PURPOSE

To request City Council approval of a Professional Services Agreement (PSA) amendment between the City of Burbank and Turner Construction Company (Turner) for additional pre-construction services for the Development & Community Services Building (DCSB) Project.

BACKGROUND

On July 22, 2001, City Council adopted a Fixed Fee, Guaranteed Maximum Price (GMP) Delivery Method for the DCSB.  This new delivery strategy was deemed in the City�s best interest and was consistent with the objectives of competitive bidding, including advertising for Statements of Qualifications (SOQ) from prospective providers of pre-construction services.  A detailed pre-qualification and selection process resulted in the January 2002 award of pre-construction services to Turner Construction Company (Turner) for the new Development & Community Services Building (DCSB) Project.

During the 2002 calendar year, Turner provided pre-construction services for the City in conjunction with the project�s normal design process.  The project architect at that time was Widom Wein Cohen O�Leary & Terasawa (WWCOT). 

However, the City placed the DCSB Project on hold on January 24, 2003 in response to cost cutting measures across all City departments to position itself against potential fiscal impact the California State Budget crisis could eventually impose on City funding resources.  The project was subsequently resumed November 6, 2003 under the auspices of a new project architect, Leo A. Daly Architects (Daly).

ANALYSIS

The City implemented an important project decision when it officially changed architects from WWCOT to Daly in October 2003.  This decision was based on financial and design benefits that would ultimately be in the City�s best long term interest.  Daly was provided a 20/20 hindsight opportunity to identify design refinements to the existing �WWCOT� design to reduce the overall construction cost with the explicit understanding and direction that the program, quality, and function should not be compromised.    

Based on design recommendations, Daly was authorized in March 2004 to proceed with an �Abbreviated Design Development� program that resulted in some of the following primary changes that translated into real cost savings:

1.      CDD�s Business Development Center � program increase

2.      PIO�s Master Control Room � program increase

3.      Overall building reduction of 4,000 g.s.f. � same building efficiencies

4.      Building perimeter simplification by relocating the atrium to the building center

5.      Reduction of structural steel tonnage

6.      Reduction of mechanical equipment tonnage

Staff also recognized that there would be an added expense to perform additional, yet essential, pre-construction service to develop a new construction budget commensurate with Daly�s Abbreviated Design Development program.   When the project was placed on hold during January 2003, Turner had just submitted its initial draft of the construction budget based on WWCOT�s completed design development phase effort.  With the exception of having to implement any subsequent City review comments, Turner had contractually completed its construction budget estimate for the design development phase.

Professional Services Agreement Amendment

Attachment A is provided herein and details Turner�s additional scope of services for the DCSB Project.  In general, these services include:

�        Conceptual Pricing Feasibility Request for Parking & Parking Structure Options

�        Conceptual Pricing Request for Master Site Plan Improvements

�        Conceptual Pricing Request for LEED Certification

�        Design Development (DD) Budget Estimate for the Leo A. Daly Design

�        Focused Special Pricing Studies related to the Leo A. Daly DD Phase

The first three bullet points listed above were the direct result of expanding the DCSB Project�s initial program early in the design phase effort to include 1) parking alternatives for the DCSB block, 2) master site planning for the area bounded by San Fernando Boulevard to the west, Glenoaks Boulevard to the east, Angeleno Avenue to the south, and Palm Avenue to the north, and 3) LEED Certification for the DCSB.   

The final two bullet points are the direct consequence of Daly�s Abbreviated Design Development program.  This added project expense is a critically important estimating function to ensure the current design program appropriately reflects market conditions that have substantially changed over the last eighteen months.  

SCHEDULE IMPACT

The project schedule will be impacted by approximately four to six weeks as a direct result of providing additional pre-construction services to complete the construction budget for Daly�s Abbreviated Design Development program.  This delay is a direct consequence of these budgeting efforts being on the project�s critical path.  This budget estimating service can only be commenced after Daly completes its Abbreviated Design Development program.  Once the budget is completed and reviewed for value management opportunities, completeness, and acceptance by City staff, only then can it be presented to the Project Oversight Committee and subsequently to City Council for final acceptance.

Based on staff�s last Project report to City Council on March 2, 2004, the DCSB Project occupancy was scheduled for August 2006 and may slip to late September 2006 as a result of this additional service. 

FISCAL IMPACT

There is no fiscal impact if City Council approves this PSA amendment for additional pre-construction services.  Staff committed to incurring additional professional services, such as those rendered by the Project Architect, Leo A. Daly, with the specific understanding that a redesign effort would result in overall project savings.  Staff continues to stand firm on that position.  Sufficient funds remain available in Project No. 11915 at this time to afford these additional professional services. 

However, there is the potential for fiscal impact due to current market conditions within the construction industry for materials such as structural steel, drywall, and concrete, as well as limited labor resources.   If warranted, this issue will be brought to the City Council�s attention when staff seeks approval of the design development phase.    

RECOMMENDATION

Staff recommends that the City Council approve the attached resolution entitled:

RESOLUTION APPROVING A PROFESSIONAL SERVICES AGREEMENT AMENDMENT BETWEEN THE CITY OF BURBANK AND TURNER CONSTRUCTION COMPANY FOR ADDITIONAL PRE-CONSTRUCTION SERVICES FOR THE DEVELOPMENT & COMMUNITY SERVICES BUILDING (DCSB) PROJECT

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