Staff Report - April 2, 2002 - Agenda Item

The existing clubhouse was dedicated in April 1970 and has since served its economic life and is functionally obsolete by today�s clubhouse operational and functional standards.[1] The clubhouse does not meet ADA compliance requirements for accessibility, structural integrity for earthquake standards, does not have a fire suppression system other than fire extinguishers and an ANSI system for its kitchen equipment, and is not energy efficient. In addition, County Health Department standards have become more stringent and would otherwise preclude the current snack bar and kitchen from operating under current applicable provisions.

The clubhouse�s generally worn condition is self-evident by simply touring the facility and is common knowledge amongst the golfing constituency and other community users. There is a documented history of repairs, miscellaneous improvements, and other maintenance efforts completed in recent years to bolster and extend the facility�s life until it is either extensively renovated or completely replaced.

Feasibility Report - In December 1998, an independent Feasibility Report issued by Klages Carter Vail and Partners reported on the practicality of either remodeling and/or expanding the existing clubhouse facilities versus demolishing and building a new clubhouse. An investigation of the facility�s foundation, walls, floors, ceilings, roof, electrical, mechanical, and plumbing systems, and general code conformance were physically reviewed and evaluated. Photographs were also taken to document the facility�s interior and exterior condition, layout, and accessibility.

The Feasibility Report concluded that the City of Burbank would be better served by a completely new clubhouse. A properly designed new facility would provide improved golf operations, more efficient concessionaire facilities, and eliminate any potential compromises from remodeling and/or expanding the existing facility. The Report�s recommendation was founded on several fronts.

During the interim period after the December 1998 Feasibility Report was issued and when the Project substantially moved forward in June 2002, capital reserves continued to be set aside in the Golf Fund to pay for subsequent capital improvements. In addition, staff continued to assess scope, funding, and phasing as to the Project�s direction given the available financial resources (approximately $4.0 million at that time), and what the project scope was to include - a new clubhouse, driving range improvements, including a two tier range structure and parking improvements.

Milestone Activities � The Clubhouse Project was �officially� kicked-off in June 2002 with the following milestone activities completed since that time.

ANALYSIS

Program Development � From the very beginning, the Project�s programming effort has been, and will continue to be, a matter of consensus building among project stakeholders who include the Burbank City Council, Parks, Recreation and Community Services Board, Oversight Committee, Greens Committee, golfing community, private golf clubs, and the general public. The Schematic Design Phase program presented in this report is the culmination of these concerted and continuing efforts.

Since late July 2003 when the Project Architect Melzer Deckert & Ruder (MDR) began its design and programming efforts, there has been a collaborative and exhaustive effort and extensive development and evaluation of financial strategies to result in the program presented in this report. More than a dozen alternative program scenarios on at least three potential clubhouse sites were developed, discussed, and modified with only the most viable program alternatives presented to project stakeholders. Clubhouse program alternatives ranged in size from 10,200 to 18,000 square feet and the total project costs, depending on when budgets were developed and what project elements were included, ranged from $6.0 million to more than $11.0 million.

For more than two years, staff faced continued construction escalation costs that proved detrimental in providing a balance between essential program needs and Project affordability. It was always important not to compromise essential program elements, aesthetics, functionality, and quality, but it became clear that in order to adhere to an original $6.0 million. Total Project Cost, deep cuts to previously intended scope would have to be pursued to ensure financial viability.

Staff�s program recommendation is the result of balancing needs and cost - maximizing program benefit for the least amount of cost. Staff�s recommendation is to provide a new clubhouse on the existing site that is about 17% larger in total interior space than the current facility.[2] Although there is a premium to locate the new clubhouse on its current site, it represents the most appropriate and beneficial location when evaluating functionality, operations, on-site parking, aesthetics, and view opportunities.

To gain an appreciation for the actual changes in the clubhouse program, the summary listed below identifies where significant program changes occurred.

Both the Cart Storage and Bar/Grill/Community areas increased by about 50% at the expense of reductions to the Restroom, Lounge, Circulation, Storage, and Equipment areas. The Pro Shop stayed approximately the same size with the most substantial gain realized in the Kitchen & Support area. These changes reflect the operational importance of the Cart Storage, Bar/Grill/Community Room, and Kitchen areas but also convey the high efficiencies imposed on the remaining program areas.

The current kitchen facilities are substantially undersized, functionally obsolete, and does not meet current health department standards. The kitchen facilities proposed as part of the new clubhouse is menu-driven but is still considered on the small end of the scale. The increase in the Cart Storage facility is to accommodate all the carts used and charged on a daily basis. The existing facility

The proposed program substantially provides the same operational elements of the current clubhouse, is more space efficient due to a decrease in common areas and circulation even though an elevator has been added to meet ADA requirements, and is functionally superior. Some of the primary pros and cons of this program recommendation include:

Public Outreach and Community Participation � To solicit important input and gain the legitimate trust of public stakeholders, staff hosted several community outreach efforts, including numerous separate meetings with the Greens Committee, to ensure the program recommendation to City Council would have solid public backing. These well attended community meetings were held in July and August 2004, May 2005, and most recently in December 2005 where the currently proposed program was well received and supported. Staff is confident that through this public outreach process and in conjunction with the substantial programming effort and City stakeholder involvement, this program has appropriately balanced and addressed community and golf constituency needs, clubhouse operations, functionality, maintenance concerns, cost implications, aesthetics, and quality.

Project Program - The program includes a new two-story, approximately 12,775 square foot clubhouse, new surface parking facility for approximately 70 spaces, and ADA accessibility improvements to the intersection of Walnut Avenue and DeBell Drive. Exhibit A portrays the proposed east building elevation and architectural style, Exhibit B is a diagrammatic layout of the clubhouse floor plans and immediate exterior surrounding area, and Exhibit C provides a program comparison between the current and proposed clubhouse facilities.

New Surface Parking Facility � After the Oversight Committee accepted the Program in January 2006 which specifically did not include a new surface parking facility, staff reconsidered the need to provide such a facility as part of the total program. Although staff can reasonably demonstrate that a new parking facility will not be a requirement imposed by the Planning Board[4], it is a viable long term benefit for the Project. This decision can be supported by the following reasons:

Parking Determination - Staff will complete and submit a Parking Determination to the Planning Board for its consideration and approval well in advance of completing the Design Development Phase. At this time, the program intends to maximize the number of on-site parking spaces possible while meeting Burbank Municipal Code (BMC) requirements for irrigation and landscaping, circulation, and lighting. The current surface parking facility covers an area of approximately 33,000 square feet and provides a total of 85 parking spaces � five (5) handicap spaces and 80 regular spaces.

Based on a preliminary design layout, approximately 70 on site parking spaces are anticipated � five handicap spaces and 65 regular spaces for the new parking facility. This loss in parking capacity is a direct function of the parking lot�s irregular shape, increased aisle width requirements and parking space envelope, and the addition of required landscaping, medians, and light standards to meet BMC requirements.

In a separate action, staff will recommend to the Planning Board that any resultant shortfall in parking stalls be absorbed along Walnut Avenue since more than sufficient off-site excess parking capacity currently exists and will not impose negative consequences to the surrounding area or neighborhood. Staff maintains that a new access path to be constructed uphill from the new clubhouse will actually promote parking along Walnut Avenue since this will represent a convenient path of travel directly to the clubhouse.

Clubhouse Setbacks � The DeBell Clubhouse is located on City property designated as �open space� and therefore does not have specific zoning criteria governing building setbacks from the street. Staff proposes that the new clubhouse exterior walls be set back approximately twenty (20) feet from face of curb along Walnut Avenue (38� from the street centerline) and approximately forty-five (45) feet from face of curb along DeBell Drive (57� from street centerline). The current set backs from face of curb to the exterior building walls are 47 feet and 55 feet from Walnut Avenue and DeBell Drive, respectively.[6] This proposed building pad location will result in more useable land for cart staging and improved cart circulation and pedestrian access around the east side of the clubhouse that is currently considered a bottle-neck.

Temporary Facilities � The Project Team recognizes that during construction of the new clubhouse, normal golf and concessionaire operations shall be maintained to the maximum extent possible. It�s important that a positive experience continues to be upheld for all customers using these facilities during this period. Therefore, a detailed Temporary Facilities Plan will be developed during the Construction Documents Phase effort. Staff will be tasked with establishing a cost effective, yet reasonable program to ensure that golf and concessionaire operations continue to function normally to the maximum extent possible. This will be a collaborative effort between the Project Team, Golf Professional, and the Food & Beverage Concessionaire. This Plan and its cost will be subject to Oversight Committee approval.

Based on the limited information currently available to develop a cohesive and functional temporary facilities plan, and based on other clubhouse projects where temporary facilities were a necessity, staff established an allowance of $150,000 over a period of fourteen (14) months.

Green Building � Although this Project is not being designed to meet a Leadership in Energy and Environmental Design (LEED) certification, responsible and energy efficient materials and systems, natural lighting, in door air quality, and other environmentally relevant features (such as deep eaves for shading, low emmissivity glass, and high energy efficient heating and cooling systems) typically provided within a LEED facility will be incorporated into the design program. Unless otherwise directed by City Council, the Project design effort will continue forward without LEED certification program.[7]

Total Project Cost � The Total Project Cost is comprised of the following Program Elements, including each cost as a percentage of the $8.0M Total Project Cost. This information duplicates a portion of Exhibit D but has been provided below for the reader�s convenience.

Schedule � Should City Council authorize staff to proceed with the Design Development Phase, the following schedule milestones are anticipated.

Staff will revisit the anticipated occupancy date upon completion of the Design Development Phase and report back to City Council around October 2006.

The Golf Fund is an Enterprise Fund that has been self-supporting for more than the past twenty years and has functioned without General Fund assistance for operating or capital improvement costs. To date, the Golf Fund has set aside $6.5 million for the DeBell Clubhouse Replacement Project but an additional $1.5 million is needed to complete this $8.0 million capital project effort.[9]

New Clubhouse Financing - Financial Services staff worked with Park, Recreation, and Community Services staff and the Golf Pro to compile data in an effort to forecast golf fund financial activity and cash flows on a ten (10) year horizon. Approximately 40 different cash flow scenarios (in $500,000 increments) were generated that incorporated total project costs ranging from $6.0 million to $9.0 million. This information, including the cash flow parameters and assumptions listed below, is summarized in Exhibit E and provided herein for convenience.

With all financing scenarios built around the parameters and assumptions listed above, the Golf Fund can internally fund a capital project up to $6.5 million without any external funding. Project costs above $6.5 million will require supplemental capital.

The Project presented in this report has a total cost of $8.0 million and will require an outside capital infusion of $1.5 million. To address this need, staff is proposing to have the General Fund advance the necessary capital, to be repaid at the LAIF (Local Agency Investment Fund) rate plus a specified margin to be approved by City Council. This provides flexible low cost capital for the Golf Fund and increased returns to the General Fund. After discussing this proposal with the City Treasurer and in an effort to maintain conservative projections, staff evaluated scenarios at an assumed LAIF rate of +0.5% margin, starting at 5.0%, increasing 0.5% each year, and capping at 6.5%, as well as the LAIF rate + 1.0% starting at 5.5%, and also capping at 6.5%. In addition to each of these rate scenarios, staff further evaluated the Golf Fund paying the advance back over a ten (10) and fifteen (15) year term.

Based on discussions with the Oversight Committee, and the subsequent consideration of including a new surface parking facility, staff recommends approval for the General Fund to advance the $1.5 million supplemental capital needed in the Golf Fund at LAIF + 0.5% over a ten (10) year term. This action will result in a projected Golf Fund average annual repayment of $199,000 and will require projected Green Fee rate increases of 10.0% to 12.0% in FY2006/07 and 4.0% in FY 2008/09.[12]

RECOMMENDATION

Staff recommends that City Council adopt the proposed resolutions for the DeBell Clubhouse Replacement Project, Bid Schedule 1153:

[1] The existing clubhouse is thirty-six (36) years old, was capitalized as of fiscal year end June 30, 1982 for a cost of $223,986, and had an established twenty (20) year economic life for accounting purposes.

[2] A majority of the increase in clubhouse size is attributable to the increased size of the cart storage area to accommodate approximately 18 to 20 additional carts. The cart storage area increase 1,607 square feet or 88% of the total net increase (1,826 square feet) for the entire clubhouse.

[3] The Community Room can be combined with the Bar & Grill to increase capacity by another 24 to 28 table seating.

[4] Although the existing parking facility does not meet current Burbank Municipal Code requirements, the fact that it is not adjacent to the proposed new clubhouse, that it provides sufficient on-site parking capacity based on the 1,826 square feet of incremental size increase in the new clubhouse, and that excess parking capacity currently exists along Walnut Avenue, all substantiate a decision to avoid the cost to build a new parking facility.

[5] A new parking facility will require best management practices for storm water run-off as part of meeting National Pollutant Discharge Elimination System (NPDES) requirements.

[6] The existing sidewalk along Walnut Avenue is four feet wide plus a 6� curb and will remain in place.

[7] Incorporating LEEDs may add as much as 2% or more (about $150,000 in soft and hard costs) to the total Project cost due to the Project�s small size. In addition, none of the architect�s principals or staff is currently LEED Certified Professionals.

[8] The set aside for Art In Public Places (AIPP) is generally one percent (1.0%) of the construction cost. The 0.6% shown above represents the value of this program element as a percentage of the Total Project Cost, less the $50,000 set aside for AIPP.

[9] The Project has $6.5 million specifically set aside for this Project within the Golf Fund and Account Number 495.PR27A.15022.0000.13635 currently has $1,972,000 appropriated. The Project has expended approximately $258,000 for professional services (or about 3.2% of the proposed Total Project Cost) through the period ending January 31, 2006.

[10] Although experience has proven that course play actually increases after a new clubhouse has been completed, staff is taking a more conservative position. The level of play is projected to increase at an annual rate of 6% the year after the new clubhouse has been completed and will continue at this rate until the level of play stabilizes between 75,000 and 80,000 rounds per year.

[11] The existing clubhouse is currently thirty-six (36) years old and was capitalized as of fiscal year end June 30, 1972 for a cost of $223,986 with a twenty (20) year life.

[12] The 10.0% to 12.0% Green Fee rate increase planned for FY 2006/07 translates to approximately $1.00 to $3.00 per person per round (or about $100,000 to $135,000 in additional annual revenues). The projected 4.0 % Green Fee rate increase planned for FY 2008/09 will add another $0.50 to $1.20 per person per round (or about another $33,000 to $55,000 in additional annual revenues). These rate increases, in effect, substantially pay for the debt service precipitated by the $1.5 million capital infusion.

Council Agenda - City of Burbank

Tuesday, March 7, 2006

PURPOSE

BACKGROUND

ANALYSIS

RECOMMENDATION