Title
Request to Amend A Development Agreement with Multiple Developers for Construction of a Relief Sewer Main (Ordinance S-49740)
Description
Request authorization for the City Manager, or his designee, to amend a Development Agreement with Creation RE, LLC, LOFTIN Equipment Company, an Arizona Corporation, TUDO Capital, LLC, a Delaware Limited Liability Company, and Villa Fifty 2, LP, a Delaware Limited Partnership (or their related entities, collectively, referred to herein as the “Developers”), for the design and construction of a relief sewer main. The amendment is to increase the reimbursement dollar amount from $210,000 to $665,000. Further request to authorize the City Controller to disburse the necessary funds related to this item.
Report
Summary
The original Development Agreement (DA) provided for the Developers to fund, design, and construct a new relief sewer main located north of Van Buren Road, between 48th Street to 50th Street. The Developers were in the process of developing or redeveloping their respective properties, and the sewer flows resulting from these developments would have placed an existing common downstream sewer main out of its maximum capacity. The new relief sewer main was initially estimated to cost approximately $330,000 and the City initially agreed to reimburse the Developers an amount not to exceed $210,000 for its share of the total project cost based on capacity calculation.
During construction, inflation, unforeseen utility conflicts, site conditions, additional rehabilitation efforts, and other changes caused the final construction cost to total $966,000 and the new City’s share of the cost to be $665,000. The Developers financed and completed the construction of the sewer relief main and are requesting the City to reimburse the proportional share based on the increased project cost.
Contract Term
The contract term will remain unchanged and will not exceed a five-year period.
Financial Impact
The City will increase its share from $210,000 to $665,000.
Funding for this project is available in the Water Services Department Capital Improvement Program budget.
Concurrence/Previous Council Action
The City Council approved: Development Agreement 153928 (Ordinance S-46623) on May 20, 2020.
Location
Council District: 6
Department
Responsible Department
This item is submitted by Deputy City Manager Ginger Spencer, and the Water Services Department.