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HomeMy WebLinkAbout3D OCR CITY COUNCIL STAFF REPORT DATE: JUNE 5, 2023 BUSINESS & LEGISLATIVE SUBJECT: APPROPRIATE FUNDS FOR HOMELESS NAVIGATION CENTER AND EARLY ENTRY FACILITY IN THE AMOUNT OF $5,000,000 AT 3589 MCCARTHY ROAD. FROM: Scott C. Stiles, City Manager BY: Community & Economic Development Department Engineering Services Department SUMMARY: Development of the Homeless Navigation Center (Navigation Center) at 3589 McCarthy Road (Site) is continuing forward with major milestones still on schedule. Sitework and utility infrastructure work is scheduled to begin in July 2023, production of the modular units is underway with delivery scheduled for Fall 2023, and the facilities are expected to be ready for the first residents in February 2024. Bids for construction of the Navigation Center were received in May 2023 and were higher than budgeted. As such, the development team is proposing to reduce construction costs through the redesign and repurposing of Building 24 and Building 8 on the Navigation Center campus, and to use existing office space in Building C. Doing so will help mitigate the increased construction costs and have the added benefit of using Building 8 as an Early Entry Facility which will house individuals who are waiting to be placed in the independent living modular units. Building 24 and Building C will incorporate the operations that were initially planned for Building 8. This request is to allocate $5,000,000 from the Fiscal Year 2024 General Fund Budget for additional costs relative to the Navigation Center and to add an Early Entry Facility at the Site. The County of Riverside will also be increasing its contribution by $3,000,000 to assist with the construction costs of the facility. RECOMMENDATION: Approve $5,000,000 in the Fiscal Year 2024 General Fund Budget for additional costs relative to the Navigation Center and to add an Early Entry Facility at 3589 McCarthy Road. Item 3D - Page 1 City Council Staff Report June 5, 2023 -- Page 2 Navigation Center and Shelter Implementation Actions BACKGROUND: At its February 9, 2023 meeting, the City Council approved additional funding for the Navigation Center in the amount of $3,000,000. Total construction costs at that time (including land) were estimated to be $31,695,202. The estimated costs were based on design development phase drawings and not the final construction phase drawings. As such, the estimates were not based on the final developed drawings. The $31,695,202 in funding for the project is broken down as follows: Funding Sources Amount % of Total HomeKey Grant (City/County) $16,035,202 51% ARPA (County) 7,000,000 22% IEHP / Molina (County) 5,500,000 17% City Funds 3,160,000 10% Total $ 31,695,202 100% Tilden-Coil Constructors (Tilden-Coil), the Project Construction Manager At Risk (CMAR) requested bids for the Navigation Center in April 2023 when the final construction phase drawings were complete. Bids were submitted in May 2023 but were much higher than initially anticipated. The development team began evaluating several potential cost cutting and value engineering options to reduce the costs as much as possible. If approved, the revised funding sources would include the County contributing an additional $3,000,000 for a total of $15,500,000, and the City contributing an additional $5,000,000 for a total of $8,160,000, with the breakdown as follows: Funding Sources Amount % of Total HomeKey Grant (City/County) $16,035,202 40% ARPA (County) 8,000,000 20% IEHP / Molina (County) 7,500,000 19% City 8,160,000 21% Total $ 39,695,202 100% The proposed revisions include utilizing Building 8 as an Early Entry Facility where individuals can transition from the Access Center on El Cielo Road to the Navigation Center. Having the Early Entry Facility integrated with the Navigation Center allows individuals to receive wrap-around services at the Early Entry Facility while working towards more independent living in the residential modules at the Navigation Center. STAFF ANALYSIS: The Project will include 80 prefabricated residential units and includes the rehabilitation of two buildings on the Site (Buildings 8 and 24). The residential units will include Item 3D - Page 2 City Council Staff Report June 5, 2023 -- Page 3 Navigation Center and Shelter Implementation Actions kitchenettes and bathroom facilities. Five of the units are for families and 10 units are for transitional age youth. The Project also includes a children’s play area; general parking; green space; hardscape and landscape. Building 8 was planned for daytime services and administration uses; Building 24 was planned for operational services; and Building C was not considered a part of the Navigation Center Project. The estimated cost developed by Tilden-Coil at the design development phase in January was lower than the construction phase drawing bid costs. The cost increase is due to several factors including the following: • Number of Bids Received – Tilden Coil has noted that a significant number of their regular subcontractors did not bid on the project due to timing issues and the complex nature of the work. The end result is a notable increase in construction costs. • Construction Phase bid costs vs Design Development Phase estimates – the cost increase is partially due to the drawings not being fully developed at the design development phase. • Electrical Costs – During the design development phase it was anticipated that the site may have to operate for about 4-6 months on temporary power as a means to house patrons at the site as quickly as possible. The temporary power costs alone exceeded $4.9 million. • Site Infrastructure – the site requires extensive infrastructure upgrades to accommodate the buildings and services being added to the Navigation Center. As the project moved from the design phase to construction drawings, the infrastructure upgrades became more evident. • Service Provider and Community Input Design Features – Third-party service provider and community input were incorporated into the design throughout the process. These include walk-in refrigeration systems, large multi-purpose rooms, recuperative care, loading dock and trash compactor, extensive landscaping and hardscape, dog park features, shade and screening from the public. These requested features also increased construction costs. The development team was able to reduce the Project costs by $10,000,000 after a thorough review of the plans, specifications and proposed amenities. This involves the following revisions: • Building 8 was initially designed to house daytime services and program administration offices. It would have been accessible Monday through Friday for eight hours a day. It included a reception area, intake room, case management, employment services, and flex space for service providers to assist residents. Building 8 will be re-designed and re-purposed to serve as an Early Entry Facility where approximately 50 shelter beds will be available as an overnight facility. Administrative functions and services will be relocated to other buildings at the site. Item 3D - Page 3 City Council Staff Report June 5, 2023 -- Page 4 Navigation Center and Shelter Implementation Actions • Building C was originally planned for use a shelter facility using funds from the County of Riverside’s Inland Empire Health Plan (IEHP) grant funds in the amount of $5,500,000. Project HomeKey Funds could not be used for such a shelter facility as congregate housing was not an allowable use of the HomeKey Funds. However, plans for the shelter facility were put on hold as the IEHP funds were needed for the Navigation Center. The existing office space in Building C will used to replace some of the office space, case management, employment services, and flex space that will be eliminated from Building 8. Only minimal funds are needed for Building C as the office space is already built out. • Building 24 was intended to house 24-hour operational services. A large portion of this building was taken up by the commercial kitchen which includes dry and cold storage. It also had a large community dining / multi-purpose room, and a large Community Corridor which was designed to also serve as a multipurpose room. Recuperative care spaces were also included for individuals who are released from hospital to continue their recovery with access to showers and nursing station. A security office, laundry room, mail room, and loading docks were also part of Building 24. Building 24 will be re-designed to reduce the size of the commercial kitchen, dining/ multi-purpose room, and eliminate office space that can be provided in Building C. The loading dock area will be removed from Building 24. Recuperative care space can also be eliminated from Building 24 as recuperative care services can be provided in the modular residential units as needed. • Additional value engineering measures include: o Reduced interior landscaping o Reduced hardscape o Elimination of awnings at the entryways o Eliminate option for use of temporary power o Eliminate keycard and electrified hardware at modular residential units The cost of developing the Project with these changes, however, requires an additional $5,000,000 from the City. The County of Riverside will also be contributing an additional $3,000,000 to the project. Early Entry Facility When people experiencing homelessness in Palm Springs need to access an overnight shelter or interim housing, the closest location of beds in the Coachella Valley are the residential facilities in Indio operated by Martha’s Village and Kitchen (MVK) and Coachella Valley Rescue Mission (CVRM). However, the distance to these shelter facilities adds unnecessary complications. The Access Center on El Cielo Road will Item 3D - Page 4 City Council Staff Report June 5, 2023 -- Page 5 Navigation Center and Shelter Implementation Actions provide limited shelter beds; the Early Entry Facility will be the second step in the process to assist in providing housing for people experiencing homelessness and will be part of the progression into the Navigation Center modular units, and preparation for being placed in permanent housing after the Navigation Center. Without an adequate number of such emergency and transitional housing beds, people experiencing homelessness are forced to find shelter in encampments, tents, cars, and other places not meant for human habitation. The City currently partners with MVK to operate the Access Center at 225 El Cielo Road on a drop-in basis during the daytime and provides a variety of wrap-around services, such as assisting individuals with securing health, disability, social security, and other benefits; providing vouchers for use of laundry facilities and for bus pass system based on client need; and case management to clients based on their individual need. However, the Access Center does not provide sufficient space for overnight shelter on a continuing basis. The Early Entry Facility in conjunction with the Navigation Center will create a path to housing where individuals can exit life on the streets, work towards independent living in the residential modules of the Navigation Center, receive wrap-around services, job training, and case management (Attachment A). Beds in the Early Entry Facility will be also available for the Palm Springs Police Department to refer individuals to the Navigation Center campus. Neither the Early Entry Facility nor the Navigation Center will provide walk-up services; instead, individuals will be referred from the El Cielo Access Center, referred by the Police Department, or referred by one of the City’s partner organizations. CONSTRUCTION SCHEDULE: Tilden-Coil has received bids for the project and is ready to move into the construction phase. As noted earlier, the bids came in higher than expected and through value engineering the cost of the project has been reduced. As a result of value engineering, several different trades are being rebid to conform to the value engineering redesign. Tilden-Coil anticipates construction to begin in late July. The design of the modular units is complete and is currently going through the manufacturing process. Tilden-Coil anticipates the modular units to be delivered to the site in the fall. In addition, the re-designed Building 8 (Early Entry Facility) is tentatively scheduled to be completed by February of 2024. It is anticipated that Building 8 will use the existing power source on the site will be the first component of the Navigation Center facility to open. Unfortunately, the delivery of the power source equipment required to power the rest of the facility is not anticipated until May of 2024. After the power source is delivered in May of 2024, the contractor will finalize the construction of the remaining facilities and deliver the completed project to the City in July 2024. Item 3D - Page 5 City Council Staff Report June 5, 2023 -- Page 6 Navigation Center and Shelter Implementation Actions ALIGNMENT WITH STRATEGIC PLANNING: The first major task in the Strategic Plan for Quality of Life (1A) with the key objective to improve homelessness is to build a Navigation Center, provide integrative services, and partner with homelessness providers for enhanced services. FISCAL IMPACT: At this time staff is requesting utilization of $5,000,000 to supplement construction costs for the Navigation Center and to set up a new Early Entry Facility. If approved, funds in the amount of $5,000,000 will be budgeted in the Fiscal Year 2024 General Fund Budget for the Navigation Center and Early Entry Facility. REVIEWED BY: Department Director: Jay Virata City Engineer: Joel Montalvo Deputy City Manager: Flinn Fagg City Manager: Scott Stiles ATTACHMENT: A) Path to Housing Item 3D - Page 6 ATTACHMENT A DRAFT Path to Housing City of Palm Springs Step 1 Step 2 Step 3 Step 4 El Cielo Emergency Access Center McCarthy Navigation Center: Building 8 Early Entry Facility McCarthy Navigation Center: Private Units Permanent Housing •30 Beds •Complete wraparound services (mobile) •Referral from PD, Access Center staff, County •May stay up to 30 days •Walk out/drive out allowed (with staff approval) •50 Beds (in cubicles) •Complete wraparound services (on site) •Referral required from El Cielo Access Center •May stay up to 180 days (until private unit is available) •Guests transported to transit facilities (or drive out allowed with staff approval) •80 Residential Units •Complete wraparound services (on site) •Referral required from either El Cielo Access Center or Building C •May stay up to 365 days (until permanent housing is available) •Guests transported to transit facilities (or drive out allowed with staff approval) •Monarch Apartments •Vista Sunrise II •Aloe at Palm Canyon •Section 8 •Housing Vouchers Item 3D - Page 7