Plans for a $25 million city-owned recreation center in northwest Lawrence are shifting as questions emerge about the propriety of Lawrence businessman Thomas Fritzel building the project without going through the city’s standard bid process.
City officials on Friday released details of discussions they are having with Kansas University Endowment about a process that would allow other construction companies to submit bids for the work. But the proposal stops short of following the city’s standard open bidding process.
“We’re trying to be open to making a public-private partnership work here,” City Commissioner Mike Dever said of the new proposal. “This is an unusual opportunity for Lawrence, but we’re doing all of this in the spirit of openness.”
The new proposal would require KU Endowment to invite bids from two other contractors — of the Endowment Association’s choosing — in addition to a bid from Bliss Sports, an entity that Fritzel controls.
If either of the bids from the other two contractors is lower than Fritzel’s bid, Fritzel would have a chance to match the bid and receive the work.
KU Endowment officials previously have said Fritzel is their presumed contractor for the facility. Fritzel has made an offer to the city to build the 181,000-square-foot recreation center, outdoor tennis courts and other amenities for a maximum price tag of $25 million.
The city has an architectural estimate that projects the value of the improvements are closer to $33 million. A majority of city commissioners have said Fritzel’s offer — which they have viewed as a donation to the city — makes the project unique.
But Dever confirmed he has heard from at least one local contractor who has expressed an interest in bidding on the project, and City Commissioner Mike Amyx has said he would like to see what other contractors can offer on the project.
“I would love to see it traditionally bid,” Amyx said Friday. “You have public funds going into this, so that seems reasonable.”
The project has another twist in that KU Endowment currently holds the rights to the approximately 20 acres that the city’s recreation center would be built on. KU Endowment has offered to donate the land to the city as part of a larger sports complex that would include a track and field stadium, soccer field, softball stadium and other amenities for KU Athletics.
Fritzel is presumed to be the contractor for those improvements, and last week project officials confirmed the current proposal actually has Fritzel’s company owning those facilities and leasing them to KU.
The city would own its recreation center, but KU Endowment has insisted on controlling construction of the center and then turning it over to the city after it is built. Dever on Friday said that insistence from KU is playing a role in why the city has not proposed a traditional bid for the center.
“They are giving us a chance to build something remarkable and, as a result, there are a few strings attached,” Dever said.
Dever said he thinks KU Endowment’s conditions on the project are reasonable. He estimated the KU facilities will represent an investment of at least $50 million.
“If you had a chance to control what your neighbor’s property is going to look like in that situation, I think most people would try to do that,” Dever said.
But Dever said the new proposal does provide more clarity than the previous plan. Previously, KU Endowment had not proposed any type of competition related to who would serve as the general contractor or construction manager for the project. The previous proposal was that Bliss Sports and KU Endowment would select subcontractors for the project and would share the bid results with city commissioners after the bids had been awarded.
Dever said the new proposal should ease concerns about whether Fritzel — who recently agreed to pay $50,000 to settle a development dispute with the city related to an apartment project in Oread Neighborhood — is giving the city a good deal.
“This process will identify the magnitude of any gift associated with the project, or it will show the true value of the project,” Dever said. “Either way, the public wins.”
But it was unclear Friday how KU Endowment would go about selecting the two other contractors that would be invited to bid on the project. The city’s standard bidding process publicly advertises projects available for bid, allowing any qualified company to compete for the work.
An attempt to reach an official with KU Endowment for this article was unsuccessful.