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Home My WebLink AboutORD-2000-127 Authorization to Purchase Property and Pursue Financing and Renovation Efforts at 228 South Churton Street IX 7 1 ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: June 29, 2000 Action Agenda Item No. I -Q SUBJECT: Authorization to Purchase Property and Pursue Financing and Renovation Efforts at 228 South Churton Street DEPARTMENT: Purchasing and Central PUBLIC HEARING: (Y/N) No Services, Budget, Finance ATTACHMENT(S): INFORMATION CONTACT: Reimbursement Resolution Pam Jones 245-2652 Capital Project Ordinance Donna Dean 245-2151 Ken Chavious 245-2453 TELEPHONE NUMBERS: Hillsborough 732-8181 Chapel Hill 968-4501 Durham 688-7331 Mebane 336-227-2031 PURPOSE: To consider the following actions: 1. Authorize the purchase of 228 S. Churton Street, Hillsborough for use as offices for the Department of Purchasing and Central Services; and 2. Authorize Manager to contract for professional services as may be necessary to carry out the retrofit of the space; 3. Authorize the Purchasing Director to award bids for renovation work that would be above her approval limit but are necessary to commence between July 1, 2000 and August 15, 2000; and to report same to the Board of Commissioners; 4. Approve a Reimbursement Resolution; 5. Approve the capital project ordinance to support such action. BACKGROUND: As the Board knows, the County has been diligently seeking an alternative location for the offices of the Department of Purchasing and Central Services for over a year. The Department is presently located in space leased from the Sprint Telephone Company, whose space needs now require that they not lease out the area used by the County. 2 The Board authorized County staff to pursue the acquisition of the building at 228 S. Churton Street. The owners of the subject property have agreed to the counter proposal amount offered by the County as follows: • 1400 square feet at the south end of the building: $56,000; • 2600 square feet at the north end of the building , plus one lot behind the facility: $240,000; • for a total of$296,000. The Board is requested to approve the purchase of the property and to direct the County Attorney to work with the property owners and their attorneys to effect closing within 30 days following approval, conditioned upon receipt of the testing results showing complete mitigation of the fuel oil tank concerns raised during the assessment of the property. The County would pursue third party financing for the property for 59 months, with annual payments of approximately $65,000. Requests for Proposals for funding will be solicited by the Finance Director and brought back for Board consideration at a later date. In order that the acquisition process might be concluded during the summer, the Board is being asked to approve a Reimbursement Resolution that would allow the County to pay for the building upon closing and then reimburse itself when financing is obtained. The Capital Project Ordinance to support this action is being presented for Board approval as well. Since time is of the essence, it is proposed that renovation efforts be commenced immediately upon closing. Pre-requisite efforts to ensure that work is begun upon closing include, but may not be limited to: • design of roof replacement and preparation of bid documents; and • renovation plan development, including, but not limited to, floor plan design, electrical upgrade and HVAC design. The Board is requested to authorize the Manager to enter into the contract(s)for professional services that may be necessary to accomplish this work. Finally, it is recommended that roof replacement be the highest priority task. It is likely that the roof design could be completed and bids solicited within a matter of a couple of weeks, which could allow the roof work to begin immediately after closing. The estimate for roof replacement will exceed the approval limit for the Purchasing Director ($20,000). It is therefore requested that the Purchasing Director be authorized to award the bid and execute the appropriate paperwork for the roof work so that it might be completed expeditiously. FINANCIAL IMPACT: The County would purchase a building at 228 S. Churton Street for a total of$296,000. Debt service payments of approximately $65,000 annually would be offset in part by the current rent amount of$18,392 for a net impact of approximately$46,600. Renovation costs for the space have been estimated at $100,000 and would be paid for through a combination of operating and capital funds. 3 RECOMMENDATION(S): The Manager recommends that the Board take the following action: 1. Authorize the purchase of 228 S. Churton Street, Hillsborough for use as offices for the Department of Purchasing and Central Services; and 2. Authorize the Manager to contract for professional services as may be necessary to carry out the retrofit of the space; 3. Authorize the Purchasing Director to award bids for renovation work that exceed her authorization limit but would be necessary to commence between July 1, 2000 and August 15, 2000; and to report same to the Board of Commissioners; 4. Approve a Reimbursement Resolution; and 5. Approve the capital project ordinance to support such action. 4 REIMBURSEMENT RESOLUTION-- B ILDING ACQUISITION PROJECT' WHEREAS, the Finance Officer has described to the Board the desirability of adopting a resolution, as provided under federal tax law, to facilitate the County's using financing proceeds to restore ' the County's funds when the County makes capital expenditures prior to closing on a bond issue or other financing. BE IT RESOLVED by the Board of Commissioners of Orange County, North Carolina, as follows: Section 11, The project is the acquisition of a building for offices of the Department of Purchasing and Central Services at 228 S. Churton Street, Hillsborough,NC. Section 2. The project is to be financed. The currently expected type of financing (which is subject to change) is installment financing pursuant to Section 160A-20 of the General Statutes. The currently expected maximum amount of obligations to be issued or contracted for the project is $296,000. Section 3. The County intends that funds advanced, or which may be advanced, from the County's General Fund for costs of this project are to be reimbursed from the financing proceeds. Section 4. The adoption of this resolution is intended as a declaration of this County's official intent to reimburse project expenditures from financing proceeds. I hereby certify that the foregoing resolution was duly adopted at a meeting of the Board of Commissioners of Orange County, North Carolina, duly called and held on June 29, 2000, and that a quorum was present and acting throughout such meeting. Such resolution remains in full effect as of today. Dated this_day of 2000. [SEAL] Beverly A. Blythe Clerk, Board of Commissioners Orange County, North Carolina 5 228 South Churton Street Project Capital Project Ordinance Be it ordained by the Orange County Board of County Commissioners that pursuant to Section 13.2 of Chapter 159 of the General Statutes of North Carolina,the following capital project is hereby adopted. Section 1. The project authorized provides funds to purchase and renovate property located at 228 South Churton Street in Hillsborough. Upon completion of the renovations,the Department of Purchasing and Central Services will locate to the facility. Financing for the project includes proceeds from a third party financing arrangement and a portion of the County's one-half cent sales taxes. Section 2. The officers of the County are hereby directed to proceed with the project within the budget contained herein. Section 3. The following revenue is anticipated to complete this project: Through FY Through F Y 1998-99 FY 1999-00 1999-00 es ax $0 $0 2/3 Net Debt Reduction Bond Funds $0 $0 $0 Private Placement $0 $296,000 $296,0(X Grant Funds $0 $0 Transfer from General Fund(99/00) $0 $100,000 $100,000 Total Fundingi so ! $396,0001 $396,Ml Section 4. The following amount is appropriated for this project: Through FY Through FY 1998-99 FY 1999-00 1999-00 Land/Building $0 $296,007 $296,0 resign $0 $15,0 Construction 1 $0 $85,0001 $85,000 01117FT $0 $U $0 , - 1 $396UUU 1 Z0JY6UW Tota Tuosts 1 $0 , , Section 5. This ordinance shall remain in effect from July 1, 1998 until June 30, 2001. Adopted this 29'day of June 2000. 7 1) Feasibility study to determine the most economically efficient HVAC system, with strong focus on the life cycle cost to be designed for the Whitted Human Services Center and the Northern Human Services Center; and 2) To design the resulting systems for the two facilities, produce specifications and drawings to support the bid process, and to provide construction administration services throughout the project; and 3) To design, produce specifications and drawings for the bidding procedure and to provide construction administration for upgrades to the electrical services in the Court Street Annex. Commissioner Jacobs made reference to point#1, "Feasibility study to determine the most economically efficient HVAC system," and added, "most economically and environmentally efficient HVAC system." A motion was made by Commissioner Jacobs, seconded by Commissioner Gordon to approve a proposal and a contract with Robson and Woese for the three items as listed above with the additional language and authorized the Chair to sign. VOTE: UNANIMOUS 9. ITEMS FOR DECISION - REGULAR AGENDA a. Authorization to Purchase Pro and Pursue Financing renovation Efforts at 228 South Churton Street The Board considered the purchase of property at 228 S. Churton Street in Hillsborough for use as offices for the Department of Purchasing and Central Services. Director of Purchasing Pam Jones summarized the information in the agenda abstract. She said that the counter offers that were received from the owners of the property were within the acceptable terms- $56,000 for the south end of the property and $240,000 for the north end of the property plus the additional lot behind it. This is a total of$296,000 for the building and the lot. The staff will be seeking third party financing for the full $296,000 for 59 months, which will be $65,000 per year and $19,000 is offset by the rent that is currently paid so the new money would be around $46,000. She said that they intend to pursue an environmentally sensitive renovation on this project. Commissioner Gordon asked that a limit be set on the contracts for professional services and the bids for the renovation. Pam Jones said that the estimate for the roof work was between $45-50,000. She said that she would not know this amount until the bids came in. The architectural work would be 10-12% of whatever the budget of the project is going to be. John Link suggested a limit of$75,000 between now and August 15, 2000. The Board agreed to add #6 to the actions that the amount disbursed between now and August 15,2000 would not exceed $100,000. A motion was made by Commissioner Jacobs, seconded by Commissioner Gordon to approve the following actions: 1) Authorize the purchase of 228 S. Churton Street, Hillsborough for use as offices for the Department of Purchasing and Central Services; and 2) Authorize Manager to contract for professional services as may be necessary to carry out the retrofit of the space; and 3) Authorize the Purchasing Director to award bids for renovation work that would be above her approval limit but are necessary to commence between July 1, 2000 and August 15, 2000; and to report same to the Board of Commissioners; and 4) Approve a Reimbursement Resolution; and 5) Approve the capital project ordinance to support such action. 6) The amount disbursed by the Manager and the Purchasing Director between now and August 15, 2000 for this project will not exceed $100,000. VOTE: Ayes, 4; No, 1 (Commissioner Halkiotis) b. EmPOWERment. Inc. Request for Funds for Acquisition of Eleven Homes The Board considered a request for funds from EmPOWERment, Inc. for the acquisition of eleven homes in Carrboro for the purpose of repairing and reselling these homes to low income families. 13