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Home My WebLink About2017-12-19 e-packet@200Tuesday, December 19, 2017 2:00 PM City of South San Francisco P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA City Hall, City Manager's Conference Room 400 Grand Avenue, South San Francisco, CA Oversight Board to the Successor Agency to the former Redevelopment Agency Regular Meeting Agenda December 19, 2017Oversight Board to the Successor Agency to the former Redevelopment Agency Regular Meeting Agenda NOTICE IS HEREBY GIVEN, pursuant to Section 54956 of the Government Code of the State of California, the Oversight Board for the Successor Agency to the City of South San Francisco Redevelopment Agency will hold a Regular Meeting on Tuesday, December 19, 2017, at 2:00 p.m., in the Large Conference Room, Top Floor at City Hall, 400 Grand Avenue, South San Francisco, California. In accordance with California Government Code Section 54957.5, any writing or document that is a public record, relates to an open session agenda item, and is distributed less than 72 hours prior to a regular meeting will be made available for public inspection in the City Clerk ’s Office located at City Hall. If, however, the document or writing is not distributed until the regular meeting to which it relates, then the document or writing will be made available to the public at the location of the meeting, as listed on this agenda. The address of City Hall is 400 Grand Avenue, South San Francisco, California 94080. In compliance with Americans with Disabilities Act, if you need special assistance to participate in this meeting, please contact the South San Francisco City Clerk’s Office at (650) 877-8518. Notification 48 hours in advance of the meeting will enable the City to make reasonable arrangements to ensure accessibility to this meeting. Page 2 City of South San Francisco Printed on 12/14/2017 December 19, 2017Oversight Board to the Successor Agency to the former Redevelopment Agency Regular Meeting Agenda Chairperson: Selected by: Neil Cullen Largest Special District of the type in H&R Code Section 34188 Vice Chair: Selected by: Michael Krause San Mateo County Superintendent of Schools Assistant Superintendent, Business Services South San Francisco Unified School District Alternate: Dr. Shawnterra Moore Superintendent, South San Francisco Unified School District Board Members: Selected by: Mark Addiego Mayor of the City of South San Francisco Councilmember, City of South San Francisco Barbara Christensen Chancellor of California Community College Director of Community/Government Relations, San Mateo County Community College District Reyna Farrales San Mateo County Board of Supervisors Deputy County Manager, San Mateo County Paul Scannell San Mateo County Board of Supervisors (Public Member) Adena Friedman Mayor of the City of South San Francisco Senior Planner, City of South San Francisco Counsel Craig Labadie Advisory: Marian Lee –Assistant City Manager, City of South San Francisco Richard Lee – Finance Director, City of South San Francisco Alex Greenwood – Director of Economic and Community Development, City of South San Francisco Jason Rosenberg – City Attorney, City of South San Francisco Krista Martinelli – City Clerk, City of South San Francisco Page 3 City of South San Francisco Printed on 12/14/2017 December 19, 2017Oversight Board to the Successor Agency to the former Redevelopment Agency Regular Meeting Agenda Call To Order. Roll Call. Agenda Review. Public Comments. Comments from members of the public on items not on this meeting agenda. The Chair may set time limit for speakers. Since these topics are non-agenda items, the Board may briefly respond to statements made or questions posed as allowed by the Brown Act (Government Code Section 54954.2). However, the Board may refer items to staff for attention, or have a matter placed on a future agenda for a more comprehensive action report. MATTERS FOR CONSIDERATION Motion to approve the Minutes from the meeting of September 19, 2017.1. Report regarding a resolution approving the Recognized Obligation Payments Schedule (ROPS) for the period July 2018 through June 2019. (Karen Miller, Financial Services Manager) 2. Resolution approving the Recognized Obligation Payments Schedule (ROPS) for the period July 2018 through June 2019, pursuant to Health and Safety Code Section 34177(l). 2a. FUTURE AGENDA ITEMS 636 El Camino Real Commercial Space. Adjournment. Page 4 City of South San Francisco Printed on 12/14/2017 City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-1210 Agenda Date:12/19/2017 Version:1 Item #:1. Motion to approve the Minutes from the meeting of September 19, 2017. City of South San Francisco Printed on 12/14/2017Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-893 Agenda Date:12/19/2017 Version:1 Item #:2. Report regarding a resolution approving the Recognized Obligation Payments Schedule (ROPS)for the period July 2018 through June 2019.(Karen Miller, Financial Services Manager) RECOMMENDATION It is recommended that the Oversight Board adopt a resolution approving the draft Recognized Obligation Payment Schedule (ROPS 18-19)for the period July 2018 through June 2019 and approving submittal of ROPS 18-19 to State of California, Department of Finance. BACKGROUND/DISCUSSION Attached for the Oversight Board’s review is the proposed ROPS for Fiscal Year 2018-19.This ROPS will form the basis for the County’s distribution of Redevelopment Property Tax Trust Fund dollars (RPTTF,or former RDA property taxes)to the Successor Agency to pay enforceable obligations for the period July 2018 through June 2019.ROPS 18-19 must be submitted to the State and County no later than February 1,2018.The Successor Agency reviewed the proposed ROPS and approved its submittal to the Oversight Board on December 13,2017.Although ROPS 18-19 covers the entire fiscal year,the Successor Agency will be allowed to submit an amended ROPS for the period January to June 2019 by October 1, 2018, if needed. The ROPS 18-19 reflects three new line items.Lines 70-72 were added to the bottom of the ROPS,as directed by the State of California Department of Finance (“DOF”),allowing the City to recoup $70,442 in expenses on lines 14 and 8 of ROPS 2015-16 and 2016-17 which exceeded the line item amounts authorized as indicated in the notes. In addition,ROPS 18-19 reflects a request for and an additional $18,890,000 on line 12.This request relates to the Oyster Point Ventures Disposition and Development Agreement which was approved by Oyster Point Ventures,LLC,the South San Francisco Redevelopment Agency,and the City of South San Francisco in 2011 (“DDA”).The DDA,which has been previously recognized as an enforceable obligation by the Oversight Board and DOF obligates the Successor Agency to fund specified public improvements in Phase IC and the landfill clay cap repair in Phase IIC of the proposed development.The amount previously funded for these specific improvements is $18,971,826.Prior ROPS have also approved and set aside an additional $10,551,403 for other Phase IIC public improvements.Consistent with DDA,the funds provided through prior ROPS have been placed in an escrow account with the Bank of New York Mellon and the balance of that account prior to commencement of construction totaled $29,621,076. The portion of the project funded by the Redevelopment Agency (now Successor Agency)in Phases IC and IIC include public infrastructure,parking and public amenities,as set forth in the DDA and as presented in the accompanying Power Point presentation.The cost estimates contained in the approved 2011 DDA,were based upon engineer’s estimates based on conceptual plans.The DDA exhibits related to the Phase IC and IIC public improvements provide that “[t]hese quantities,scope of work,and cost estimates were prepared based on conceptual plans and will be modified when construction drawings are prepared.”(Exhibits 3.2.1A,B,C,D,E, F, G, and 3.2.2.A) Following approval of the agreements in 2011,the project remained dormant for five years until Oyster Point Development,LLC (hereinafter referred to as Developer)acquired the project in 2016.The required land transactions provided for the DDA have been completed and all related conditions met as identified in the DDA City of South San Francisco Printed on 12/14/2017Page 1 of 3 powered by Legistar™ File #:17-893 Agenda Date:12/19/2017 Version:1 Item #:2. transactions provided for the DDA have been completed and all related conditions met as identified in the DDA approved in 2011,which allowed for construction groundbreaking on November 11,2017,for Phase IC and Phase IIC (cap repair only.)Consistent with the terms of the Bank of New York Mellon Escrow account,and upon approval of the City Manager and City Attorney,the Successor Agency has begun to and will continue to withdraw funds from the established escrow account to pay for the Successor Agency’s (as distinguished from the Developer) share of Phase IC and IIC public improvement enforceable obligation costs. . Construction drawings are now 100%complete for most of the items specified in the Phase IC public improvements and are also complete for the Phase IIC landfill cap repair costs and actual bids from contractors have been received.Expectedly,and as discussed in the attachment presentation materials and the reports from Cummings and Swinerton that are also included as attachments,the cost of the development has increased since the 2011 cost estimate.The DDA anticipated potential cost escalations for Phase IC and Phase IIC.Sections 3.4.1,3.4.2,3.4.3 and 3.4.7 and Recitals E and H allocates the responsibility for funding the public improvements included Phases IC and IIC and the related cost overruns for the former redevelopment agency’s share of the Phase IC and Phase IIC Improvements to the former redevelopment agency (now Successor Agency).Specifically,Section 3.4.3 related to Phase IC,provides that the party (i.e.Successor Agency or Developer)responsible for the Phase IC costs is also “responsible for any cost overruns …above the estimated costs of such Improvements.”Similarly,Section 3.4.7,related to Phase IIC public improvements,provides, that the “[a]gency ….shall pay for any cost overruns above …the estimated costs of such Improvements.” Finally,the Responsibility Matrix Summary included as part of the DDA exhibits also states that the “… assigned party (or parties)is responsible for cost overruns/savings for any reason (including but not limited to escalation,change in scope,value engineering,etc)above/below the fixed monetary contribution.”The Successor Agency and the Developer are the assigned parties and their obligations are specifically assigned by project scope. Accordingly,included in the FY 2018-19 ROPS is an additional need of $18.0M for Phase IC and $890K for Phase IIC Cap Repair.These totals include construction costs as well as associated soft costs.The additional funding need covers cost increases associated with project cost escalation of 38.37 percent since 2011 and completed construction drawings which reflect regulatory requirements/standards and best practices related to grading,underground utility,geofoam technology minimizing settlement,bio retention for storm water draining, clay cap repair and intersection improvements. The Successor Agency to the Redevelopment Agency is not paying all of the costs associated with the public infrastructure.The Developer is also contributing $25.8 million towards the cost of Phase IC.This obligation by the developer is separate from the buildings and additional improvements they will be constructing on their property related to Phases ID - IVD and obligation to Phase IIC. The request for additional funds to the Successor Agency conforms with the obligations of the Redevelopment Agency identified in the DDA.All cost information was prepared by the OPD construction management team, informed by preliminary bids from potential contractors,and peer reviewed by City staff/consultants.Lastly,as shown in the attached presentation,the tax revenue received by the taxing entities upon buildout of the Oyster Point Development project and related infrastructure will increase from an annual amount of $112,600 in 2011 to amount estimated to be between $14,600,000 and $16,700,000 per year. Attached to the report is an executive summary prepared by Cummings,a consulting firm that provides construction management services to OPD,regarding the cost escalation and a review memo by Swinerton,a consulting from that provides program management services to the City and Successor Agency. As with previous ROPS submissions,line items highlighted in red reflect items that were requested by the Successor Agency,approved by the Oversight Board,but ultimately denied by the Department of Finance.The highlighted format of the report is locked by the Department of Finance to allow them to easily track previously City of South San Francisco Printed on 12/14/2017Page 2 of 3 powered by Legistar™ File #:17-893 Agenda Date:12/19/2017 Version:1 Item #:2. denied items. The Department of Finance did not include any prior period adjustment (PPA)reports in the FY 2018-19 ROPS.Submission of a prior period adjustment for FY 2015-16 to the County Controller-Auditor (CC-A)was voluntary.Beginning in October 2018,submission of a prior period adjustment will once again be mandatory. While the PPA was not required,the ROPS 2018-19 reflects cash balances from FY 2015-16,a gap of three years. CONCLUSION Adoption of this resolution will fulfill the obligation under Health and Safety Code Section 34177(o)(1) regarding adoption of a ROPS 18-19 for the period July 2018 through June 2019. City of South San Francisco Printed on 12/14/2017Page 3 of 3 powered by Legistar™ Oyster Point Development ROPS 2018-2019 Oversight Board December 19, 2017 2011 Oyster Point Development Note: Phase IIC also includes clay cap repair and new sewer pump station to support hotel. 2 Development Milestones 2011 Development Approvals -South San Francisco Redevelopment Agency -City of South San Francisco -San Mateo County Harbor District 2016 OPV to OPD 2017 Milestones -Residential application submitted for Phase IIID – IVD -Groundbreaking for Phase IC, Phase ID, Phase IIC Cap Repair 3 Developer and SA Obligations (2011) Developer $76.7M -Phase ID Land Improvements -Phase IC Streets and Utilities at Hub and Landscaping at Bay Trail and Palm Promenade -Phase IIC Sewer Pump -Phase IID-IVD Infrastructure -Other Transaction Costs Successor Agency $29.5M -Phase IC Infrastructure Improvements -Phase IIC Infrastructure Improvements 4 2011 Conceptual Plan 2011 Conceptual Plan Phase IC 2011 Cost Obligation ($35.6M) 7 Phase IC 2011 Cost Obligation Cost Overrun /Saving Streets and Utilities at Hub $7.7M Developer 1.9M SA 80% Developer 20% SA Streets and Utilities to Point Clay Cap Repair Parking at Marina Grading/Construction Recreation Area Demo/Grading Hotel Site Landscaping Beach/Park $16.5M SA 100% SA Landscaping Bay Trail and Palm Promenade* $9.53M Developer 100% SA * The $9.53M is capped per the DA/DDA. Cost overrun/savings associated with this line item is SA obligation. Phase IIC 2011 Cap Repair Cost Obligation ($570K) 8 Phase IIC (Cap Repair Only) 2011 Cost Obligation Cost Overrun /Saving Clay Cap Repair $570K SA 100% SA 2017 Construction Plans 2017 Plans Phase IC Improvements Phase IC Improvements, cont. Cost Update Highlights 38% of cost increase due to 8 year construction cost escalation 62% of cost increase due to conceptual to construction plans -Grading -Cap Repair -Underground Utility -Geofoam Minimize Settling -Bio Retention for Storm Drainage -Signalized Intersection Improvement Other potential cost: Off-site disposal of hazardous material Phase IC 2017 Cost 14 •2011 project conceptual plan cost: $35.6M -Developer obligation: $17.2M -SA Obligation: $18.4M 2017 project construction plan cost: $62.2 -Additional funding need: $26.6M -Developer additional obligation: $8.6M -SA additional obligation: $18.0M ROPS additional need: $18.0M -65% of the cost GMP (Jan. 2018) Phase IC SA Cost Obligation Breakdown 15 Cost Categories SA 2011 Obligation SA Cost Overrun/Savings Obligation Streets Utilities Hub 1.9M 2.1M Streets Utilities Point 5.4M 5.6M Clay Cap Repair 540K 100K Parking at Marina 4.2M 4.0M Recreation Area 2.0M 800K Hotel Site 800K 400K Beach Park* 3.5M 1.3M Bay Trail Promenade * 0 3.7M TOTAL 18.4M 18.0M * Developer contribution capped at $9.53M for Bay Tail Promenade. SA cost overrun obligation for Beach Park and Bay Trail Promenade capped at cost escalation. Phase IIC Cap Repair 2017 Cost 16 •100% SA obligation •2011 project conceptual cost: $570K •2017 project 100% final plan cost: $1.5M •Additional funding need: $890K •ROPS additional need: $890K -80% of the cost GMP (Jan. 2018) Cost Basis / Due Diligence OPD managing construction -Cummings/SKS provide PM/CM services to OPD -City team and OPD provide joint oversight 4 Construction packages (with limited allowances) -Temporary Road 100% Design -Grading 100% Design -Streets and Utilities 100% Design -Landscape 50% Design Cost update -Prepared by Cummings -Informed by 3 contractor BIDs and discussions -Peer reviewed by City staff/consultant 18 Estimated Property Taxes Phase I – IV (Annual) Agency Pre-2016 Current 2011 Project (Phase I – IV) 2017 Application (Phase I – IV) City $18,800 $251,300 $2.4M $2.8M SSFUSD $49,500 $659,800 $6.4M $7.3M Other Taxing Entities* $44,300 $590,800 $5.8M $6.6M Total $112,600 $1.5M $14.6M $16.7M *Other taxing agencies: County General and Education, SM JR College, Colma Creek Flood Control Zones, Willow Garden Management; Bay Area Air Quality Management, County Harbor District, Resource Conservation District Grant Efforts Actively pursing grant opportunities to fund cost escalation Waiting to Hear -San Francisco Bay Restoration Authority ($300K) Not Successful -State Natural Resources Urban Greening Grant ($5M) -State Coastal Conservancy Proposition 1($1.25M) 13 December 2017 Page 1 OPD City 2011 2018 Budget Difference_Ver10 CITY OF SSF & OYSTER POINT DEVELOPMENT, LLC PROJECT BUDGET CHANGE BETWEEN 2011 ESTIMATE & CURRENT PROJECT DESIGN – PHASE IC AND PHASE IIC CAP REPAIR EXECUTIVE SUMMARY Concept design solutions were first developed for the Oyster Point Phase IC Infrastructure project during 2010 – 2011 timeframe and a project budget amounting to $35.6M was presented as Exhibit 3.2.1 (A-H) of the Disposition and Development Agreement which was adopted on March 23rd, 2011 by the Redevelopment Agency of the City of South San Francisco. In August 2016, Oyster Point Development, LLC (OPD) acquired the Landing at Oyster Point project from Oyster Point Ventures LLC. OPD then re-started the Phase IC and ID infrastructure project and developed the design from the previously prepared concept design. 100% Construction Document packages have been prepared for the demolition, temporary road, refuse relocation, grading and cap repair and access roads and utilities scopes of work. The landscaping improvements with amenities are currently at 50% Construction Documents. An updated Phase IC budget was prepared in December 2017 in the amount of $62.2M. The following table provides a comparison between the original and the updated dated budget: 2011 Cost Increase due to Escalation (38.37%) Other Increase 2017 Updated Cost SA Current Obligation Add’l SA Obligation OPD Obligation Phase IC $35.6M $13.7M $12.9M $62.2M $18.4M $18.0M $25.8M Phase IIC Cap Repair $0.6M $0.2M $0.6M $1.5M $0.57M $0.89M $0 Escalation: Whilst the published Consumer Price Average Inflation (CPI) rate for the US from 2011 to 2017 is 11.83%, the Bay Area has experienced substantially higher escalation at 38.37%, which is one of the strongest construction markets to recover from the 2008 Financial Crisis. The Bay Area construction market bottomed out in 2010 with an annual spend of $16.7B, from a high of $33.4B in 2005. The current projected gross construction revenue for 2017 is $40.0B, which is an increase of 140%. The magnitude of this increase has stretched the local labor resources resulting in shortages of skilled construction workers which has a consequence of increasing labor costs as companies are having to fund the attraction and retention of and payment of overtime and travelling costs to workers. 13 December 2017 Page 2 OPD City 2011 2018 Budget Difference_Ver10 Further, with this labor shortage construction, companies are being selective on which projects they are bidding on. This is being experienced on the Oyster Point Phase IC infrastructure project. These issues are driving escalation in the Bay Area construction market above the US National Average. Other Increases: In addition to the escalation increases during the development of the design, several cost drivers have resulted in an increase to the budget. Other increases are: Cost Driver - Detail Total Phase IC Excavation, Grading & Fill $2.50M Bio-retention Treatments $2.46M Underground Utility Corridor $4.78M Traffic Intersection Signaling $0.78M Geofoam Fill & Gabion Retaining Walls $2.36M Total $12.88M Cost Driver - Detail Total Phase IIC Cap Repair Clay Cap Repair $0.67M Total $0.67M The Project Team are procuring the scopes of work for Phases IC & Phase IIC Cap Repair as four individual Work Packages as follows: Package 1 – Temporary roads & demolition (based on 100% CD’s) Awarded Package 2 & 3 – Refuse relocation, grading, clay cap repair; streets and utilities (based on 100% CD’s) Bidding process Package 4 – Landscaping (based on 50% CD’s & Subcontractor input) Budget & 3rd Party Verification The information generated through the procurement process has been used to develop the Phase IC Project Budget of $62.2M thereby increasing the accuracy and certainty of the budgeted costs as they have been produced by the construction market. The budget comprises the following market derived and estimated values: 13 December 2017 Page 3 OPD City 2011 2018 Budget Difference_Ver10 Note *: The Phase IC contingency amount of $ $2.57M is to address any unforeseen costs that may arise from the major risks that the project is facing. The contingency has been calculated as a blend of varying percentages from 3-20% based on the risk profile of the associated scope of work. In the 2011 concept estimate, a global percentage of 7% was applied for contingencies. At concept stage, we historically see a percentage higher than 7% due to the undefined scope of work. These major risks are: • Certain unknown soil quality and contamination thereof, relating to contaminated soil off haul, odor control and management, leachate control and management, cleanup requirements • Pending PG&E utility design and sign-off • Pending CalWater sign-off of proposed double containment water line solution • Portions of the landscaping bid that require significant design development, i.e., public restroom structures • Construction means & methods and sequencing of work in compliance with regulatory agency specifics • Design advancement of the dock access ramps and stairs design To address the risks the project is facing the Project Team have developed the following management protocols: • Development of Risk Register to log all potential project risks • Analysis of potential risks for likelihood • Analysis of severity of potential risks in terms of financial and schedule impacts to project • Development of Risk Mitigation plans to manage the impact of the risks to the project • Regular monitoring of risks against contingency values within budget As an example of the management processes we will be utilizing, Cumming will agree a unit rate for the removal of soil from the site which can then be applied to the quantity of material to be removed thereby limiting our financial exposure to the volume of confirmed material removed off site. This report outlines the major changes to the initial approved Oyster Point Phase IC project budget from February 2011, to the current project budget. Scope changes described in this report outline updates between the 2009 Conceptual Design and the current design, where the underlying intent has been to adjust the approved design to current codes, standards and site conditions. As detailed in the report that follows, changes to the original budget (as established in October 2010), reflect: 13 December 2017 Page 4 OPD City 2011 2018 Budget Difference_Ver10 SECTIONS 1.0 Escalation .......................................................................................................................................... 5 2.0 Excavation, Grading & Fill Updates ................................................................................................... 11 3.0 FEMA Mapping Update: Sea Level Geofoam Fill & Retaining Walls ................................................. 11 4.0 Bioretention Treatment & Code Requirements .................................................................................. 12 5.0 Underground Utility Corridor Updates ............................................................................................... 13 6.0 Streets and Traffic Signalization ........................................................................................................ 13 7.0 Project Certainties & Unknowns / Uncertainties ................................................................................ 13 8.0 Attachments and Exhibits .................................................................................................................. 15 13 December 2017 Page 5 OPD City 2011 2018 Budget Difference_Ver10 1.0 Escalation In determining the impact to budget of material and labor cost increases over the period, the Cumming Team first turned to its own data. We analyzed the Northern California Bay Area region to forecast construction conditions that may impact our clients' project delivery efforts. The forecast starts with global issues affecting construction costs, ultimately focusing on local market conditions. A. Volume Trends 2009 - 2017 The Bay Area has been one of the strongest markets in the country, and is forecasted to peak in 2017 after six strong years of growth, averaging 10.7% increase annually. After a 5.6% increase in 2016, this year's construction volume growth year-over year is forecasted finish with a 7.1% surge. The market is expected to reach the high - volume mark set in 2005 and reach of $33.4b (2009$) by the end of 2017. The market bottomed out in 2010 with $16.7b (09$), 50% below the $33.4b 2005 peak. A.1 Annual Construction Volume Forecast Summary - Oakland-San Francisco-San Jose Bay Area, CA (nominalized 2009$) 2009 2010 2011 2012 2013 2014 2015 2016 2017 (p) Volume (x$1m) $18,205 $16,510 $16,959 $19,593 $22,842 $25,360 $29,300 $31,156 $33,380 Annual Inc/Dec Y-O-Y % -9.3% 2.7% 15.5% 16.6% 11.0% 15.5% 6.3% 7.1% $0 $10,000 $20,000 $30,000 $40,000 Total Volume (x $1m) -15% -10% -5% 0% 5% 10% 15% 20% Total % Y-O-Y Increase/Decrease 13 December 2017 Page 6 OPD City 2011 2018 Budget Difference_Ver10 B. Labor Impacts: With such a large ramp-up in volume, labor has been unable to keep up with the demand. While volume has been increasing at a rate of 10.7% per year, labor has only been able to increase at a rate of 6.0% per year (Reference Exhibit B.3). The resulting shortage of labor has not only driven up wages (Reference Table B.4), it has affected productivity as well as impeded the ability for subs and general contractors to bid work. The surge in residential projects along with the new tech headquarters also acts to strain available labor resources. Steel erectors, welders, plumbers, pipefitters, sheet metal workers, and electricians are in tight supply. During the recession, some of the skilled labor force left the area or went to work in other industries, resulting in shortages of skilled labor. After the last recession contractors are much more hesitant to grow as fast as the current market increases. Labor capacity is just now reaching pre-recession levels, totaling 168,700 workers (Reference Exhibit B.1). B.1 Total Construction Workers - January 2006 To June 2017 100,000 110,000 120,000 130,000 140,000 150,000 160,000 170,000 180,000 13 December 2017 Page 7 OPD City 2011 2018 Budget Difference_Ver10 B.2 Unemployment Rate - January 2006 To May 2017 B.3 Comparison Year-Over-Year Increases - Construction Labor Vs. Volume 2010-2017 As illustrated by Table B.4 Labor Rates, fully burdened labor rates in the Bay Area have increased an average of 52.1% from 2009 to 2017. Not only have base rates increased, worker's compensation rates and contractor mark- ups have increased as well. Shortages of iron workers have plagued projects the last twelve months. Skilled workers such as plumbers, pipefitters, glaziers, sheet metal workers, welders, and electricians are in high demand and tight supply. 0% 2% 4% 6% 8% 10% 12% -15% -10% -5% 0% 5% 10% 15% 20% YE A R -OV E R -YE A R IN C R E A S E / D E C R E A S E Construction Volume 13 December 2017 Page 8 OPD City 2011 2018 Budget Difference_Ver10 13 December 2017 Page 9 OPD City 2011 2018 Budget Difference_Ver10 C. Impacts to Material Pricing and Availability: National material prices have increased as well. We track 21 key material prices on a monthly basis. Price increases nationally from 2009 to 2017 are tracked on Table C.1 (Reference Table C.1 above). In addition, we track diesel gasoline prices in California, which has unique trends incongruent with the national prices as a result of blends and taxes. These tables do not necessarily capture unique conditions to California, or increased subcontractor mark-ups since 2009. In the West, there are currently twelve to eighteen-month lead times for elevator and curtainwall orders due to the unprecedented volume. In addition, metal stud framing is subject to allocation and longer-than-normal lead times currently. Material increases of specific note for 2009-2017 for large horizontal and infrastructure projects are: Reinforced Concrete Pipe - 48" (+24%), Corrugated Steel Pipe - 36" (+30%), Ductile Iron Pipe - 12" (+47%), Copper Pipe - 1-1/2" (+29%), Asphalt Paving - PG 58 (+22%), Concrete Ready-Mix, 4000 psi (+33%), Reinforcing Bar, Grade 60, #4 (+35%), and Gasoline – Diesel (+32%). Locally, we are seeing additional premiums for metal stud framing, curtainwall and concrete. Ready -mix concrete is in short supply as a result of demand from key tech, sport, transportation and institutional projects ($140/cy to $180/cy). D. Impacts to Codes: California updated their 2,521-page energy code, Title 24, which was phased in July 1st 2014. T-24 Revisions are responding to AB32 legislation for a path to net zero energy usage for residential construction by 2020 and non-residential by 2030. Typical standard updates increase stringency by 15%, but the 2013 standards exceed this amount by a wide margin, up to 33%! The overall cost impact has varied greatly (much like LEED), depending on: type of project, location, size of project, and owner's previous sustainability requirements. This not only increased construction costs, it added costs to inspection, design, commissioning and documentation as well. Exterior closure Costs have increased as much as 2% to 6%, HVAC costs by 3% to 10%, and electrical costs will increase as much as 10% to 25%, depending on the project type, size and location. We have found construction cost impacts can range from 2% to 6%, depending on the type of project. E. Summary Volume is forecasted to peak at frothy levels in 2017, then plateau in 2018-2019. Labor capacity and key materials are experiencing strong demand, and the more complex and difficult projects are struggling to get trade bid coverage. After a projected volume spike of 7.1% in 2017, volume should plateau slightly over the following two years. Labor capacity is currently struggling to meet demand. Drywall, precast erectors, steel erectors, plumbing and pipefitting, HVAC, and electrical subcontractors will struggle to staff larger and more complex projects. General contractors and subcontractors have increased their margins in conjunction with the subsequent volume growth. Subcontractor's mark-up ranges from 16.5% for base trades to 25%-30% for HVAC, Plumbing, and Electrical. Back at the market trough in 2010-2011, subcontractors were using mark-ups in the 10% to 15% range. Many contractors are turning away work, so the pool of bidders is smaller. As a result, we are seeing elevated escalation rates from 2009 to 2017. The graph below shows the history of escalation in this mar ket since 2002, and these rates are nowhere near the market peak of 2005. We expect the rates to get back to the 4.5% to 5.5% range in 2018-2019. 13 December 2017 Page 10 OPD City 2011 2018 Budget Difference_Ver10 E.1 Key Market Statistics: 1. San Francisco and Bay Area construction bottomed out in 2010 at $16.7b (2009$), 50% below the 2005 peak 2. Construction volume is expected to increase robustly through 2017, exceeding the 2005 peak of $33.4b (2009$) 3. The volume increase over the last 3 years is being driven by a projected 102% increase in residential construction since 2010. 4. Current lead times for elevator and curtainwall orders remains twelve to eighteen months. 5. Shortages in concrete are driving quarterly price increases ranging from 3.0%-5.0% through 2017. 6. Current labor shortages are occurring in steel erectors, welders, plumbers, pipefitters, glaziers, sheet metal workers, and electricians 7. Unemployment rate in the San-Francisco-Oakland-Fremont Area is currently 2.6%. E.2 Annual Escalation Rate - 2009 to 2017 2009 2010 2011 2012 2013 2014 2015 2016 2017 (p) Escalation Rate 0.0% 0.0% 2.5% 3.8% 4.2% 8.0% 10.0% 7.0% 6.0% 3. 9 % 4. 8 % 20 . 0 % 18 . 7 % 8. 5 % 7. 0 % -10 . 0 % 0. 0 % 0. 0 % 2. 5 % 3. 8 % 4. 2 % 8. 0 % 10 . 0 % 7. 0 % 6. 0 % -15.0% -10.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 20 0 2 20 0 3 20 0 4 20 0 5 20 0 6 20 0 7 20 0 8 20 0 9 20 1 0 20 1 1 20 1 2 20 1 3 20 1 4 20 1 5 20 1 6 20 1 7 Escalation Rate (2002 -2017) 13 December 2017 Page 11 OPD City 2011 2018 Budget Difference_Ver10 2.0 Excavation, Grading & Fill Updates The Oyster Point Development project supports the redevelopment and repurposing of portions of the former Oyster Point Landfill. The landfill is located east of U.S. Highway 101 (Bayshore Freeway) and south and east of the intersection of Oyster Point Boulevard and Gull Drive and underlies portions of the Phase IC and IIC development areas. The current anticipated total volumes included in the budget are as follows: Cap Grading Dirt and Clay Excavated to top of Refuse: 292,280 bcy cut Refuse Relocated: 152,600 bcy cut, 175,200 bcy fill (anticipated 15% swell) Foundation Layer: 75,720 bcy fill Clay Cap Layer: 54,085 bcy fill Erosion Protection/Rough Grading Layer: 24,400 bcy cut, 173,830 bcy fill Phase IC Lightweight Fill: 21,000 bcy fill Rough Grading Earthwork: 24,710 bcy cut, 51,860 bcy fill When looking at solely the dirt, clay and refuse volume to be excavated as part of the Cap Grading, this amounts to the volume of two Transamerica Buildings or 150 Olympic swimming pools. Design refinement that occurred as a result of further investigations during the design development phase of the project and further efforts to fulfill the requirements outlined in the Final Closure Plan resulted in an increase in area & volume of refuse grading and cap repair; increased uncertainty of the location and as-built construction details for the landfill gas cut-off barrier on the west side of the site; and the additional need for a soil cement slurry cut off wall at the teardrop area in SW corner of site. These changes are in line with regional and county submissions and approvals. 3.0 FEMA Mapping Update1: Sea Level Geofoam Fill & Retaining Walls The Oyster Point Development and adjacent City owned properties contain several thousand feet of shoreline which will be subject to the effects of sea level rise over time. In the interest of avoiding the decrease of usable area within the project due to the rising water levels, the engineering team had to raise the elevations of the bay trails and many portions of Oyster Point Phase IC Infrastructure facilities. To address the elevation requirements that resulted from the FEMA Mapping update, the Phase IC civil and landscaping design necessitated the use of Geofoam fill. Revised grading conditions and levels related to the Marina Boulevard also necessitated the use of Gabion Retaining Walls to retain the raised earthworks, as well as provide flexibility in design for potential settlement. At this time, there are no uniform regulatory design standards for addressing sea level rise along the shoreline of the Bay. We understand there are regulatory recommendations that private property owners and public agencies design improvements along the Bay to provide resiliency to sea level rise for the year 2050, with the adaptability to protect against sea level rise for the year 2100. 1 “Sea Level Rise Investigative study into future sea level rise for the development of Oyster Point ” Prepared by Wilsey Ham 7/19/2017 13 December 2017 Page 12 OPD City 2011 2018 Budget Difference_Ver10 However, not all improvements are equally adaptable to future modification, and the financial impacts of flood damage can vary significantly. For example, grading improvements can often be raised in elevation at a later date whereas it is generally not feasible to raise the ground floor of a building. A draft report was prepared to summarize sea level rise estimates developed by the scientific community, and to provide options for design criteria to address the FEMA Mapping update. The draft report was presented at a joint meeting between the City of South San Francisco/Successor Agency Staff and the Oyster Point Development team on February 16, 2017. The purpose of the meeting was to reach agreement on the design criteria to be used for the Oyster Point Development and the adjacent City properties to protect against future sea level rise. Subsequent to the joint meeting, the City retained a third party marine consultant (Moffatt & Nichol) to review and comment on the report. Moffatt and Nichol have recent experience coordinating sea level rise criteria for other projects around San Francisco Bay. Based on the parameters described above as well as the committee and reviewer comments, the sea level rise criteria recommendations for the Oyster Point Development Phases IC and ID are as follows: a. Buildings - All buildings are recommended to be resilient to the maximum expected sea level rise at the year 2100. The National Research Council of the National Academies published a range of the anticipated sea level rise for the California coast, and we understand that agencies recommend using the upper end of the range (66”) for designing buildings to accommodate the expected sea level rise for the year 2100. This would require the ground floors to be at, or above elevation 13.7’ NGVD ’29. b. Parking Lots and the Bay Trail – Parking lots and the Bay trail are recommended to be resilient to sea level rise at the year 2050, and adaptable to sea level rise for the year 2100. Consistent with the approach for buildings, agencies recommend using the upper end of the range (24”) for designing improvements to accommodate the expected sea level rise for the year 2100. The selection of the Geofoam fill and Gabion Retaining Walls resulted from option studies undertaken by Wilsey Ham and Langan in 2017, which determined that they were the most cost effective. Alternative systems considered were engineered fill, cell-crete with waterproofing membrane, shot-crete retaining walls and precast panel retaining walls. 4.0 Bioretention Treatment & Code Requirements Between the February 2011 budget and the current project civil design, there were updates to meet regional and municipal codes specifying stricter requirements for treatment of storm water on-site. The design team has incorporated bioretention filters within the landscaping planters in the original design of both Streets and Utilities (OPB) - Hub and Streets and Utilities (OPB) - Point, to minimize impact. 13 December 2017 Page 13 OPD City 2011 2018 Budget Difference_Ver10 5.0 Underground Utility Corridor Updates CalWater & Division of Drinking Water (DDW) DDW State water main code previously prohibited this utility “near refuse”, which is subjective, and was not an issue in 2009, was revised to state prohibited “within 100 feet of refuse”. This change in code causes an increase in the utility design, permitting and construction costs. Our current anticipated quantities involved in building up the site to meet road elevations and redistributing the refuse whilst maintaining the requirements of the Regional Water Quality Control Board are listed below. The overall elevation of the landfill cover will be higher under post-construction conditions with fill material extending to the high tide line in the drawing set. Target depths will vary at the edges to provide a slope transition between different areas of cover requirement, and there may be up to one foot of fill below the high tide line, but above mean high water. We understand this is to return the site back to its previous elevation. 6.0 Streets and Traffic Signalization Over the course of the period, project engineering teams have built upon concept drawings developed in 2009 to settle at the design for streets today. Most notably, Oyster Point Boulevard needed to be reconfigured to allow for a maximum 4.5% grade, an additional 2’ public sidewalk was added per City planning, and bioretention curbs, walls, planter boxes, drainage and plants are now required across the site (Reference 4.0 above). Further, the significant requirement for traffic signalization, poles, equipment and programming has been defined for the development. Additionally, a traffic-pedestrian island has been detailed in the design so as to prevent a back-up occurring on an already stressed Gull Drive and to ease any right-turn off Gull Drive onto the slope of Oyster Point Boulevard for buses. 7.0 Project Certainties & Unknowns / Uncertainties Phase IC – Budget Certainties: • Approximately 65% GMP package certainty relates back to 100% construction documentation & contractor bids received for the following packages: - Temporary road & buildings demolition – Contract Package 1 (currently awarded to DeSilva Gates). - Refuse relocation, grading & clay cap repair to Phase IC – Contract Package 2. - Streets & Utilities to Phase IC – Contract Package 3. • Additional contributors to this ~65% GMP certainty are the following: - Provisional bids received from 3 landscaping contactors based on 50% construction documentation. 13 December 2017 Page 14 OPD City 2011 2018 Budget Difference_Ver10 Phase IC – Budget Unknowns / Uncertainties: • Approximately 35% GMP package unknown / uncertainty relates to the following critical items within the project scope: - Certain unknown soil quality and contamination thereof, relating to contaminated soil off haul, odor control and management, leachate control and management, sump cleanup requirements; - Pending PG&E joint trenching utility design and sign-off; - Pending CalWater sign-off on current proposed design and containment water line solution; - Portions of the landscaping bid that require significant design development, i.e., public restroom structures; - Design advancement of the dock access ramps and stairs; - Project sequencing, including means & methodology in compliance with regulatory agency specifics; These certainties and reservations relate back to various contingencies on the following trades / package areas: Trade / Package: Contingency % Site Demolition & Temporary Works 5% Grading / Refuse Relocation / Cap Repair 10% Streets & Hardscape 3% Landscaping 3% CalWater / Domestic Water 20% SD / SS / Fire & Irrigation 5% PG&E Joint Trenching 20% Site Lighting 5% Traffic Signalization 3% Site Structures (Restrooms & Dock Access Ramps & Stairs) 15% Phase IIC Cap Repair – Budget Certainties: • 80% GMP package certainty relates back to 100% construction documentation & contractor bids received for the full Phase IIC Cap Repair scope package. Phase IIC Cap Repair – Budget Unknowns / Uncertainties: • 20% GMP package unknowns / uncertainty relates to the following critical items within the project scope: - Sequencing of the Phase IIC Cap Repair scope of work in relation to the concurrent undertaking of Phase IC. 13 December 2017 Page 15 OPD City 2011 2018 Budget Difference_Ver10 8.0 Attachments and Exhibits Attachment 1 Phase IC Infrastructure Cost Allocation Matrix Attachment 2 Cumming Quarterly Construction Market Report: 2nd Quarter 2017. San Francisco & Northern California Bay Area Attachment 3 Drawings: Exhibit 1 Storm Drain Key Plan, Wilsey Ham 10/31/2017 Exhibit 2 Bioretention Details, Wilsey Ham Exhibit 3a-d Joint Trench Composite Plan, Phase IC, Wilsey Ham 10/27/2017 Exhibit 3e-j Public Street Lighting, Phase IC, Wilsey Ham 10/27/2017 Exhibit 4 Traffic Signal Plan, Phase IC, Wilsey Ham 10/27/2017 Exhibit 5 Civil Details, Phase IC, Wilsey Ham 10/31/2017 Exhibit 6a-b Utility Corridor Trenching Plan and Sections Exhibit 7 Oyster Point Blvd Cut and Fill Exhibit 8 Lightweight Fill Plan, Section and Photo, Wilsey Ham 11/22/2017 Exhibit 9 Retaining Wall Plan, Section and Photo, Phase IC, Wilsey Ham 10/27/2017 Exhibit 10 Phase IC Site Features Plan Exhibit 11a Site Boring Locations and Top of Bedrock Locations, Langan End of Report 260 Townsend Street, San Francisco, CA 94107-1790 │ Tel: 415.984.1261 │ Fax: 415.984.1292 www.swinerton.com MEMORANDUM To: Marian Lee, Assistant City Manager From: Dennis Wong, City of South San Francisco Consultant Date: 12/12/17 Subject: Oyster Point Ph. IC Infrastructure and IIC Cap Repair-Escalation, Market Forces, and Cost Drivers Impact to Project Budget Executive Summary The 2011 DDA Conceptual Budget for Phase IC Infrastructure work was $35.6 MM; Phase IIC Cap Repair $572,000. As of December 2017, the current project budget (based on bidding of majority of the work) is projected to be $62.1 MM for IC and $1.46 MM for IIC Cap Repair-totaling $63.6 MM. With the completion of construction document packages the 2017 Project Budget for Phase IC increased by $26.5 MM and IIC increased by $888,000. The 2017 Project Budget now includes escalation since 2011 plus projection to midpoint of construction in Dec 2018 accounts for 38.37% escalation or increase of $13.6 MM for IC and $220,000 for IIC. Other market factors and cost drivers accounted for $12.9 MM increase to IC and $668,000 for IIC. These factors are driven by multiple regional and national market forces and the evolution of conceptual level drawings to more detailed, and precise construction documents that are compliant with current codes and standards required for construction. Developer’s Construction Manager, Cumming Corporation, prepared Technical Memo dated 12/12/17 which tabulated escalation, studied market forces, and identified cost drivers that impacted the Oyster Point Project Budget. City/Successor Agency Staff and Swinerton agree with the findings and conclusions in the Cumming Technical Memo. Development Process; Developer Lead with City/Agency Peer Review In August 2016, Swinerton Management & Consulting (Swinerton) was retained to provide Development Program Management services on behalf of City of SSF /Successor Agency (City/Agency) in the implementation of the Oyster Point Phase IC and IIC Cap Repair development program described in the Disposition and Development Agreement (DDA) dated March 23, 2011. The DDA is a Disposition and Development Agreement amongst Oyster Point Development (Developer), and City of South San Francisco and the Successor Agency which establishes specific requirements, timing, and funding for construction of Phase IC infrastructure improvements. The Developer provides development management services pursuant to the Agreement for Integrity Leadership Passion Excellence F:\Oyster Point\Oversight Board\Dec 2017\Memo 17_1211 OP IC IIC Market Labor Impacts Construction Cost Final.doc Page 2 of 4 Development Management Services (dated 1/18/17) between City /Agency (acting on behalf of the Agency) and Developer for design, project, and construction management services for construction of Phase IC infrastructure and IIC Cap Repair. The DDA is based on conceptual plans prepared in October 2010 including a detailed Phase I Precise Plan created in February 2011. A Conceptual Cost Budget was prepared in February 2011 and updated in March 2011 for inclusion in the DDA. The 2011 Conceptual Cost Budget Exhibits (3.2.1 A-H Phase IC and 3.3.2 B Phase IIC Cap Repair) each carry a clause that: “A depiction of these improvements as well as quantities and cost estimates are included in the following pages. The quantities, scope of work, and cost estimates were prepared based on conceptual plans and will be modified when construction drawings are prepared.” Since January 2017, Swinerton has acted as the Agency program management consultant to coordinate with former SSF Director of Public Works (Mr. Ray Towne) and City consultants to monitor the selection of design professionals; and the progressive design development of civil, grading, landscape, street, and utility construction documents plus supporting reports. Construction Documents were progressively developed in 3 or 4 steps, typically Schematic Design, Design Development, 50% Construction Document (CD), and 95/100% CD. At each step City staff and its peer review consultants checked the plans and specifications to validate compliance with DDA and design standards, ordinances, codes, and consistency with City maintenance and operation practices. Similarly, as Developer-managed preparation of regulatory agency plans, e.g., County of San Mateo Environmental and Regional Water Quality Control Board permit (for Final Landfill Closure and Post-Maintenance and Monitoring Plan), BCDC permits, and US Corp. of Engineer permit, were issued; staff and City consultants, most familiar with landfill programs, provided peer review of the regulatory permit documents. City staff monitored compliance with existing regulations, i.e., RWQCB Order 13267 (issued 12/10/15) for Oyster Point Landfill. City submitted Short Term Flood Protection Plan (2/26/16) and Long Term Flood Protection Plan (5/25/16) to address inundation of the landfill from King Tides and future sea level rise. DDA Recital “G” affirms: “Implementation of the redevelopment project will raise the level of certain portions of the closed landfill and the surrounding property, and protect the environment from potential release of the contents of the landfill into the Bay.” Developer and its designers worked with the project budgets to adhere to the development program as detailed in the DDA. Project budget was updated and monitored at each step in the CD production and monitored for consistency with the DDA. Plan review comments are documented F:\Oyster Point\Oversight Board\Dec 2017\Memo 17_1211 OP IC IIC Market Labor Impacts Construction Cost Final.doc Page 3 of 4 and signed off by the appropriate City/Successor Agency Department Head then submitted to Developer’s design team for correction and follow-up in subsequent CD submittal. This process continues through each step until final CDs are submitted for permits and construction. In October/ November 2017, Construction Documents for Temporary Road/ Utility Relocation, Street and Utilities, Cap Grading and Refuse Relocation, and 50% CD Landscape Improvements were sent out for bids and pricing. The Developer’s schedule has targeted execution of GMP contract by January 2018 and planned for a 24-month construction schedule with project completion December 2019. Escalation, Market Forces, and Cost Drivers Cumming Technical Memo tabulated the annual escalation since 2011, provided information regarding the booming San Francisco Bay Area Economy, and the impact of industry-wide shortage of skilled construction labor. These findings are no surprise to City/Successor Agency staff as it has seen its bids in recent history come well above Engineer’s Estimates for many of the same scopes of work that Oyster Point is now bidding. Similarly, the tabulation of escalation considered multiple industry indices which have differing weight for subcontractor, labor, and material costs. The final escalation rate was calculated from a blend of the indices. City /Successor Agency staff and Swinerton reviewed this with Cumming and is in full agreement that the 38.37% is accurate escalation for the scope of work. Cumming Technical Memo identified the following cost drivers and cost impacts: Phase IC • Excavation, Fill, and Grading on Landfill $2.5 MM • Bio-retention treatment structures $2.46 MM • Underground Street Utility Corridor $4.79 MM • Traffic Signal Systems $0.78 MM • Geofoam Fill and Gabion Retaining Wall $2.36 MM • Total Phase IC $12.89 MM Phase IIC • Clay Cap Repair $0.67 MM The six identified cost drivers were recognized early in the design development stages of the respective construction document packages for the infrastructure work. With each stage of drawing development, City /Successor Agency staff and peer review consultants were involved with the plan review. Review comments included engineering solutions, engineering requirements, regulatory requirements, and consideration of possible implementation means and methods. Developer was F:\Oyster Point\Oversight Board\Dec 2017\Memo 17_1211 OP IC IIC Market Labor Impacts Construction Cost Final.doc Page 4 of 4 tasked with quantifying and estimating the cost impacts and engineering definition became more definite. Four of the cost drivers are specific requirements particular to landfill sites: Excavation, Fill, and Grading, Utility Corridor, Clay Cap Repair, and Geofoam & Gabion Retaining Wall. Landfill sites settle and engineering solutions require engineered fills that minimize total and differential settlements that may damage long retaining wall structures. Grading of landfill requires specially trained workers with personal protection to work with hazardous materials in the landfill. All these items add complexity to the work and premium to costs. Bio-retention treatment structures are a state-imposed regulatory water quality requirement (C3) which was not contemplated in 2011. Traffic Signal Systems have become more expensive since 2011 as recent public bid results have demonstrated. In conclusion, City/Successor Agency staff and Swinerton agrees with Cumming findings regarding escalation, market forces, recommended contingencies, and cost drivers that impacted the Oyster Point Project Budget. City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:17-894 Agenda Date:12/19/2017 Version:1 Item #:2a. Resolution approving the Recognized Obligation Payments Schedule (ROPS) for the period July 2018 through June 2019, pursuant to Health and Safety Code Section 34177(l). WHEREAS,pursuant to Health and Safety Code Section 34177(l),before each fiscal period,the Successor Agency to a dissolved Redevelopment Agency is required to prepare a draft Recognized Obligation Payment Schedule (“ROPS”)that lists all of the obligations that are “enforceable obligations”within the meaning of Health and Safety Code Section 34177,and which identifies a source of payment for each such obligation from among (i)bond proceeds,(ii)reserve balances,(iii)the administrative cost allowance,(iv)revenues from rents, concessions,interest earnings,loan repayments,or asset sales,or (v)the Redevelopment Property Tax Trust Fund established by the County Auditor-Controller to the extent no other source of funding is available or payment from property tax is contractually or statutorily required; and WHEREAS,the draft ROPS must be concurrently submitted to the County Administrative Officer,the County Auditor-Controller,the State Department of Finance and the Oversight Board established to review Successor Agency actions; and WHEREAS,pursuant to Health and Safety Code Section 34177(j),the Successor Agency also must prepare a proposed administrative budget and submit it to the Oversight Board for approval,including the estimated amounts for Successor Agency administrative costs for the upcoming fiscal period and proposed sources of payment for those costs; and WHEREAS,once the ROPS is approved by the Oversight Board,the ROPS must be posted on the Successor Agency’s website and transmitted to the County Auditor-Controller,the State Department of Finance,and the State Controller. NOW,THEREFORE,the Oversight Board for the Successor Agency to the Redevelopment Agency of the City of South San Francisco does hereby resolve as follows: 1.The Recitals set forth above are true and correct, and are incorporated herein by reference. 2.The Recognized Obligation Payment Schedule (ROPS)and administrative budget for the period July 1, 2018 through June 30, 2019 attached hereto as Exhibit A are hereby approved. 3.The Finance Director is authorized to modify the ROPS to correct errors and provide clarifications consistent with requirements of the Department of Finance and the intent of this Resolution. 4.The City Manager or designee is authorized and directed to take all actions necessary to implement this Resolution,including without limitation,the submittal of the ROPS to the County Auditor-Controller, the County Administrative Officer,the State Department of Finance,and the State Controller,and the City of South San Francisco Printed on 12/14/2017Page 1 of 2 powered by Legistar™ File #:17-894 Agenda Date:12/19/2017 Version:1 Item #:2a. posting of this Resolution and the ROPS on the Successor Agency’s website. 5.The Oversight Board Chairperson or Vice Chairperson in his absence is hereby authorized to certify the ROPS. ***** City of South San Francisco Printed on 12/14/2017Page 2 of 2 powered by Legistar™ Successor Agency:South San Francisco County:San Mateo Current Period Requested Funding for Enforceable Obligations (ROPS Detail) 18-19A Total (July - December) 18-19B Total (January - June) ROPS 18-19 Total A 468,485$ 50,000$ 518,485$ B - - - C - - - D 468,485 50,000 518,485 E 9,594,762$ 9,524,320$ 19,119,082$ F 9,469,762 9,399,320 18,869,082 G 125,000 125,000 250,000 H Current Period Enforceable Obligations (A+E):10,063,247$ 9,574,320$ 19,637,567$ Name Title /s/ Signature Date Recognized Obligation Payment Schedule (ROPS 18-19) - Summary Filed for the July 1, 2018 through June 30, 2019 Period Enforceable Obligations Funded as Follows (B+C+D): RPTTF Redevelopment Property Tax Trust Fund (RPTTF) (F+G): Bond Proceeds Reserve Balance Other Funds Administrative RPTTF Certification of Oversight Board Chairman: Pursuant to Section 34177 (o) of the Health and Safety code, I hereby certify that the above is a true and accurate Recognized Obligation Payment Schedule for the above named successor agency. A B C D E F G H I J K L M N O P Q R S T U V W Bond Proceeds Reserve Balance Other Funds RPTTF Admin RPTTF Bond Proceeds Reserve Balance Other Funds RPTTF Admin RPTTF $ 47,500,073 $ 19,637,567 $ - $ - $ 468,485 $ 9,469,762 $ 125,000 $ 10,063,247 $ - $ - $ 50,000 $ 9,399,320 $ 125,000 $ 9,574,320 7 Debt Serv Principal Hsg Rev Bonds Bonds Issued On or Before 1/1/1999 9/1/2018 Bank of New York 1999 Housing Revenue Bonds 285,000 N $ 285,000 285,000 $ 285,000 $ - 8 Debt Serv Interest Hsg Rev Bonds Bonds Issued On or Before 12/31/10 1/1/1999 9/1/2018 Bank of New York 1999 Housing Revenue Bonds 7,125 N $ 7,125 7,125 $ 7,125 $ - 11 Bond Admin/Disc Costs Hsg Bonds Fees 1/1/1999 9/1/2018 Bank of New York/Willdan Costs to administer the housing bonds 15,000 N $ 15,000 15,000 $ 15,000 $ - 12 Oyster Point Ventures DDA OPA/DDA/Construction 3/23/2011 11/11/2026 Oyster Pt Ventures, LLC Section 3.4.1 of DDA-infrastr. required 18,890,000 N $ 18,890,000 111,360 9,389,320 $ 9,500,680 9,389,320 $ 9,389,320 13 Oyster Point Ventures DDA OPA/DDA/Construction 3/23/2011 11/11/2026 Various contractors/staff Secs. 4.5 closg/escrow; 5.2 environ indemnification; 5.3 methane monitoring 20,000,000 N $ - $ - $ - 14 Oyster Point Ventures DDA Project Management Costs 3/23/2011 11/11/2026 Legal/Staff costs Soft project management costs 1,263,144 N $ 100,000 50,000 $ 50,000 50,000 $ 50,000 16 Harbor District Agreement Improvement/Infrastructure 3/25/2011 11/11/2026 Harbor District Secs. 5.0 lease rev; 7.0 temp. office 1,793,248 N $ - $ - $ - 17 Harbor District Agreement Project Management Costs 3/25/2011 11/11/2026 Legal/Staff costs Soft project management costs 818,341 N $ 20,000 10,000 $ 10,000 10,000 $ 10,000 21 Train Station Imprvmnts Ph 1(pf1002) Remediation 3/11/2009 12/31/2014 TechAccutite/Wisley Ham Contracted work-site remediation 87,494 N $ - $ - $ - 22 Train Station Imprvmnts Phase 1 Project Management Costs 3/11/2009 12/31/2014 Staff Costs Soft project management costs 9,309 N $ - $ - $ - 23 Train Station Imprvmnts Phase 2 Remediation 12/9/2009 12/31/2014 Various contractors Site remediation per Cal Trans Agrmt. 620,000 N $ - $ - $ - 24 Train Station Imprvmnts Phase 2 Project Management Costs 12/9/2009 12/31/2014 Legal/Staff costs Soft project management costs 148,115 N $ - $ - $ - 45 Maintenance of Non-Hsg Properties Property Maintenance 2/1/2012 12/31/2014 Various contractors Rehab, repair, maintenance, & utilities N 46 Maintenance of Non-Hsg Properties Property Maintenance 2/1/2012 12/31/2014 Legal/Staff costs Soft project management costs N 47 Administration Costs Admin Costs 2/1/2012 12/31/2014 Various contractors/misc Costs to administer Successor Agency 1,272,576 N $ 125,000 110,000 $ 110,000 15,000 $ 15,000 48 Administration Costs Admin Costs 2/1/2012 12/31/2014 Legal/Staff costs Costs to administer Successor Agency 949,132 N $ 125,000 15,000 $ 15,000 110,000 $ 110,000 49 Property Disposition Costs Property Dispositions 2/1/2012 12/31/2014 Various contractors Initial envir. testing, noticing, listing costs N 50 Property Disposition Costs Property Dispositions 2/1/2012 12/31/2014 Legal/Staff costs Soft project management costs N 51 Accrued PERS Pension Obligations Unfunded Liabilities 1/1/1980 6/30/2016 CalPERS Costs incurred through 02/01/2012 168,800 N $ - $ - $ - 52 Accrued Retiree Health Obligations Unfunded Liabilities 1/1/1980 6/30/2016 CalPERS Retiree Benefit Trust (CERBT) Costs incurred through 02/01/2012 197,600 N $ - $ - $ - 57 1999 Housing Bond Proceeds Bonds Issued On or Before 12/31/10 10/23/2013 12/31/2014 Future Developer To be used on low/mod housing dev 904,747 N $ - $ - $ - 69 630-634 El Camino Real Tenant Improvement Project Management Costs 3/1/2011 2/28/2086 TBD Tenant improvements for tenant space 3 N 70 Line 14 FY 15-16 Additional Expense RPTTF Shortfall 3/23/2011 11/11/2026 Legal/Staff costs Soft project management costs 13,586 N $ 13,586 13,586 $ 13,586 $ - 71 Line 14 FY 16-17 Additional Expense RPTTF Shortfall 3/23/2011 11/11/2026 Legal/Staff costs Soft project management costs 42,856 N $ 42,856 42,856 $ 42,856 $ - 72 Line 8 Interest Payment made but not reported on FY 16-17 RPTTF Shortfall 1/1/1999 9/1/2018 Bank of New York 1999 Housing Revenue Bonds 14,000 N $ 14,000 14,000 $ 14,000 $ - 73 N $ - $ - $ - 74 N $ - $ - $ - 75 N $ - $ - $ - South San Francisco Recognized Obligation Payment Schedule (ROPS 18-19) - ROPS Detail July 1, 2018 through June 30, 2019 (Report Amounts in Whole Dollars) Item #Payee Description/Project Scope Project Area Total Outstanding Debt or Obligation Retired 18-19A (July - December) 18-19B Total Project Name/Debt Obligation Obligation Type Contract/Agreement Execution Date Fund Sources Fund Sources Contract/Agreement Termination Date ROPS 18-19 Total 18-19B (January - June) 18-19A Total A B C D E F G H I Other RPTTF Bonds issued on or before 12/31/10 Bonds issued on or after 01/01/11 Prior ROPS period balances and DDR RPTTF balances retained Prior ROPS RPTTF distributed as reserve for future period(s) Rent, grants, interest, etc. Non-Admin and Admin 1 Beginning Available Cash Balance (Actual 07/01/15) 54,987,340 29,172,608 1,080,881 2,001,528 Column C is funding for the housing bond debt. This debt was paid in Sept 2016. Column E $4,620,999 (BNY reserve Acct) were used along with bond retirement funds to call the 2006 bonds on the call date of 9/1/2016 and Housing bond reserves in the amount of $333,836 retained per bond covenants to be paid out 9/1/2018. Additionally $24,217,773 of prior periods RPTTF reserved for Development (OPD) in BNY reserve account. Column G is excess cash balance of $118,144 reported to DOF in October 2014, $119,945 and $842,792 of excess other revenues from ROPS 14-15A & B respectively. Column H is $1,176,996 and $824,532 excess RPTTF from FY 14-15A & B PPA used to fund ROPS 15-16 A & B respectively. 2 Revenue/Income (Actual 06/30/16) RPTTF amounts should tie to the ROPS 15-16 total distribution from the County Auditor-Controller during January 2016 and June 2016. 216,427 258,413 1,160,479 8,028,256 Column G is actual rent/interest received 7/1/2015 - 6/30/2016. Column H is $5,619,513 and $2,408,743 RPTTF received in ROPS 15-16 A& B respectively. 3 Expenditures for ROPS 15-16 Enforceable Obligations (Actual 06/30/16) 1,555,700 9,553,108 Column G: Other funds expended FY 15-16 PPA Column H: RPTTF funds expended (actual) FY 15-16 PPA includes line item overspend 4 Retention of Available Cash Balance (Actual 06/30/16) RPTTF amount retained should only include the amounts distributed as reserve for future period(s) 55,203,767 29,431,021 Column C: Funds to used to pay off bond in FY 2016/17 Column E: Funds to pay off bond debt 9/2016 & 9/2018 as detailed in line 1 comment and to fund development project from BNY Account per DDA Column H: includes line 14 overspend now line 70 plus line 71&72 overspend from FY 16/17 ROPs 5 ROPS 15-16 RPTTF Balances Remaining No entry required 490,262 Column H: Total remaining RPTTF reported on FY15-16 PPA 6 Ending Actual Available Cash Balance (06/30/16) C to G = (1 + 2 - 3 - 4), H = (1 + 2 - 3 - 4 - 5) -$ -$ -$ -$ 685,660$ (13,586)$ South San Francisco Recognized Obligation Payment Schedule (ROPS 18-19) - Report of Cash Balances July 1, 2015 through June 30, 2016 (Report Amounts in Whole Dollars) Pursuant to Health and Safety Code section 34177 (l), Redevelopment Property Tax Trust Fund (RPTTF) may be listed as a source of payment on the ROPS, but only to the extent no other funding source is available or when payment from property tax revenues is required by an enforceable obligation. For tips on how to complete the Report of Cash Balances Form, see Cash Balance Tips Sheet Fund Sources Comments Bond Proceeds Reserve Balance Cash Balance Information for ROPS 15-16 Actuals (07/01/15 - 06/30/16) Item #Notes/Comments 7,8 Last interest and principal payments on bond 12 Represents additional funding required to meet terms of original DDA due to escalation in construction cost. Original funding is reflected on cash balances E1 70 Line 14 project management costs related to this obligation which exceeded the amount authorized on FY 15/16 ROPS 71 Line 14 project management costs related to this obligation which exceeded the amount authorized on FY 16/17 ROPS 72 Line 8 costs from FY 16/17 related to interest payments that were not requested in FY 16/17 in error 22,23,24 Funding was requested in prior years which should continue to reduce this obligation as they are expended. No additional funding is requested as the RPTTF is currently retained until FY 16/17 and FY 17/18 PPAs South San Francisco Recognized Obligation Payment Schedule (ROPS 18-19) - Notes July 1, 2018 through June 30, 2019 Professional & Specialized Services Estimated Cost Jul-Dec 2018 Estimated Cost Jan-Jun 2019 Total FY 18-19 Legal Consultants $23,000 $23,000 $46,000 $23,000 $23,000 $46,000 Supplies and Services $10,000 $10,000 $20,000 $10,000 $10,000 $20,000 $ 6,000 $ 6,000 $ 12,000 $ 2,000 $ 2,000 $ 4,000 $ 4,000 $ 4,000 $ 8,000 $ 3,000 $ 3,000 $ 6,000 $ 4,000 $ 4,000 $ 8,000 $ 14,000 $ 14,000 $ 28,000 $ 12,000 $ 12,000 $ 24,000 $ 14,000 $ 14,000 $ 28,000 $ 6,000 $ 6,000 $ 12,000 $ 3,000 $ 3,000 $ 6,000 $ 15,000 $ 15,000 $ 30,000 $ 4,000 $ 4,000 $ 8,000 $ 5,000 $ 5,000 $ 10,000 $ 92,000 $ 92,000 $ 184,000 GRAND TOTAL 125,000$ 125,000$ 250,000$ Notes: 1 -- Staff costs include payroll, benefits, and retirement costs 2 -- Payment source for these costs is the RPTTF Administrative Cost Allowance (ROPS items 47 and 48) 3 -- Minimum of $250,000 per year or 3% of the prior year RPTTF funding Miscellaneous staff City Clerk Subtotal Economic Development Coordinator Sr Accountant Economic Development and Housing Manager Management Analyst ECD Director Accountant I Financial Services Manager Adminstrative Assistant II Assistant City Manager City Manager Successor Agency Administrative Budget ROPS 18-19 July 2018 - June 2019 Subtotal Meeting expenses, office supplies, postage, copies, printing services, special noticing, etc. Subtotal Staff Wages and Benefits Position Title Director of Finance