HomeMy WebLinkAboutIR 10019 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 10019
To the Mayor and Members of the City Council June 13, 2017
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*a SUBJECT: CITY FACILITY CONSTRUCTION COST FACTORS
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This Informal Report is prepared in response to a question about the costs to design and construct city
building facilities. There are many factors unique to procurement and construction of municipal facilities
that impact the overall costs. These factors can be broadly grouped into four primary drivers:
Long Life and Efficiency
Established facility design standards that enforce a 50 year design life criteria. This results in a higher
initial cost, but also significantly lowers total lifecycle cost. Initial costs are typically less than 25% of the
total lifecycle cost of a facility. Focus is on long term ownership versus a return on investment model used
in the private sector when facilities are built primarily to generate revenues.
• Increased Energy Efficiency— constructing beyond the minimum building codes results in lower
lifecycle costs, and often out performs standard duty elements
• Durable materials —examples include: plywood instead of particle board; stainless steel instead of
galvanized steel; structural steel instead of wood framing
• Roofing — metal or multi-ply coverings...no single membrane, prevents interior water damage after
hail storms, magnified lifecycle increases over single membrane installations
• Structural slabs - minimum foundation for building is a structural slab as opposed to slab on grade
due to highly expansive soils that cause structural problems years after construction when
warranties are no longer actionable
• Masonry screening wall minimum foundation is pier and beam as opposed to spread footing —
creates lasting wall elements that require little to no maintenance
• Building automation systems on every mechanical installation - allows remote monitoring,
troubleshooting, and control of key data points, provides increased efficiency
• Adjustable door frames for lower maintenance costs, standardized robust lock sets to reduce
inventory needed for multiple brands.
Federal/State/Local Policy Requirements
• City wage rate schedule - minimum hourly rates required to be paid (higher than minimum wage)
• Davis Bacon wages if any Federal funds are used
• Green building goals
• MBE/SBE requirements for subcontracting
• State legislated procurement processes — impacts timing and drives risk cost in bidding
• State law requires selection of design consultant based on qualifications, which results in a more
involved process for the designers, which increases costs overall
Municipal Business Practices
• Bid bonds, payment bonds, and performance bonds on every project to protect the City's financial
interests become part of bid costs.
• Insurance limits required by City are higher than those required on common facility construction
• Indemnification requirement for all contracts
• Public process requirements in design phase adds work for design consultants (creates
uncertainty/extended design process)
• Increased and specific reporting burdens if Federal funds are utilized
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS
INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 10019
To the Mayor and Members of the City Council June 13, 2017
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*a SUBJECT: CITY FACILITY CONSTRUCTION COST FACTORS
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• Formal approval process for change orders that increases time and adds to risk costs for
contractors
• Liquidated damages clause in construction contracts
Soft/Non-Construction Costs Included In Proiect Budget
City projected costs per square foot for facility projects includes costs not directly attributable to the design
and construction of a facility which may create a perception that the per sq. ft. costs are not in line with the
market. Non design and construction items include:
• Land acquisition
• Platting
• Survey
• Furniture, fixtures, and equipment (such as specialized equipment based on facility: fitness
equipment, RFID automatic book scanning equipment, commercial kitchen equipment)
• Staff construction inspection and contract management charges
• Information Technology costs (network cables, outlets, servers, phones, computers)
• Security system (card readers/openers at doors, cameras, DVRs, etc.)
• Material testing (state law requires us to hire third party)
Based on our current practices, policies and legally mandated processes, staff believes costs of municipal
facility construction are in line with expectations and estimates when compared to market costs on similar
buildings. If you have any questions or concerns please contact Steve Cooke, Property Management
Director at 817-392-5134 or stevesteve.cooked-fortworthtexas.. ov
David Cooke
City Manager
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS