HomeMy WebLinkAboutCOW 2008-09-22 COMPLETE AGENDA PACKET �Jw w,;s, Tukwila City Council Agenda
0 2 COMMITTEE OF THE WHOLE
$,t t Oa r Jim Haggerton, Mayor Councilmembers: Joan Hernandez Pamela Linder
Rhonda Berry, City Administrator Dennis Robertson Verna Griffin
1908 Joe Duffle, Council President Kathy Hougardy De'Sean Quinn
EXECUTIVE SESSION 6:30 -7:00 PM
Potential Litigation; pursuant to RCW 42.30.110(1)(i)
MONDAY, September 22, 2008, 7:00 PM Tukwila City Hall; Council Chambers
1. CALL TO ORDER PLEDGE OF ALLEGIANCE
2. SPECIAL Introduction and swearing -in of lateral Police Officer Randal Rusness
PRESENTATIONS and entry -level Police Officer Micah Ristow; David Haynes, Police Chief.
Tukwila School District Report on Student Achievement;
Dr. Linda Elman, Director of Research Evaluation, Tukwila School District,
and Dave Larson, Board Director, Tukwila School District.
3. CITIZEN At this time, you are invited to comment on items not included on this
COMMENT agenda (please limit your comments to five minutes per citizen). To
comment on an item listed on this agenda, please save your comments until
the issue is P resented for discussion.
4. SPECIAL a. Contracts for Structural Plan Review Services. Pg.1
ISSUES b. Automated Cashiering System proposal. Pg.21
c. Tukwila Village discussion and developer selection. Pg.31
Please bring the two proposals from the developers, distributed in July. Q
5. REPORTS a. Mayor c. Staff e. Intergovernmental
b. City Council d. City Attorney
6. MISCELLANEOUS
7. EXECUTIVE SESSION
8. ADJOURN TO SPECIAL MEETING
SPECIAL MEETING
Ord #2208 Res #1669
1. CALL TO ORDER ROLL CALL
2. CONSENT Approval of vouchers.
AGENDA
3. UNFINISHED a. Authorize the Mayor to enter into contracts with Reid Middleton, Pg.1
BUSINESS Inc. and Sound Inspections and Investigative Engineers, LLC for
structural plan review services (no impact to the General Fund).
b. Authorize the Mayor to enter into exclusive negotiations with a Pg.31
developer for the Tukwila Village Project.
4. ADJOURNMENT
Tukwila City Hall is wheelchair accessible. Reasonable accommodations are available at public hearings with advance notice
to the City Clerks Office 206 433 1800 /TDD 206 248 -2933. This notice is available at www.ci.tukwila.wa.us,
and in alternate formats with advance notice for those with disabilities. Tukwila Council meetings are audio taped.
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COUNCIL AGENDA SYNOPSIS
Initials ITEM No.
f P 11; 1 il'Ieetin: Date 1 Prepared by illayor'r review 1 Counc I review
•u 0 1 09/22/08 1 BB I ULer I .,�3 I ,4
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ITEM INFORMATION
( CAS NUMBER: 08-113 I ORIGINAL AGENDA DATE: SEPTEMBER 22, 2008
AGEND.\ ITENt TITLE Structural plan review contracts with Reid Middleton, Inc. and Sound Inspections
and Investigative Engineers
C. \1 Discussion Motion Resolution Ordinance Bid Award Public Hearing Other
Altg Date 9/22/08 Altg Date 9/22/08 AN Date Alt; Date tbitg Date Aitg Date bitg Date
SPONSOR I 1 Council Mayor Adm Svcs DCD n Finance Fire Legal P&R Police PIS
SPONSOR'S The Department of Community Development requires consultant services to provide
SUM \L \RY structural plan review for building permits. Currently, there is no consultant under
contract to provide this service. The permit revenues pay for the consultant's permit
application review, and there will not be an impact to the General Fund. Due to plan
review needs at this time and a tight timeline, the Council is being asked to approve the
contracts at the Special Meeting directly following the Committee of the Whole.
RI:\'1l:WIU BY COW Mtg. CA &P Cmte F &S Cmte Transportation Cmte
Utilities Cmte Arts Comm. Parks Comm. Planning Comm.
DAIE: 9/22/08
RECOMMENDATIONS:
SPONSOR /ADMIIN. Approve contracts for services
COMMITTEE Discussed at CAP directly prior to tonight's Council meeting.
COST IMPACT FUND SOURCE
ExPI i,NDITURE REQUIRED AMOUNT BUDGETED APPROPRIATION REQUIRED
Fund Source: No IMPACT TO GENERAL FUNDS.
Comments:
MTG. DATE RECORD OF COUNCIL ACTION
I 09/22/08
MTG. DATE I ATTACHMENTS
09/22/08 I Informational memorandum dated 09/22/08
Contract with Reid Middleton, Inc.
Contract with Sound Inspections Investigative Engineers
1 (No Committee minutes attached; this item was discussed at CAP prior to C.O.W. mtg.)
O t ••:2', '1' Gity of T I Jim Haggerton, Mayor
LI.VI Asi, r 0
0 ba.. Department of Community Development Jack Pace, Director
1908
INFORMATION MEMO
To: City Council, Committe the Whole
From: Jack Pace, DCD Directo
Date: September 22, 2008
Subject: Structural Plan Review Services Contracts
ISSUE
The Depai fluent of Community Development requires consultant services to provide
structural plan review for building permit processing. Currently, there is no consultant
under contract to provide this service. The aggregate sum of compensation and the
proposed term of the new contract requires Council approval. Council approval would
then allow these contracts to be effective for the remainder of 2008 in addition to a full
two year term that would end in December of 2010.
BACKGROUND
For the past thirteen years Reid/Middleton, Inc. has provided structural plan review
services to the Department of Community Development. The standard contract for
services was approved with the condition that it could be reviewed and approved
annually for a maximum of four contract extensions.This year was the end of a four
extension cycle for Reid/Middleton. The need to advertise an RFQ and policy protocol of
the process has delayed the award of a new contract for services. The Department of
Community Development has been without the services of a structural plan review
consultant since July 31, 2008.
ANALYSIS
The contract language and the scope of work for structural plan review services remain
unchanged from the previous contracts. Each contract requires work under the same
stated conditions. Past procedures allowed one consultant to provide the City with
structural plan review services and remain as a sole provider of this service for an
extended period of time. This may have contributed to the minimal response to the RFQ.
The award of a structural plan review contract for two firms will give the department
flexibility in assigning work load, it will provide for a backup service provider and it will
eliminate the perceived ownership of an exclusive contract for services with the City.
1
6300 Southcenter Boulevard, Suite #100 Tukwila, Washington 98188 e Phone: 206 431 -3670 Fax: 206 431 -3665
REVENUE SOURCE
The consultants are paid for each plan review as a separate project. Their fee for each
project is paid from permit fees collected with each permit application. There is no
impact to the general fund.
RECOMMIENDATION
Approve the contract for Reid/ Middleton, Inc. and for Sound Inspections Investigative
Engineers, LLC. Forward to Special Meeting fol 1 owi ng the Committee of the Whole
Attachments:
Contract for Services for Reid/Middleton, Inc.
Contract for Services for Sound Inspections Investigative Engineers, LLC
2
Contract No.
CONTRACT FOR SERVICES
This Agreement is entered into by and between the City of Tukwila, Washington, a noncharter
optional municipal code city hereinafter referred to as "the City and Reid/Middleton, Inc.
hereinafter referred to as the Consultant whose principal office is located at 728 134`" Street SW,
Suite 200, Everett, Washington 98204
WHEREAS, the City has detemiined the need to have certain services performed for its citizens
but does not have the manpower or expertise to perfoiin such services; and
WHEREAS, the City desires to have the Consultant perfoun such services pursuant to certain
terms and conditions; now, therefore,
IN CONSIDERATION OF the mutual benefits and conditions hereinafter contained, the parties
hereto agree as follows:
1. Scone and Schedule of Services to be Performed by Consultant. The Consultant shall
perform those services described in Exhibit A attached hereto and incorporated herein by this reference
as if fully set forth. In performing such services, Consultant shall at all times comply with all Federal,
State, and local statutes, rules and ordinances applicable to the perforniance of such services and the
handling of any funds used in connection therewith. The Consultant shall request and obtain prior
written approval from the City if the scope or schedule is to be modified in any way.
2. Compensation and Method of Payment. The City shall pay the Contractor for services
rendered according to the rate and method set forth on Exhibit B attached hereto and incorporated
herein by this reference. A new schedule of charges will be issued no later than Junel and become
effective July 1 each year beginning in the year 2009. Charges for all work, including continuing
projects initiated in prior years, will be based on the schedule of charges for period in which the work
was performed.
3. Contractor Budget. The Contractor shall apply the funds received under this Agreement
within the maximum limits set forth in this Agreement. The Contractor shall request prior approval
from the City whenever the Contractor desires to amend its budget in any way.
4. Duration of Agreement. This Agreement shall be in full force and effect for a period
commencing from the signature of all parties of this contract through December 31, 2010. The
Consultant shall not begin work under the teinis of this Agreement until authorized in writing by the
city.
5. Independent Consultant.. Consultant and City agree that Consultant is an independent
Consultant with respect to the services provided pursuant to this Agreement. Nothing in this
Agreement shall be considered to create the relationship of employer and employee between the
parties hereto. Neither Consultant nor any employee of the Consultant shall be entitled to any benefits
accorded City employees by virtue of the services provided under this Agreement. The City shall not
be responsible for withholding or otherwise deducting federal income tax or social security or
contributing to the State Industrial Insurance Program, or otherwise assuming the duties of an
employer with respect to the Consultant, or any employee of the Consultant..
6. Indemnification. The Consultant shall indemnify, defend and hold harmless the City, its
officers, agents and employees, from and against any and all claims, losses or liability, including
attorney's fees, arising from injury or death to persons or damage to property to the extent occasioned
by any negligent act, omission or failure of the Consultant, its officers, agents and employees, in
performing the work required by this Agreement. With respect to the performance of this Agreement
and as to claims against the City, its officers, agents and employees, the Consultant expressly waives
its immunity under Title 51 of the Revised Code of Washington, the Industrial Insurance Act, for
injuries to its employees, and agrees that the obligation to indemnify, defend and hold harmless
provided for in this paragraph extends to any claim brought by or on behalf of any employee of the
Consultant. This waiver is mutually negotiated by the parties. This paragraph shall not apply to any
damage resulting from the sole negligence of the City, its agents and employees. To the extent any of
the damages referenced by this paragraph were caused by or resulted from the concurrent negligence
of the City, its agents or employees, this obligation to indemnify, defend and hold harmless is valid
and enforceable only to the extent of the negligence of the Consultant, its officers, agents, and
employees.
H .Reid M contract 08.doc
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7. Insurance. The Consultant shall secure and maintain in full force throughout the duration
of the Agreement insurance as follows:
A. General liability insurance, with a minimum coverage of $500,000 per occurrence and
$1,000,000 aggregate of personal injury; and $1,000,000 per occurrence /aggregate for property
damage.
B. Professional liability insurance, with a minimum coverage of 1,000,000. per occurrence
and $2,000,000. aggregate against claims arising out of work provided for in this contract.
Said general liability policies shall name the City of Tukwila as an additional named insured and shall
include a provision prohibiting cancellation of said policy except upon thirty (30) days prior written
notice to the City.
Certificates of coverage as required by Paragraph A and B above shall be delivered to the City within
fifteen (15) days of execution of this Agreement.
8. Record Keening and Reporting.
A. The Consultant shall maintain accounts and records, including personnel, property,
financial and programmatic records which sufficiently and properly reflect all direct and indirect costs
of any nature expended and services perfottued in the perfounance of this Agreement and other such
records as may be deemed necessary by the City to ensure the perfoiniance of this Agreement.
B. These records shall be maintained for a period of seven (7) years after tettuination hereof
unless permission to destroy them is granted by the office of the archivist in accordance with RCW
Chapter 40.14 and by the City.
9. Audits and Inspections. The records and documents with respect to all matters covered by
this Agreement shall be subject at all times to inspection, review or audit by law during the
performance of this Agreement.
10. Termination. This Agreement may at any time be terminated by the City giving to the
Consultant thirty (30) days written notice of the City's intention to terminate the same. Failure to
provide products on schedule may result in contract termination. If the Contractor's insurance
coverage is canceled for any reason, the City shall have the right to terminate this Agreement
immediately.
11. Discrimination Prohibited. The Consultant shall not discriminate against any employee,
applicant for employment, or any person seeking the services of the Consultant to be provided under
this Agreement on the basis of race, color, religion, creed, sex, age, national origin, marital status or
presence of any sensory, mental or physical handicap.
12. Assignment and Subcontract. The Consultant shall not assign or subcontract any portion of
the services contemplated by this Agreement without the written consent of the City.
13. Entire Agreement. This Agreement contains the entire Agreement between the parties
hereto and no other Agreements, oral or otherwise, regarding the subject matter of this Agreement,
shall be deemed to exist or bind any of the parties party Either may request changes in the
Y p prt'S' Y q g
agreement. Proposed changes which are mutually agreed upon shall be incorporated by written
amendments to this Agreement.
14. Notices. Notices to the City of Tukwila shall be sent to the following address:
City Clerk, City of Tukwila
6200 Southcenter Blvd.
Tukwila, Washington 98188
Notices to the Consultant shall be sent to the address provided by the Consultant upon the
signature line below.
15. Applicable Law; Venue; Attorney's Fees. This Agreement shall be governed by and construed
in accordance with the laws of the State of Washington. In the event any suit, arbitration, or other
proceeding is instituted to enforce any term of this Agreement, the parties specifically understand and
agree that venue shall be properly laid in King County, Washington. The prevailing party in any such
action shall be entitled to its attorney's fees and costs of suit.
DATED this day of 20
CITY OF TUKWILA CONSULTANT.
By: By:
Title: Mayor
Title:
ATTEST /AUTHENTICATED:
Printed Name:
Christy O'Flaherty, City Clerk Address:
APPROVED AS TO FORM:
Office of the City Attorney
Date approved by City Council:
By: (Applicable if contract amount is over $25,000)
I
H: \SoundLLCstruct 08.doc
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EXHIBIT `A'
SCOPE OF WORK
The objective of this Agreement is to provide structural code compliance plan review for
proposed new and remodeled buildings within the City of Tukwila as specifically
requested in writing by the Building Official or his designee. The consultant shall
perform all services and provide all necessary equipment, materials and professionally
trained, licensed, and experienced personnel to accomplish the plan review as outlined
below.
1. On behalf of the Department of Community Development Building Division, the
consultant will perform structural plan review to establish compliance with the
structural provisions of the International Building Code as amended by the State
and as adopted by the City of Tukwila.
2. During the plan review process, the Consultant may contact the permit applicant
directly to request submission of additional information to the city. The
Consultant will keep a written record of this communication in the project file.
3. Upon completion of each plan review, the Consultant will furnish a summary plan
review letter directly to the Building Official and a copy to the permit applicant
outlining discrepancies in the plans, reports, and/or calculations (if any).
4. The Consultant will perform follow -up plan reviews as required to confirm that
plans have been corrected adequately according to the original plan review. In
these instances, the Consultant will furnish additional letters directly to the
Building Official and a copy to the permit applicant summarizing the results of
the review. When the Consultant is satisfied that the proposed structural work is
in compliance with the structural provisions of the Building Code, the Consultant
will issue a fmal letter stating that there are no further comments.
5. The plan review services for each permit applicant will be treated as an individual
project, the Consultant will track all associated labor and material costs according
to each project and invoice the City accordingly. The consultant will invoice the
city prior to the 10 of each month.
6. The City may need other structural engineering services throughout the term of
the on -call agreement. For these instances, the Consultant will perforini structural
engineering services as mutually agreed to by both parties. The scope of work,
fee, and schedule for the additional structural engineering services will be defined
and negotiated at the time the additional work is requested.
7. The City, in entering into this agreement, does not guarantee that any services will
be requested nor guarantee any specific dollar amount of work during the term of
this Agreement.
8. The city shall respond to the consultant's telephone or E -mail inquires concerning
interpretation of City Standards within three (3) working days.
9. The Consultant shall complete the specified work generally within (15) calendar
days of written notification by the City. (Large and/or complex projects may take
longer to review but require concurrence by City of time extension).
10. The Consultant shall perfoun all work described in this Agreement in accordance
with the latest edition and amendments to the Washington State Building Code as
adopted and amended by the City of Tukwila.
11. The City shall administer issuance of building permits and certificates of
occupancy. The consultant will assume no responsibility for proper on -site
construction techniques, job site safety, or any construction contractor's failure to
perform its work in accordance with approved plans, contract documents, and
permit conditions.
12. Corrections or comments made during the review process do not relieve the
project proponent or designer from compliance with requirements of codes,
conditions of approval, or permit requirements. Nor is the designer relieved of
responsibility for a complete design in accordance with the laws of the State of
Washington.
Reid Middleton, Inc.
Exhibit 4" Schedule of Charges
Effective July 1, 2008 through .tune 30, 2009
Compensation shall be based on time and expenses directly attributable to the project and shall follow the schedule
below unless another method of compensation has been expressed in the written agreement.
L Personnel Hourly Rate
Principal 180.00 225.00
Principal Engineer /Principal Planner/Principal Surveyor 170.00 190.00
Senior Engineer /Senior Planner/Senior Surveyor 145.00 165.00
Project Engineer /Project Surveyor/ Project Planner 115.00 135.00
Design Engineer /Senior Designer /Surveyor /Senior Technical Writer 95.00 105.00
Engineer /Planner /Senior Technician 85.00 S 95.00
Project Administrator 80.00 85.00
Technician S 60.00 70.00
Survey Crew (2 Person/RTK/RobOtic) 165.00
Survey Crew (3 Person/GPS) 250.00
Expert Witness/Forensic Engineering 1.5 times usual hourly rate (4 hour minimum)
Individuals not in the regular employ of Reid Middleton may occasionally be engaged to meet specific
project requirements. Charges for such personnel will be comparable to charges for regular Reid
Middleton personnel.
A premium may be charged if project requirements make overture work necessary.
1I. Equipment Rate
Design Software /Computer Aided Drafting 12.00/hour
[[I. Reimbursable Expenses
Local Mileage Automobile 0.65 /mile
Local Mileage Survey Truck S 0.55 /mile
Expenses that are directly attributable to the project are invoiced at cost plus 15 These expenses
include, but are not limited to, subconsultant or subcontractor services, travel and subsistence,
communications, couriers, postage, fees and permits, document reproduction, special instrumentation and
field equipment rental, premiums for additional insurance where required, special supplies, and other costs
directly applicable to the project.
A new schedule of charges is issued and becomes effective July 1 each year. Charges for all work,
including continuing projects initiated in prior years, will be based on the latest schedule of charges.
IV. Client Advances
Unless the parties agree otherwise in writing, charges for the following items shall be paid by the client
directly, shall not be the responsibility of Reid Middleton, and shall be in addition to any fee stipulated in
the agreement: government fees, including permit and review fees; soils testing fees and costs; charges for
aeriarphotogra hy; and charges for monuments. If Reid Middleton determines, in its discretion, to
advance any of these costs in the interest of the project, the amount of the advance, plus a fifteen percent
administrative fee, shall be paid by the client upon presentation of an invoice therefore.
1I:1. DOC FORMS\f X11 t131TS12008- A- Preliminarv.doc
1115/08 (nip
Contract No.
CONTRACT FOR SERVICES
This Agreement is entered into by and between the City of Tukwila, Washington, a noncharter
optional municipal code city hereinafter referred to as "the City and Sound Inspections
Investigative Engineers LLC, hereinafter referred to as "the Consultant whose principal office is
located at PMB 223, 1802 "A" Street SE, Auburn. Washington 89002
WHEREAS, the City has determined the need to have certain services performed for its citizens
but does not have the manpower or expertise to perform such services; and
WHEREAS, the City desires to have the Consultant perform such services pursuant to certain
terms and conditions; now, therefore,
IN CONSIDERATION OF the mutual benefits and conditions hereinafter contained, the parties
hereto agree as follows:
1. Scone and Schedule of Services to be Performed by Consultant. The Consultant shall
perform those services described in Exhibit A attached hereto and incorporated herein by this reference
as if fully set forth. In performing such services, Consultant shall at all times comply with all Federal,
State, and local statutes, rules and ordinances applicable to the performance of such services and the
handling of any funds used in connection therewith. The Consultant shall request and obtain prior
written approval from the City if the scope or schedule is to be modified in any way.
2. Compensation and Method of Payment. The City shall pay the Contractor for services
rendered according to the rate and method set forth in Exhibit B attached hereto and incorporated
herein by this reference. Compensation shall be limited as set forth in Exhibit A.
3. Duration of Agreement. This Agreement shall be in full force and effect for a period
commencing from the signature of all parties of this contract through December 31, 2010. The
Consultant shall not begin work under the terms of this Agreement until authorized in writing by the
city.
4. Independent Consultant.. Consultant and City agree that Consultant is an independent
Consultant with respect to the services provided pursuant to this Agreement. Nothing in this
Agreement shall be considered to create the relationship of employer and employee between the
parties hereto. Neither Consultant nor any employee of the Consultant shall be entitled to any benefits
accorded City employees by virtue of the services provided under this Agreement. The City shall not
be responsible for withholding or otherwise deducting federal income tax or social security or
contributing to the State Industrial Insurance Program, or otherwise assuming the duties of an
employer with respect to the Consultant, or any employee of the Consultant..
5. Indemnification. The Consultant shall indemnify, defend and hold harmless the City, its officers,
agents and employees, from and against any and all claims, losses or liability, including attorney's fees,
arising from injury or death to persons or damage to property occasioned by any act, omission or
failure of the Consultant, its officers, agents and employees, in performing the work required by this
Agreement. With respect to the performance of this Agreement and as to claims against the City, its
officers, agents and employees, the Consultant expressly waives its immunity under Title 51 of the
Revised Code of Washington, the Industrial Insurance Act, for injuries to its employees, and agrees
that the obligation to indemnify, defend and hold harmless provided for in this paragraph extends to
any claim brought by or on behalf of any employee of the Consultant. This waiver is mutually
negotiated by the parties. This paragraph shall not apply to any damage resulting from the sole
negligence of the City, its agents and employees. To the extent any of the damages referenced by this
paragraph were caused by or resulted from the concurrent negligence of the City, its agents or
employees, this obligation to indemnify, defend and hold harmless is valid and enforceable only to the
extent of the negligence of the Consultant, its officers, agents, and employees.
6. Insurance. The Consultant shall secure and maintain in full force throughout the duration of the
Agreement insurance as follows:
A. General liability insurance with a minimum coverage of $500,000 per occurance and
1,000,000 aggregate of personal injury; and 1,000,000 per occurance /aggregate for property
damage.
H: \SoundLLCstruct 08.doc
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B. Professional liability insurance, with a minimum coverage of 1,000,000. per occurrence
and $2,000,000. aggregate against claims arising out of work provided for in this contract.
Said general liability policies shall name the City of Tukwila as an dditional named insured and shall
include a provision prohibiting cancellation of said policy except upon thirty (30) days prior written
notice to the City.
Certificates of coverage as required by Paragraph A and B above shall be delivered to the City within
fifteen (15) days of execution of this Agreement.
7. Record Keening and Reportine.
A. The Consultant shall maintain accounts and records, including personnel, property,
financial and programmatic records which sufficiently and properly reflect all direct and indirect costs
of any nature expended and services performed in the performance of this Agreement and other such
records as may be deemed necessary by the City to ensure the performance of this Agreement.
B. These records shall be maintained for a period of seven (7) years after termination hereof
unless permission to destroy them is granted by the office of the archivist in accordance with RCW
Chapter 40.14 and by the City.
8. Audits and Inspections. The records and documents with respect to all matters covered by
this Agreement shall be subject at all times to inspection, review or audit by law during the
performance of this Agreement.
9. Termination. This Agreement may at any time be teuziinated by the City giving to the
Consultant thirty (30) days written notice of the City's intention to terminate the same. Failure to
provide products on schedule may result in contract tezzniination. If the Contractor's insurance
coverage is canceled for any reason, the City shall have the right to terminate this Agreement
immediately.
11. Discrimination Prohibited. The Consultant shall not discriminate against any employee,
applicant for employment, or any person seeking the services of the Consultant to be provided under
this Agreement on the basis of race, color, religion, creed, sex, age, national origin, marital status or
presence of any sensory, mental or physical handicap.
12. Assienment and Subcontract. The Consultant shall not assign or subcontract any portion of
the services contemplated by this Agreement without the written consent of the City.
13. Entire Agreement. This Agreement contains the entire Agreement between the parties
hereto and no other Agreements, oral or otherwise, regarding the subject matter of this Agreement,
shall be deemed to exist or bind any of the parties hereto. Either party may request changes in the
agreement. Proposed changes which are mutually agreed upon shall be incorporated by written
amendments to this Agreement.
14. Notices. Notices to the City of Tukwila shall be sent to the following address:
City Clerk, City of Tukwila
6200 Southcenter Blvd.
Tukwila, Washington 98188
Notices to the Consultant shall be sent to the address provided by the Consultant upon the
signature line below.
15. Applicable Law: Venue: Attorney's Fees. This Agreement shall be governed by and construed
in accordance with the laws of the State of Washington. In the event any suit, arbitration, or other
proceeding is instituted to enforce any term of this Agreement, the parties specifically understand and
agree that venue shall be properly laid in King County, Washington. The prevailing party in any such
action shall be entitled to its attorney's fees and costs of suit.
DATED this day of 20
CITY OF TUKWILA CONSULTANT.
By: By:
Title: Mayor
Title:
ATTEST /AUTHENTICATED:
Printed Name:
Christy O'Flaherty, City Clerk Address:
APPROVED AS TO FORM:
Office of the City Attorney
Date approved by City Council:
By: (Applicable if contract amount is over $25,000)
H:\SoundLLCstruct 08.doc
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EXHIBIT `A'
SCOPE OF WORK
The objective of this Agreement is to provide structural code compliance plan review for
proposed new and remodeled buildings within the City of Tukwila as specifically
requested in writing by the Building Official or his designee. The consultant shall
perform all services and provide all necessary equipment, materials and professionally
trained, licensed, and experienced personnel to accomplish the plan review as outlined
below.
1. On behalf of the Department of Community Development Building Division, the
consultant will perform structural plan review to establish compliance with the
structural provisions of the International Building Code as amended by the State
and as adopted by the City of Tukwila.
2. During the plan review process, the Consultant may contact the permit applicant
directly to request submission of additional information to the city. The
Consultant will keep a written record of this communication in the project file.
3. Upon completion of each plan review, the Consultant will furnish a summary plan
review letter directly to the Building Official and a copy to the permit applicant
outlining discrepancies in the plans, reports, and/or calculations (if any).
4. The Consultant will perform follow -up plan reviews as required to confirm that
plans have been corrected adequately according to the original plan review. In
these instances, the Consultant will furnish additional letters directly to the
Building Official and a copy to the pelniit applicant summarizing the results of
the review. When the Consultant is satisfied that the proposed structural work is
in compliance with the structural provisions of the Building Code, the Consultant
will issue a final letter stating that there are no further comments.
5. The plan review services for each permit applicant will be treated as an individual
project, the Consultant will compute the plan review fee in accordance with the
contract schedule for each project and invoice the City upon completion of the
plan review. The consultant will invoice the city prior to the 10 of each month.
6. The City may need other structural engineering services throughout the term of
the on -call agreement. For these instances, the Consultant will perform structural
engineering services as mutually agreed to by both parties. The scope of work,
fee, and schedule for the additional structural engineering services will be defined
and negotiated at the time the additional work is requested.
1
7. The City, in entering into this agreement, does not guarantee that any services will
be requested nor guarantee any specific dollar amount of work during the teiili of
this Agreement.
8. The city shall respond to the consultant's telephone or E -mail inquires concerning
interpretation of City Standards within three (3) working days.
9. The Consultant shall complete the specified plan review generally within (15)
calendar days of written notification by the City. The (15) day period shall result
in written comments to the engineer of record or a return of the plans to the City,
approved for issuance. (Large and/or complex projects may take longer to review
but require concurrence by City of time extension).
10. The Consultant shall perform all work described in this Agreement in accordance
with the latest edition and amendments to the Washington State Building Code as
adopted and amended by the City of Tukwila.
11. The City shall administer issuance of building peunits and certificates of
occupancy. The consultant will assume no responsibility for proper on -site
construction techniques, job site safety, or any construction contractor's failure to
perform its work in accordance with approved plans, contract documents, and
permit conditions.
12. Corrections or comments made during the review process do not relieve the
project proponent or designer from compliance with requirements of codes,
conditions of approval, or peniit requirements. Nor is the designer relieved of
responsibility for a complete design in accordance with the laws of the State of
Washington.
2
EXHIBIT `B'
COMPENSATION SCHEDULE
Sound Inspections Investigative Engineers will follow the payment schedule that the
City of Tukwila has in place at this time. Our fees will be based off of the fee schedule
for permits and plan review as adopted by the City of Tukwila. We will charge 70% of
the plan review fee collected by the City. Example: If the plan review fee is $1000.00 we
will charge $700.00 for the plan review service.
When we are complete with our review the plans will be ready to issue for permit. Our
turn around time will be 2 weeks max, meaning if corrections are required we will have
red lined plans back to the engineer of record within that two week period or returned to
the City for issuance.
'WILA,
COUNCIL AGENDA SYNOPSIS
J Y
/-4 :y Initials h Em No.
0" 0 1 Meeting Date 1 Prepared by Mayor's review 1 Council review 1
w 'O o 1 09/22/08 I Co 1 -�'j 1 1,..
10/06/08 I co
1
rs t
I I I 1
ITEM INFORMATION
CAS NUMBER: 08-114 'ORIGINAL AGENDA DATE: SEPTEMBER 22, 2008
AGENDA ITIs I TI11.i Acquisition of an automated cashiering system
C.\"1v1 Discussion Motion Resolution Ordinance 1 I Bid Award Public Hearing Other
Altg Date 9/22/08 Alltg Date 10/6/08 tlltg Date Mtg Date Mfg Date tlltg Date illtg Date
1SPONSOR n Council Mayor Adm Svcs 1 1 DCD Finance I I Fire Le P&R fl Police Pl7
SPONSOR'S There is a need for an automated cash receipts system in the Finance Department to
SUMMARY modernize the cash handling and posting process and to provide for the acceptance of
credit /debit card payments. The Council is being asked to approve the expenditure of
$40,000 to purchase a cash receipting system.
RI.1"IEW`G'I..D BY COW Mtg. CA&P Cmte F &S Cmte Transportation Cmte
Utilities Cmte Arts Comm. Parks Comm. Planning Comm.
DAI'E: 9/16/08
RECOMMENDATIONS:
SPONSOR /ADMIN. Approve acquisition of the system
COMMITTEE Unanimous approval; forward to Committee of the Whole
COST IMPACT FUND SOURCE
EIPI?NDPI u1w REQUIRED AMOUNT BUDGETED APPROPRIATION REQUIRED
$40,000
Fund Source: FINANCE DEPARTMENT BUDGET
Comments:
I MTG. DATE I RECORD OF COUNCIL ACTION
9/22/08 1
MTG. DATE I ATTACHMENTS
9/22/08 1 Informational memorandum dated 9/17/08
Informational memorandum dated 9/3/08
1 1 Minutes from the Finance and Safety Committee meeting of 9/16/08
I I
j City of Tukwila
1 15,19Nr* i o 6200 Southcenter Boulevard A Tukwila, Washington 98188
MEMORANDUM
To: Mayor Jim Haggerton and Members of the City Council,
Through Rhonda Berry, City Administrator
From: Robert F. Noland, Interim Finance Directory
Date: September 17, 2008
Subject: Automated Cashiering System
ISSUE
Addressing the need for an automated cash receipts system in Finance in order to
modernize the cash .handling and posting process and provide for acceptance of credit
and debit card payments.
BACKGROUND
The attached report and recommendation was presented to the Finance and Safety
Committee at its meeting of September 16 The direction of the Committee was to
move the proposal forward to the COW with a recommendation to approve a re-
allocation of appropriations in the Finance Department budget in the approximate
amount of $40,000 for the purpose of acquiring cash receipting software.
The Committee further directed Staff to analyze alternative cash receipting software
solutions as desired, and not be limited to just the Eden cashiering module.
RECOMMENDATION
Council motion to approve reallocation of appropriations in the Finance Budget in the
amount of $40,000 for the purchase of cash receipting system, including licenses,
installation, and training.
cc: Mary Miotke, Information Technology Director
Attachment: Report to Finance and Safety Committee.
RFN
ri 2' at of Tukwila
i 0 6200 Southcenter Boulevard A Tukwila, Washington 98188
1 �i��.i
1908
MEMORANDUM
To: Mayor Jim Haggerton n
From: Robert F. Noland, Interim Finance Director
Date: September 3, 2008
Subject: Eden Cashiering System
ISSUE
Proposal from Eden Systems for implementation of their cashiering module at the
various pay stations throughout the City.
BACKGROUND
The City has used the Eden financial software systems literally for decades.
Therefore, I was very surprised to discover that we do not have an automated cash
receipting process. There are many areas in which we can improve upon our use of
technology, most of which can wait for the permanent Finance Director to act upon.
However, I wanted to specifically bring this deficiency to your attention. Not only is
it very archaic for a city our size to still be handling cash receipts by hand, but it is
also potentially a serious internal control issue.
In discussing the posting process with the Finance Staff, I was advised that we are a
full month behind on daily posting of cash receipts. This is a daily routine that should
be accomplished the very next day.
In addition, because of a lack of a cash receipts module, we do not have an automatic
posting of water and sewer payments to the general ledger. This results in a great
deal of unnecessary hand accounting.
Finally, we are also unable to provide our citizens with the ability to pay for services
by credit card. We are very remiss in this area even the smallest of cities are
making payment by credit card available to their customers.
Eden Cashiering System Page 2
ACTION TAKEN
Research was conducted to determine the number of pay stations throughout the
City. They include: Finance and City Clerk; Community Development /Public Works;
Municipal Court; Foster Golf Course; Community Center /Parks and Recreation, and
the main Fire Station. A proposal was then obtained from Eden to provide the
cashiering function at the various City pay locations.
PROPOSAL SUMMARY
The license fees are per station, meaning that the costs increase with the number of
stations. The costs are as follows:
1" Station $12,000
2 "d Station $8,000
3' (or more) Station $6,000 /ea.
In addition are costs for training and conversion, taxes, and hardware costs.
Considering the enormity of providing for automated cashiering throughout the City
operations, it was suggested that we start with three stations: Finance /City Clerk,
DCD /Public Works, and the main Fire Station.
RECOMMENDATION
Council to accept proposal from Tyler Technologies (Eden Systems) to provide
licenses, installation, and training for three cash receipting stations in City Hall. The
total cost is $39,427.44. Funding can be provided from under- expenditures in the
Finance Department budget, and from partial assessment of the cost to the City
enterprise operations Water, Sewer, and Surface Water Utilities).
cc: Rhonda Berry, City Administrator
Attachment: Proposal from Tyler Technologies
Financial and Administrative
Information Systems Proposal
Prepared for
City of Tukwila
Linda Grage
Fiscal Coordinator
6200 Southcenter Blvd.
Tukwila, WA 98188
Phone: 206 4331836
FAX: 206 4331833
lgrage@ci.tukwila.wa.us
Prepared By:
Tyler Technologies I EDEN Division
Carrie Hughes
eden.sales@tylertech.com
Phone: 800 328 -0310
June 15, 2007
tyler
tyler 1100 Rento ale Avenue SW Customer Name: City of Tukwila
Renton, WA 98057 Contact: Linda Grage
eden.sales@tylertech.com Date: June 15, 2007
800- 328 -0310 Salesperson: Carrie Hughes
Summary Investment
Summary Investment Annual Maintenance Fees
License Fees 31,505 Software Maintenance 6,500
Training and Conversion 5,000
Premier Project Management 0
Estimated Travel Expenses 150
Estimated Tax 2,772
Total Purchase Price 39,427 Total Annual Fees 6,500
For existing EDEN Clients, the fees are billed as follows:
100% of Application Software Licence Fees upon delivery of the software products
100 %of the Year 1 Application Software Maintenance Fees are billed upon Initiation (first day of training)
100% of the Third Party Product License Fees/Purchase Price upon delivery of the third party products..
100% of the Year 1 Third Party Product Maintenance Fees upon delivery of the third party products
Services and associated expenses as provided/incurred.
Payment is due within 30 days of invoice receipt. Quote is subject to existing Contract.
Tyler Technologies; 1100 Oakesdale Ave SW; Renton, WA 88057; (800) 328 -0310; eden.sales @tylertech.com
tNyfler Customer Price Quotation Standard Implementation***
Customer Name: City of Tukwila
concurrent Users: 3
Date: June 15, 2007
csuma�eu
Service
Charges
License F ee (Framing Estimated
Supporf TofatProduct Con1r tf,l?rof Expenees8
Product Descnp_ttolt B fees '410111.0!: _Taxes Total
Edein= Systeiir, l3 401 0se, .S' etuP
Cashiering Setup including Verisign 5 1,000.00 1,000.00
EDEN` iif)alctatApfilisatro ts`
EDEN ashiinng ,3
Eden Integrated Cashiering NO Imaging S 26,000.00 26,000.00 J S 4,00 0.N 150.00 30,150.00
Cashiering Hardware 5,505.00 5,505.00
EDEjj. Perspgne Apphcahons
0E441.00ir eCV f P,phca
Qtbei Frndadts eryi ,ce
Otfret _PEA
bra Po YPLoduc
GBA faster Series
SubTotal 4 $26,000.04 31.505.00 b 6 5.000.00 1 5 150.00 II 36,655.00
Applicable Taxes =9 5 2,772.44 II 5 2,772.44
Grand Total 1-!= F:; 5 31,505.00 tl 5,000.00 0 2,922.44 II 39,427.44
Eden Standard Support -All Products
Third Party Direct Support S Crystal Software Software Assurance
Disaster Recovery Services (DRS) S l
Escrow Service for Source Co de S
Support Plus
OS/DBA (Ops System and DataBase Support)
All prices except for those marked as 'Estimated' are good for 120 days from the above date. °Estimated' quotes are subject to immediate change without notice. Tyler
offers software support on items under the 'Eden' categories. Software support begins upon onset of training of the software module. Support and maintenance on all
other items is offered directly by the supplier or manufacturer. All client computers must meet the minimum client hardware and software requirements defined by Tyler.
Sales taxes will be charged to Washington customers. Estimated costs of Travel and Expenses includes estimated charges for travel to and from the customer site.
Tyler Technologies; 1100 Oakesdale Ave SW; Renton, WA 58057; (800) 328 -0310; eden.sates@tylertech.com
Estimated Training Install Conversion Days
tyler Customer Name: City of Tukwila
Concurrent Users: 3
Date: June 15, 2007
I
Installation, Other
On Site Training, Off- Data Conv Consulting Total Services
Product Description Trips j site prep days I Days Days Days
EdemSystenis �ysfegr Datebas�i S.Setup
Cashiering Setup including Verisign 1.0 1.0
Ertehysterrfsnaacllppllcabons
Eden Integrated Cashiering NO Imaging 1.0 4. 0 4.0
Eders_Syrs[ ems PersoiineClpplfca6ona
Eden systems Cffizer fie( +ice App atfons
Oche Proc rids 8 Set vices
Other-EDEW ervices
3rdPattsr Pfoducfs
Total to i 5.0 II I I 5.01
Although quotes for services are provided here as our best estimate of what it will take to properly train your personnel in a 'train the trainer' setting, such quotations are
not a guarantee that quoted services will match the skill and requirements of your staff and that additional services might not be needed. For all services quoted here
Tyler will deliver the number of days for the dollars quoted. All additional services beyond those shown in this quotation must first be authorized by the customer and will
be provided by Eden Systems at its then going hourty rate.
4
:Z City o f Tukwila
is 1� �!i i.
s y Finance Safety Committee
rsoa
FINANCE AND SAFETY COMMITTEE
Meeting Minutes September 16, 2008 5:00 p.m.
PRESENT
Councilmembers: Dennis Robertson, Chair; Joe Duffle (filling in for Pam Linder) and Kathy Hougardy
Staff: Bob Noland, Nick Olivas, Dave Haynes, Mary Miotke and Kimberly Matej
CALL TO ORDER: Committee Chair Robertson called the meeting to order at 5:10 p.m.
I. PRESENTATIONS
No presentations.
II. BUSINESS AGENDA
A. Cashiering System Proposal
Staff is seeking full Council approval to redistribute funds in the Finance Department in order to purchase
an automated cash receipting function for the City. Some of the advantages of an automated cash
receipting process include:
Next day posting of cash receipts.
Automatic posting of water and sewer payments to the general ledger.
Ability for customers to pay for services via credit/debit card.
The total cost associated with purchasing this processing function is estimated at $40,000. This funding
amount would provide an initial automated cashiering function at three specified City pay locations
(Finance /City Clerk, DCD/Public Works and Fire Station No. 51).
There is no budget impact or budget adjustment that would need to be made in order to purchase this
function, as funding would be provided from current under expenditures within the Finance Department
budget.
Initially, Eden Systems (also known as Tyler Technologies) was the only vendor being considered for this
purchase, as the City's current financial software system is provided by Eden. Additionally, it is often
advantageous to minimize the variety and software of vendors in relation to systems and processes for
financial processing and accounting.
However, based on past research, the IT Department would like to secure an updated proposal/quote from
an alternate cash receipting system provider prior to making the fmal decision on a vendor. After
receiving an updated proposal, Mary Miotke will meet with Interim Finance Director Bob Noland and
new Finance Director Shawn Hunstock to discuss and identify the best vendor choice for the City.
In consideration of time, the desire to implement an automated system by year's end and vendor choice
ultimately being a staff decision, the Committee recommends moving this item forward to COW for
discussion. If staff is not able to identity a vendor by the October 7 Finance and Safety meeting, this item
will return for further discussion at the Committee level; otherwise, if a vendor is indentified, the item
will not return to Committee. UNANIMOUS APPROVAL. FORWARD TO SEPTEMBER 22
COW FOR DISCUSSION.
B. Sales Tax Report
Bob Noland discussed the Sales Tax Report actual receipts received through June 2008. May receipts
proved a rebound in actual verses estimated revenue and receipts; however, June receipts dropped again
and came in below budget for the month. Regardless of the uncertainty and sometimes volatility of
-j CO UNCIL AGENDA S I'NOPSIS
.VILA
Initials ITEM No.
S Q VOX 1 I P a 3 9 1 �Meetinp, Date 1 Prepared by Mayor's Council review 1
i S
s3 1 08/18/08 1 DCS I 1_ 1 4, 0--,
1..
1 08/25/08 1 DCS 1 1 1 1 c+- rsos -S_�- 09/08/08 DCS 1
09/22/08 DCS 1 AZ 117 1 SP B'
ITEM INFORMATION
I CAS NUMBER: 08-109 I ORIGINAL AGENDA DATE: AUGUST 18, 2008
AGENDA I1'EM TITLE Tukwila Village: Selection of developer
C. \1'IGoRY Discussion Motion Resolution 1 Ordinance Bid Award Public Heart: nb Other
lltg Date 09/22/08 Mfg Date 09/22/08 Mtg Date Mtg Date Mtg Date lltg Date Mtg Date
I SPONSOR Council IVlayor Adrn Svcs DCD I I Finance Fire legal P6R Police [1 PW
SPONSOR'S Two developers have submitted proposals to develop Tukwila Village.
SUMMI;1RY At this meeting, Council may discuss the proposals and select a developer.
RI.1'II.AVI {D BY COW Mtg. CA &P Cmte F &S Cmte [1 Transportation Cmte
Utilities Cmte fI Arts Comm. Parks Comm. Planning Comm.
DA 1'E:
RECOMMENDATIONS:
SPONSOR /ADMIN. Discussion /Select one developer
COMMITTEE.
COST IMPACT FUND SOURCE
ExPI•,NDITURI!: REQUIRED AMOUNT BUDGETED APPROPRIATION REQUIRED
$0 $0 $0
Fund Source:
Continents:
1 MTG. DATE RECORD OF COUNCIL ACTION
08/18/08 Developer proposals were presented to the Council
08/25/08 I Discussion and questions and answers; forward to 9/8/08 Council Meeting
09/08/08 Discussion and questions and answers; forward to 9/22/08 Council Meeting
MTG. DATE I ATTACHMENTS
08/18/08 Informational memo providing a basic statistical comparison of the proposals dated 8/12/08
Informational memo comparing statistics for proposed housing dated 8/14/08
Informational memo comparing developer experience dated 8/14/08
08/25/08 Informational memo evaluating the proposals to the City's criteria dated 8/21/08
09/08/08 Informational memo providing a revised evaluation of the proposals dated 9/5/08
09/22/08 1 Informational memo with Fuller /Sears /Ravenhurst report dated 9/15/08
(Please bring the 2 proposals from the developers distributed in July)
q s City of Tukwila Jim Haggerton, Mayor
o 3.. j
Office of the Ma
iii O f Mayor
Y
N a e 6200 Southcenter Boulevard
1
r
Tukwila, WA 98188
190$ www.ci.tukwila.wa.us
Date: September 15, 2008
To: City Council
Copy: Mayor
City Administrator
Council Analyst
From: Economic Developm mini for
Re: Tukwila Village Fuller /Sears/Ravenhurst Report
The City contracted with Fuller /Sears Architects and Ravenhurst Development to review the two
developers' proposals for Tukwila Village. The main purpose of the review was to evaluate the
project financials with an emphasis on development risks and design elements that could affect
the project financials.
Fuller /Sears Architects is a full- service architectural firm in Seattle that was already very
familiar with Tukwila Village. Fuller /Sears performed the architectural work for the Sabey
proposals in 2002 and the Metrovation (Ron Sher) concept in 2007. Bill Fuller, one of the
principals in the firm, provided the architectural oversight for this evaluation.
Ravenhurst Development is a commercial development and real estate consulting firm based in
Seattle. Ravenhurst is currently partnering with TRF Pacific LLC on the $300 million, mixed -use
Dearborn Street development to be located on the 10 acre Goodwill site in Seattle. Darrell Vange
is the owner and president of Ravenhurst and performed the financial evaluation.
The report provides a number of conclusions. The main conclusion is that neither project appears
to offer a high enough return on cost to be economically feasible, although they are close (see
page 13). However, the authors note that their assumptions may have been too conservative.
Using more optimistic assumptions would tip the equations so the projects would be financially
feasible.
The report also makes a number of comparisons between the two proposals based on various
assumptions (e.g. assuming the same apartment rents or different retail vacancy rates). After
these comparisons, the authors conclude "the choice of developers cannot and should not be
made based on a review of the financial models."
I have attached a copy of the report, including tables that summarize the four different financial
statements. They are:
(1) Legacy's proposal "base model"
(2) Tarragon's proposal "base model"
(3) Tarragon's proposal "Apples to Apples Because Tarragon's proposed apartment rents
of $1.35 per square foot seemed unrealistically low, this version uses Legacy's rent,
apartment sizes, and estimated land payment to the City to make more of an "apples to
apples" comparison.
(4) Tarragon's proposal "Apples to Apples with Retail Vacancy Because the authors do
not believe the market will support as much retail as is proposed by Tarragon, this
version uses the "apples to apples" comparison but also includes a higher vacancy rate on
the retail.
Although it is disappointing to me that the financial comparisons are not able to offer a more
clear picture of which proposal is more feasible and estimates a higher value for the land, this is
not surprising. There are three main reasons why it is challenging to quantify, with a high degree
of certainty, the differences in the feasibility and estimated land value between the two
proposals:
(1) "Residual effect Since the land value is a residual result of the project revenue and costs
and a small portion (approximately 5 of the total project cost, small changes in
revenue and cost assumptions can cause large fluctuation in land value.
(2) Conceptual stage: It is always difficult to predict a specific land value at this early stage
when the design is so conceptual because there are many unknowns that affect the
development. For example, the final design may have significantly different amounts and
configuration of parking spaces. Without getting detailed estimates from contractors or
professional cost estimators, it is difficult to predict the difference in cost between the
Legacy approach as compared to the Tarragon approach.
(3) Apples and Oranges: The proposals are based on very different assumptions that will
probably become much more similar as the project evolves which means we should not
draw too strong of conclusions from the different assumptions. For example, Legacy's
proposal assumes an average rent of $1.65 per square foot yet Tarragon's assumes $1.35
per square foot. The proposals may reflect different product quality and mix which can
explain some of the difference in expected rent but in the final design, the product types
and mix will probably be fairly similar and so the rents would be, too.
In my opinion, the Fuller /Sears/Ravenhurst report offers many good insights and suggestions.
Some of the suggestions and risks can be addressed during negotiations. In terms of selecting
one of the developers, the conclusions I draw from the report are:
(1) Both developers are very qualified and can do this project.
(2) Neither proposal is a "sure thing The projected costs and revenues show the projects are
not quite fmancially feasible, but with more optimistic assumptions, it is possible the
projects are feasible.
(3) The Legacy proposal provides more detail and the design appears to be thought through
more (e.g. the grade difference between the outdoor plaza and comer retail store in the
Tarragon proposal will be challenging to remedy) so there are fewer "unknowns."
Tarragon's proposal will probably evolve to be a bit more similar to Legacy's (e.g. how
parking is handled, height and footprint of the apartment buildings).
(4) The Tarragon proposal appears to be highly dependent on getting a 15,000 square foot
drug store on the corner. This may be very possible and would support the fmancials,
however, the question is whether the City would want this type of tenant on the corner.
(5) The most significant unknown risk is the amount of demand for retail. This risk is higher
with the Tarragon proposal since it assumes more retail. If Tarragon can get the retail at
the rents they propose, it improves the financial feasibility of the project.
(6) The second most significant unknown risk is how much rent people will pay for the
apartments. This risk is generally the same for both proposals since they are likely to
seek the same demographic of residential tenant. (Note: This comment does not take into
account the difference between senior housing, ownership townhouses, and affordable
apai Intents.)
(7) The report also mentions that in Tarragon's proposal the parking for phase 1 appears to
be too low. Parking is very expensive and so if more parking is needed, this could be a
very significant cost and thus reduction in the price we would receive for the land.
If you would like a copy of the entire project budget and income statement proformas developed
for the Fuller /Sears/Ravenhurst report, please let me know.
Please contact me at 206 433 -1832 or dspeck @ci.tukwila.wa.us if you have any questions.
Tukwila Village
Evaluation of Legacy and Tarragon Proposals.
1. Introduction
Fuller /Sears Architects and Ravenhurst Development, Inc. have been asked by the City
of Tukwila to assist in the evaluation of the two responsive proposals to the Tukwila
Village RFP dated July 11, 2008. Two firms, Legacy Partners and Tarragon, responded
to the RFP, and this summary memorandum contains an evaluation of the design
concepts, the economic implications, the development risks and an assessment of the
capabilities of the two proposals. This information is intended to supplement and not
replace the memoranda and comparison materials prepared by Derek Speck for the
Mayor and City Council.
Fuller /Sears specializes in the design of urban mixed -use projects similar to the
program proposed here, and has had a long involvement with the site, assisting Sabey
in their initial planning for the site. Fuller /Sears also worked with Metrovation on a
second development plan in early 2008. Ravenhurst Development is a private
commercial development firm, currently developing a major mixed -use project on the
Seattle Goodwill site in downtown Seattle. Ravenhurst often provides development
perspective for municipalities considering or engaged in "town center" development.
Each response to the Tukwila Village RFP included a conceptual design with site and
building plans. While these were done by very capable architects, they are at this point
just concepts, and very few of the working details have been resolved. They illustrate
the mix of uses and the relative location and size of the various parts, but should not be
taken very literally. Whichever developer is selected, you should anticipate that the final
project may look very different than the designs presented today. Of all the elements
we will consider in our review, the "look" of the project is not one of them.
Both proposals include some limited financial information, but the detail provided differs
greatly between Legacy and Tarragon. Rather than prejudice either proposal, we
prepared complete financial projections for each project from scratch, relying as little as
possible on the cost and revenue projections provided. Like the design concepts, the
financial information provided is simply too conceptual to use for evaluating the projects.
FULLER =SEARS Tukwila Village Developer Evaluation
RAVENHURST
ARCHITECTS September 12, 2008 DEVELOPMENT, INC.
1
2. Report Summary
Both proposals are complex and responsible programs from experienced developers.
Either one would be very challenging, and neither is likely to be executed exactly in the
design and configurations as shown on the conceptual plans. The Legacy program is
more thought out, is more pragmatic, and has a higher likelihood of execution. The
Tarragon program is more exciting, is far more aggressive, and will probably change
significantly before it gets to final design, especially in the parking and residential plans.
If measured by what the city leaders want, we would guess the Tarragon plan is more
appealing. If measured by what the market will support, the Legacy plan may be closer
to the mark. By selecting a more visionary course, there is added risk that all the effort
will be for naught, and in three years time there is still no development activity on the
site. There is also the very good chance that the exciting plan gets whittled down by
market realities, and ends up being very similar to the program you did not select.
We suggest the selection should not be made purely on the emotive impact of the
conceptual renderings. We also suggest the selection not be made on the financial
information, as the numbers provided by the developers are incomplete, and the
marketplace will bring the figures closer together. Our assessment is that neither
program is likely feasible in today's financial markets, and further concessions and/or
support will be necessary to close the deal.
Both developers are qualified. Both will refine their plans as the project moves forward.
Both have to live in the same retail marketplace and the same financial community. We
suggest you assess the developers and not the plans. Consider their level of interest,
the commitment and effort they have invested to date, the rapport and level of trust they
have built in this process. If you have not spent enough time with them to make this
kind of assessment, invest the time.
And even though you may not be real estate experts, you live in this community; you
have a gut level feel for what is realistically possible for the site. Select the developer
you feel can deliver what they promise, both in terms of their character and their vision
for the site. Don't make it easy by trusting their vision; make them convince you their
program is possible.
FULLER SEARS Tukwila Village Developer Evaluation
AR CHITECTS Se tember 12 2008 RAYENHURST
p DEVELOPMEAT INC
2
3. Design Character Overview
Legacy:
The Legacy development program appears to respond to all of the programmatic
requirements of the RFP. It includes the library in a prominent position at the TIB edge
of the site; it includes the police resource center at the corner of TIB and 144 in a
highly visible location. The program includes a 3400 sf community room as a fully
enclosed and built -out space, with an 8000 sf plaza immediately outside the community
room and the library.
The retail program, at 10,000sf in phase 1, is small, but it has good visibility from TIB,
with adequate surface parking adjacent to it.
The residential program is divided into three distinct parts: there is a senior housing
building on the north end of the site, to be developed independently by LIHI, 144 units of
market -rate housing overlooking the central plaza developed in three distinct buildings,
and twenty -five for -sale townhouse units on half of the site south of 144 also
developed by LIHI. A second market -rate apartment building is planned for south of
144 in phase 2.
The overall site plan acknowledges the highway oriented character of the surrounding
neighborhood, and provides a more urban, more -dense design that complements the
neighborhood without pushing the limits of urban design. The most significant visual
impact is the building height, as the project uses five stories of housing over one story of
commercial base.
The program is driven by the residential, which makes some sense, since Legacy is
primarily an urban residential developer. The residential elements are efficient and
pragmatic, and the inclusion of LIHI adds specialized affordable housing expertise and
reduces development risk.
Tarragon:
The Tarragon program also responds to the programmatic requirements of the RFP,
and reflects the strengths of the Tarragon organization. Their plan has a much larger
retail component, witi l a higher emphasis on place making. The key featur of the plan
FULLER SEARS Tukwila Village Developer Evaluation
ARCHITECTS September 12, 2008 RAVENHURST DEVELOPMENT INC
3
is a large central plaza of 20,000sf, with a 1000 sf community pavilion. The plaza is
ringed by parking, and surrounded on all four sides by the mixed -use buildings.
The plan includes 40,000 sf of retail in the first phase, with a large retail building on the
TIB frontage and at the leading corner of the project. While the residential unit count is
similar, the character is very different, as the buildings have three stories (in Phase 1) or
four stories (in Phase 2) of residential over a one -story commercial base, and the
above -grade structured parking is distributed around the site rather than consolidated
underground.
The program is more internally- organized than the Legacy design, and has less visibility
into the site from TIB. It may be a stronger project design, but it does not relate to the
surrounding commercial neighborhood as well.
Emotionally and from a presentation standpoint, the Tarragon proposal is more
attractive. The rendering style is warmer, the program is more people- oriented and the
amenities are more obvious. The question is whether the individual elements function
as well as they need to, and whether there can be enough activities and people to fill
the large public spaces.
Design Details Legacy
Parking strip: the Legacy plan features a parking strip along the TIB frontage,
which pulls the public space back from the busy street and acts as a buffer. This
is more in character with the highway- oriented development forms of the
surrounding properties, and the commercial areas across the street. We consider
this an appropriate response to the neighborhood conditions.
5 over 1 vs 3 over 1: the Legacy residential program features five story
buildings in easily phased blocks. This is a more efficient building type than a
three -story or a four -story project, with lower construction costs and shorter
internal corridors. Since we expect that rent levels will be a critical hurdle in the
project, building efficiency will be important.
Community room: the Legacy community room is a 3400 sf multi -use space
that is well located next to the library and facing the plaza. It has the potential to
be a very usable community resource. At the same time, it is an expensive
feature and a very large space, so it should be constructed only if there is a clear
program of uses and a means to pay for its costs.
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Plaza utility: the Legacy plaza is much smaller than the Tarragon plaza (8000sf
vs. 20,000sf), and it is directly adjacent to the library and community room, which
allows for easy activation. An 8000sf plaza is large enough for a 20 -stall farmers'
market or a gathering of 1000 people standing. The city should determine how
they expect this space to be used, and make sure it is designed to an appropriate
size, not too large or too small.
Three housing types: We consider the Legacy plan, with the affordable
housing elements developed by LIHI, to be an appropriate solution to the city's
desire to include affordable housing in the mix. Neither Legacy nor Tarragon
have specific expertise in senior or affordable housing of this type, and LIHI is an
expert in this type of development. Housing density will be a critical factor in the
success of the project, and providing diverse product types and a range of
income levels increases the likelihood the project will be fully built -out.
Grade treatment: the site slopes away from TIB, and is approximately 10 feet
lower than TIB on its eastern edge. It is preferable for the plaza and the internals
of the site to be at grade or slightly higher than the street edge, and the Legacy
grading plan accomplishes this. It is not clear that the edges along 144 have
been resolved, but the plans are at a very conceptual stage.
Parking configuration and access: the Legacy parking structure is a single,
efficient, one -level structure, which is very cost effective to build. It would benefit
from an access point at the northwest corner, but this appears possible based on
conceptual site plan.
Design recommendations Legacy
Reconfigure retail space around the plaza: we think the retail areas could be
increased, and that the east side of the plaza should be re- worked. The retail
behind the community room is dysfunctional, and the live -work spaces would be
better suited for retail.
Move the police: While it is a great community amenity, the leading edge of the
plaza building is too valuable to give to the police station. This space should
house the bellweather retail tenant in the project. The building could also be
somewhat larger without sacrificing the visibility into the plaza.
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Parking improvements: While we agree that the parking strip along TIB is
appropriate, the access and dead -ends are impractical. Better traffic flow
through that area can and should be designed. The internal surface parking can
be much more efficient, and access into the garage can be improved.
Smaller plaza: Even the smaller Legacy plaza may be too big, so some
programmatic analysis should be done to evaluate its utility.
Design Details Tarragon
View blockage into site: the large retail building at the TIB street edge, while
maximizing the quality retail space in the project, blocks the view into the large
central plaza from the street, so the primary public amenity of the project cannot
be seen from the perimeter. This also blocks the line of sight to the other
retailers at the back of the project, which are behind the large building and at the
far side of the large plaza. This space will be hard to lease.
Corner retail issues, drug store issues: We assume that the 15,000sf tenant
is a drug store, presumably Bartells relocated from across the street. If this is the
case, it adds a healthy anchor tenant to the project, but creates a number of
urban design problems. First, the drug store will not merchandise the street side
of the project, and it will either become a large blank wall, or mandated
storefronts with nothing in the windows. Second, the plaza side of the building,
which will also have little glass, will be dominated by the drive through and the
loading docks. This does not activate the plaza the way one would like. There is
also the question whether it is in the city's best interest to create a problem in the
existing shopping center by moving their anchor tenant into the new project.
Outdoor plaza: the outdoor plaza has the potential to be a great amenity for the
community, but at 20,000sf it is not a plaza, it is an urban park. As it is across
the parking Tots from any of the retailers or the library, it is something of an
island, and will need specific amenities to attract people to go there. The coffee
shop as shown will not be sufficient, and in fact, the coffee retailer will likely want
a more prominent location with more pedestrian traffic. A space on the library
plaza, which is the best urban space in the project, would be much better for
them.
Parking access and configuration. The Tarragon parking garages are all
above grade, multi -story structures. As such, they are somewhat visible and will
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need to be architecturally treated, and they will need to have internal ramps,
which make them far Tess efficient. The access from the parking (especially the
second levels) to the library and to the residential lobbies is unclear and probably
convoluted.
Retail parking shortfall: The surface parking around the plaza is not sufficient
to serve the retail spaces or the library, so some of the parking structures will be
used by retail and public customers. Pedestrian access, garage controls and
revenue collection becomes more difficult in a shared parking configuration like
this. The retail parking for the shops south of 144 and facing on TIB is non-
existent, and as a result, the space will be very hard to lease.
Residential lobbies, sky bridges: the concept plan shows one residential
lobby and elevator core for the two buildings on the north half of the site. This
will require a multi -level sky- bridge to connect the buildings, which is totally
impractical. There will need to be a lobby and elevator core near the library,
which makes the parking distribution between the lots and the buildings more
difficult.
Pea patch roofs: the Tarragon program has an admirable amount of pea
patches, landscape and other activity on the roofs of the retail buildings, but in
reality, most of this will be too expensive to provide and maintain.
144 parking: The idea of adding angled parking in the 144 right -of -way is an
excellent idea for the project, but we don't know whether it conflicts with the city's
plans to upgrade that street.
3 story and 4 story residential floors: The lower building heights allow the
project to fit within the existing neighborhood more comfortably, but they create
very Iong.internal hallways and are an inefficient (ie: more expensive) footprint.
Plaza grade: the site drops nine feet from the TIB intersection to the coffee shop
in the plaza. This puts the plaza in a hole behind a big building, which is not
conveyed in the attractive renderings. In the next design stage, the design team
will have to reconcile the site plan to the existing topography.
Library on street: the library is very prominent on TIB, and is built to the edge
of the street. This is very attractive in terms of highlighting the library and making
it visible to the thousands of cars driving by, but it is also a noisy location, and
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some buffer to the street might be better. Similarly, the plaza between the library
and the restaurant is a great space, but it will also suffer from street noise, and
so is not the best place for outdoor dining. The site plan could easily be adjusted
to resolve these issues while retaining the overall character of the project.
Design Recommendations Tarragon
Less retail: We believe there is too much retail space in the Tarragon plan, both
from a market perspective, and in terms of quality retail space.
Consolidate and shrink the plazas: we fear the central plaza will be inactive
compared to the library plaza, so the open space could be consolidated closer to
the retail stores.
Rethink parking configurations: it appears the parking program and
organization has not been given great thought. This program should be re-
organized and balanced for the various uses it needs to serve. Parking is the
economic bane of any urban project, so anything that can be done to reduce cost
must be considered.
Move townhouses, change to retail: the space shown for townhouses on the
south side of 144 is actually fairly good retail space. Four townhouses in the
middle of the project seem out of place, and serve only to block the view of the
garage.
4. Economic Deal Structure Overview
As was stated in the introduction, we were provided very little economic information
from Tarragon, and incomplete information from the Legacy proposal. We were told by
Derek Speck that Tarragon has suggested the land price be based on an appraisal,
while Legacy proposed a price based on a specific set of project economics. Given
these circumstances, we have taken two approaches to the economic evaluation of the
proposals. The first is simply the consideration of some of the deal points and project
elements that have an impact on the economic structure. The list is not comprehensive,
but it introduces some elements that can form the basis for further discussion between
the City and the potential developers.
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The second approach is to develop full development pro formas (project budgets and
income statements) for each phase of each proposal, based on the physical design and
facilities program they each propose, applying some of the proposal data and using
industry standards and our own experience to flesh out the details. Then by evaluating
each program based on its hypothetical performance, and by comparing the programs
to one another, we can get some sense of the relative strengths of the two proposals.
Legacy program: notable economic features.
Higher land price: the Legacy land price of $5,385,000 is $3 million higher than
the figure Derek uses for Tarragon, but that might be mitigated by the Tarragon
offer of appraised value. On the face of it, it appears that Legacy is pushing
harder to make the best offer they can.
Separate senior and townhouse ownership: a key difference between the
Legacy and Tarragon offers is that Legacy proposes to sub divide the site and
carve off two pads for LIHI, one for a senior housing building, and one for a for
sale townhouse project. The senior housing land is valued at $16,000 per unit,
and the townhouse land is at $29,000 per unit, and the total LIHI land
contribution is $1,520,000. Without checking market comps, these figures
appear reasonable. But the importance is not in the land value; it is that by
bringing in an affordable housing specialist that can build distinctly different
product, Legacy is reducing the overall risk in the project while increasing the
likelihood that the elements will get built. By including these elements, the
number of market -rate rental units goes down, thus improving the odds that the
market -rate housing can be absorbed. Neither Legacy nor Tarragon, to our
knowledge, have specialized expertise for either senior or affordable for -sale
housing, but LIHI does. We consider this a very smart move.
More in Phase 1: Because of the sale to LIHI, which includes about half of the
land south of 144 the Legacy program delivers more in Phase 1 and leaves
less to Phase 2. We think the city should focus their evaluation on Phase 1,
because if Phase 1 is not successful, there will be no Phase 2.
Parking swap complications: The Legacy plan calls for a and swap with the
apartments to the northeast, moving some of their parking on to the library site.
This may be a very good idea- it appears to create a more efficient garage floor
plate, but it also introduces a complication and another agreement that is
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necessary for the project to move forward. Legacy should be quizzed on their
level of confidence that this land trade can be achieved.
Community room economics: The Legacy program includes a 3400 sf
community room as a fully enclosed interior space. This is a significant public
amenity, and a very expensive feature that drags down the financial performance
of the project. Its fully allocated cost to the project probably approaches $1
million, so the city should carefully consider whether they have a real use for the
space, or whether it should be deleted in exchange for elements of higher
priority. If there is a realistic program of uses for the room, it could contribute
significantly to the civic character of the project.
Library expansion: The Legacy program also includes 2400 sf of library
expansion space. There is no indication in the RFP that this was requested, and
it appears to be left-over space in the conceptual plan. As with the community
room, the City should decide whether this space is needed, and if not, eliminate it
to improve the project economics.
Tarragon program: notable economic features.
Lower land price: the materials provided by Derek Speck suggest a land price
of approximately $2,352,000, which we used in the pro forma analysis. This
figure is $3 million less than the figures suggested by Legacy. If in fact Tarragon
has proposed an appraisal approach to the land valuation, this differential may
be meaningless, but based on the numbers provided to us, it is the most
significant difference between the programs. We have not done an appraisal of
the property.
Lots of retail: The Tarragon program has a very significant retail program with
over 50,000sf of shops and restaurants. This helps their pro forma, as the retail
performs better than the residential, but we have major concerns that the market
may not be able to support a retail project of this size. Even if a retail anchor of
15,000sf can be secured, (see below) this still leaves nearly 40,000sf to be
leased. Using an average tenant size of 2000sf, which is large for a typical small
shop retail tenant, Tarragon will have to find another twenty tenants for the
project. We believe this site is a neighborhood retail location, similar to the retail
located across the street, and the market is not deep enough to fill all the space
that is proposed. If Tarragon proposes the project have a different and distinct
retail character, they should be challenged to describe specifically what that is.
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Having said that, Tarragon confounded the "experts" when theft Kent Station
project was so successful, so their retail expertise should not be discounted. But
it would be wishful thinking to expect a Kent Station program on this site,
because of the proximity of the Southcenter retail district and the very different
area demographics. The retail program is what makes the Tarragon proposal
attractive, but there is a very high risk that this vision cannot be achieved.
Low apartment rents: Based on the information provided to us, it appears that
Tarragon is projecting apartment rents of $1.35/sf, and an average unit size of
865sf. This may be exactly what the local market needs and can support, but
rents of $1.35 will not pay for a project with structured parking, extensive public
space and subsidized community tenants. Given current construction costs, we
would expect something closer to $1.85, which is also higher than the $1.65 that
Legacy uses in their analysis. So both programs require some subsidy, but the
gap to be filled if the rents are actually $1.35 is greater than anyone, public or
private, can afford.
Larger apartment units: The average unit size is 155 sf larger than Legacy's
units, but it is unclear whether Tarragon is quoting gross or net area, so this may
be a non issue. If the market for housing is primarily for immigrant families,
larger unit sizes may be appropriate. If the target market is fully- employed young
urban professionals, a smaller average unit size would be more appropriate.
Anchor tenant: the Tarragon plan shows an anchor tenant of 15,000sf on the
corner of TIB and 144 We agree that a project with over 50,000sf needs an
anchor, and speculate that it is intended to be Bartells. If not, the list is very short
for tenants of that size.
Affordable housing program: The Tarragon proposal describes an affordable
housing program, but does not discuss any special financing mechanisms for
that component. We assume that both developers would use the tax abatement
program that was offered, but Tarragon may need additional funding programs if
their affordable housing program is significant. (Legacy solved this by selling
land to LIHI.) When evaluating both development programs, the city should
compare market rent levels to the income restricted rent levels. It is quite
possible that market rents in this neighborhood are "affordable and if that is the
case; you should determine whether the goal is to provide affordable housing
that is below market rents.
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Phase 1 Parking: It appears there are approximately 285 parking stalls in
Tarragon's Phase 1, but the parking needs are more likely to be nearly 400 stalls
(residential at 1.3 stalls per unit, and retail and the library at over 3 stalls per
1000 sf). Adding these stalls would increase costs by $1 to $2 million, without
generating significant revenues.
Police station size: Just as the Legacy program has a larger community room
and library, the Tarragon program adds 230 sf over the police space
requirements. The number is minor, but it does add to the features that
distinguish the two plans.
5. Pro forma Financial Analysis
In order to evaluate the financial performance of the two proposals, we prepared
complete business projections for each of the two programs. The models consist of
projected capital budgets for each project, and pro forma income statements, with
revenues and expenses. An assumptions page is used to collect inputs, and a
summary page is used to describe the results.
To prepare the models, we used the facilities program described by each developer, so
the mix of uses, areas, parking counts and public elements come from each proposal.
Neither package provided complete cost information, so we used our own experience in
assembling capital budgets and development costs for each one. We used the
apartment rent figures provided by each developer, but used equal retail rents and
library/police station rents.
The purpose was to arrive at an order of magnitude financial assessment for each plan,
and to provide a platform for making adjustments to better compare the two plans. In
the end, we developed three separate models. We modeled the Legacy program as it
was presented in the response to the RFP. We modeled the Tarragon program as it
was presented in the RFP, but we had to fill in some of the blanks. And because the
Tarragon plan is based on significantly different apartment assumptions, we ran a
second Tarragon model using the Legacy rent rates, unit sizes and land price.
Base Model: Both Programs as Proposed.
As the two projects were presented in the responses to the RFP, the costs and returns
are as follows:
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Total Project Cost Phase 1 Phase 2 Consolidated
Legacy: 46,476,000 16,655,000 63,132,000
Tarragon: 42,488,000 39,667,000 82,155,000
The total project costs for Tarragon are higher than for Legacy, because the Legacy
costs do not include the LIHI housing components, and Tarragon builds more retail
space. It should be noted that we subtracted the LIHI land payments of $1,520,000
from the Legacy land cost figures, as these funds will basically flow through Legacy to
the City and as such are not a Legacy project cost.
Legacy builds more in Phase 1, with a small Phase 2. Tarragon builds more than half of
its housing in Phase 2.
Either project is a very significant undertaking, and of a project size for which only the
strongest developers can find financing today.
Return on Cost: Phase 1 Phase 2 Consolidated
'Legacy: 6.7% 6.8% 6.7%
Tarragon: 6 .9% 5.7% 6 .3%
Return on cost is the simple measure that developers use to determine whether the
project makes money. The return on cost needs to be higher than the interest rate on
debt (6.5% in this case), and should be higher than the returns a purchaser would
expect if they were to buy the property on completion (probably 7.0% to 7.5% today).
Neither project performs well enough to meet these thresholds, although they are close.
You should expect the final development pro forma to show a residential return on cost
of at least 6.5 and at least an 8.5% return on cost for the retail, for a combined 7.5%
return.
For either project to go forward, something good needs to happen. It is possible that
our cost estimates are high, and reality is a little less pessimistic. We have assumed
fairly low rents for both the apartments and the retail. Other new projects around
Seattle have needed retail rents of over $30 /sf /yr and residential rents of at least
$1.85 /sf /mo in order to be financially successful, and applying these rent levels to the
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current models produces returns for both Legacy and Tarragon that would be
satisfactory in the current market.
But one cannot just assume higher rents, and we expect the developers will be
challenged to achieve the more conservative numbers we use in the models, which is
$25 retail rents and $1.65 for the residential rents. The Tarragon base model uses
residential rents of only $1.35, and it is highly unlikely the project makes any economic
sense at those numbers.
Second Model: Equivalent Rents and Land Costs.
For a more equitable comparison„ we applied the Legacy rent figure ($1.65 /sf /mo for
the apartments) and the Legacy unit size (750 sf net versus 865 sf net) to the Tarragon
development program. We also adjusted the land payment to the city so that it was the
same for both developers. This produced the "Tarragon Apples to Apples" model,
which compares to the Legacy program as follows:
Total Project Cost Phase 1 Phase 2 Consolidated
46,476 000 16,655,000 63,13,
Legacy: 63,132,000
Tarragon Apples: 41,377,000: 37,148,000 78,525,000
The cost of the Tarragon project is reduced by $4 million even though the land price
goes up, because the residential unit sizes are reduced.
Return on Cost: Phase 1 Phase 2 Consolidated
Legacy: 6.7% 6.8% 6.7%
:Tarragon A pies: 7 5 °Y 6.6 7.1%
The return on cost of the Tarragon project goes up because the residential rents go up,
which more than offsets the increase in land price.
At the end of the day, the Tarragon Apples to Apples project outperforms the Legacy
program because of the retail component. The Legacy site has more residential units
(including LIHI), but little retail, while the Tarragon design has a large retail element.
But we have some concern that the large retail program is viable, and it may never fully
lease up.
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Third Model: Retail Vacancy Adjustments.
If you were to assume a higher vacancy rate for the Tarragon plan because the market
won't support that much retail, which we believe but cannot support without a retail
market study, the two projects look very similar. Using a 10% retail vacancy rate for the
Legacy plan and a 25% vacancy rate for the Tarragon program, the two models are
virtually identical:
Return on Cost: Phase 1 Phase 2 Consolidated
Legacy: 6.7% 6.8% 6.7%
;Tarragon 25% Apples: 6.9% 6.4 6.7%
We therefore believe the choice of the two developers cannot and should not be made
based on a review of the financial models. The assumptions used in the two proposals
were very different, and the number of variables can make your head spin. The four
models (adding the "Tarragon 25% Apples" to the list) can be found in an appendix at
the end of this report.
6. Developer Experience
Experience is an excellent and appropriate criterion for the developer selection, but in
this case, both developers are capable, financially stable and innovative, and either one
would be a good choice.
Legacy Partners: Legacy's current projects tend to be more urban and of larger scale
than the Tukwila project. Legacy is primarily a residential developer, but virtually all of
their projects include some amount of commercial, and they are fully qualified to
develop an urban mixed -use project. Their Redmond project currently under
construction is a good example of an innovative, multi- block, mixed -use property. While
based in California, their Mercer Island office has ample horsepower to execute a
project of this scale. Legacy's greatest strengths are there extensive residential
development background, and a very pragmatic, responsible approach to development.
Tarragon: Tarragon is a more diverse and Tess- focused developer. Their portfolio
includes industrial development and suburban shopping centers as well as some very
innovative urban mixed -use projects. They do not have the residential expertise that
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Legacy has, but they have become strong retail developers. Their most comparable
project is Saffron. They are opportunity- driven and undertake challenging projects that
appeal to them. Their staffing levels and development capacity are similar to Legacy's.
7. Project Risks
Retail risk: we believe this is a very difficult retail site. It primarily serves a
neighborhood retail trade area with low market rents, and the tenant types are not
significantly different than the uses already found in the neighborhood. There may be
an untapped market opportunity, but if so, it may be an ethnic one, not a cosmopolitan,
glossy retail concept. We fear that the city's ambition for the site is more visionary than
the market can support, and pursuing that vision will delay a more realistic project that
can ultimately be built.
Housing risk: we believe the housing is the economic engine that will drive the
successful development of this site. We suspect that current market rents will not
support the construction types envisioned for the project by either of the two developers,
and that careful and efficient design and well- executed affordable housing components
will be necessary for the project's success. Structured parking is the element that often
kills a project's economics, so a very rational parking program will be needed.
Legacy's biggest risks: Legacy's program, as proposed, will be challenged by
residential market rents, by the economic drag of the community space, by the added
risk of the parking lot trade, and by the questionable need for library space expansion.
Some of these can be mitigated by further design and program refinements.
Tarragon's biggest risks: Tarragon's program, as proposed, will be severely
challenged by the visionary but very aggressive retail plan, by the economic drag of
inefficient parking garage design, by residential inefficiencies and excessive amenities,
and by the plan's reliance on parking along 144 Some of these risks will be
eliminated in further design, but we expect the result will be a residential and parking
plan that looks more like the Legacy program.
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8. Our Ideal Project Mix:
Our experience tells us the ideal project composition will be a program that includes 20
to 25,000sf of retail in addition to the library space, with multiple housing types,
developed in three or four phases, serving moderate to middle incomes. The project
will depend on multiple funding sources as is typical for affordable housing. Structured
parking will be simplified into an efficient plan, with more surface parking, efficiently laid
out, than either plan currently shows. The community room will shrink, as will the
plazas, and they will be consolidated to the hot spot on the site where the most activity
is located.
9. Questions for Each Developer
Before making a selection, we would recommend you ask the developers a few more
questions.
For Legacy you should ask the following:
What is your justification for the $1.65 apartment rents? Can you elaborate on
the size and mix of units, and on the target market for these apartments?
Would you be willing to increase the retail component of the project? What is
your plan for the retail mix and uses?
For Tarragon, you should ask the following:
How did you arrive at your $1.35 rents for the residential units? Can you make
this project pencil at those rent numbers?
What is the Bartells level of interest? If Bartells is not your potential anchor
tenant, do you have other realistic candidates for the space?
What is the retail merchandising concept? What kinds of tenants do you have in
mind for the space?
Do you expect to pay more for the land than is in your proposal? What are your
realistic land price expectations?
Attachments: FS Design Review, Pro formas
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RAVENHURST DEVELOPMENT, INC. DRAFT 9/12/2008
Tukwila Village Legacy
CONSOLIDATED PROFORMA
PROGRAM SUMMARY Phase 1 Phase 2 Consolidated
Library sf 10,000 2,400 12,400
Shops sf 12,000 6,500 18,500
Total Retail GLA sf 25,400 8,900 34,300
Apartment Units units 200 68 268
Parking stalls 380 80 460
COST SUMMARY:
Land $2,820,000 3,866,000
Offsites $150,000 $0 150,000
Construction: $34,935,458 $12,093,146 47,028,603
Design Fees $2,311,127 $850,589 3,161,716
Development Costs $2,101,773 $814,657 2,916,430
Leasing and Marketing $300,000 $125,000 425,000
Tenant Allowances $220,000 $65,000 285,000
Interest and Financing $2,691,143 $1,068,287 3,759,430
Contingencies $946,645 $592,762 1,539,407
TOTAL COSTS: $46,476,146 $16,655,441 63,131,587
OPERATIONS:
Net Operating Income, Commercial: $441,318 $214,016 $655,334
Net Operating Income, Apartments: $2,681,291 $919,307 $3,600,598
Net Operating Income, Parking: $0 $0 $0
Total Net Operating Income: $3,122,610 $1,133,323 $4,255,932
Debt Service 6.50% 30 yr. Amort ($2,562,016) ($619,907) ($3,181,923)
NET CASH FLOW: $560,594 $513,416 $1,074,009
RETURN ON COST: 6.7% 6.8% 6.7%
PROJECTED PROJECT VALUE (year 3) $44,608,708 $16,190,327 $60,799,034
POTENTIAL PROFIT (year 3) ($1,867,438) ($465,115) ($2,332,553)
SALE CAP RATE 7.00% 7.00% 7.00%
CONSTRUCTION EQUITY: $16,266,651 $5,829,405 $22,096,056
CONSTRUCTION LOAN AMOUNT $30,209,495 $10,826,037 $41,035,532
CONSTRUCTION LOAN TO COST 65.0% 65.0% 65.0%
CONSTRUCTION LOAN TO VALUE 67.7% 66.9% 67.5%
PERMANENT EQUITY: $13,019,615 $4,512,696 $17,532,311
PERMANENT LOAN AMOUNT $33 ,456,531 $12,142,745 $45,599,276
PERMANENT LOAN TO COST 72.0% 72.9% 72.2%
PERMANENT LOAN TO VALUE 75.0% 75.0% 75.0%
PERMANENT DEBT COVERAGE RATIO 1.22 1.83 1.34
RETURN ON PERMANENT EQUITY (YR 3): 4.3% 11.4% 6.1
Drawing Reference: none
Contractor Estimate: none
legacy pf consol Tess LIHI 080912 .xlsx summary
9/12/2008 1:21 PM Pagel
RAVENHURST DEVELOPMENT, INC. DRAFT 9/12/2008
Tukwila Village Tarragon
CONSOLIDATED PROFORMA
PROGRAM SUMMARY Phase 1 Phase 2 Consolidated
Library sf 10,000 0 10,000
Shops sf 43,985 12,715 56,700
Total Retail GLA sf 53,985 12,715 66,700
Apartment Units units 144 158 302
Parking stalls 285 284 569
COST SUMMARY:
Land $1,410,000 $940,000 $2,350,000
Offsites $0 $0 $0
Construction: $32,576,423 $31,743,093 $64,319,517
Design Fees $2,169,585 $2,004,586 $4,174,171
Development Costs $1,983,821 $1,701,155 $3,684,976
Leasing and Marketing $498,040 $264,720 $762,760
Tenant Allowances $539,850 $127,150 $667,000
Interest and Financing $2,551,041 $2,431,084 $4,982,124
Contingencies $759,565 $454,881 $1,214,445
TOTAL COSTS: $42,488,325 $39,666,668 $82,154,993
OPERATIONS:
Net Operating Income, Commercial: $1,131,225 $336,699 $1,467,924
Net Operating Income, Apartments: $1,804,241 $1,920,521 $3,724,762
Net Operating Income, Parking: $0 $0 $0
Total Net Operating income: $2,935,466 $2,257,220 $5,192,686
Debt Service 6.50% 30 yr. Amort ($2,408,469) ($1,234,658) ($3,643,127)
NET CASH FLOW: $526,997 $1,022,562 $1,549,559
RETURN ON COST: 6.9% 5.7% 6.3%
PROJECTED PROJECT VALUE (year 3) $41,935,228 $32,246,001 $74,181,229
POTENTIAL PROFIT (year 3) ($553,098) ($7,420,667) ($7,973,764)
SALE CAP RATE 7.00% 7.00% 7.00%
CONSTRUCTION EQUITY: $14,870,914 $13,883,334 $28,754,248
CONSTRUCTION LOAN AMOUNT $27,617,412 $25,783,334 $53,400,745
CONSTRUCTION LOAN TO COST 65.0% 65.0% 65.0%
CONSTRUCTION LOAN TO VALUE 65.9% 80.0% 72.0%
PERMANENT EQUITY: $11,036,905 $15,482,167 $26,519,072
PERMANENT LOAN AMOUNT $31,451,421 $24,184,501 $55,635,921
PERMANENT LOAN TO COST 74.0% 61.0% 67.7%
PERMANENT LOAN TO VALUE 75.0% 75.0% 75.0%
PERMANENT DEBT COVERAGE RATIO 1.22 1.83 1.43
RETURN ON PERMANENT EQUITY (YR 3): 4.8% 6.6% 5.8%
Drawing Reference: none
Contractor Estimate: none
tarragon of consol 080903 .xlsx summary
9/12/2008 1:22 PM Pagel
RAVENHURST DEVELOPMENT, INC. DRAFT 9/12/2008
Tukwila Village Tarragon Apples to Apples
CONSOLIDATED PROFORMA
PROGRAM SUMMARY Phase 1 Phase 2 Consolidated
Library sf 10,000 0 10,000
Shops sf 43,985 12,715 56,700
Total Retail GLA sf 53,985 12,715 66,700
Apartment Units units 144 158 302
Parking stalls 285 284 569
COST SUMMARY:
Land $3,477,000 $1,908,000 $5,385,000
Offsites $0 $0 $0
Construction: $29,893,531 $28,799,363 $58,692,894
Design Fees $2,008,612 $1,827,962 $3,836,574
Development Costs $1,849,677 $1,553,968 $3,403,645
Leasing and Marketing $498,040 $264,720 $762,760
Tenant Allowances $539,850 $127,150 $667,000
Interest and Financing $2,365,659 $2,227,679 $4,593,339
Contingencies $744,809 $438,690 $1,183,499
TOTAL COSTS: $41,377,177 $37,147,533 $78,524,710
OPERATIONS:
Net Operating Income, Commercial: $1,131,077 $336,699 $1,467,776
Net Operating Income, Apartments: $1,979,700 52,129,890 $4,109,590
Net Operating Income, Parking: $0 $0 $0
Total Net Operating Income: $3,110,777 $2,466,589 $5,577,366
Debt Service 6.50% 30 yr. Amort ($2,382,154) ($1,349,179) ($3,731,333)
NET CASH FLOW: $728,623 $1,117,410 $1,846,033
RETURN ON COST: 7.5% 6.6% 7.1%
PROJECTED PROJECT VALUE (year 3) $44,439,672 $35,236,991 $79,676,663
POTENTIAL PROFIT (year 3) $3,062,495 ($1,910,542) $1,151,953
SALE CAP RATE 7.00% 7.00% 7.00%
CONSTRUCTION EQUITY: $14,482,012 $13,001,637 $27,483,649
CONSTRUCTION LOAN AMOUNT $26,895,165 $24,145,896 $51,041,062
CONSTRUCTION LOAN TO COST 65.0% 65.0% 65.0%
CONSTRUCTION LOAN TO VALUE 60.5% 68.5% 64.1%
PERMANENT EQUITY: $10,269,407 $12,481,639 $22,751,046
PERMANENT LOAN AMOUNT $31,107,771 $24,665,894 $55,773,664
PERMANENT LOAN TO COST 75.2% 66.4% 71.0%
PERMANENT LOAN TO VALUE 70.0% 70.0% 70.0%
PERMANENT DEBT COVERAGE RATIO 1.31 1.83 1.49
RETURN ON PERMANENT EQUITY (YR 3): 7.1 9,0% 8.1
Drawing Reference: none
Contractor Estimate: none
tarragon pf consol apples 080903 .xlsx summary
9/12/2008 1:22 PM Pagel
RAVENHURST DEVELOPMENT, INC. DRAFT 9/12/2008
Tukwila Village Tarragon Apples 25%
CONSOLIDATED PROFORMA
PROGRAM SUMMARY
Phase 1 Phase 2 Consolidated
Library sf 10,000 0 10,000
Shops sf 43,985 12,715 56,700
Total Retail GLA sf 53,985 12,715 66,700
Apartment Units units 144 158 302
Parking stalls 285 284 569
COST SUMMARY:
Land $3,477,000 $1,908,000 $5,385,000
Offsites $0 $0 $0
Construction: $29,893,531 $28,799,363 $58,692,894
Design Fees $2,008,612 $1,827,962 $3,836,574
Development Costs $1,849,677 $1,553,968 $3,403,645
Leasing and Marketing $498,040 $264,720 $762,760
Tenant Allowances $539,850 $127,150 $667,000
Interest and Financing $2,365,659 $2,227,679 $4,593,339
Contingencies $744,809 $438,690 $1,183,499
TOTAL COSTS: $41,377,177 $37,147,533 $78,524,710
OPERATIONS:
Net Operating Income, Commercial: $884,962 $258,715 $1,143,677
Net Operating Income, Apartments: $1,979,700 $2,129,890 $4,109,590
Net Operating Income, Parking: $0 $0 $0
Total Net Operating Income: $2,864,662 $2,388,605 $5,253,268
Debt Service 6.50% 30 yr. Amort ($2,350,377) ($1,306,524) ($3,656,901)
NET CASH FLOW: $514,285 $1,082,081 $1,596,367
RETURN ON COST: 6.9% 6.4% 6.7%
PROJECTED PROJECT VALUE (year 3) $40,923,746 $34,122,935 $75,046,680
POTENTIAL PROFIT (year 3) ($453,432) ($3,024,598) ($3,478,030)
SALE CAP RATE 7.00% 7.00% 7.00%
CONSTRUCTION EQUITY: $14,482,012 $13,001,637 $27,483,649
CONSTRUCTION LOAN AMOUNT $26,895,165 $24,145,896 $51,041,062
CONSTRUCTION LOAN TO COST 65.0% 65.0% 65.0%
CONSTRUCTION LOAN TO VALUE 65.7% 70.8% 68.0%
PERMANENT EQUITY: $10,684,368 $11,555,332 $22,239,700
PERMANENT LOAN AMOUNT $30,692,809 $25,592,201 $56,285,010
PERMANENT LOAN TO COST 74.2% 68.9% 71.7%
PERMANENT LOAN TO VALUE 75.0% 75.0% 75.0%
PERMANENT DEBT COVERAGE RATIO 1.22 1.83 1.44
RETURN ON PERMANENT EQUITY (YR 3): 4.8% 9.4% 7.2%
Drawing Reference: none
Contractor Estimate: none
tarragon pf consol apples 25% 080903 .xlsx summary
9/12/2008 1:22 PM Pagel
Tentative Agenda Schedule
MONTH MEETING 1— MEETING 2 MEETING 3 MEETING 4
REGULAR C.O.W. REGULAR C.O.W.
September 2 (Tuesday) 8 15 22
Zit —Labor Day
(City offices closed) See agenda packet
2,9y cover sheet for this
Fifth Monday of the week's agenda
month —no Council (September 22, 2008
meeting scheduled Committee of the Whole
Meeting)
COMA 1 1 tt OF THE
WHOLE MttI INC TO
BE FOLLOWED BY A
SPECIAL MEE 1 ING
October 6 13 20 27
Special Presentation:
Introduction of
new employee
Update on
Duwamish
Riverbend Hill
project
(Bruce Fletcher)
Unfinished Business:
Eden cashiering
system proposal
November 3 10 17 24
Public Hearin: Public Hearing:
i1' Veterans Day
(City offices closed) Comprehensive Plan 2009 -2010 proposed
amendment (map budget
27th change and zoning
Thanksgiving Day map change
(City offices closed) LDR -MDR)
Snecial Issues:
28th Day after Comprehensive Plan
Thanksgiving amendment (map
(City offices closed) change and zoning
map change
LDR -MDR)
Upcoming Meetings Events
SEPTEMBER OCTOBER 2008
22nd (Monday) 23rd (Tuesday) 24th (Wednesday) 25th (Thursday) 26th (Friday) 27th (Saturday)
Community Finance COPCAB, Planning Highway 99
Affairs Parks Safety Cmte 6:30 PM Commission, Trash Pickup Day
Cmte, SPECIAL (CR 65) 7:00 PM 9:00 10:00 AM
5: 00 PM MEETING, (Council For location call
(CR 63) 2:00 PM Chambers) Donna at 206-242 -5556
(CR 61)
City Council Court
Executive Transportation
Session, Cmte,
6:30 PM 5:00 PM
(Council (CR 61) Day 1 of 2: Rental Day 2 of 2: Rental
Chambers) manager /owner manager /owner Mayor's Day of
City Council training through training through Concern for the
Committee of Tukwila's Crime- Tukwila's Crime- Hungry
the Whole Mtg., Free Multi- Housing Free Multi- Housing Please consider making
7:00 PM Program Program a donation at your local
(Council
Two half -day classes Two half -day classes. grocery store today.
Chambers) To reeister call Chris To register call Chris
C.O.W. to be at206 -431 -2197 at206- 431 -2197 s3
immediately or e-mail cpartman@ or e-mail cpartenan@ 1 474 -pT!n
followed b a ci.tukwila.wa.us ci.tukwila.wa.us e—
Y 1:75 OM
Special Meeting tv
iJi7 U O? '4��
29th (Monday) 30th (Tuesday) 1st (Wednesday) 2nd (Thursday) 3rd (Friday) 4th (Saturday)
Fifth Monday of Sister City Cmte, Equity Thud Annual
the month (no 5:30 PM Diversity Steppin' Out to
Council meeting (CR #3) Commission
Stop Domestic
scheduled) 5:15 PM p
(CR 63) Violence
Please note new Walk Thon
OPEN HOUSE meeting location Event starts at the
and starting time Starfrre Complex at
Shoreline Master
Program
For Dent Park
Court
Registration opens at
5:00 to 8:00 PM 10:00 AM. Walk -A-
Thon beg_ins at 11:00.
Council Chambers
For information visit
wwaarSOSDomestic
Yiolence.com or call
253- 850 -5927
October 4 is the 30 -day
mail -in registration and
address change deadline
for voting in the
General Election on
November 4, 2008
City Council Committee of Whole (C.O.W.) Meeting: 2nd 4th Mon., 7:00 PM, Council Chambers at City Hall.
City Council Regular Meeting: Ist 3rd Mon., 7:00 PM, Council Chambers at City Hall.
Community Affairs Parks Committee: 2nd 4th Mon., 5:00 PM, Conf. Room #3. Agenda items for 9/22/08 meeting:
(A) Contracts for structural plan review. (B) Comprehensive Plan amendment Capital facilities element. (C) Tukwila Urban Center
Plan briefing.
COPCAB (Community Oriented Policing Citizens Adv. Board): 4th Wed., 6:30 PM, Conf Rm 65. Phi Huynh (206 -433- 7175).
Finance Safety Committee: Agenda item for the 9/23/08 Special Meeting is the Fire Master Plan.
>Highway 99 Action Committee: 2nd Tues., 7 :00 PM, Tukwila Community Center. Contact Chief Dave Haynes at 206- 433 -1812.
Planning Commission/Board of Architectural Review: 4th Thurs., except 2nd Thursday in Nov. Dec., 7:00 PM,
Council Chambers at City Hall. Contact Wynetta Bivens at206 -431 -3670.
Transportation Committee: 2nd 4th Tues., 5:00 PM, Conf. Room #1. Agenda items for 9/22/08 meeting: (A) Tukwila Urban
Center Transit Center Supplement 64 Phase I Design. (B) Andover Park West (Tukwila Pkvy. to Strander) Supplement 65 design
report update. (C) Tukwila International Blvd Phase II III third party utility coordination op-, cements. (D) Minfler Shop Re -Roof
Building B project completion and acceptance.
Utilities Committee: 1st 3rd Mon., 5:00 PM, Conf. Room
Court Busy Court and/or Jury Calendar (noted to alert employees and citizens of potential parking_ difficulty).