HRA Board of Commissioners

City of South St. Paul Housing and Redevelopment Authority Agenda Special Meeting Monday, October 8, 2018 Training Room 6:30 P.M. 1. CALL TO ORDER: 2. ROLL CALL: 3. AGENDA: A. Approval of Agenda Action – Motion to Approve Action – Motion to Approve as Amended 4. PUBLIC HEARINGS: A. Approval of 2019 Annual Plan and Revised 5-Year Capital Fund Plan – Resolution No. 18-3322 5. CONSENT AGENDA: All items listed on the Consent Agenda are items, which are considered to be routine by the Economic Development Authority and will be approved by one motion. There will be no separate discussion of these items unless a Commissioner or citizen so requests, in which event the item will be removed from the consent agenda and considered at the end of the Consent Agenda. A. Approval of Minutes – Special Meeting – June 25, 2018 6. GENERAL BUSINESS: A. Approval of Bid and Award Contract for Sprinkler Head Project at Highrises B. Approval of 2019 Public Housing Budget – Resolution No. 18-3323 7. ADJOURNMENT: Respectfully Submitted, Ryan Garcia, HRA Executive Director  5-A HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY OF SOUTH ST. PAUL BOARD OF COMMISSIONERS MINUTES SPECIAL MEETING JUNE 25, 2018 The Special Meeting of the Housing and Redevelopment Authority of the City of South St. Paul was held on June 25, 2018 in the South St. Paul City Hall Training Room. Chairperson Hansen called the meeting to order at 7:15 P.M. The following Commissioners were present: Lori Hansen, Todd Podgorski, Marilyn Rothecker, Joe Forester, Tom Seaberg and Jimmy Francis. Commissioner Bill Flatley observed via Webconference. Staff was represented by: Ryan Garcia, Steve King, Joel Hanson, Shelly Anderson, Chris Hartzell. APPROVAL OF AGENDA It was moved by Commissioner Seaberg and seconded by Commissioner Rothecker to approve the agenda as presented. Motion carried. PUBLIC HEARING There were no public hearings. CONSENT Motion/Second: Commissioner Francis moved and Commissioner Podgorski seconded the motion to approve the consent agenda as follows: A. Approval of Minutes – Annual Meeting – June 11, 2018 Motion carried 6 ayes / 0 nays GENERAL BUSINESS A. Approval to Amend HRA By-Laws Motion/Second: Commissioner Seaberg moved and Commissioner Francis seconded the motion to amend the HRA By-Laws. Motion carried 6 ayes / 0 nays HRA Special Meeting Minutes June 25, 2018 Page 2 of 2 B. Sprinkler Head Replacement Project at Highrises Mr. Garcia discussed the process to commission a contractor for the sprinkler head replacement project at the Nan McKay and John Carroll apartment buildings. Two bids were received. After bid opening, the low bidder notified HRA staff that they had made an error in their pricing and the bid price would increase by $36,000 to complete the project. Staff consulted with the HRA’s counsel and concluded that all bids should be rejected and the project should be re-bid. The project will be re-bid in late summer 2018 in an effort to increase the number and competitiveness of bids. Motion/Second: Commissioner Rothecker moved and Commissioner Francis seconded the motion to reject all bids for the sprinkler head replacement project and rebid the project. Motion carried 6 ayes / 0 nays ADJOURNMENT Motion/Second: Commissioner Forester moved and Commissioner Seaberg seconded the motion to adjourn the meeting at 7:21 P.M. Respectfully submitted, __________________________________ ______________________________ Bill Flatley, Secretary Lori Hansen, Chairperson Dated: ____________________________ A HRA Agenda Report Date: October 8, 2018 6-A HRA Executive Director: ____________ Agenda Item: Approval of Bid and Award Contract for Sprinkler Head Replacement Project at Highrises Action to be considered: Motion to accept the low bid for the sprinkler head replacement project and award contract to Dynamic Fire Protection for the Sprinkler Head Replacement Project at the John Carroll and Nan McKay Highrises. Overview: An advertisement for bids to replace all sprinkler heads in the highrise buildings was published in August of this year, and we received only one bid. This bid, from Dynamic Fire Protection, proposes completing the entire project for $192,000. A potential deduction of $56,875 is possible in the event that the Fire Official determines that sprinkler heads in the atrium area of the John Carroll building do not require replacement. Dynamic Fire Protection (DFP) is a relatively new fire protection contractor, although their principals have several years of industry experience. We have worked with our architect to conduct reference checks, interviews, and site visits on DFP, and have reviewed their business financials. The project will be funded using 2017 and 2018 HUD Capital Funds and should begin within the next 60 to 90 days. It is anticipated that the project will take approximately 10 weeks to complete. In total, there are nearly 3,000 sprinkler heads to be replaced as a part of the project. Source of Funds: This project is funded through the City’s 2017 and 2018 Capital Fund Program, which is a HUD Subsidy that’s already been awarded and committed to the project. Attachments: Bid recommendation materials from Finn-Daniels Architects Bid Recommendation 10-1-18 To: South St. Paul Housing and Redevelopment Authority 125 3rd Avenue North South St. Paul, MN 55075 Attn: Mindy Ostrow Public Housing Manager Re: Sprinkler Head Replacement Project John Carroll Apartments – 300 Grand Avenue Nan McKay Apartments – 200 Marie Avenue South St. Paul, MN 55075 On May 8th, 2018 plans and specifications were completed and distributed for bids. The results of that bid were that bidding errors were made by both of the two (2) companies that submitted bids. After discussions between the HRA HUD, and the Architect, the plans & specifications were further clarified for the project listed above and then rebid. On August 28, 2018 plans and specifications were clarified and redistributed for bids. An Advertisement for Bids was listed in the local paper twice, and plans were posted on various construction bidding networks. On May 15, 2018, May 30, 2018 and August 6th 2018, Mandatory Prebid Meeting and Walkthroughs were held at the two locations, John Carroll Apartments and the Nan McKay Apartments. There were 10 Sprinkler Companies represented at the three (3) Prebid-Walkthrough meetings. On May 29th, 2018 at the first bid opening, bids were read aloud consistent with the procurement policy of the South St. Paul HRA for the work described in plans and specifications (Architects Project #18001). As mention previously, the HRA received 2 sealed bids from Sprinkler Contractors that both contained bid errors. On September 20th, 2018, the HRA received a singular bid from Dynamic Fire Protection for a $192,000.00 with the Alternate Deduct price of $56,875.00 for removing the Atrium Work. They were the only Sprinkler Contractor to bid at this time even though numerous efforts were made to engage additional bidders and the bidding pool looked promising based on the interest level of the walkthroughs. Dynamic Fire Protection (the low bidder) is a newly created company (May of 2018). They have done acceptable work in the past year based on the references they provided. The Contractor has completed and submitted all required paperwork with their bid as required by HUD (such as Non-Collusive Affidavit, Section 3 information etc.). On October 1st 2018 Jim Lindquist and I interviewed the sprinkler contractor at their home office in Chisago City. Since this is a newer company they are currently running their business out of the residence of one of the owners. The project and their bid were discussed as noted below: • Dynamic Fire Protection, Inc is a Sub Chapter S Corporation formed in May of 2018. • The Owners (Brian Hoffman & Tony Morris) both work in the office and in the field. • They both previously worked for LVC Fire Protection and Brian previously had worked as a fire inspector for the City of St. Paul. • They have a total of 2-3 total staff (Head replacement projects typically take 1-2 workers on site). • Dynamic Fire Protection can be retained after the 12-month warranty period for sprinkler maintenance as they do that sort of service work as well. • Their performance and payment bonding would come through Pate Bonding and Northern Escrow since their bonding company will require payment of workers and subcontractors first (see attached letter). • When asked about their financial viability to do this project they responded by stating that the material costs are approximately $35,000 and they said they can afford that amount – thus they have the financial ability to do the job. This is probably true since as owners and the workforce they are paying themselves for the labor portion of the job. • While much of their work has been tenant improvement work, they have tackled larger jobs at Canterbury Park and a hotel.  • They interviewed quite well and I believe they would work with the resident population quite well. They both have experience in working in occupied rehab projects. See there attached resume list of projects along with experience noted at the bottom of the second page. • Also, they had a suggestion that could potentially save some money on the project but it would require engaging the Fire Marshal and the Building Official before we can quantify those savings. The design team along with the HRA will verify if this is a viable option to save money. From a pure workmanship aspect at this time I do not see anything that would disqualify this “newer company” Dynamic Fire Protection, Inc. from their bid of: John Carroll - $143,825 Nan McKay - $48,175 Total $192,000 Based on available funds of the HRA. As a point of reference: In the June Bidding, by the two companies that made bid errors, their total bids were: Naseff Mechanical - $178,200 Brothers Fire - $195,934 These two companies were contacted for re-bidding, but neither elected to provide a bid in the bidding completed in September 2018. This report is respectfully submitted by, Daniel Dege AIA, LEED AP, CEO Finn Daniels Architects Attachments: Bid Tabulation, Experience Form (submitted with bid), 3-Page memo and letter from Bonding and Escrow Company. A HRA Agenda Report Date: October 8, 2018 6-B HRA Executive Director: ____________ Agenda Item: Approval of 2019 Public Housing Budget – Resolution No. 18-3323 Action to be considered: Motion to adopt Resolution 18-3323 approving the 2019 Public Housing Budget. Overview: In our capacity as a Public Housing Agency, each year we are required to prepare an Annual Budget and submit this to the U.S. Department of Housing and Urban Development (HUD) for approval. The 2019 budget is enclosed for the board’s review and approval. 2019 budgeted operating income totaling $2,015,800 are anticipated from the following sources: • Rental income $1,150,000 • Operating Subsidy $778,000 • Excess Utilities (air conditioner surcharge) $17,760 • Other Income (washer/dryer income, keys, misc) $70,040 2019 budgeted operating expenses of $1,672,500 are estimated and include: • Administrative Expenses $547,790 • Contract Costs (CommonBond) $587,580 • Utilities $283,990 • Payment in lieu of Tax $90,010 • Other Expenses $163,130 Residual receipts (i.e. “profit”) are budgeted to be approximately $343,310 for 2019. The 2019 Budget represents what staff considers a reasonable plan and expectation for the operations of the John Carroll and Nan McKay Public Housing communities. We have intentionally budgeted on the conservative side considering that this will be our transition year to an outside management partnership. Furthermore, our budgeted operating subsidy may or may not be approved by Congress (via HUD) at the level we’re requesting, and we wanted to build in enough wiggle-room to adequately support operations in this transition year. Source of Funds: The Public Housing Budget is supported primarily by rental income from the units in the John Carroll and Nan McKay buildings and the annual operating subsidy from HUD. Attachments: 2019 Public Housing Budget Details PHA Board Resolution U.S. Department of Housing OMB No. 2577-0026 Approving Operating Budget and Urban Development (exp. 07/31/2019) Office of Public and Indian Housing - Real Estate Assessment Center (PIH-REAC) Public reporting burden for this collection of information is estimated to average 10 minutes per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. This agency may not collect this information, and you are not required to complete this form, unless it displays a currently valid OMB control number. This information is required by Section 6(c)(4) of the U.S. Housing Act of 1937. The information is the operating budget for the low-income public housing program and provides a summary of the proposed/budgeted receipts and expenditures, approval of budgeted receipts and expenditures, and justification of certain specified amounts. HUD reviews the information to determine if the operating plan adopted by the public housing agency (PHA) and the amounts are reasonable, and that the PHA is in compliance with procedures prescribed by HUD. Responses are required to obtain benefits. This information does not lend itself to confidentiality. PHA Name: South St. Paul HRA PHA Code: MN010 Board Resolution Number: 18-3323 PHA Fiscal Year Beginning: 01/01/2019 Acting on behalf of the Board of Commissioners of the above-named PHA as its Chairperson, I make the following certifications and agreement to the Department of Housing and Urban Development (HUD) regarding the Board’s approval of (check one or more as applicable): DATE Operating Budget approved by Board resolution on: 10/08/2018 Operating Budget submitted to HUD, if applicable, on: Operating Budget revision approved by Board resolution on: Operating Budget revision submitted to HUD, if applicable, on: I certify on behalf of the above-named PHA that: 1. All statutory and regulatory requirements have been met; 2. The PHA has sufficient operating reserves to meet the working capital needs of its developments; 3. Proposed budget expenditure are necessary in the efficient and economical operation of the housing for the purpose of serving low-income residents; 4. The budget indicates a source of funds adequate to cover all proposed expenditures; 5. The PHA will comply with the wage rate requirement under 24 CFR 968.110(c) and (f); and 6. The PHA will comply with the requirements for access to records and audits under 24 CFR 968.110(i). I hereby certify that all the information stated within, as well as any information provided in the accompaniment herewith, if applicable, is true and accurate. Warning: HUD will prosecute false claims and statements. Conviction may result in criminal and/or civil penalties. (18 U.S.C. 1001, 1010, 1012.31, U.S.C. 3729 and 3802) Print Board Chairperson’s Name: Signature: Date: Lori Hansen, Chairperson 10/08/2018 Previous editions are obsolete form HUD-52574 (04/2013)  2019 Budget 2017 Actual 2018 Estimate 2019 Budget 2019 Budget (rounded to Operating Receipts 2019 Public Housing Budget PUM PUM PUM (not rounded) nearest $10) 070 3110 Dwelling Rental $322.19 $324.80 $323.76 $1,149,995.52 $1,150,000 080 3120 Excess Utilities $5.00 $5.00 $5.00 $17,760.00 $17,760 090 3190 Nondwelling Rental $0.00 $0.00 $0.00 $0.00 $0 100 Total Rental Income (sum of lines 070, 080, and 090) $327.19 $329.80 $328.76 $1,167,755.52 $1,167,760 110 3610 Interest on General Fund Investments $0.00 $0.00 $0.00 $0.00 $0 120 3690 Other Income $226.51 $248.15 $238.75 $848,040.00 $848,040 130 Total Operating Income (sum of lines 100, 110, and 120) $553.70 $577.95 $567.51 $2,015,795.52 $2,015,800 Operating Expenditures - Administration 140 4110 Administrative Salaries $0.00 $0.00 $0.00 $0.00 $0 150 4130 Legal Expense $1.00 $1.55 $2.67 $9,483.84 $9,490 160 4140 Staff Training $0.57 $0.00 $0.53 $1,882.56 $1,890 170 4150 Travel $0.62 $0.00 $0.38 $1,349.76 $1,350 180 4170 Accounting Fees $36.37 $1.28 $2.11 $7,494.72 $7,500 190 4171 Auditing Fees $8.71 $4.65 $8.45 $30,014.40 $30,020 200 4190 Other Administrative Expenses $59.72 $101.01 $140.08 $497,564.16 $497,570 210 Total Administrative Expense (sum of line 140 thru line 200) $106.99 $108.49 $154.22 $547,789.44 $547,790 Tenant Services 220 4210 Salaries $0.00 $0.00 $0.00 $0.00 $0 230 4220 Recreation, Publications and Other Services $0.00 $0.00 $0.00 $0.00 $0 240 4230 Contract Costs, Training and Other $19.62 $22.13 $20.10 $71,395.20 $71,400 250 Total Tenant Services Expense (sum of lines 220, 230, and 240) $19.62 $22.13 $20.10 $71,395.20 $71,400 Utilities 260 4310 Water $4.87 $3.21 $4.36 $15,486.72 $15,490 270 4320 Electricity $46.98 $43.42 $47.02 $167,015.04 $167,020 280 4330 Gas $13.68 $13.87 $14.64 $52,001.28 $52,010 290 4340 Fuel $0.06 $4.55 $3.15 $11,188.80 $11,190 300 4350 Labor $0.00 $0.00 $0.00 $0.00 $0 310 4390 Other utilities expense $11.53 $8.31 $10.78 $38,290.56 $38,300 320 Total Utilities Expense (sum of line 260 thru line 310) $77.12 $73.36 $79.95 $283,982.40 $283,990 Ordinary Maintenance and Operation 330 4410 Labor $0.00 $0.00 $0.00 $0.00 $0 340 4420 Materials $18.96 $23.11 $19.95 $70,862.40 $70,870 350 4430 Contract Costs $133.90 $142.11 $145.47 $516,709.44 $516,710 360 Total Ordinary Maintenance & Operation Expense (lines 330 to 350) $152.86 $165.22 $165.42 $587,571.84 $587,580 Protective Services 370 4460 Labor $0.00 $0.00 $0.00 $0.00 $0 380 4470 Materials $0.00 $0.00 $0.00 $0.00 $0 390 4480 Contract costs $0.94 $1.29 $2.17 $7,707.84 $7,710 400 Total Protective Services Expense (sum of lines 370 to 390) $0.94 $1.29 $2.17 $7,707.84 $7,710 General Expense 410 4510 Insurance $19.20 $29.13 $21.68 $77,007.36 $77,010 420 4520 Payments in Lieu of Taxes $25.17 $0.00 $25.34 $90,007.68 $90,010 430 4530 Terminal Leave Payments $0.00 $0.00 $0.00 $0.00 $0 440 4540 Employee Benefit Contributions $0.00 $0.00 $0.00 $0.00 $0 450 4570 Collection Losses $1.22 $0.00 $1.83 $6,500.16 $6,510 460 4590 Other General Expense ($0.22) $0.19 $0.15 $532.80 $540 470 Total General Expense (sum of lines 410 to 460) $45.37 $29.32 $49.00 $174,048.00 $174,050 480 Total Routine Expense (sum of lines 210, 250, 320, 360, 400, and 470 $402.90 $399.81 $470.86 $1,672,494.72 $1,672,500 Rent for Leased Dwellings 490 4710 Rents to Owners of Leased Dwellings $0.00 $0.00 $0.00 $0.00 $0 500 Total Operating Expense (sum of lines 480 and 490) $402.90 $399.81 $470.86 $1,672,494.72 $1,672,500 Nonroutine Expenditures 510 4610 Extraordinary Maintenance $0.00 $0.00 $0.00 $0 $0 520 7520 Replacement of Nonexpendable Equipment $0.00 $0.00 $0.00 $0 $0 530 7540 Property Betterments and Additions $0.00 $0.00 $0.00 $0 $0 540 Total Nonroutine Expenditures (sum of lines 510, 520, and 530) $0.00 $0.00 $0.00 $0 $0 550 Total Operating Expenditures (sum of lines 500 and 540) $402.90 $399.81 $470.86 $1,672,495 $1,672,500 Prior Year Adjustments 560 6010 Prior Year Adjustments Affecting Residual Receipts Other Expenditures: 570 Deficiency in Residual Receipts at End of Preceding Fiscal Yr. 580 Total Operating Expenditures, including prior year adjustments and $402.90 $399.81 $470.86 $1,672,494.72 $1,672,500 other expenditures (line 550 plus or minus line 560 plus line 570) 590 Residual Receipts (or Deficit) before HUD Contributions and provision for operating reserve (line 130 minus line 580) $150.80 $178.14 $96.65 $343,300.80 $343,310 HUD Contributions 600 8010 Basic Annual Contribution Earned - Leased Projects-Current Year 610 8011 Prior Year Adjustments - (Debit) Credit 620 Total Basic Annual Contribution (line 600 plus or minus line 610) 0 0 0 0 $0 630 8020 Contributions Earned - Op. Sub - Cur. Yr.(before year-end adj) 640 Mandatory PFS Adjustments (net) 650 Other (specify) 660 Other (specify) 670 Total Year-end Adjustments/Other (plus or minus lines 640 thru 660) 0 0 0 0 $0 680 8020 Total Operating Subsidy-current year (line 630 plus or minus line 670) 0 0 0 0 $0 690 Total HUD Contributions (sum of lines 620 and 680) 0 0 0 0 $0 700 Residual Receipts (or Deficit) (sum of line 590 plus line 690) Enter here and on line 810 $150.80 $178.14 $96.65 $343,300.80 $343,310 Operating Reserve 740 2821 PHA / IHA-Leased Housing - Section 23 or 10© 50% of Line 480, column 5, form HUD-52564 $836,250