Report Prepared by: Christopher Jensen, Parks and Community Services Director and Joe Cardoso, City Surveyor, Engineering Department
Title
SUBJECT: Authorization of Use of South Merced Funding from General Fund of $350,000 and Economic Development Opportunity Funding of $154,291 Towards the Completion of Stephen Leonard Youth Center Up to an Amount not to Exceed $504,291, Transferring to and Appropriating Within Fund 5000-Parks and Community Services Capital Improvement Project (CIP)
REPORT IN BRIEF
Considers authorizing the use of South Merced Investment funding and Economic Development Opportunity Funds in an amount not to exceed up to $504,291 to complete construction and increase the safety, security and utility of Stephen Leonard Youth Center. The Department of Parks & Community Services and Development Services is requesting Council direction on work to be added and the matching allocation of funding from the South Merced project allocated in the General Fund and Economic Development Opportunity Funding to address the unforeseen costs and prioritized work to complete the buildings restoration.
RECOMMENDATION
City Council - Adopt a motion:
A. Approving the allocation of $350,000 from the General Fund CP240001 South Merced Improvement transferring to Fund 5000-Park and Community Service CIP and appropriating the same to CP230052 Stephen Leonard Building Repair; and,
B. Approving a supplemental appropriation from the unencumbered, unreserved fund balance of Fund 1017- Economic Development Opportunity in the amount of $154,291, transferring to Fund 5000-Park and Community Service CIP and appropriating the same to CP230052 Stephen Leonard Building Repair.
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ALTERNATIVES
1. Approve, as recommended by staff; or,
2. Approve, subject to conditions other than recommended by staff (identify specific findings and/or conditions amended to be addressed in the motion); or,
3. Deny; or,
4. Refer to staff for reconsideration of specific items (specific items to be addressed in the motion); or,
5. Continue to a future meeting (date and time to be specified in the motion).
AUTHORITY
Charter of the City of Merced, Article XI, Section 1109 - Contracts on Public Works.
Merced Municipal Code Chapter 3.04, Article IV - Public Works Contracts.
CITY COUNCIL PRIORITIES
As provided in the 2024-25 Adopted Budget.
DISCUSSION
Stephen Leonard Park Youth Center, located at 640 T Street, Merced, was severely damaged by a fire on the evening of May 17, 2022. The damage was extensive, and a rendered the building unusable.
Immediate repairs were required to secure the roofing and November 21, 2022, City Council awarded the construction contract to Harris Builders, Inc. to prevent future damages from the weather and future deterioration. This portion of work was covered by the insurance claim and completed on June 7, 2023.
In addition to immediate repairs required to the roof, the exterior and interior of the building required significant repairs. The insurance requested that claims be filed and work be tracked for each type of damage suffered; fire, vandalism, and code upgrades. There was a difference between what the insurance agreed to cover on the claims and the work that was determined to be required at the time. This shortage was presented to Council on two occasions in 2024 and a total of $208,343 was allocated to the project from American Rescue Plan Act (ARPA).
On October 10, 2024, Council awarded the construction contract to Diede Construction Inc. for the rehabilitation of Stephen Leonard Building in the amount of $1,515,720. However, between the time the project was put out to bid and the contract being awarded additional damage was carried out on the building due to unauthorized entry and vandalism including graffiti, broken windows, and damage to interior doors that rendered them useless. Much of the ongoing damage suffered was not part of the initial assessment or ongoing negotiations considered by the insurance companies’ appraisal resulting in a gap of coverage and scope of work for the project.
In addition to the vandalism, additional work was found to be required as the condition of segments of the building were not reusable or suitable to be considered complete by the contractor. These items included plumbing repairs, facia on the exterior of the facility, and interior doors.
In order to address the gap between approved and required work, prioritized upgrades and suggested additional investment to the site, Staff are requesting Council’s consideration of the use of South Merced Investment and Economic Development Opportunity funds to add safety, utility, and security features that are currently not afforded with the given budget.
The additional work requested for your consideration is as follows:
MANDATORY EXTRA WORK NOT COVERED, REQUIRED PER BUILDING CODE
The following is a brief description work which was required to be done as part of the Contractor’s critical path but fell outside of insurance claims and previously budgeted code upgrades:
• Dry rot on external facia, plumbing to support ADA required amenity upgrades, interior doors rendering useless due to vandalism- $52,929
PRIORITIZED ADDITIONAL UPGRADES FOR SAFETY, SECURITY AND UTILITY
The following is a brief description of additional work which falls outside of what was covered by insurance claims, code upgrades but are suggested as owner betterments which has been prioritized by Staff and South Merced Subcommittee to add safety, increase security, and add utility to the facility:
• Additional engineering by Northstar to support added scope, upgraded commercial flooring, ADA parking added, front entry foyer conversion, internet and security camera installation, kitchen counters and cabinets, replacement of barn doors with artistic security screens- $298,000
POTENTIAL ADDITIONAL UPGRADES FOR CONSIDERATION
The following is a brief description of each item that are not covered by insurance and would be additional upgrades to the rest of the facility and surrounding park:
• Anti-graffiti coating over exterior of the building, center room divider in center of facility, upgrade park lighting to city standard Sternberg style, convert storage room into office space - $153,362
See itemized breakdown of costs below:
The Stephen Leonard Park Youth Center is a traditional gathering place and anchors this historical park in south Merced. It served as the original home of the Merced County Boys and Girls Club, provided years of afterschool programs through parks and community service programs, housed Merced Youth Soccer Academy after school tutoring and community Zumba classes and served the community in several other capacities over the years. Staff is requesting Council support of the investments required to increase the safety, security and utility of this resource at Stephen Leonard Park for years to come.
Economic Development Opportunity Fund Use Policy: On April 2, 2018, the City Council adopted Resolution 2018 - 20 establishing the Economic Development Opportunity Fund and uses for the Fund. Per the adopted Resolution, Expenditures from the fund shall be used only for the following purposes (Excerpt):
1(h). To fully utilize existing real estate, real property, existing or planned infrastructure, facility or capital improvements.
Use of the Economic Development Opportunity Funds is consistent with the Use of Funds set forth in Resolution 2018 - 20 (ATTACHMENT 2).
IMPACT ON CITY RESOURCES
Staff is requesting the allocation of $350,000 from CP240001-South Merced Improvement from the General Fund as well as $154,291 from Fund 1017-Economic Development Opportunity to CP230052 Stephen Leonard Building Repair.
Please note that this item will require an affirmative five votes for approval.
ATTACHMENTS
1. Stephen Leonard Building
2. Resolution No. 2018-20 Economic Development Opportunity Fund