Form revised April 23, 2003

FISCAL NOTE FOR CAPITAL PROJECTS ONLY

Department:	Contact Person/Phone:	DOF Analyst/Phone:
Parks and Recreation	Erin Devoto, 233-7937	Aaron Bert, 684-5176

Legislation Title:

AN ORDINANCE relating to the Department of Parks and Recreation; authorizing the Superintendent of Parks and Recreation to execute a development agreement for the International District/Chinatown Community Center between the City of Seattle and the Seattle Chinatown International District Preservation and Development Authority; and to accept a deed conveying a condominium interest for Unit 2 of the structure described as IDVS 2.

Summary of the Legislation:

The proposed legislation authorizes the execution by the Department of Parks and Recreation (DPR) of a development agreement for the International District/Chinatown Community Center between the City of Seattle and the Seattle Chinatown International District Preservation and Development Authority (SCIDPDA). This agreement relates to the development, design, and construction of a new community center as part of the International District Village Square Phase 2 (IDVS2) Project and utilizes funding made available in large part through the 1999 Seattle Center and Community Centers Levy (Proposition 1). The proposed legislation also authorizes the acceptance by DPR of a deed conveying a condominium interest for Unit 2, which will be operated as a community center as part of the IDVS2 Project.

Background:

The City of Seattle and SCIDPDA have entered into prior agreements including a Bond Payment Guaranty Agreement, Special Obligation Bonds, 2002 Series A (Housing Facilities) dated December 12, 2002 and a Bond Payment Guaranty Agreement, Special Obligation Bonds, 2002 Series B (Community Facilities) also dated December 12, 2002. The City of Seattle now wishes to enter into an agreement with SCIDPDA to guide the development of the new International District/Chinatown Community Center and provide for its ownership by the City following such development. SCIDPDA has undertaken to develop, design and construct the International District Village Square Phase 2 Project (“Project”), a mixed use project containing (i) a community center (“International District Community Center” or “Community Center”), (ii) low-income family housing, and (iii) certain other community facilities, including parking, a branch public library and other uses. The Community Center (and community facilities) will be developed by SCIDPDA. The Community Center will thereafter be a separate condominium unit owned by the City, by and through Parks. The community facilities will be owned and managed by SCIDPDA. The right and responsibility to develop, own and manage the low-income family housing has been assigned by SCIDPDA to IDVS 2 Family Housing LLC.

In November 1999, City of Seattle voters approved Proposition 1, providing funding for the development and expansion of 11 community centers. Among other things, Proposition 1 made $2,100,000 in funding available for the International District Community Center (CIP Project K73482). This project provides partial funding for a 7,000 square foot community center and 8,000 square foot gym as part of Phase 2 of the Village Square project. Funding is to be provided to SCIDPDA for development of a community center as part of a mixed-use facility. Other components include a neighborhood branch library funded through the “Libraries for All” program (CIP project BLIDL1), 57 units of housing, 75 parking spaces, and retail.

The total City funding available for the Community Center is $2,508,000 ($2,724,000 less $216,000 retained by Parks for project management expenses). The total cost of the Community Center is presently estimated to be $3,908,784, with SCIDPDA being responsible for arranging for the remainder of the financing. SCIDPDA is relying on numerous outside financial sources to fund the difference of the Community Center including private donations.

The Development Agreement is structured to ensure the final transfer of the Condominium Interest is not executed until all conditions are completed, and each party is satisfied with the outcome. Provisions of the agreement include:

· limiting City funds transferred to SCIDPDA as part of this agreement to the development, design and construction of the Community Center;

· requiring that all contracts relating to the Community Center conform with all state and local laws on competitive bidding, fair contracting and all applicable federal, state and local nondiscrimination requirements;

· requiring SCIDPDA to notify Parks in the event there is any significant risk that there will be a substantial delay of over five working days in the completion of the Community Center as shown in the construction schedule or significant risk of increased costs for the Community Center;

· allowing the City to inspect and audit all pertinent books and records of SCIDPDA, its assignees, its consultants and contractors, any subcontractors, or any other person or entity that performed work in connection with or related to the Project;

· requiring any changes in the approved design or budget of the Community Center be subject to the written approval of the City. The City can withhold its approval of such proposed changes if they would, (i) cause the Community Center to not comply with the City’s design program and standards; or (ii) either reduce the agreed scope of the Community Center or require additional City funding for the Community Center;

· requiring SCIDPDA to hire a City-approved commissioning consultant to assist in implementing the Building Commissioning Plan for the Community Center to ensure full compliance with City standards for building commissioning; and

· allowing the City to terminate this Agreement if the Community Center is for whatever reason not finally complete as of June 1, 2005. If the Agreement is terminated, in no event will SCIDPDA be liable for return of the previously advanced funds. Instead, the City shall be entitled to take over in whole or in part management of the Project, including the Community Center in accordance with provisions of the previously signed Series B Bond Agreement. If the City exercises this remedy, SCIDPDA shall pay to the City the amount of any funds that it has raised for construction of the Community Center, which funds have not yet been expended.

Project Name:	Project Location:	Start Date:	End Date:
International District Community Center – Construction (K73482)	Village Square II, 8^th Ave. S. & S. Dearborn St.	2^nd Qtr 2000	3^rd Qtr 2004 (end of closeout phase)

Note: The project end date listed above is as of the 1^st Qtr 2003 Monitoring Report.

· Please check one of the following:

____ This legislation does not have any financial implications. (Stop here and delete the remainder of this document prior to saving and printing.)

__X__ This legislation has financial implications. (Please complete the boxes below and all relevant sections that follow.)

Appropriations (in $1,000’s): Not applicable.

Fund Name and Number	Department	Budget Control Level*	2003 Appropriation	2004 Anticipated Appropriation
TOTAL

* This is line of business for operating budgets, and program or project for capital improvements

Notes: Funding for this project has been appropriated in the City’s 2002 and 2003 Adopted Budgets. The proposed legislation does not request additional appropriation for the International District/Chinatown Community Center project.

Anticipated Revenue/Reimbursement (in $1,000’s): Not applicable.

Fund Name and Number	Department	Revenue Source	2003 Revenue	2004 Revenue
TOTAL

Notes:

Spending Plan and Future Appropriations for Capital Projects (in $1,000’s):

Spending Plan and Budget	2002 LTD	2003	2004	2005	2006	2007	2008	Total
Spending Plan	-	-	-	-	-	-	-	-
Current Year Appropriation	-	-	-	-	-	-	-	-
Future Appropriations	-	-	-	-	-	-	-	-

Key Assumptions:

The total cost of the Community Center is presently estimated to be $3,908,784, with SCIDPDA being responsible for arranging for the remainder of the financing. Once construction on the Community Center portion begins, DPR will be invoiced by SCIDPDA, on a monthly basis, as the project proceeds.

Funding source (in $1,000’s): (City’s Portion of the Community Center)

Funding Source	2002 LTD	2003	2004	2005	2006	2007	2008	Total
2000 Parks Levy	250	-	-	-	-	-	-	250
1999 Community Centers Levy Fund	2,100	-	-	-	-	-	-	2,100
Neighborhood Matching Fund	199	-	-	-	-	-	-	199
Community Development Block Grant	-	175	-	-	-	-	-	175
TOTAL	2,549	175	-	-	-	-	-	2,706

Bond Financing Required (If the project or program requires financing, please list type of financing, amount, interest rate, term and annual debt service or payment amount. Please include issuance costs of 3% in listed amount): Not applicable.

Type	Amount	Assumed Interest Rate	Term	Timing	Expected Annual Debt Service/Payment
TOTAL

Uses and Sources for Operation and Maintenance Costs for the Project (in $1,000’s):

O&M	2003	2004	2005	2006	2007	2008	Total
Uses
Start Up
On-going	-	90	370	381	392	403	1,636
Sources (itemize)	(see ‘Key Assumptions’ below)

Key Assumptions:

The amounts shown above are those estimated O&M costs based on the 1999 Seattle Center/Community Centers Levy fiscal note and include funding to operate the gym element which was added after the Levy was approved. These amounts have also been included in subsequent Capital Improvement Programs adopted by the City. Funding sources will need to be identified for O&M as the facility comes on line. Possible options include General Fund support or re-programming savings from reduction in other DPR operations.

Periodic Major Maintenance costs for the project (Estimate capital cost of performing periodic maintenance over life of facility. Please identify major work items, frequency):

Not applicable.

Major Maintenance Item	Frequency	Cost	Likely Funding Source
TOTAL

Funding sources for replacement of project (Identify possible and/or recommended method of financing the project replacement costs):

Not applicable.

Total Regular Positions Created Or Abrogated Through This Legislation, Including FTE Impact: Not applicable.

Position Title*	Part-Time/ Full Time	2003 Positions	2003 FTE	2004 Positions**	2004 FTE**
TOTAL

· Fund Name and Number: _________________________________________

· Department: ___________________________________________________

* List each position separately

** 2004 positions and FTE are total 2004 position changes resulting from this legislation, not incremental changes from 2003.

· Do positions sunset in the future? (If yes, identify sunset date):

Not applicable.

· What is the financial cost of not implementing the legislation: Success of the project depends on the utilization of all funding sources. The bonds for the project as a whole, have already been issued and if approval to disperse the $2.7M is withheld, it will put the final completion of the project in jeopardy. If SCIDPDA defaults on its’ bond repayment obligation by not completing the project, the City would then be responsible for the total bond issuance of $10.5M.

· What are the possible alternatives to the legislation that could achieve the same or similar objectives: No other alternatives exist that would meet the needs, schedule, and budget constraints of the project. With IDVS2, the City is able to leverage its limited resources with an organization willing to partner with the City to build a much needed recreational facility. In order to meet budget, certain City design standards have been scaled back, to the point where the $2.7M City investment would not be able to build a comparable freestanding project.

· Is the legislation subject to public hearing requirements: (If yes, what public hearings have been held to date, and/or what plans are in place to hold a public hearing(s) in the future.)

No.

· Other Issues (including long-term implications of the legislation):

None.