Facing funding problems with awarding the contract for construction of the teen center, Riverbank City Council members on Monday put the project on hold until February. The project will have to be re-bid because a bid is only valid for 90 days and the bid opening was Nov. 20. But by mid-February, the city should have a judgment on a skate park lawsuit that affects funding and may also know more about the general fund budget and its property tax revenues.
Councilmember Dave White pressed for awarding the contract Monday night, which would have meant borrowing $390,000 from the Redevelopment Agency's funds for the Del Rio Theatre renovation.
"Years ago when I came to this town I had teenage kids and there was nothing for them to do. There's still nothing for kids to do. So now we need to move forward and get it done," White said.
But his motion was voted down 2-3 in favor of the motion to delay the award by David I. White, which passed 3-2.
The extra time will also give the city a chance to cut some items from the project design to reduce overall cost and it may need to borrow less from the RDA.
While the construction estimate was $1 million, the low bid was for $818,000 with total costs including testing, inspections and contingencies pegged at $936,000, Parks and Recreation Director Sue Fitzpatrick explained.
Funds available include $611,450 from the park development fund, $251,000 in a state grant and $79,000 in the teen fund for a total of $941,700 - sufficient to cover the construction cost.
The problem, however, is the city owes money from the park development fund, which is no longer receiving its usual amount of development fees because of the steep decline in construction.
"Since we do have some debt for this account (park development), it is important not to drain it on the teen center project without a plan," she said in her written memo to the council.
In accumulating the debt, the city borrowed from the Stanislaus County's Economic Development Bank to build the Sports Complex on Morrill Road and has repaid the first two years of that loan but still owes $240,000. It planned to pay this back from development fees over the five-year period.
In addition, the city is reaching the end of a breach of contract and warranty lawsuit against the builder of the skate park. If the city wins its case, it will be responsible for paying only the $42,000 retainer to the contractor. But if it loses it will be on the hook for the full $155,460. A judgment on the lawsuit is not due until February or perhaps March.
Fitzpatrick offered the council a number of options before they settled on postponing the award. Those options included:
• Award the bid and borrow $390,000 from the RDA's Del Rio Theatre project for the teen center project. Success in the skate park litigation could return $110,000 immediately to the Del Rio account.
• Award the bid and renegotiate the Economic Development Bank loan from the county to obtain an extension until more development funds are available, at the same time leaving an additional $240,000 in the city's park development fund.
• Do not award the bid until February while deducting some items from the project design. The current bid, however, is only good for 90 days so the contract would be re-bid.
• Do not award the bid until 2011 and let the state grant agency know the situation.
• Do not award the bid at all, return the grant and pay back all major donors.
Council members rejected any idea of postponing the project into 2011 or dropping it altogether, said they supported the arts and hoped to go ahead with the theatre project also, but after the teen center. Their recent vote to deny $16,000 for HY Architects to do a structural survey of the theater will be brought back in January for reconsideration.
The Riverbank Youth/Teen Committee has worked with the city and Indigo Hammond Architects for several years to complete the building's design, Fitzpatrick added. The Committee worked with the city to obtain the state grant and raised all the matching funds (over $35,000) required to get the grant. More than 30 youth and teens have been active in this project.
Councilmember Dave White pressed for awarding the contract Monday night, which would have meant borrowing $390,000 from the Redevelopment Agency's funds for the Del Rio Theatre renovation.
"Years ago when I came to this town I had teenage kids and there was nothing for them to do. There's still nothing for kids to do. So now we need to move forward and get it done," White said.
But his motion was voted down 2-3 in favor of the motion to delay the award by David I. White, which passed 3-2.
The extra time will also give the city a chance to cut some items from the project design to reduce overall cost and it may need to borrow less from the RDA.
While the construction estimate was $1 million, the low bid was for $818,000 with total costs including testing, inspections and contingencies pegged at $936,000, Parks and Recreation Director Sue Fitzpatrick explained.
Funds available include $611,450 from the park development fund, $251,000 in a state grant and $79,000 in the teen fund for a total of $941,700 - sufficient to cover the construction cost.
The problem, however, is the city owes money from the park development fund, which is no longer receiving its usual amount of development fees because of the steep decline in construction.
"Since we do have some debt for this account (park development), it is important not to drain it on the teen center project without a plan," she said in her written memo to the council.
In accumulating the debt, the city borrowed from the Stanislaus County's Economic Development Bank to build the Sports Complex on Morrill Road and has repaid the first two years of that loan but still owes $240,000. It planned to pay this back from development fees over the five-year period.
In addition, the city is reaching the end of a breach of contract and warranty lawsuit against the builder of the skate park. If the city wins its case, it will be responsible for paying only the $42,000 retainer to the contractor. But if it loses it will be on the hook for the full $155,460. A judgment on the lawsuit is not due until February or perhaps March.
Fitzpatrick offered the council a number of options before they settled on postponing the award. Those options included:
• Award the bid and borrow $390,000 from the RDA's Del Rio Theatre project for the teen center project. Success in the skate park litigation could return $110,000 immediately to the Del Rio account.
• Award the bid and renegotiate the Economic Development Bank loan from the county to obtain an extension until more development funds are available, at the same time leaving an additional $240,000 in the city's park development fund.
• Do not award the bid until February while deducting some items from the project design. The current bid, however, is only good for 90 days so the contract would be re-bid.
• Do not award the bid until 2011 and let the state grant agency know the situation.
• Do not award the bid at all, return the grant and pay back all major donors.
Council members rejected any idea of postponing the project into 2011 or dropping it altogether, said they supported the arts and hoped to go ahead with the theatre project also, but after the teen center. Their recent vote to deny $16,000 for HY Architects to do a structural survey of the theater will be brought back in January for reconsideration.
The Riverbank Youth/Teen Committee has worked with the city and Indigo Hammond Architects for several years to complete the building's design, Fitzpatrick added. The Committee worked with the city to obtain the state grant and raised all the matching funds (over $35,000) required to get the grant. More than 30 youth and teens have been active in this project.
