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01/12/1984 - Minutes a MINUTES LIBRARY BOARD - SPACE NEEDS III REVIEW COMMITTEE JANUARY 12, 1984 DURHAM TREATMENT PLANT HALL BOULEVARD AND DURHAM ROAD TIGARD, OREGON 97223 The meeting was called to order at 7:10 P.M. by Chairman Walter Munhall. Members present: Dick Bendixsen, Jane Miller, Susan Mueller, Peggy Ober and Madalyn Utz. Excused (illness): Dorene Thomas. Munhall introduced Eric Johanson, financial analyst with Foster and Marshall. Johanson began his review by going over the summary table of the Foster and Marshall analysis document. He explained the figures in the table, taking as example the Sundeleaf proposal. He also reviewed the Air King - B page in the summary to clarify particular terms and explain how the numbers were arrived at. Johanson pointed out, in explaining the present value, that they had assumed a 7% interest rate each year. Mueller questioned GTE's very high total cost. Johanson explained that the initial rental cost caused that. Johanson pointed out that the tax rate for Air King during the first 5 years is exceptionally low ( .19) because of the rental and low bond debt for separate library. There was considerable discussion regarding the total bonds in both phases, the total costs, interest rates and tax rates. Johanson explained that they had assumed an annual 10% increase in the City's assessed valuation over the first 10 years and 7% thereafter. Mueller asked why the 72nd site total cost was so high. Johanson attributed that to the higher bonding in Phase I. (The Phase I bonds were $3,100,000; much higher than other proposals.) Johanson also stated that the assumed interest on the bonds is 10%. Munhall reviewed some informal rankings that he and City staff had done (by evaluating the various factors on the summary sheet) . The rankings, as read, were: Sundeleaf - 5, Air King (A) - 6, Air King (B) - 3, GTE - 7, Sturgis - 5, Crow (A) - 2, Crow (B) -1, Weigel/Crow - 6, 72nd Avenue - 4, rent-as-needed - 7. (oil was most desirable.) Munhall pointed out that the rental options ranked lowest and suggested that the Board make some decisions on eliminating some of the proposals, reminding them that their charge had been to recommend various types of options. Munhall invited questions from the audience. Frank Tepedino, audience, suggested that the Committee make its recommendations as to three best choices but also include a rental option for consideration since that is sure to come up. Minutes - Library Board - Space Needs III Review Committee - 1/12/84 Page - 2 - Anthony Maksym, audience, raised a question regarding the price of the Crow site. Munhall replied that $1 million had been quoted, though $1.25 million had been mentioned at other times as a possible price. Maksym felt that the report (Foster and Marshall) was not valid if there was no firm price on the Crow options. Bendixsen reminded the group that inasmuch as City Council had turned down the Committee's request for a new appraisal, the price of $1 million had been used. Munhall stated the existing appraisal (2 years old) was unavailable because it had been checked out by a Council member, but never checked back into City Hall files. Bob Wyffels, audience, said that the Crow proposal in the November election had a tax rate of 11 cents per thousand. It was pointed out that this had been an average for the 20 year bond. There was discussion among the Committee members regarding the information on the summary table (Foster and Marshall report). Munhall pointed out if they were able to narrow the choices, it would be possible to have Saul Zaik, Architect, go over the proposals more closely and have Johanson give the Board more specific financial information. He reminded members that next week they would have to decide on what to recommend. Munhall then announced that he had come up with yet another plan with some very preliminary information supplied by Zaik. Munhall outlined his original plan to include the present Public Works property and acquisition of the Davis and Tarkanian lots on Ash. (Both are on the market.) Initially, Munhall had considered putting the Library on the Davis/Tarkanian lots, recognizing the support for a separate facility, with Police and City Hall on the Public Works site. (Public Works would remain on the site.) After talking with City staff he decided to present his plan with the Library located on Fanno Creek on the Public Works site with City Hall. The Police Station would go on the Davis/Tarkanian site with room for a Fire Station in the future. Fire District personnel have expressed a desire to eventually move into that area. Munhall acknowledged that he had only rough figures, but that they were "in the ball park" with the other proposals. J.B. Bishop, audience, asked whether or not the present Police site plus adjacent site wouldn't be sufficient for a new Police facility. Chief Adams pointed out that the increased traffic generated by having the joint facility on the Public Works site would require those sites for public parking. Bishop suggested that the Crow property across Ash Street from Public Works be acquired and used for parking. It is in a flood plain and unbuildable, but could be used for parking with proper contouring and not be flooded. Bishop quoted $1 square foot as the appraised price. Munhall commented that this was much like the Ash Street proposal which had been considered, and "scratched". That proposal had called for acquiring some of the Crow property and then realigning Ash Street so as to provide adequate room on the Public Works site for a joint facility. Minutes - Library Board - Space Needs III Review Committee - 1/12/84 Page - 3 - Munhall asked the Committee whether they felt his proposal was worth further investigation. Board members expressed concern over the time left to make proper considerations. Bendixsen said he felt it was attractive in that it had the advantage of taking care of needs without buying a lot of property. There was discussion regarding street improvement, acquisition of the properties, offering an option for decentralization, the extension of Ash Street, size of Davis property (1.4 acre). Saul Zaik, Architect, said that the Davis property is sufficient for Police or Library (no need to acquire Tarkanian). Further discussion included screening the view of Public Works from the Library. Frank Currie, Director of Public Works, explained improving of Ash Street, saying that if the project is on one side of the street, then only one side is improved. He estimated $125 per property foot (frontage) for improvement. Utz questioned the security factor for the Library if the Police are away from the complex. Munhall mentioned future development of Ash as a factor in eliminating "isolation" of the Library. Tepedino, audience, expressed concern over the Committee's discussion moving its focus away from proposals on which much information is available toward one that has relatively little. He recommended that the Committee bring its attention to the proposals before them with the condition that this new proposal will be developed and then considered with the others. His concern was over spending time redesigning this proposal without proper information. Munhall reviewed the. rough data supplied by Zaik regarding his proposal. Zaik programmed the purchase of the Ruff/Davis properties at $350,000, building a 9,000 square foot Library for $553,000; building a 3,600 square foot Police Station for $221,000; a total of $1,124,000 in the first phase. The City Administration would continue to rent during Phase I. It was noted that the initial cost was very reasonable and that the total cost was approximately $3,105,000. Munhall asked whether the Committee wished to consider this new proposal, explaining that he would be able to get Zaik and Rebecca Marshall to analyze the project and furnish the same information as was available for the other proposals. There were comments regarding rental costs and cutting Police space. Bendixsen maintained that he was not in favor if it was necessary to cut Police space in order to make the proposal competitive with others. Miller agreed. Munhall agreed and pointed out that he "had in mind" 8,500 square feet for Police, 10,000 square feet for Administration and 12,000 square feet for the Library. His total estimated cost, to include acquiring property between Police and Public Works ("little house"), was $2,065,500, excluding fees, utilities, etc. Zaik said his figures included fees, utilities, landscaping. The Committee decided to have Zaik and Marshall analyze the option, expressing concern over time line, decentralization, location, and the Police square footage. Minutes - Library Board - Space Needs III Review Committee - 1/12/84 Page - 4 - Bishop asked how soon bonds could be sold after voter approval in March. Johanson estimated 1 to 1-1/2 months. There was also some discussion of possible dates in May and June. Maksym objected to the validity of the financial figures "based on the nebulous purchase prices" on a number of the properties under consideration. He felt that there was no accuracy in the analyses where prices had not been established. Munhall asked the Committee whether or not they wanted to have appraisals on the proposals being considered. Bishop explained that ordinarily appraisals are not sought until a specific piece of property is being sought, the cost usually being $1500 to $2000 per appraisal. Ober expressed her comfort with dealing with the current information. Miller agreed. Maksym suggested that the Committee needed an "option" rather than an appraisal, explaining that appraisals are "estimates of value" and that options are what are needed, i.e. , an offer as to what the owner is willing to sell for. Maksym further explained that options are as cheap as $l. Tepedino stated that he felt that though the Committee was working with figures that "were not firm", they were working within the City Council's charge to go ahead "the best you can" with the best data available. He felt that it would be reasonable to limit the choices given to Council and then suggest getting appraisals on those few pieces, rather than stopping everything to request appraisals now on the number of proposals before them. Bendixsen reinforced that view saying that he felt the figures had been given in good faith and reiterating that the Committee was only recommending to Council. Tepedino also pointed out that since all this information was being publicly discussed that owners have an obligation to come forward and correct numbers that are "way off". Munhall asked the Committee to evaluate each proposal, using the Municipal Facilities Proposal Assessment. He listed the categories: cost, adaptability (future needs), land requirements, longevity, adaptability to municipal services, efficiency considerations (single vs multiple buildings), structure (concrete, metal, wood), transportation system, center location, enhance economic revitalization, enhance cultural qualities, enhance community spirit and image, meet basic community needs. (Each category was weighed 1 through 5, 5 being the most desirable.) The Committee decided not to consider cost in view of uncertainty over some of the figures. The totals were: Sundeleaf - 51.8; Air-King - 54.8; GTE - 26.8; Sturgis - 57.4; Crow (Bishop) - 47.4. The Committee emphasized tha this was a subjective evaluation to try to determine the most "attractive". The Committee spent time discussing on what basis they should make their recommendation to City Council. There were comments regarding the various categories, i.e. , rental, bonds, lease options, build to suit, which the Committee had been asked to decide. Munhall, addressing Hiliary MacKenzie (the Sundeleaf representative) explained that their proposal had come in high on the analysis because through miscommunication, the acquisition of 72nd for Public Works was in the 6th year Minutes - Library Board - Space Needs III Review Committee - 1/12/84 Page - 5 - instead of immediately. He asked Johanson to re-run the Sundeleaf proposal with that correction. More discussion ensued regarding how many sites should be recommended to City Council. Munhall reiterated his request for Johanson to re-analyze the Sundeleaf proposal and his proposal. For the record, Munhall read off appraisals: City Hall (Main Street) - $130,000; Pinebrook lots - $25,000. He suggested that the figures can be used later to offset costs. Bishop pointed out that the prices, though reasonable, would probably not be paid in a lump sum. Munhall queried the Committee as to which sites (according to category) they wished to carry over, listing GTE as "the Library Board rental choice"; Sturgis, Air King and Sundeleaf as the "build-to-suit"; and Crow as the "bond". Bendixsen questioned the "build-to-suit" category. Bishop suggested that "build-to-suit" is a rental and that bond is actually being considered for all except GTE. The Committee decided to differentiate Crow as a "remodel" and the others as "new construction". Tepedino suggested that the Committee, using the data it has, come up with the best 3 choices for recommending to City Council, even if they are more expensive, but also give them other alternatives to consider. Bendixsen pointed out that space is the only factor to be used to cut the costs. Tepedino suggested that might be a good point for negotiation. Munhall pointed out that the "cheaper way" is to build everything at once instead of piece by piece because of rising costs. Tepedino urged the Committee to take an analytical approach with the Council and to point out practical considerations. He cautioned that the Council should not be asked to do the analysis - they have asked the Committee to do that. The meeting adjourned at 8;25 P.M. Irene t. Ertell IEE/pn (0178p)