Memorandum

City of Lawrence

City Manager’s Office

TO:	Mayor and City Commission
FROM:	David L. Corliss, City Manager
DATE:	June 4, 2013
RE:	Rock Chalk Park Update

At its meeting on May 21, the City Commission requested an update on Rock Chalk Park shared infrastructure and other associated costs prior to authorizing a contract on the recreation center construction. This update was scheduled for the June 4 City Commission meeting.

Updated Cost Estimates:

Attached is an updated itemization of shared infrastructure and other project costs provided by KU Endowment. This document provides details on unit quantity and unit costs of items such as general construction, site grading, retention ponds, trails and tennis courts, waterline, sanitary sewer, storm sewer, parking lot lights, landscaping, Rock Chalk Drive & George Williams Way construction, overflow parking lot, parking lot and access drives, Rock Chalk Lane and Rock Chalk Parkway construction, chip and seal on the County Road, and the preparation of the recreation center pad. The total of these items is $12,290,952.65.

Staff has reviewed the updated cost estimates provided by KU Endowment and has found them to be generally in line with costs the City has seen on other recent projects, such as Iowa Street reconstruction and the Farmland infrastructure. Differences between the updated estimates and earlier City cost estimates for infrastructure of $8.3 million can be identified primarily in the area of several items- the addition of landscaping (+$583,850), parking lot paving includes the entire site and has been enhanced to provide durability and longevity of the infrastructure (+ approximately $895,000), the inclusion in the infrastructure figure of tennis courts and a retaining wall required for the tennis court construction (+$810,000), the inclusion of the recreation center pad in the infrastructure estimate ($432,250), site grading (+$850,500), and soft costs (legal, loan origination, loan interest, construction management fee of 2.5% (+$914,851). There were also various cost reductions, such as a reduction for the waterline and sanitary sewer costs (-$451,696) and a reduction in the estimated costs of Rock Chalk Drive/George Williams Way construction (-$197,000).

As the City Commission is aware, other cost items related to the project are the construction of the recreation center, architecture fees and land acquisition for the recreation center site. These items total $12,209,050. These items, along with the itemization of the shared infrastructure and other project costs are listed below:

Item	Total Estimated Project Cost
Recreation Center Bid	$ 10,500,000.00
Architecture Fees	$ 925,000.00
Land	$ 784,050.00
Shared Infrastructure, tennis courts, pad site and other costs*	$ 12,290,952.65
TOTAL	$ 24,500,002.65
*itemized on KU Endowment list

Assist Foundation Contribution to Project:

Earlier today, Bill and Cindy Self’s Assists Foundation announced a major gift to the Lawrence community of up to $2 million. This gift will be provided to enhance wellness and physical activity in the community by contributing to the project. This is one of the largest gifts ever received by the City.

Resulting Reduction in Maximum Cost to the City from $25 million to $22.5 million:

Under the agreement between KU Athletics, the City of Lawrence, KU Endowment and Bliss Sports, the city’s contribution to the Rock Chalk Park project, including the city’s Recreation Center, shared infrastructure and related costs, was capped at $25 million. The total project costs are now estimated at $24.5 million. As a result of the approximately $2 million donation from the Assists Foundation, representatives of the parties have agreed to recommend a reduction in the city’s maximum cost from $25 million to $22.5 million. The city’s actual costs for the project will be set forth as follows: $10.5 million for the recreation center bid, $925,000 for architect fees and $784,000 for land acquisition, with a remaining maximum amount of $10,290,950 for tennis courts, walking/running trails, recreation center site preparation, and other shared site infrastructure. Additionally, pursuant to the development agreement, these costs will all be based on actual expenses. Below is a chart of estimated City project costs reflecting the Assists Foundation Donation and the total project cap of $22.5 million.

Item	Total estimated City cost
Recreation Center Bid	$ 10,500,000.00
Architecture Fees	$ 925,000.00
Land	$ 784,050.00
Shared Infrastructure, tennis courts, pad site and other costs*	Cap of $10,290,950 after Assists Foundation Donation of up to $2 million
TOTAL	$ 22,500,000 Maximum City Cost
*itemized on KU Endowment list

Conclusion:

Staff believes that the updated total cost estimate of $24.5 million for the project is a valid estimate. With the generous gift of the Assist Foundation reducing these costs to the City to a maximum of $22.5 million, the City will be able to realize a first-class recreational facility, lighted tennis courts and shared site improvements with the Kansas Athletics facilities at a cost that is at least 10% less than the original $25 million project maximum.

Requested Action:

Provide direction to staff regarding the project and direct staff to finalize agreements for City Commission action, if appropriate.