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ADOPT A MOTION TO AMEND THE ST. MARY’S DINING ROOM OPERATION SERVICES CONTRACT AND ALLOCATE FF&E FUNDING
recommended action
RECOMMENDATION
It is recommended that City Council adopts a motion to:
1. Reallocate and appropriate $800,640 in American Rescue Plan Act (ARPA) funds from St. Mary’s Dining Room operation services contract funded through ARPA project #EARP211 to ARPA Navigation Center project #EARP212
2. Allocate and appropriate $800,640 of HHAP Round 4 funds, to replace the deobligated ARPA funds, for the St. Mary’s Dining Room operation services contract;
3. Amend St. Mary’s Dining Room operation services contract, to update funding source with HHAP 4 funds;
4. Approve up to $800,640 of ARPA funds for the unaddressed Fixtures, Furnishings, and Equipment (FF&E) of the Navigation Center project, through the City’s contract with Durst Office Designs;
5. Authorize the City Manager, or designee, to allocate remaining funds and any other cost savings realized during construction to, and to enter into contract(s) with, other entities involved in the completion of the Navigation Center project;
6. Authorize the City Manager, or designee, to enter into and execute any associated documents and take appropriate and necessary actions to carry out the purpose and intent of this motion.
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Summary
On September 1, 2023, the City of Stockton’s Economic Development Department (EDD) assumed control of the Navigation Center Construction Project.
On September 12, 2023, Council adopted Motion 2023-09-12-1501, to allocate and appropriate a total of $5.3 million from ARPA funds ($800,640), HHAP funds ($2.6 million), and the general fund contingency ($1.9 million) for a three-year operations subsidy for St. Mary’s Dining Room. Staff is recommending the reallocation of ARPA funding out of the operations project and into the ARPA general fund. Staff also recommends allocation of $800,640 of HHAP to replace the operational funds. Once approved, the $800,640 ARPA contingency funds will be allocated, executed, and expended by the December 2024 allocation deadline, for the use of Furniture, Fixtures, and Equipment (FF&E).
On October 17, 2023, City Council approved Motion 2023-10-17-1204, authorizing the allocation of $1,826,961 in grant funding to complete G&G Builders’ Inc. (G&G) original scope of work with Stockton Shelter for the Homeless and other identified scope items that were not part of the original contract, excluding landscaping and FF&E.
Staff recommends amending the St. Mary’s Community Services Operations contract to remove and reallocate $800,640 in ARPA funding to the ARPA General fund in order to address the FF&E needs and complete the Navigation Center Project. Additionally, an allocation of $800,640 of matching HHAP 4 system support funds have been identified and will be included in the amendment.
Reallocation of ARPA funds to Project # EARP212 and the allocation of HHAP funds in its place shows a consideration for the intended use of both funds. It enables a more expedient use to comply with deadlines and will allow St. Mary’s Community Services to maintain a more informed, strategic, and balanced budget.
DISCUSSION
Background
The State's Homeless Housing, Assistance and Prevention Program (HHAP) funds are designed to support regionally coordinated efforts between the County, the Continuum of Care (CoC), and the City to expand and develop local capacity to address immediate homelessness challenges throughout the state. HHAP funds are focused on moving homeless individuals and families into permanent housing and ensuring those individuals and families maintain their permanent housing.
On November 17, 2020, the City Council approved a Resolution 2020-11-17-1402, authorizing the allocation of $6,460,265 in grant funding through HHAP Round 1. In total, 12 projects were approved for HHAP Round 1 funding to carry out eligible activities prioritized in the San Joaquin Community Response to Homelessness Strategic Plan, including the allocation of $2,338,623 to the Stockton Shelter for the Homeless for the construction of the Navigation Center. Construction of the Navigation Center commenced on October 22, 2022.
The City continued to apply for HHAP funding. On November 16, 2022, Council convened a public hearing and adopted Motion 2022-11-15-1602, to apply for, accept, and appropriate grant funding from the California Interagency Council on Homelessness (Cal ICH) for Round 4 of the HHAP grant program.
Stockton Shelter for the Homeless terminated shelter operations on September 1, 2023 and EDD assumed control of the Navigation Center Project.
On September 12, 2023, Council adopted Motion 2023-09-12-1501, to allocate and appropriate a combined total of $5.3 million in ARPA funds, HHAP funds and general fund contingency for a three-year operations subsidy for St. Mary’s Dining Room.
On October 17, 2023, City Council approved Motion 2023-10-17-1204, authorizing the allocation of $1,826,961 in grant funding to complete G&G’s original scope of work with Stockton Shelter for the Homeless and other identified scope items not part of the original contract, excluding landscaping and FF&E.
On May 21, 2024, Council adopted Motion 2024-05-21-1203, and Contract Change Orders (CCO) were approved for:
• G&G in the amount of $2,714,647.13 for construction of the Navigation Center.
• Professional Services Contract Amendment No. 1 in the amount of $200,000 with Griffin for construction management services for the Navigation Center project.
Items completed by these CCOs were:
1. Deferred Work. Elevator seismic gap.
2. Scope Due to Mold/Demo Remediation. Costs for drywall and finish work after remediation, including all new partitions and fire rated partitions and updates to the fire rating assembly, details added by CalFire. All new flooring work after remediation. Any reinstallation of existing panels and HVAC units removed for remediation work and reconnecting electrical.
3. Additional Scope of Work Items. The Construction Management team conducted several months of Discovery to assess current project conditions. Gaps were identified between project plans and specifications and contracted scopes of work with the Stockton Shelter for the Homeless and its contractors, including:
a. Additional asphalt paving and curb to create an accessible entry.
b. Exterior seaming work and scaffolding.
c. Intumescent Paint at floor penetrations, ceilings, and wall to provide 1-hr Fire Rating. Added by CalFire.
d. Utilities (Storm Drain).
4. Extended Construction Management Services. Additional months of construction management services to extend through completion of construction plus 30-days.
5. Landscaping.
Present Situation
Reallocation of ARPA funds to Project #EARP212 and the allocation of HHAP 4 funds in its place shows a consideration to the intended use of both funds. It allows for a more expedient use with respect to deadlines and will allow St. Mary’s Community Services to maintain a more aware, strategic, and mindful budget.
The Navigation Center is the first of its kind, a service-enriched shelter in Stockton, dedicated to keeping families together. The focus will be on moving homeless families into permanent housing while providing temporary living facilities. Inhouse case managers will connect these families with income, public benefits, health services, shelter, and housing.
Construction is winding down to final projects, and focus is shifting to the final items that will allow for not just shelter but services to be provided. Such items include furnishings, a security system, elevator function, as well as phone and Wi-Fi systems.
FF&E (estimated $50 per sq. ft @ 13,500 sq ft.). Since this project was funded in 2020 during a global pandemic, the homelessness landscape has changed tremendously. Further, there have been recent changes in the overall campus wide utilization. Staff noted to City Council on October 17, 2023 that it would return to request funds for FF&E once St. Mary’s had an opportunity to confirm highest and best use of the building. While all three shelters have been at or near capacity, St. Mary’s is regularly turning away families. In the first quarter of 2024, St. Mary’s was unable to accommodate 142 families because the family shelter was full.
There are insufficient funds available to include FF&E as part of the May Contract Change Orders. The City is coordinating with St. Mary’s on FF&E options. Some examples include partitions to maximize the number of semi-private family units, office furniture to accommodate the case management and other wraparound services, tables and chairs to assist with congregate eating, as well as, other items, such as a hot box to combat bed bugs.
Council approval is required, as the recommended actions increase the project budget. Upon Council approval of the recommendation, administrative authority will be reset, providing the City Manager with authority to approve future contracts, contract changes or amendments up to the new calculated limits. Staff are requesting $800,640 in ARPA funds to complete the work.
The estimated date of completion is December 2024, pending approval of the recommended action.
FINANCIAL SUMMARY
There will be no financial impact to the City’s General Fund or any other unrestricted fund as a result of this action. HHAP 4 funds are available in project # EH23054 to fund the St Mary’s Dining Room operation services contract. $800,640 of ARPA funds will need to be de-obligated from the St. Mary’s Dining Room operation services contract funded through ARPA project #EARP211 to then be reallocated to ARPA Navigation Center project #EARP212 for Durst Office Design contract.