City seeks alternatives to usual bid process as cost of field operations campus increases to $135M
photo by: City of Lawrence
As the estimated cost of building a new field operations campus for the City of Lawrence continues to increase — now estimated to cost about $135 million total — city leaders will soon consider using a method other than traditional bidding as a way to partially control costs.
As part of its meeting Tuesday, the Lawrence City Commission will consider two items related to the field operations campus project: an additional $904,000 for project design and a proposal to authorize the use of what is known as “construction manager at risk” instead of the traditional bid procedure for construction projects, in which a project is typically awarded to whichever company had the lowest bid.
In 2018, the commission voted to allow the city to use methods that deviate from the traditional bid procedure for construction projects. Under the construction manager at risk method (CMAR), a construction manager is selected by the city based on a combination of qualifications and cost. In order to use an alternate method, the commission must determine the method is in the public interest.
The city plans to build the approximately 75-acre campus, known as the Municipal Services and Operations Campus, on the former Farmland Industries site in eastern Lawrence, bringing together various divisions such as streets, water, sewer, inspections, traffic, as well as MSO administration, a fueling station and a central maintenance garage. The project is broken into four phases and spread out over several years.
The city initially proposed the project in 2017, and in earlier discussions staff stated that the campus would improve services and save the city money by making city operations more centralized and efficient. The city’s maintenance-oriented facilities are currently in multiple locations, including several at 11th and Haskell, which includes areas of floodway. Earlier estimates, from 2019, projected total project capital costs for the project could be $50 million to $60 million, but that amount has increased as planning has continued. As the Journal-World reported last year, the campus is one of several multimillion-dollar projects contributing to significant increases in city utility bills.
photo by: City of Lawrence
The 2021 estimate for all four phases was about $124 million, but city staff told commissioners last year that those costs would increase once initial designs were completed and costs were updated. The 2023 cost estimate for the project has risen to $135 million, according to a city staff memo to the commission. The memo indicates that factors contributing to the increase in cost include increasing phase one from 73,000 to 100,000 square feet to accommodate “added program requirements,” moving the site of phase one east to accommodate concerns from the nearby Brook Creek Neighborhood, the addition of vehicle storage space, the addition of sound walls and “berms” (mounds of earth that will also have vegetation coverage to help reduce noise), as well rising construction costs. The two-year escalation of construction costs was 26%, not 6% as projected.
City staff is recommending the CMAR method because they say it provides “the best value” for the project. The memo states the recommendation is based on several factors including a desire to encourage construction manager input on material availability, constructability and costs during design development; technical complexities of the site work in coordination with the Farmland remediation design; and construction schedule and phasing. Among strategies to align the scope of the project and costs, the city lists getting a construction manager on board to advise on more accurate costs; reducing the square footage of phase one; and seeking additional funding through federal grants. If authorized, staff will solicit CMAR services through a request for proposals and return to the commission at a future date with a proposed agreement.
The city previously hired Dake Wells Architecture in October 2019 to design the project for a cost of $577,480. The city is requesting the commission approve a third supplemental agreement for additional design services in the amount of $904,000. Under the agreement, Dake Wells will prepare design development documents for the components of the campus planned for phase one of the project. Phase one includes the MSO Operations Campus entry, the MSO Building (streets, stormwater, water, wastewater, traffic, inspections, Construction Management Engineering Division and MSO administration) and the fueling station. Phase two consists of the central maintenance garage. Dake Wells has nearly completed the schematic design for the first two phases, and the proposed agreement would cover the creation of more detailed design development documents. The memo states that the documents will allow further input from MSO staff and a more detailed progress cost estimate from the construction manager.
In other business, the commission will consider an environmental sustainability policy for city capital projects. The proposed policy incorporates sustainable practices into the siting, design, construction, remodeling, repair, maintenance, operation, and deconstruction of city facilities and infrastructure, according to a city memo.