Opening Request for Qualifications - SB Pinhook WTP Guaranteed Savings Contract - Reynolds Construction

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EXECUTIVE SUMMARY CITY OF SOUTH BEND: PINHOOK WTP IMPROVEMENTS PROJECT GUARANTEED SAVINGS CONTRACT EXECUTIVE SUMMARY INTRODUCTION Reynolds Construction is honored to be considered a partner for this important project at the Pinhook Water Treatment Plant. Our team appreciates being invited to participate in this opportunity and we feel the decision-making committee will witness that our approach is more comprehensive, cost effective and will fulfill more of the long-term needs of the plant. The focus of Reynolds Construction is to maximize the amount of work that can be completed during the defined operational shut-down period to avoid additional shutdowns which may be associated with a phasing approach. Our team is offering 2 separate options for completing the work required at the plant. The first option meets the intent of the RFQ and includes the stated scope of work in the solicitation. The second option offers a structure to increase the scope of work and include additional items which have been identified and will be required in the future. It is anticipated by both the staff of the plant and representatives of American Structurepoint that the Pinhook plant will need to be taken out of service for a period of time to complete the work identified on the priority list. Our second option offers a project structure which accelerates the schedule, takes advantage of the shutdown period, and completes a more comprehensive scope of work at the plant. As mentioned during the walk thru, the identified scope of work for this project is being driven by the budget which was stated to be approximately $1.2M. This estimate could grow or be reduced once our team shuts down the plant and the unforeseen conditions are exposed. Based on our history with projects like this one, we anticipate the scope will be reduced which will provide more funding for other scope items to be completed. However, we do not think the additional funds will be enough to afford the total improvements required for the plant. The basis of design identifies improvements for the entire plant to be closer to $3M to $3.5M. In an effort to accomplish a more comprehensive modernization plan, Reynolds is proposing funding this project utilizing an alternative tax-exempt financing structure Since the financial markets are offering long term tax-exempt financing structures at historically low interest rates, the ity should seriously consider this option. This structure will allow the City to complete a more comprehensive project now, avoid multiple phases of work shutdowns and spread the costs out over time. Our proposed financing structure includes the following. Fixed tax-exempt rate range 2% 2.7%6.The City will not make a payment until receiving No down payments or reserves requiredbeneficial use of the plant improvements, which is Non-appropriated structure, not consideredscheduled for August 2021. constitutional debt7.Funds are immediately available at closing Financing term aligns with the life of the new assets Lower issuance costs than traditional financing methods The request for Qualifications states the City may implement the capital improvements in several phases over a three (3)to five (5) year period. If the City has identified funding sources for future work, then a more in-depth discussion about utilizing alternative financing would prove to be beneficial. Reynolds Construction offers this alternative funding plan so a phased in approach can be avoided. The Reynolds team has developed preliminary strategies to assist in reducing the investment required for this rehabilitation work while maintaining the highest standard of quality. Reynolds is proposing a fixed fee agreement set at 8%. The design documents estimate a 15% overhead and profit for construction, this reduction of fees is an indication of our commitment to bring this project in at the highest quality standards and under budget. Reynolds Construction has completed more than 70 Alternative Delivery projects over the past several years with a total value of more than $800 Million. Our construction team, one of the largest in the state, has over 75 years of experience specializing in progressive design-build construction in the water and wastewater industry. Doug Tischbein, manager of GSC services for Reynolds, has over 30 years of experience completing projects under the GSC statute. Page | 4