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sr-092810-3kCity Council Meeting: September 28, 2010 Agenda Item:~~-- To: Mayor and City Council From: Andy Agle, Director of Housing and Economic Development Subject: Replacement of Previously-Proposed Arizona-Based Manufacturer for the Mountain View Mobile Home Park Rental Housing Replacement Contract Recommended Action Staff recommends that the City Council: 1. Authorize the City Manager to negotiate and execute a contract not to exceed $3,000,000 with Golden West Homes, located in Perris, CA, to design, build, and install 20 new, affordable and sustainable manufactured homes to replace 20 existing rental units at Mountain View Mobile Home Park (MVMHP); and 2. Approve the budget changes as outlined in the Financial Impacts & Budget Actions section. Executive Summary Staff has identified a qualified California-based company for the purchase of 20 new manufactured homes to replace City-owned units at MVMHP and recommends that Council award a contract not to exceed $3,000,000 to Golden West Homes. This proposal replaces staff's August 10. 2010 proposal of Cavco Industries, Inc., an Arizona-based company. The proposal was negotiated on the open market in response to Council's August 10, 2010 decision to uphold their resolution imposing financial trade sanctions against the State of Arizona and therefore reject all bids related to the MVMHP housing replacement Request for Proposals (RFP), four of which were from Arizona companies. The Golden West Homes proposal is .consistent with the design and sustainability goals established in the previous RFP process and results in no change to the $3,000,000 total budget presented in the August 10, 2010 recommendation to Council Background Ten years ago, the City purchased MVMHP to preserve it for affordable housing. A comprehensive infrastructure upgrade at MVMHP was completed in August 2010. The next phase of improvement involves replacing 20 City-owned units which include older 1 travel trailers and mobile homes. Staff issued an RFP to mobile home manufacturers on December 1, 2009 to design, build and install 20 affordable and sustainable manufactured homes at MVMHP. Seven proposals were received in response to the RFP. On August 10, 2010, staff presented a recommendation to Council to authorize the City Manager to award a contract for this work to Cavco Industries, Inc., an Arizona- based company. Council upheld their May 25, 2010 resolution imposing financial trade sanctions against the State of Arizona, voted to reject all bids received in response to the RFP, and authorized staff to negotiate on the open market to seek a manufacturer that is not based in Arizona. Discussion Acting on Council's August 10, 2010 directive, staff contacted the three non-Arizona- based manufacturers that had submitted proposals in response to the RFP and informed them that the City was seeking proposals matching the original RFP specifications with .pricing competitive to the estimates included in the Cavco proposal. These manufacturers, namely Silvercrest Western Homes Corporation, Skyline. Corporation and Golden West Homes, were joined by four additional non-Arizona companies who contacted the City. Golden West Homes (located in Perris, California) and Silvercrest Western Homes Corporation (located in Corona, California) submitted proposals. Staff reviewed both proposals and determined that the Silvercrest proposal does not include costs for. the add alternatives outlined in the RFP so a full cost comparison could not be completed. However, a comparison of the manufactured home, transportation and installation costs provided shows that the Silvercrest proposal is approximately $154,000 more than the Golden West Homes proposal (based on the unit sizes and quantities described in Attachment A). Golden West Homes, in partnership with Marmot Radziner Prefab (located in Los Angeles, CA and Cavco's partner in the previous RFP process) offers a proposal that is approximately $35,000 less than the Cavco proposal. The cost of the manufactured homes is approximately $95,000 higher than the Cavco proposal due to increases in material and labor costs in the 9 months since the Cavco proposal was submitted and 2 market differences from one state to another. This increase is fully offset by $130,000 in savings associated with transportation and installation costs, thereby creating a net savings of $35,000 that allows for an increase in the contingency amount and maintains the $3,000,000 total budget presented in the August 10, 2010 recommendation to Council. A comparison of the Estimated Project Budget based on the Cavco proposal submitted in December 2009, and the current costs from Golden West Homes proposal, submitted in September 2010, is included in Attachment A. Features and prices included in the Cavco, Golden West Homes and Silvercrest proposals are compared in Attachment B. Images of the proposed manufactured home designs are provided in Attachment C. The Golden West Homes proposal provides the same quality affordable homes with the added benefit of keeping City dollars in the Southern California region. Also, in keeping with the City's commitment to sustainable practices, the Perris plant's location, 310 miles closer to Santa Monica than that of Cavco, will result in fewer carbon emissions than would have been generated during transportation of the units from Goodyear, Arizona. Furthermore, Golden West Homes offers the additional benefit of homebuyer financing that Park residents may use in the future when replacing their homes. Staff recommends moving forward with this proposal and purchasing 20 new manufactured homes from Golden West Homes. Staff anticipates entering into a contract with Golden West Homes and obtaining design approvals from the Architectural Review Board by the end of 2010. Installation of units is anticipated to commence by April 2011, ensuring that the City will meet its federal funding source spending deadlines. Community Engagement Staff meets with residents of the MVMHP on a monthly basis, both to update residents on the project and ask for their input, and has done so throughout both the RFP and open negotiations processes. Additionally, staff has held a meeting with the residents of City-owned units to address issues specific to the anticipated replacement of their units 3 with new manufactured homes and will continue to work closely with them as units are designed and installed: Environmental Analysis As noted in the August 10, 2010 staff report, the proposed purchase of 20 manufactured homes has been reviewed under both the California Environmental Quality Act (CEQA) and the National Environmental Quality Act (NEPA). The project was determined to be exempt from CEQA and achieved a Finding of No Significant Impact under NEPA. Staff will assemble the environmental review documentation and submit the package to HUD to initiate a final public comment period prior to HUD's release of funds for the subject purpose. Financial Impacts & Budget Actions The total cost to replace the 20 City-owned units will not exceed $3,000,000. The replacement of 20 existing City-owned units with new manufactured homes will decrease the City's annual costs for maintenance of those units. Staff recommends that Council appropriate $527,956 in available HOME Investment Partnership Grant funds that remain unprogrammed from previous years' allocations to the HOME Housing Trust Fund account H20034410.589000. CDBG entitlement program funds in the amount of $1,233,611 may be at risk if not expended by April 30, 2011.The total of $3,000,000 is comprised of the $527,956 appropriation described above and $2,472,044 budgeted and available in the following accounts: 4 Account Number Amount Source of Funding 0194042.589000 $ 307,487 CDBG (Stimulus Funds) 0195002.589000 $ 1,233,611 CDBG (Entitlement Funds) H20034409.589000 $ 178,518 HOME (Entitlement Funds) H20034410.589000 $ 475,000 HOME (Entitlement Funds) H20005005.589000 $ 68,646 HOME (Entitlement Funds) H20005010.589000 $ 29,000 HOME (Entitlement Funds) H150194.589000 $ 179,782 Low/Mod Income Housing Fund H20034410.589000 $ 527,956 HOME (Entitlement Funds)-new Total $ 3,000,000 Prepared by: Melissa Lindley, Senior Administrative Analyst Approved: Forwarded to Council: ~~ AndyAgle, r or Rod Gould Housing and Economic Development City Manager ATTACHMENTS: A. Estimated Project Budget Comparison B. Comparison of Features and Prices C. Proposed Manufactured Home Designs 5 ATTACHINENT A Estimated Project Budget Comparison Cavco Industries IncIMarmol Radziner Prefab Golden West Homes/Marmot Radziner Prefab Description PeriUnit Costs per December 2009 Bid Quantity ` ' Total Butlget Per Unit Costs per September 2010 Bid Quantity TotaC Budget MANUFACTURED HOMES 12' x 32' Unit $ 22,975 8 $ 183,800 $ 23,808 8 $ 190,464 13.5' x 32' Unit $ 22,975 3 $ 68,925 $ 25,920 3 $ 77,760 13.5' x 50' Unit $ 31,411 1 $ 31,411 $ 40,500 1 $ 40,500 16' x 50' Unit $ 38,577 7 $ 270,039 $ 48,000 7 $ 336,000 24' x 48' Unit $ 55,449 1 $ 55,449 $ 59,904 1 $ 59,904 Sub'.-Total i 20 $ 609,624.' 20 $ 704,628-` ADD ALTERNATIVES Solar Photovoltaic System after rebate $ 8,303 20 $ 166,060 $ 8,303 20 $ 166,060 Passive Domestic Solar Water Heating (after rebate $ 1,860 20 $ 37,200 $ 1,860 20 $ 37,200 Sunearth Domestic Hot Water Panel $ .5,900 20 $ 118,000 $ 5,900 20 $ 118,000 Built-In Microwave $ 600 20 $ 12,000 $ 675 20 $ 13,500 Stackable Washer & D er $ 1,500 20 $ 30,000 $ 1,700 20 $ 34,000 AirConditionln $ 2,600 20 $ 52,000 $ 2,100 20 $ 42,000 Tankless Hot Water Heater $ 1,500 20 $ 30,000 $ 1,715 20 $ 34,300 Side Porch $ 8,400 20 $ 168,000 $ 8,400 20 $ 168,000 Rear Porch Railin $ 1,800 20 $ 36,000 $ 1,800 20 $ 36,000 Front orch railin $ 1,000 20 $ 20,000 $ 1,000 20 $ 20,000 Green Box $ 2,200 20 $ 44,000 $ 2,200 20 $ 44,000 Subtotal $! 713,260 $ 713,060" UNIT INSTALLATION Unit Transit $ 4,000 20 $ 80,000 $ 1,425 20 $ 28,500 Unit Installation $ 17,000 20 $ 340,000 $ 13,100 20 $ 262,000 Subtotal $ 420,000 ` $ 29Q,500' SOFT COSTS Permits, Insurance & Bond $ 80,000 $ 80,000 Relocation of Units $ 70,000 $ 70,000 Removal and Disposal of Units $ 400,000 $ 400,000 Construction Mana ement $ 200,000 $ 200,000 Sub.-Total $ 750,000 $ 75Q,O110: TOTAL $2 ,492,884 $2,458,188 Contin enc $ 50T,116 $ 541,812 TOTAL with Contih enc ,$3,000,000` +$3,000,000: TOTAL per Unit $ 150,000 $ 150,000 ATTACHMENT B Comparison of Features and Prices escription Cavco Industries Inc./Marmot Radziner Prefab Per. Unit Costs per December 2009 Bid Golden West `. HomeslMarmol Radziner Prefab Per Unit Costs' per September '2010 Bid ilvercrest Pec Unit Costs per September. 2010 Bid MANUFACTURED HOME 12' x 32' $22,975 $25,344 $31,296 12' x 34' $23,702 $26,928 $33,150 12' x 36' $24,381 $28,512 $34,927 12' x 38' $25,241 $30,096 $35,790 13.5'x30' $21,927 $25,110 $31,590 13.5' x 32' $22,975 $26,784 $33,134 13.5' 34' $23,702 $28,458 $35,113 13.5' x 36' $24,381 $30,132 $37,017 13.5' x 38' $25,241 $31,806 $38,509 13.5' x 46 $29,277 $38,502 $42,410 13.5' x 50' $31,411 $41,850 $44,245 16' x 50' $38,577 $49,600 $49,165 18' x 30' $25,511 $32,400 $39,690 18' x 36' $29,366 $38,880 $45,911 18' x 38' $30,744 $41,040 $47,948 18' x 44' $31,021 $47,520 $55,124 18' x 50' $37,994 $54,000 $62,910 20' x 48' $49,065 $57,600 $63,250 24' x 36' $43,810 $51,840 $59,691 24' x 48' $55,449 $69;120 $60,490 24'x 50' $57,466 $72,000 $61,023 Do all of the above units meet the construction specifications required the RFP? Yes Yes Yes ,4TTACHMENT B Cont'd Comparison of Features and Prices Cavco Golden West' Industries Homes/Marmot Inc./Marmot Radziner Prefab Description Radziner Prefab Per Unit Costsr Silvercrest Per Unit Costs' per September Per Unit Costs per December 2010 Bid per September'- 2009 Bid 2010 Bid ADD ALTERNATIVES Required by RFP: Solar Photovoltaic System (After $8 303 $8 303 Not Provided Rebates , , Passive Domestic Solar Water Heating $1 860 $1 860 Not Provided After Rebates , , Sunearth Domestic Hot Water Panel $5,900 $5,900 Not Provided Built-In Microwave $600 $675 Not Provided Stackable Washer & Dryer $1,500 $1,700 Not Provided A/C $2,600 $2,100 Not Provided Tankless Water Heater $1,500 $1,715 Not Provided Additional Add Alternatives proposed: 6' Side Porch $8,400 $8,400 N/A 4' Side Porch $7,800 $7,800 N/A Rear Porch Railing $1,800 $1,800 NIA Front Porch Railing $1,000 $1,000 N/A Green Box $2,200 $2,200 N/A Solar Tube N/A $350 N/A UNIT INSTALLATION Unit Transit $2,300-4,000 $1,200-2,400 $2,475 Unit Installation $6,400-17,000 $12,000-16,000 $15,051 OTHER Does the manufacturer provide Homebuyer No Yes No Financin ? 3-~_ cu1a1®nwest Penis UNIT1 -MICRGGREEN a MARMOL RADZINER PREFAB o~ MOUNTfilN VIEW Mountain View RFP September 2010 Gatden West ~,r~s ulrti-nit~.acz--ov MOUMPtN VI`cW PdARtufOL RADZINER PREFAB Mountain View RFP September 2010 G®Ede!lWest Peals UNiTt -MICROGREEN MOUNTAIN VIEW MAi2MOt RA6ZtNEft PREFAB Mountain View RFP September 2010 Gulden West Aenls UNITi -MICROGREEN MOUNTAIN VIEW ddARM4t RADZINER PREFAB Mountain View RFP September 2010 Golden West Perris MARMOL RADZINER PREF,~B unrz r -rdicaoc,~-w Mountain View RFP September 2010 Golden West Perris UHiTY-9NE 9EIX30CA4 u MIXINAW YiEW MARMOLRADZIPIER PREF.16 ?REFfS Mountain View RFP September 2010 GaEden West Perris MARM4L RADZINER PREFAB UYR2-0NESEQ=_OCd9 Mountain View RFP - September 2010 Golden West Perris UNR2-ONEBEA:O~A MAftMOL RADZINEFZ PREFAB Mountain View RFP September 2010 GaldWest Perris MARMOL RADZIhlER PREFAB IINR2-IX+E 6ER30Cd Mountain View RFP September 2010 G®klen West Penis uuRZ-o~es~xoan vi-rv MARM4L RA©ZIt+fER PREFAB _~~.-~a Mountain View RFP September 2010 G®lden West Penis MARMF~L ftA~ZINER PREFAB ?REF}& Mountain View RFP September 2010 G®ltien West Perris tdQR3¢S4L RADZINER PREFAB uwr3rnoseo3ocmoti aa~ Mountain View RFP September 2010 Golden West Perrir urvrarvo sEO~ocn+orr_a;TM HOUNTAtN VIEW Pr1ARPrtbt RA6ZIMER PREFAB Mountain View RFP September 2010 Gol[len West Penis MpRM4t RAOZINER PREFAE# lNr-3"!~W 5E0.~iOGfif Of.~ 3Ali Mountain View RFP September 2010 Gatdeo West Pe~~is tiNr 3 ~4RJ EE W OCM11 Oh= BAII MARiufOt RA-ZINER PREFAB ?REfF3 Mountain View RFP September 2010 Guidenll~est Perris ua?r±.~vo s~~ocn~ nvo sari ~J PvtARtvtOL RA6ZIMER PREP.~B ~+ ~• September 2010 Mountain View RFP Gaigeee West Penis UN c.1Y06~ROCM PX06AF~i MARMOL RROZINER PREFAB Mountain View RFP September 2010 GaldenUYest Ferris MARPviOL RA©ZINER PREFAB ^NiT?-A'JO ^eEORO W5 P.V~ 5ATtl Mountain View RFP September 2010 Ga[denwest Penis UNiSk-tt•10 3u130CMPN0 9Aii MAfttrf6t RABZINER PREFAB September 2010 Mountain View RFP G®ltlen West Penis ^tJ32? -N:O 6£9RQGM TVO 80.41 MARP¢SOL RA6ZINER PREFAB September 2010 Mountain View RFP Gu~iee West Perris iNARM4t RADZWER PREFAB e Mountain View RFP September 2010 Is'o1 nwes3 Perris MARM6L RAt)ZINER PREFAB UM1ITn Side CAR Mountain View RFP September 2010 Ga1t[enYYeSt Perris uurssio=_ca~ Mrv~l.rrn~u ~:cciai tv1ARMQt RA6ZMEft FREF.a6 Mountain View RFP September 2010 Gatd®West Penis GNITa SID'c ~ft MIXFNfNN V[EW MARMOL. RAF7~IMER PREFAB Mountain View RFP September 2010 Galslen Wes4 Penis MAR7~EOL RADZINER PREFA6 ^fiIT 55~~=G1.4 Mountain View RFP September 2010 Reference Contract No. 9283 (CCS).