Background: The City would be required to spend $3.5 million in needed repairs on the Police Headquarters on Habersham Street. As an alternative to spending $3.5 million, the City could enter into property exchange agreement for a design-build replacement for Police Headquarters that would allow new construction without the City’s paying any out-of-pocket expense. Major repairs are required as soon as possible to improve air quality and ensure safe working conditions on the 1870 building. Some work would need to begin immediately to remediate mold in work areas, but relocation would avoid the more expensive costs to replace HVAC systems/ductwork, replace all windows, replacing the double roof system, seal brick and exterior envelope and eliminate water penetration. In addition, the recent loss of parking spaces due to the sale of the Oglethorpe Lot also affects long-term use of the Police Headquarters.

Facts & Findings:

1. Based on the Council’s interest, City staff pursued an exchange of surplus parcels that value $12 million in exchange for a project that would deliver design and construction of a new Police Headquarters. This would expedite a 5-year plan to relocate Police Headquarters or spend several million dollars renovating it.  The immediate benefit would be to avoid spending an estimated $3.5 million based on architect and engineering inspections of cost to cure the building’s pressing needs.

2. In an unrelated meeting with staff from the Savannah College of Art and Design (SCAD) about a vacant parcel for sale, City staff proposed a plan for SCAD to design and construct a new Police Headquarters in exchange for surplus City parcels.  Subsequent to the meeting, work began to identify parcels, obtain appraisals and initial surveys and develop an agreement (see attached).

3. Police Headquarters totals about 40,000 SF.  Because the determining factor will be the actual cost of the project--to program, design and construct a new Police Headquarters--the approach would be to compile a list of City properties with a total value that would be equal to the project value.  For planning purposes, the agreement sets a target of $12 million (40,000 SF @ $300SF).  This amount will be reconciled before start of construction and at the City’s acceptance based on the actual value of properties in exchange for actual project valuewould be able to design and deliver efficiently because of the college’s experience in new construction. In addition, the City’s recent experience in program, design and construction of the Central Precinct, helps to set a standard for programmatic layout of areas and sizing of offices.

4. SCAD would be able to design and deliver efficiently because of the college’s experience in new construction. In addition, the City’s recent experience in program, design and construction of the Central Precinct, helps to set a standard for programmatic layout of areas and sizing of offices.

5. As a goal, SCAD would deliver a turn-key project in December 2020.

6. Work to remediate for mold will begin as soon as possible with funding set up in the 2020 Capital Improvement Plan.

Policy Analysis: Georgia law authorizes local governments to exchange properties that are equal value (city can exchange for properties of higher value). In this case, the City could enter into property exchange with SCAD to design and build a new Police Headquarters for City parcels of equal value but without the City’s paying any out-of-pocket expense.

Alternatives:

1. Authorize the City Manager to execute the attached agreement and related documents to initiate a property exchange that would offer City-owned parcels of equal value in exchange for a new Police Headquarters. Because the determining factor will be the actual cost of the project--to program, design and construct a new Police Headquarters--the approach would be to compile a list of City properties with a total value that would be equal to the project value. For planning purposes, the agreement sets an initial target of $12 million (40,000 SF @ $300SF). This amount will be reconciled based on actual project value of a new Police Headquarters versus appraised value of the parcels.

2. Proceed with amending the Capital Improvement Plan to fund the $3.5 million needed for the Police Headquarters renovation. This alternative would require amending the supplemental funding from SPLOST 6 (i.e. City’s share of funding from collections in excess of $400 million) and require eliminating other capital priorities from the list. In addition, during construction, work areas of Police Headquarters would need to be relocated to leased space and return after completion of work—section by section. This alternative does not address long-term parking issues since the Oglethorpe lot would not be available after spring 2020.

3. Do nothing.

Recommendation: Adopt the Motion (Alternative 1).

Authorize the City Manager to execute the attached agreement and related documents to initiate a property exchange that would offer City-owned psurplus arcels of equal value in exchange for delivery of a new Police Headquarters designed and constructed to City standards.  Because the determining factor will be the actual cost of the project--to program, design and construct a new Police Headquarters--the approach would be to compile a list of City properties with a total value that would be equal to the project value.