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Community & Economic Development
1200 County -City Building, 227 West Jefferson, South Bend, Indiana 46601 -1830 Phone 574/235 -9371 Fax 574/235 -9021
To: Redevelopment Commission
From: David Relos, Economic Development Planner PL
Subject: Hansel Center Memorandum of Understanding (MOU)
Date: November 22, 2011
Beginning in March 2009, the Department has been working with community partners to transform
the historic Hansel Center, located at 1045 W. Washington, into a premier arts and cultural center.
This facility will strengthen the community by celebrating cultural diversity through its provision of
a common and accessible space for community programming, art, and education. It will provide a
gathering place through its class and meeting rooms, gallery, and outdoor spaces. This facility will
have a national and international reach, which will ultimately attract resources from outside the area
and further strengthen the local community.
The attached MOU between South Bend Heritage Foundation, Vanir (a donor to the project), the
University of Notre Dame, and the Redevelopment Commission, will allow the hammers to start
swinging. The MOU lists each partner's responsibilities, and when and how the construction phases
will be completed. Once the MOU is fully signed, it is anticipated construction will begin by year's
end.
Ultimately, this rehabilitated historic structure will become an anchor in the West Washington
Chapin Museum Campus area, joining such west side stalwarts as The Center for History,
Studebaker National Museum, Indiana University Civil Rights Heritage Center at the Natatorium,
and the soon to be opened Salvation Army Kroc Center.
Staff requests favorable consideration of this MOU, to allow this important project to move forward,
and to rehabilitate an under utilized historic building into an asset to the entire community.
What We Do Today Makes A DNVenmm !
MEMORANDUM OF UNDERSTANDING
THIS MEMORANDUM OF UNDERSTANDING ( "MOU ") is entered into
effective November , 2011 ( "Effective Date "), by and between the University of
Notre Dame du Lac (the "University ") on behalf of its Institute for Latino Studies
( "Institute "), the South Bend Heritage Foundation, Inc. ( "SBHF "), the City of South
Bend, Indiana, acting by and through its Redevelopment Commission (the "City "), and
the Vanir Group of Companies, Inc. ( "Vanir "). The University, SBHF, the City, and
Vanir, shall be referred to individually as a "party" and collectively as the "parties."
Recitals
A. The Hansel Center, located at 1045 West Washington Street, South Bend,
Indiana, 46601 ( "Hansel Center "), is a two story brick building with partial basement and
carriage house built in 1925. The Hansel Center is owned by SBHF and is listed on the
National Register of Historic Places. The Hansel Center is currently in a state of
disrepair.
B. The Hansel Center has been identified by the University as a possible site
to relocate the Institute Annex ( "Institute "), currently housed at 1024 Notre Dame Ave,
South Bend, Indiana, as well as for use by other potential University users and tenants
such as the Notre Dame Center for Art and Culture, Segura Fine Arts Studio, Consejo
Grafico, the Art Department, Center for Social Concerns, Office of Public Relations, and
the Legal Aid Clinic ( "Project "). Before University sponsored programs can be
permitted at the Hansel Center, substantial renovations must be performed to render the
Hansel Center fit for occupancy.
C. The Board of Public Works for the City of South Bend has been the
Redevelopment Commission's contracting agent for various programs intended to
revitalize and enhance neighborhood development within the City of South Bend, Indiana
and to provide various secular programs and activities. The City is empowered under the
authority of Indiana Code § 36- 10 -2 -4 to aid cultural facilities and programs and the
Project as described above is consistent with those cultural programs to which the city
may lend aid under state law, and serves a public purpose that will facilitate revitalization
of the neighborhood. The City further believes that the actions contemplated by this
MOU are in the best interests of the health, safety, and welfare of the City and its
residents, and that such actions comply with the public purposes and applicable state and
local laws.
D. SBHF is an Indiana not - for - profit corporation meeting the requirements of
Indiana Code § 36- 1- 11- 1(a)(7), and was created for the purpose of planning, directing
and coordinating economic and community revitalization within the City of South Bend.
SBHF has been working with the parties to facilitate the development of the Project
within the City which will provide certain artistic, cultural, secular programs and
activities, and legal services to poor and under - represented persons, all of which the City
believes will be of benefit to the City and its citizens
E. The City is willing to contribute tax incremental funding ( "TIF ") for those
uses permitted by state law and Community Development Block Grants ( "Grants ") to the
renovation of the Hansel Center prior to the transfer of the Hansel Center to the
University. The City has approved contributions of up to Seven Hundred Ninety -Six
Thousand. Dollars ($796,000) in TIF funds for permitted TIF uses, and One Hundred
Thirty -Four Thousand Dollars ($134,000) in Community Development Block Grant
Funds ( "CDBG ") to be applied to the renovation of the Hansel Center.
F. Vanir shall donate construction funds and professional project
management services to the renovation of the Hansel Center and act as the "Owner's
Representative" for the University based on the scope of services outlined in Vanir's
proposal dated 9 -8 -11 attached hereto as Exhibit A, subject to and provided that the
University raises funds for the remaining cost of renovation (including contingencies),
and that the renovated Hansel Center is to be subsequently transferred to the University.
G. The University is willing to coordinate services related to data,
telecommunications, and cable requirements for the renovation of the Hansel Center, and
to raise funds and provide funding for the remaining cost of the renovation after
subtracting the contributions of the City and Vanir, provided that the renovated property
is subsequently transferred to the University.
H. Once renovations are completed, and provided that certain property tax
liabilities, existing liens, and current loans secured against the Hansel Center have been
discharged, the parties agree that SBHF shall transfer ownership of the Hansel Center to
the University at no cost.
I. The parties intend by this MOU to set forth the principal terms and related
agreements to be negotiated between the parties to implement their agreement to renovate
the Hansel Center so that upon completion it may be transferred to the University for: (1)
use and operation in part by the Institute; (2) the provision of various artistic, cultural,
secular programs and activities, as well as legal services to poor and under - represented
persons in the community; and (3) the revitalization and enhanced development of the
neighborhood.
NOW THEREFORE, it is agreed as follows:
1. Scope of Agreement: The Recitals are incorporated herein by reference as
though fully set forth. It is acknowledged and agreed by the parties that the greatest
challenges to implementing the plan to renovate and transfer the Hansel Center to the
University (the "Project ") will be: (a) finalizing the Project design and scope of work
pursuant to applicable law and agreed upon guidelines (b) establishing a comprehensive
budget with contingencies for unknown conditions, and (c) raising sufficient funds to
retire all current liabilities and to fully pay for renovation of the Hansel Center. In
furtherance of the Project plan, the parties will participate as follows.
2
a. SBHF: Upon execution of this MOU and completion of any conditions precedent
to the beginning of construction set forth herein, including but not limited to satisfaction
of the requirements set forth in the University's Construction Funding Policy, a copy of
which is attached hereto as Exhibit B, SBHF will engage Kil Architecture to provide
architectural and engineering services for the Project going forward. Said services shall
be paid by the Project Treasurer as herein defined. SBHF will also conduct
environmental remediation work at the Hansel Center, hereinafter referred to as Phase I.
Phase I shall be completed with the CDBG funds referenced in Sec. lb. below. Upon
completion of Phase I, SBHF will transfer the property to the City for completion of its
portion of the renovations, hereinafter referred to as Phase II. Upon completion of Phase
II, SBHF will receive the property back from the City in order to complete the
renovations to the property, hereinafter referred to as Phase III. SBHF shall then transfer
the fully- renovated property to the University upon completion of the Project. The
University shall facilitate the placement of "all risk ", full replacement cost builder's risk
insurance, including building materials, for the Hansel Center for the duration of the
Project and shall include the City, SBHF and the University as named insureds under the
policy. The cost for this policy shall be identified by the University and paid for using
funds raised by the University.
b. City: The City shall contribute up to Seven Hundred Ninety -Six
Thousand Dollars ($796,000) in TIF funds and One Hundred Thirty -Four Thousand
Dollars ($134,000) in CDBG Funds to the Project prior to the transfer of the Hansel
Center to the University. The use of the TIF Funds, to the extent permitted by law, will
be used to complete Phase II. Upon completion of Phase II, the City will transfer the
Hansel Center back to SBHF for completion of Phase III.
The City will facilitate all necessary governmental approvals. The City and
SBHF will work together to solicit public bids and hire one General Contractor for both
Phases II and III of the Project which should facilitate a seamless transition between these
two phases. The bids should include a Schedule of Values which coincides with the
funds allocated to each phase. The bidding process shall be conducted according to the
City's bidding protocol. Change Orders are to be paid for out of the funding allocated for
phase III. Change Orders shall not be initiated without Kil Architect's authorization
following initial review of cost associated. with such change and authorization by Vanir
and UND.
C. Vanir: Vanir will donate a combination of Project management services
as the Owner's Representative for the University and cash under the condition that the
Hansel Center is to be transferred to the University upon completion of the Project. The
University and Vanir shall enter into a separate agreement for the project management
services to be provided by Vanir. Vanir shall provide the University with a monthly
report of budgeted versus non - budgeted costs. Vanir shall have no obligation to perform
3
unless and until all construction funding (including contingency) has been raised and set
aside for the Project.
d. University: The University will pay certain fees for architectural and
engineering services as herein designated. Furthermore, after subtracting the
contributions of the City and Vanir, the University will contribute the remaining cost of
the renovation according to the projected budget attached hereto as Exhibit C and
incorporated herein by reference. Additionally, the University will obtain all University
approvals necessary to (1) accept the transfer of the Hansel Center by the University and
(2) accept contributions of money and, by receiving the property, services from the other
parties to the MOU. Furthermore, the University will designate a representative to act as
Project Treasurer for the architectural and engineering services and Phase III.
e. Institute: The Institute will act as the principal intermediary with the
University, City, and SBHF. Through the Institute, the University will enter into
definitive agreements, where appropriate, with tenants and occupants of the Hansel
Center.
2. Implementation:
a. Documentation: The parties shall work cooperatively to determine the
need for a definitive written agreement(s) further setting forth the rights, duties, and
obligations of each participant in the Project consistent with the terms of this MOU, and
the form of those agreement(s). At any time, individuals and entities may be added to the
MOU and/or any further agreements as mutually agreed by the parties.
b. Party Representatives: Kil Architecture shall serve as the Architect of
Record for each phase of the Project. The following individuals will operate as the onsite
representative for the parties as designated below:
i. Vanir for the University — list of authorized representatives to be
provided;
ii. TBD — will be designated in writing by the Director of Public
Works; and
iii. Marco Mariani for SBHF.
C. Steering Committee: A steering committee for the Project will be
established by the Parties.
3. Exclusive Project Planning: The parties agree that during the term of this
MOU, and both before and after the execution of any definitive agreements, the parties
will work together on an exclusive basis to jointly develop the architectural plans, scope
of work, construction budget (including contingency), permitting plan, construction
financing, cash flow requirements, contracting requirements, grant applications, property
tax dispositions and other tax planning to successfully implement the Project. In the
event that any party terminates the MOU, the remaining parties shall continue to develop
and implement the Project plan contemplated by this MOU, and the terminating party
B
may not use any plans or ideas contemplated by this MOU without the express written
consent of the remaining parties to the MOU.
4. Term of MOU: This MOU shall commence on the Effective Date and
shall continue thereafter until completion of the project unless terminated earlier by the
execution of any further definitive agreements between the parties that supersede this
MOU.
5. Allocation of Costs: Except as provided above, the parties shall each bear
their own costs incurred in connection with the preparation of this MOU and any
definitive agreements, and in connection with the administration of this MOU, including
but not limited to travel costs, legal and accounting expenses, and all other out of pocket
expenses incidental to the performance of their respective obligations under the MOU.
6. Administrative Controls. The administrative duties associated with the
contracting and financial obligations of this Project are to be undertaken as follows:
a. Architectural and Engineering Services — Contracting — SBHF; Fund
Control — the University via review by University Architect Office with
sign off by Development
b. Phase I: Contracting and Fund Control — SBHF
C. Phase II: Contacting and Fund Control — the City
d. Phase III: Contracting — SBHF; Fund Control — the University
7. Notices: All notices under this MOU shall be delivered personally or by
overnight courier to the addresses provided by each of the parties hereto, and shall be
deemed effective upon receipt.
8. Concluding Provisions: This Agreement supersedes all prior negotiations,
discussions and agreements between the parties related to the subject matter hereof. No
amendment or modification to this MOU shall be effective unless set forth in writing and
signed by the parties hereto. This MOU may be assigned to affiliates of the parties for
purposes of effectuating this transaction. Any other assignments shall be void and non-
binding on the other party. There are no intended or incidental third party beneficiaries
of this MOU and any such relationship, whether express, incidental, or implied, is hereby
disclaimed. If any provision of this MOU is held by a court of competent jurisdiction to
be invalid, void, or unenforceable, the remaining provisions shall continue in full force
and effect. The undersigned warrant and represent that they are duly authorized and
empowered to execute this MOU and to bind their respective entities accordingly.
[SIGNATURES APPEAR ON THE FOLLOWING PAGE]
5
IN WITNESS WHEREOF, this MOU has been executed effective as of the date first
appearing above.
UNIVERSITY OF NOTRE DAME
DU LAC
14d"
Rev. J46 I. Jen ins, C.S.C.
Presid nt
SOUTH BEND HERITAGE
FOUNDATION,, INC. .
Marco Ma
Executive
2
CITY OF SOUTH BEND, INDIANA
ACTING BY AND THROUGH ITS
REDEVELOPMENT COMMISSION
Name:
Title:
VANIR GROUP OF COMPANIES, INC.
ore denC. Domi ue t
Exhibit A
Hansel Center Renovation Project
PLANNING AND DESIGN
• Confirm Scope /Validate Budget
• Develop Program Schedule
• Project Organization Meeting and Kick -off
• Expedite Initial Permits
• Manage the Design Phase (A /E, University, SBHF, City, Vanir)
- Schedule Management
- Interim Cost Estimates
- Value Engineering
- Constructability Reviews
- Manage Consultant Payments
BIDDING
• Bidder Solicitation and Follow -Up
• Pre -Bid Walk- Through
• Bid Opening, Contract Award Recommendations and Contract Preparation
CONSTRUCTION
• Pre - Construction Meeting
• Construction Contract Administration
• Regular Site Visits
• Weekly and Monthly Meetings
• Progress Reviews
• Expediting the Schedule
• Issue Resolution
• Change Order Review and Recommendation
• Project Coordination
• Analyze and Manage Contractor and Consultant Payments
• Coordinate Installation of Direct - Purchased Equipment and Furnishings
• Project Close -Out
EXHIBIT B
UNIVERSITY OF NOTRE DAME
Cottotractioa 1t�snWisS Polley
rAMM a COMM M19 of the Bout of Truft"
The Finence'Dw mliMOe ofd o DOW of Trustees waft with dw Aduninlltad= ofdw UnW** ID
Uaivers*I i.er, bud�mdng; . flnlihcia! aid, of tbau1ci11 ie
at d
711 s1 m I 1 110 a MUM of due aiR1811 Cotaattcticn Fwdbit Policy adopted by the hwo tent
ad Pbwm Commines of the Bond of Trastem, ad approved by do 7Yaseaem on October 3. 2002,
ad October 4,2M respaotiw* an4 a revision Otto Cow*vcdon Awil t Po ft *%pad by to
Rhharhr a Committee of tits Board oMwm and sireved by do Thwees on A0129. 2001, sed
Apt 30.2004 mepec&*.
710 ft 1M CoimWMW of the Board of Tweases ecomme ds dot die Uaiver* comer die
howww beachmorks
be coal recommond* do ing of any elective c ion F*M in
httegrky ofthe iatitudoq. Tb me bwhnwb kmhm :
Firm (ia w fer loop, ca"i ofthe cost ofthe project,
At lest 73 Percent of the project costa in hand, with
The majority of do nm hft beds to be collaoed widrin tiro years of dw sort of
consbwulon.
71e lboeendve Vice P- esiderit will periodicNly review die fbadint states of each project and upon
oerd4ft that the project has met die benchmerim, odwiae do project to commence. In to an of
MOW eepital pro)eota or projects dot foil to most benchmerhs, die Executive Vice Padden will
atemas paoteest toewrd: audiieviag theme beihchinerlts and ua>aha reoommerhdatioos m dio Phhsaoe
Comldlbe ofdie Board ofTrus ees to begin cowbution as -j F v prfae,
!f ooshaoraodan bids we received in excess of eadmaes, and times M*w bids rat In a 8ilm w
meet the tmnctinhwkl dis prciect anrot proceed miles addkkmd funds are seciaed to sheet the
benohawks andlor the Finsaoe Commitles of tbs awd off halm r emWovve the project.
In adAf A% do ogpbg overhead malwaance, sad reomW costs„ should continue to be pleated ibr
sad added each yar to the operating budpt. sad abets apprapeim a should be iaaasigl6 eudoured.
as pat of the regular bedtmdiit process of the University. 71e Finance Commime will -swim
budget ft eons wNh amounts so be added sot less dm srnuplly.
11e Mena Cum midee of the Bond of Tnateea will review dais policy on a periodic bask sad rot
less tier arraaily. and make appropriate s4vMwft based out due national eeonomic envircamw
sad fiaanc W poddon of die Uniwersi y at do time of die review.
Approved by duo Fin mce Caasmittee of due Bound dMuseoes on OMber S. 2006 and recommeadsd
to do Pod Bard of 7 rume s for approval on October 6, 2006.
Exhibit C, Page 1 of 2
Hansel Center Project Budget
November 2011
Hansel Center Renovation - Bid Estimate (Budget Version May 12, 2011 *)
Adjustments:
Taxes and penalty due
Costs incurred and paid by Vanir, not already included within budget
Insurance estimate
Project management fees not Included in budget
Total Adjusted Hansel Center Project Budget
$ 2,481,291
17,727
81,329
20,000
242,500
$ 2,842,847
* The Bid Estimate (Budget Version as of May 12, 2011) is attached as Exhibit C. Page 2 of 2
Exhibit C, Page 2 of 2
Hansel Center Renovation - Bid Estimate
5112/11 update
61,000
Alternate 2: Repair Windows, operable lower sash
5.12.11
Cal �4!!
Budoet Cost
1 General Conditions
120,000
2 Site Work S Demolition
85,000
3 Concrete
25,000
4 Masonry
52.000
5 Motels
28,000
8 Carpentry items
36,000
7 Rooting & Canopy
46,000
8 Doors b Windows
225,000
9 Finishes
235,000
10 Specialties
16,000
11 Equipment
0
12 Furnishings
7,100
14 Elevator
62.000
15 Mechanical / Plumbing ! Fire Protection
400,000
16 Electrical
230,000
SLKRWed Alternates:
Alternate 1: New Windows
61,000
Alternate 2: Repair Windows, operable lower sash
Alternate 3: No Furred ulterior wells
Alternate 4: Garden Wall Repair
20,000
Alternate 5: Cast Iron Fence Repair
15,000
Altxnate 6: Demolition Costs
87,000
Atiemate 7: Recycling Program for Demo Materials
1,043
Other Contractor Fees:
Builders Fee ' -
123,500
Parf. / Payment Bonds
17.700
Subtotal Hard construction costs
1.769,943
Construction Contingency (10 %)
170,994
Total Preiected Construction Cost Estimate:
1,940,937
Associated Project Costs:
Bulding Acquisition '
35.1100
Furniture, Fbdures & Equipment (Estimated)
0
A!E Design Fees, Initial Report 1
3,804
A/E Design Fees, Schematic Design
23,250
AIE Design Fess, Awl Services. SD '
12,010
NE Design Fees. Addl Services, Cost Reduction Study '
7,500
ME Design Fees, Next Phase Detail Design, DD, CD, S. CA
137,750
Environmental (SSI 2010 Bid- Mold and Asbestos)
104,405
Env. (add110% premium recommended by Greuvogel to rebid)
10,441
Environmental (lead abatement @ windows) M
10,000
Env. tong. / Grauvogel Fen S Report '
5.360
Env. Eng / Greuvogei Fees (Abatement)
10,830
Permit Fees (State CDR)
S00
Carnage House Renovation `
0
Landscape '
12,500
Fumishinge/Equip r
12,000
Communications '
47,000
Misc. other costs '
32AN
Escalation '
69,241
Total Proiect Cost:
2,481,291
NOTES:
kKW provides for seven WOW (7%) pMM
= 2010 Budget had a 7% COnetnratiOn CondrVrwy, tMvsrWty Archkeds Ofaee rsoornrnends a 10% Con ingency.
'329-11 oonunttrrwd by SMF. Needs lo be cordirmed in writing. Estknate includes do" txu1 1.
' D0WV C- MWtodon fees praWOWy paid by Va* Development CmVwy
Winnal lead abatement prarneters It Window, ors replaced wfdr new units
' No frarda have been allocated to the design, mrasatton or renovation of ow existing Camtege House
' Recom erbed by Urrlversity A"IteW's Office