A little last-minute math is in order before Lawrence city commissioners sign a key development agreement for the Rock Chalk Park recreation center and sports park.
Commissioners at their Tuesday evening meeting deferred action on the agreement that will formalize the public-private partnership among the city, a Kansas University Endowment entity and a private company led by Lawrence developer Thomas Fritzel.
Instead, commissioners said they wanted staff members to add new language to the agreement that will help the city track how much contractors are spending on infrastructure at the site.
“I have been for this project the whole time, but we owe it to the public to get this (agreement) right,” said City Commissioner Jeremy Farmer, who argued that approval of the agreement should be delayed at least a week. “This is the one we can’t screw up.”
Commissioners expect to bring the agreement up for approval at next week’s meeting.
Commissioners unanimously directed staff members to contact the other parties and have two pieces of language added to the agreement. They are:
• A statement that gives the city the right to see on a monthly basis the invoices related to the construction of about $12 million of infrastructure. As it was proposed, the city only would see the invoices at the end of the project, after all the work had been completed.
• A new provision that spells out exactly what construction activities are subject to a 2.5 percent management fee that will be charged by Fritzel’s general contracting firm, which is overseeing the work. Commissioners had questions about whether a management fee was being charged for some items such as site mobilization costs, legal fees and other expenses that will be incurred by the developer.
A majority of commissioners indicated that they will be ready to sign the development agreement once those provisions are added to the agreement.
The recently-raised issue of whether the city has the legal authority to move forward with the development agreement, which includes a no-bid contract for Fritzel’s firm to build the infrastructure, did not cause much concern with commissioners. Lawrence attorney Chris Burger, an adjunct professor of construction law and litigation with the KU law school, said Monday that he thought the city was breaking its own law that requires such public projects to be bid.
But commissioners on Tuesday night heard from their own special counsel, Gary Anderson of Gilmore & Bell, that he believes the city is within its legal authority to waive the bid process.
After the meeting, City Commissioner Bob Schumm said Anderson’s blessing of the process was important because he doesn’t believe Anderson would issue an opinion on such a critical matter without a good degree of certainty.
“We are caught up in a bit of a legal debate, I guess,” Schumm said. “But he would want to err on the side of caution.”
Commissioners had approved a development agreement for the project earlier this year. But a revised development agreement was brought forward after KU basketball coach Bill Self’s Assists Foundation agreed to make a $2 million donation to the project, which will include a city-owned recreation center and a privately-owned track, softball and soccer stadiums that will be leased by Kansas Athletics.
The revised development agreement limits the amount of money the city is obligated to pay for the development to $22.5 million, down from $25 million in the previous agreement. The costs are broken down this way: $10.5 million for the construction of the 181,000-square-foot recreation center; $10.2 million for infrastructure to serve both the city and KU portions of the project; about $785,000 for the cost of the land for the recreation center; $925,000 for architecture fees.
The new development agreement also provides more details than the previous document. It provides a copy of the infrastructure construction contract. That contract will be between RCP, LLC — a private company controlled by KU Endowment — and Bliss Sports II, LLC — a development company led by Fritzel. Although the city is expected to pay for $10.2 million of the infrastructure costs -- the Assists Foundation will pay for the remaining $2 million — the city is not a party to the contract.
Commissioner Mike Amyx said that concerned him because he believes the city needs to be on the contract to ensure it can play a significant role in the construction of the infrastructure.
“My main concern is where our seat at the table is, so to speak,” Amyx said.
But other commissioners said they were fine with the arrangement because it gives the city the ability to review all invoices related to the infrastructure and also allows city inspectors on the construction site.