Approval of Cinder Bed Road Design Build Agreement and Financial Plan

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1 Finance & Administration Committee Action Item III-A October 14, 2010 Approval of Cinder Bed Road Design Build Agreement and Financial Plan

2 Washington Metropolitan Area Transit Authority Board Action/Information Summary Action Information MEAD Number: Resolution: Yes No TITLE: Cinder Bed Road Design/Build Agreement PURPOSE: To obtain Board approval: 1. to amend the Master Developement Agreement for the Cinder Bed Road Bus Garage Project; 2. to extend the property sales agreement for 120 days. DESCRIPTION: The request to approve the amendment to the Master Development Agreement is necessary to continue the progress towards building a new bus garage to replace the Royal Street Bus Garage. The existing garage has exceeded its useful life, has no potential for expansion, and is not compatible with the surrounding neighborhood. A modern, well-designed facility will help to attract new employees, advancing Metro`s goal of attracting and retaining the best and the brightest. In addition, new technology buses and fuels in an expanded and modern facility, will improve the quality of bus service, thereby enhancing Metro`s image. An unsolicited proposal was received in August 2008 offering to provide the real estate necessary to house a new garage to replace Royal Street Bus Garage. The proposal also offered design and construction services and proposed a private financing plan to cover the project`s costs. Following a procurement request for alternatives, of which there were none, authorization was given to proceed with the developer, Iskalo. After a WMATA Public Hearing, the Board of Directors accepted the Public Hearing Staff Report and amended the Mass Transit Plan on September 24, The next step was the negotiation of the Master Development Agreement (MDA) that addresses the efforts leading up to and including closing for property acquisition. Board approval for execution of the MDA was provided in January of The next step in advancing the project is an amendment to the Master Development Agreement for the performance of preliminary engineering by the designer of record for the garage. By advancing the design to a higher level of completion than currently exists, the pricing for the Design/Build Agreement can be of higher accuracy. The proposed

3 action will utilize up to $500,000 of FY11 CIP funds approved for the project. Under the terms of the Master Development Agreement WMATA was assigned the property sales agreement on July 1, One of the terms of the sales agreement is that closing on the sale of the property must occur before December 31, WMATA has a clause requiring completion of the Fairfax County Planning Process prior to purchasing the property. It is now obvious that the planning process will not be completed in time for closing to take place this calendar year. Therefore, staff negotiated a 120-day extension of the sales agreement to allow for completion of the planning process before closing is scheduled. The extension requires payment of $50,000 for each month until closing. This fee is credited towards the agreed to sales price. The Board is also requested to approve the addition of 3 positions to the FY11 budget in support of the capital program. The positions are for administration of the Cinder Bed Road project. FUNDING IMPACT: FY11 Program: Capital Improvement Program Project: Cinder Bed Road Bus Garage Project Manager: Ed Shepperson Project Department/Office: TIES/ESVC Budget: $16,595,332 This Action: $ 500,000 Prior Approval: $ 3,876,296 Remaining $12,219,036 Budget: Remarks: None Capital Budget Three (3) new positions with this action. Impact: Operating Budget Positions: None. Impact: Annual Expense: None.

4 RECOMMENDATION: Board approval: 1. to amend the Master Developement Agreement for the Cinder Bed Road Bus Garage Project; 2. the addition of three positions for administration of the project; 3. to extend the property sales agreement for 120 days.

5 Washington Metropolitan Area Transit Authority Cinder Bed Road Bus Garage Approvals Finance and Administration Committee October 14, 2010

6 Purpose Obtain approval to: Amend the Master Development Agreement Addition of three positions for administration of the project; and Revise the terms of the property sales agreement.

7 Background Discussions towards establishing the guaranteed maximum price for the Design/Build contract have exposed differences in estimated costs; Proposal is to amend the existing Master Development Agreement to advance the design to a higher level of completion to minimize the current differences; The current property sales agreement expires on 12/31/10; Extension necessary to allow for the completion of the Fairfax County approval processes; Assuming successful completion of the Fairfax processes closing on the property would take place before the end of March of 2011; The extension maintains Metro s control of the property until closing.

8 Costs and Benefits Benefit to Customers Implications on Service Provides modern facility to enhance maintenance & improve service reliability. Depending on assignment of buses, costs could increase due to more deadhead. Replacement of outdated & deteriorated garage;

9 Recommendations Obtain Board approval to: Amend the Master Development Agreement; Add three positions for the administration of the project; and Revise the terms of the property sales agreement.

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