New Merriam Community Center Design

Master Plan Conformance Audit

by David Neal, Merriam City Council

July 22, 2018
Last Updated September 15, 2018

As a member of the City Council, I believe it is one of the duties of all elected officials to provide oversight and thoughtful judgment concerning activities that the City is undertaking. When something doesn't seem right, as an elected official you should ask questions and try to understand to the best of your ability any discrepancies between the information that has raised your concerns and any other factual information you can develop. The purpose of this series of posts is to discuss issues that have been raised about the new Merriam Community Center and Aquatics Center project.

Overview: Ignoring the 2017 Master Plan Budget

Based on my engineering and construction background, after seeing things that clearly did not make sense following the design presentations for outdoor aquatics in July, 2018, I began to carefully review the 2017 Facilities Master Plan and supporting documents for the new Merriam Community Center. I have reviewed the design work product of the internal staff-led team. I have reviewed the work of the various committees involved in the selection of the design-build contractor and in the design review process for what amounts to a no-bid design and construction project. As a result, I have discovered and compiled detailed information in this report that appears to show that during the City's implementation of the "design-build" process:

• The 2017 Facilities Master Plan was selectively ignored, particularly with respect to aquatics design.
• A $10 million planned investment in new aquatics was reduced to $4.4 million unilaterally by staff without consultation with the City Council or other committees related to the new community center project. The remaining $4.4 million in the project budget was directed mostly to the indoor aquatics features, leaving token amounts for outdoor aquatics.
• After public outcry, an additional $1.6 million of funding had to be added to the project to marginally improve the outdoor aquatics design.
• Early staff design decisions regarding the Community Center building that increased the cost of the building (including an expensive entry courtyard) meant that the original $30 million cost estimate for the project was low. Since the planned funding for the project was only $30 million, the project was clearly under-funded.
• In deciding the amount of funding to put before the voters in a Special Election, the City made the mistake of not adjusting the Master Plan cost estimates for 18 months of inflation. This meant that the project started out $2 million under-funded on the day the Special Election vote was approved.
• The Community Center campus design was significantly altered by the re-location/co-location of the Antioch Library to the Community Center campus immediately after the Community Center Special Election. This idea and early discussions about it were not included in the community center public vote discussions about the Community Center project despite being discussed internally for at least 6 month prior to the vote.
• The introduction of the library into the Community Center project seems to have been a primary driver in the design of the Community Center site, squeezing out room for an appropriate outdoor aquatics design. The library's requirements for the combined building entrance area, building orientations and elevations were major elements in the site plan decisions that limited what could be provided in terms of outdoor aquatics.
• The Johnson County Library stakeholder interests seem to have been much more closely involved in design discussions during the critical early months of design than the new Merriam Community Center's interested parties who were represented only by City staff. Since staff was also actively negotiating/lobbying for the Library to co-locate, staff was providing concessions in support of a new project deal despite being obligated to deliver what the residents of Merriam voted for in the Master Plan. There should have been active participation of other community center stakeholders to represent the Merriam residents' interests in such a negotiation with the Johnson County Library.
• Parking requirements for the site that contains both a community center with aquatics and a public library realistically requires the construction of a multi-level parking structure that will be paid for by the City of Merriam.
• Although a $5 million cost (now $6.6 million) is cited for this parking structure, most of the TIF money involved is really being used to pay for Community Center site preparation costs and infrastructure originally included in the $30 million project budget. This is necessary because the $30 million in the Master Plan implicitly approved by voters was not enough to build the project as currently designed.
• Major decisions about the design, project budget emphasis, additional funding needs and other important matters were made 'behind closed doors' by City staff (and possibly a very few others) without a full airing before Merriam's elected officials.
• This series of unilateral incremental staff decisions have eaten up the project clock making them hard to revisit, and have significantly negatively altered the community center project deliverables and increased the City's financial outlays by 22% so far.

In summary, major decisions about the design, project budget emphasis, additional funding needs and other important matters were made 'behind closed doors' by City staff (and possibly a very few others) without a full airing before Merriam's elected officials. These decisions have significantly altered the community center project deliverables downward and increased the City's financial outlays by 22% so far. The design direction and the promises made to Merriam residents as reflected in the 2017 Facilities Master Plan appear to have been very poorly followed during a feedback-deficient internal staff design process. The outdoor aquatics facilities have been significantly downgraded in the design for the new community center as a result.

Process breakdowns have resulted in a design featuring a costly entry courtyard and a constrained outdoor aquatics area leading to an inflated project cost that can't fit the features detailed in the Master Plan into the original $30 million project budget. At a current project budget of $36.6 million, Merriam is still getting less than expected for more money. Therefore, the current project design should be reviewed/audited thoroughly before demolition of existing facilities or construction of the new community center proceeds.

Details: Ignoring the 2017 Master Plan Budget

From the Merriam 2017 Parks and Recreation Facilities Master Plan, the new community center project design 'Concept 1' containing both indoor and outdoor aquatics was selected and put before Merriam voters in September, 2017.

The anticipated budget for this option had an overall budget amount listed in the Plan as $29,970,318. Despite a check of the addition of the numbers in the table yielding a slightly higher total of $30,098,056, the $30 million number was discussed when trying to promote a 'yes' vote.

The 2017 Parks and Recreation Facilities Master Plan conceptual design costs for the indoor aquatics portion of the project were $5.6 million for the aquatic features listed which includes choosing the 4-lane, 5 ft maximum depth lap pool option and a 2,800 sf leisure pool with max depth of 5 ft, and spray features.

The 2017 Parks and Recreation Facilities Master Plan conceptual design costs for the outdoor aquatics portion of the project was $4.5 million for the aquatic features listed in the table including a 8-lane main pool, a leisure pool with a lazy river and water slides, and a spray pad area.

Thus the total anticipated budget for the aquatics portion of the community center according to the 2017 Master Plan conceptual design was around $10 million.

Aquatics Design - "Follow the money"

Graphic shows the outdoor aquatics design process and the money moves made by city staff and the City Council. The City Council was essentially forced to increase the overall project budget by $1.6 million to enhance the outdoor aquatics only after the city staff design 'team' secretly re-allocated $5.6 million in the original plan away from the aquatics budget into something else, as yet unknown.

The email response from the Merriam Assistant City Administrator to a question by Councilmember Neal about the apparent discrepancy between aquatics amounts in the actual project budget as disclosed during a Council Work Session on July 16, and the Master plan budget which forms the basis for the funding approved by voters during the September 2017 special election resulted in a troubling answer.

Reading past the counter-factual 'spin' ("So in order to adhere as closely as possible to the original intent of the community and maximize the aquatics budget,..."), the meat of the sentence shows that the internal staff team made the decision themselves to combine separate indoor and outdoor aquatics equaling $10 million into the $4.4 million outdoor aquatics 'bucket,' thereby freeing up $5.6 million (for something):

Really now. It was more than $10 million until staff apparently changed it on their own.

I apologize for the dripping sarcasm in this section of my report to Merriam residents. I hate when information is presented wrapped in bold 'spin' phrases. This answer to my serious inquiries was boldly spun to hide the fact that the internal design team made a unilateral decision to significantly reduce the Master Plan's level of emphasis on aquatics.

When I attempted to ask questions about this email disclosure at the July 23, 2018 City Council meeting, the answers were deflected and spun masterfully by the Assistant City Administrator. My questions were to inform the other members of the City Council about the key staff funding shift I had learned from the email received 3 days before.

The spin was designed to deflect and make sure that the other City Council members did not perceive the staff decision to shift $5.6 million away from aquatics through their design choices was a major unapproved policy decision made by staff. This kind of major deviation from the Master Plan clearly should have been brought to the City's elected officials for approval before proceeding forward for five more months of design.

The decision by staff to re-allocate project major funding away from aquatics should have been discussed and debated openly, and should not only have been disclosed in a contorted response to a persistent Council Member's questioning. Troubling.

But the spin in written form and before the Council is classic.

The staff project 'team' decided to lop off $5.6 million from the Master Plan's aquatics budget "in order to adhere as closely as possible to the original intent of the community."

Who decides what the original intent of the community was/is?

I would think that determination should also be a function of the only elected representatives of Merriam residents, the City Council and Mayor collectively. This was not done for at least 4-5 months after the decision was made at the staff level.

Or better yet, we could ask the community the questions we are facing now, and stop relying on staff's interpretation of community intent. Staff continuously refers to a 'statistically valid' survey from which they have divined all sorts of answers that are not actually there in what I believe was a poorly constructed survey of residents from 2016 that is now out of date. The survey also does not directly ask key questions about where to cut this project since we now also have a funding shortfall.

While the City leaders promote the spin that the project is not 'over-budget' since we 'found' and authorized more money in the TIF fund, the project is clearly 'over-budget' when compared to the original $30 million cost promoted by the city to get voter approval of the project funding.

I am not sure which 'community' the Assistant City Administrator was referring to and I think there can reasonably be multiple interpretations about what was the "original intent of the community" but I guess by only cutting $5.6 million from the aquatics budget in their original design was how the team was able to "maximize the aquatics budget" while still including all the other more important stuff "in the building" (based on staff's superior understanding of 'the community').

Should we be thankful?

Staff could have done away with the outdoor pool altogether but instead on July 9th the 'team' recommended a 6-lane 25 yard pool with an integrated diving well. This gave Merriam residents a third of the outdoor pool we already have. And the design took up half of that with an integrated restricted-use diving well. Certainly one could ask what thing is staff is giving Merriam residents 'the maximum' of? Certainly it is something other than aquatics.

Failure to read the Master Plan's directions about cost inflation

The same July 20, 2018 email discussed above also first disclosed another significant problem with the project budget. Specifically, the email disclosed that the project's construction budget had to be adjusted by an unrecognized $2 million for construction inflation.

According to the email, "The other caveat I will add to this is that this was a preliminary budget set in 2016 escalated to being at the midpoint of construction in summer 2018. Once you factor in 5% inflation factor (the current standard for non-residential construction is 5-5.5%) that would take the $25.5 budget to $27.5 at the midpoint of construction in late 2019."

The September 15, 2017 special election featured a ballot question which permits the city to raise $24 million of the projected $30 million cost for a new community center by issuing general obligation municipal bonds which are to be paid back using an increased sales tax.

In the first quarter of 2018, the bond sale was held and new restrictions and obligations have been imposed on the city based on the terms under which the bonds were sold.

Based on a response to my questions about the project budget sub-categories dated July 20, 2018, the Assistant Administrator admitted to me that the design team was forced to find $2 million extra as compared to the 2017 Master Plan because that plan's project costs assumed the midpoint of construction would be occurring now during the summer of 2018. A 5% per year increase in costs was needed to account for the actual timeline by shifting the midpoint of construction forward by 18 months.

Section 7-3 of the Facilities Master Plan cost estimate for a new community center with indoor and outdoor aquatics starts with a warning about adjusting the cost estimates for inflation if the construction schedule assumed in the Master Plan (midpoint of construction in summer 2018) is not the actual schedule used.

It is unacceptable that a construction inflation cost adjustment was not made by city staff before finalizing the funding amount authorized in the September 2017 ballot vote and then actually raised during the bond sale 6 months later.

It was unreasonable for City staff to go forward and prepare a vote in September 2017 with cost numbers that represent the midpoint of construction of a three year project using an assumed midpoint only 8 months after the vote (May 2018). The design process itself should have been expected to take more than a year to complete after the project is approved by voters.

As it now appears that there is not enough money available to build the community center envisioned by the 2017 Master Plan, it is too bad that the bond sale was allowed to proceed without revisiting the amounts and particulars of the project again before committing the city to build a facility that will not meet community needs.