm to the coating. Thinning will
necessitate applying more coats to achieve the desired mil thickness.
Any overspray and equipment must be cleaned immediately with acetone, toluene, xylene, or
MEK.
FGI-6500 is 60% solids. Approximate Pot Life: 4 to 6 hours at 80 F. Drying time 1 to 2 hours at
80 F. Curing time: Initial: 8 hours at 80 F, Complete: 3 days at 80 F.Apply 5 mils (.005 inches or
0.127mm) wet to achieve a final dry mil thickness of 3 mils (0.003 inches or 0.076 mm). FGI-
6500 will cover approximately 320 square feet per gallon at 3 mils thickness. If second coat is
needed wait till first coat is tacky dry, usually one to two hours in 80 F, The second coat may be
applied at 3.5 mils (0.0035 inches or 0.089 mm) wet to achieve a dry mil thickness of 2 mils
(0.002 inches or 0.05 mm). This second coat will cover any voids in the surface due to a very
rough surface. Max of 10 mils (0.01 inches or 0.254 mm) can be applied per coat without runs if
necessary. An example of the suggested Spray Equipment: Graco 5900 with 0.021 to 0.031 tip
size with 3000 PSI capability and typically a reversible self-cleaning tip. Remove all filters from
gun and hose, including bung hose.
Use in well ventilated area; if not possible, use a NIOSH approved self contained breathing
apparatus or vapor filters on a mask. Protective gloves and safety glasses must be worn at all
times. Only very high abrasion will remove the coating. Caution: With the extreme adhesion
characteristics of this product all safety procedures must be followed.
Customers should consult FGI on all special requirement installations.
Storage Stability & Shelf Life
The shelf life of FGI -6500 is one year when stored in original, unopened container. Store cans in
a well ventilated and covered area away from extreme heat and moisture. Please contact your
FGI representative if you have any questions about product usability.
Additional information is available at www.fqinternational.net
Health,safety and environmental information are provided for this product in the Materials Safety Data Sheet. This gives
details of potential hazards,precautions and First Aid measures,together with environmental effects and disposal of used
products. Before using the product other than directed,please contact FGI for consultation.
F G International,LLC
33717 Hwy 23
Collins,Ga.30421, USA
Email:info@fginternational.net
Tel: +1.912.684.2283
Fax: +1.630.604.7984
Rev.06-30-08
QAServices, Inc. .,n .,Iaskan O%yned and Operated festingand Inspection Company
Quality Assurance*Weld Inspection*Coating Inspection:.\ondestcacti,c"resting*API 653 Tank Inspection*Special Inspections
City of Seward,Alaska 9 September.2010
Attn:Kari Anderson,Harbormaster
Re: Seward's Ship DryDock
Specific: Protective Coating Rehabilitation Observations
REPORT
Arrived at Seward Harbor at 0700 hours on 8 Tuesday,2010 and met with Kari Anderson and Jim Lewis and traveled in
harbor skiff to drydock for inspection.Tide at this time was minus 1.5 and conditions were calm.We conducted
observations and inspections around sheet pile buffer and pipe piles under dock area.My observations are as follows:
• Surface preparation and coatings were very erratic in base elevation as attached photos show.The maintenance
preparation and coatings should be between high and low tide elevations as this is the most corrosive
environment.Coatings were taken to the top of all pile but the splash zone is most critical.Recommend
complete preparation and coating to low tide level
• Poor surface preparation prior to coating was encountered throughout both sheet and pipe pilings.Loose scale,
barnacles,particulate matter,etc.was observed on coated surfaces resulting in voids in coating system.
Oxidation present in these areas.Large flakes of delaminated oxidation were easily picked off,revealing
uncoated surfaces underneath.Coating manufactured recommends high pressure washing at minimum 3000
psig.Contractor was not conducting surface preparation while observations were being conducted.Due to the
levels of oxidation and surface defects observed,I would recommend surface preparation by abrasive blasting
with a nickel slag or garnet abrasive(no EPA concerns)or at a minimum,water jetting per SSPC-SP 12,which
requires a minimum 10,000 psig or greater and would be much more effective in removing oxidation and other
organic contamination in order to expose a solid substrate in which to coat.
• Several attempts to measure dry film thickness of maintenance coatings were indeterminate due to levels of
oxidation.Numerous holidays were observed as well as concentrated corrosion in the pinhole form on surfaces
prepared and coated.Manufacturer's data sheet for the product being utilized recommends a dry film thickness
of 3-8 mils,and in my opinion,is not adequate to encapsulate the substrate.I would recommend surface
preparation as stated above and coating with a 100%solids Polyurea product to attain a dry film thickness of
60-250 mils in order to better encapsulate the substrate and any surface defects.
• Adhesion testing of the maintenance coatings were taken at 3 locations,all high on the sheet pile,out of the
splash zone.Results were as follows
1. Inside sheet pile,448 psi,adhesive failure
2. End sheet pile, 128 psi,coating failure
3. Outside sheet pile,274 psi,adhesive failure
Adhesion is marginal at best and results need to be taken in the splash zone,which is difficult to attain due
to cure time of dolly adhesives.
• As no surface preparation was being conducted during our observations,no testing for surface contaminates was
conducted.
In overview,my opinion of the maintenance being conducted is very poor to poor at best.The amount of oxidation
already present on surfaces prepared and coated is disturbing.Surface preparation is the most key element in the
longevity of a properly specified and applied coating system.With what is currently being done,the extended life of the
pilings will be very little.I suggest consulting a corrosion engineering firm for further recommendations and analysis.
If you have any questions or need me to expound further on any item,please feel free to call.
Respectfully,
Tyrel I C.Amberg
NACE Certified Level 3 Coating Inspector,#1808
P.O.Box 112328 * Anchorage,AK 99511-2328 * Ph:(907)522-1969 * FAX: (907)344-1980
c-xh b & 6
QAServices, Inc. :An Alaskan Owned and Operated Testing and Inspection Company
QualityAssurance*N1 eld Inspection*Coating Inspection*Nondestructive Testing*:API 653 Tank Inspection*Special Inspections
09/08/2010 07 :51
Poor surface preparation and inconsistent elevations under dock.
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More flaking of scale with oxidation leaching from under.Area with sheen is extremely thin coatings probably due to
over thinning.
P.O.Box 112328 * Anchorage,AK 99511-2328 * Ph:(907)522-1969 * FAX:(907)344-1980
AServices, Inc.IAn Alaskan Onned and Opereted Testing and Inspection Company
Quality Assurance*M eld Inspection*('nating Inspection*Nondestructise Testing*API 653 Tank Inspection*Special Inspections
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Typical oxidation due to lack of encapsulation of the substrate by coating system.Scale delamination can also be seen
with oxidation leaching from under poorly adhered scale.
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Loose scale and inadequate coating thickness.
P.O. Box 112328 * Anchorage,AK 99511-2328 * Ph:(907)522-1969 * FAX:(907)344-1980
Inc.QA Services, nAn Alaskan Ossned and Operated Testing and Inspection('ompa s
Quality Assurance*'s eld Inspection*Coating Inspection*Nondestructne Testing*API 653 Tank Inspection*Special Inspection.
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Typical failure of new coatings under dock
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Inconsistent surface preparation and coating elevations throughout piles.Preparation should cover the entire splash zone
defined as the area between low and high tides.
P.U.Box 112328 * Anchorage,AK 99511-2328 * Ph:(907)522-1969 * FAX:(907)344-1980