TITLE
Recommendation to authorize City Manager, or designee, to execute any and all documents, including any necessary amendments, required by the Los Angeles Homeless Services Authority (LAHSA) and its fiscal agent Brilliant Corners, to accept and administer the 2017 Capital Costs for Crisis and Bridge Housing Grant awarded to the Health and Human Services Department in 2018, in the amount of $3,400,000;
Adopt resolution to increase purchasing authority under the existing Purchase Order with Williams Scotsman, Inc., of Santa Fe Springs, CA, and execute a contract, and all necessary amendments, replacing such Purchase Order, for the design, purchase, installation and permitting of modular housing units required for the Atlantic Avenue Bridge Community (ABC) Project at 6841-6845 Atlantic Avenue (Property), in the amount of $2,500,000, with a 35 percent contingency in the amount of $875,000, for a total contract amount not to exceed $3,375,000;
Authorize City Manager, or designee, to negotiate and execute any and all documents, including any necessary amendments, required by the County of Los Angeles, County Sanitation District, Flood Control District, Caltrans, Southern California Edison, and other private entities that may be required to obtain access to the Property and adjacent properties that will help complete and operate the ABC Project in a timely manner, and as may be required by grant funding agencies;
Increase appropriations in the Capital Projects Fund Group in the Public Works Department by $5,150,000, offset by $3,400,000 in grant revenues expected to be received from LAHSA and its fiscal agent, Brilliant Corners, and an estimated $1,750,000 transfer from the General Fund year-end surplus;
Increase appropriations in the General Fund Group in the Citywide Activities Department by an estimated $1,750,000 for a transfer to the Public Works Department, offset by FY 19 year-end surplus, to the extent available, or General Fund operating reserves, if necessary; and
Find that the ABC Project is exempt from the California Environmental Quality Act pursuant to Section 15269 of the Public Resources Code. (District 9)
DISCUSSION
At its meeting on February 5, 2019, the City Council authorized the purchase of real property located at 6841-6845 Atlantic Avenue (Property) with the intention of utilizing it as a year-round homeless shelter in the City of Long Beach (City) (Attachment A). The long-term vision for the Property involves the construction of a state of the art village-style campus for homeless services, housing opportunities and other community services.
Atlantic Avenue Bridge Community Project
The proposed Atlantic Avenue Bridge Community (ABC) Project is the first phase of implementing the City Council’s vision by establishing a year-round shelter that is targeted to be complete by Summer 2020 (Attachment B). The ABC Project improvements during phase one will benefit future phases as the vision for the Property is further planned and designed. Purchase of the Property by the City was authorized by the City Council at its meeting on February 5, 2019 and is now owned by the City. Since its purchase, staff has been working with existing tenants to vacate it. Due to a warehouse on the Property being used by an existing tenant, staff developed a Relocation Plan that would allow the City to construct the ABC Project while accommodating the tenant’s ongoing use of the warehouse. This Relocation Plan was approved by the City Council at its meeting on November 19, 2019.
Funding
The Health and Human Services Department (Health Department) has been awarded a grant in the amount of $3.4 million by the Los Angeles Homeless Services Authority (LAHSA) and its fiscal agent, Brilliant Corners, for the 2017 Capital Costs for Crisis and Bridge Housing Grant (Grant) for reimbursement of pre-development and construction costs of the ABC Project, with a deadline of completion of June 2020. The Grant will partially fund the construction of the facility as described in this letter.
Ongoing funding for operations for this facility are currently being negotiated with the County of Los Angeles (County) using Measure H Intermediate Housing Strategy Funding (Measure H) with the strong expectation of the County reimbursing the City $45 per bed per individual housed each day. The Health Department expects the ABC Project to operate at or near its 125-bed capacity each night of the year. As a result, the County funding for operations would total about $2.0 million annually for operations and maintenance of the facility. The Health Department anticipates these funds to be sufficient to support daily operations and ongoing maintenance, including utilities.
Modular Housing Units
Not having a year-round shelter in operation creates a detrimental impact on public safety and health within the City. As a result, staff is recommending the City purchase modular units from Williams-Scotsman, Inc. (WSI), for the implementation of the ABC Project, as they are known to function for the specific purpose, meet permitting requirements, and are immediately available. These units will be pre-designed and permitted by the State, which will save the City considerable time and cost since we will be able to expedite the often-complex plan check, approval, and installation process.
City staff is ready to proceed with the purchase and installation of the modular housing units required for the implementation of the ABC Project. Staff has evaluated different options for the project including traditional construction, repurposed cargo containers, and modular buildings. Staff conducted a comprehensive analysis of different options and an evaluation of similar projects undertaken by other cities, like the City of Anaheim, and determined that the modular buildings were both the most cost-effective and expeditious option (Attachment C).
The City issued a Purchase Order to WSI for professional services in connection with the design of the modular units specific to the ABC Project based on the urgent public health need to get the year-round shelter operational. The City of Anaheim recently installed similar facilities using WSI modular units. Staff has toured these facilities and met with those involved with their implementation and believe this to be the best option given the Property dynamics, funding deadlines, and the City’s urgent need for these services.
The cost for the design, purchase, installation, and permitting of modular housing units buildings is estimated to cost $3,375,000, including contingency. The associated furniture and fixtures are estimated to cost $500,000; and, all other expenses, including any one-time start-up costs, are estimated to cost $1,275,000.
City Charter Section 1801 requires that contracts for City purchases be awarded to the lowest responsible bidder after a competitive bid process, but allows for awards without a competitive bid process if accompanied by a Resolution adopted by City Council.
On September 11, 2018, the City Council adopted Resolution 18-0135 declaring a shelter crisis in accordance with Government Code Section 8698.2. The shelter crisis remains in effect, and the ABC Project will be designed, constructed, installed and permitted in accordance with the authority granted to the City thereunder. State law enables local jurisdictions to suspend local laws and regulations relating to building, health and safety “to the extent that strict compliance would in any way prevent, hinder, or delay the mitigation of the effects of the shelter crisis” for any City-owned, leased or maintained property. In accordance with the Guidelines for implementation of the California Environmental Quality Act (CEQA) under Section 15269, the emergency project is exempt from the requirements of CEQA.
This matter was reviewed by Deputy City Attorney Richard F. Anthony on November 21, 2019, by Purchasing Agent Tara Yeats on December 4, 2019, and by Budget Analysis Officer Julissa José-Murray on November 25, 2019.
TIMING CONSIDERATIONS
City Council action is requested on December 17, 2019, so the City can address an urgent need for a 24/7 shelter to be available as part of its continuum of care and to comply with the Grant, requires that funding be expended and the ABC Project operational by June 30, 2020 to fill a critical gap in the City’s continuum of care.
FISCAL IMPACT
The total estimated cost of the ABC Project is $5,150,000, which includes the contract award amount of $3,375,000 including contingency, an estimated $500,000 for furniture and fixtures, and $1,275,000 in other costs (i.e. labor compliance, Percent for the Arts, project management, and start-up costs). The cost is partially funded by a reimbursement grant from the 2017 Capital Costs for Crisis and Bridge Housing Grant in the amount of up to $3,400,000. The Grant does not require any matching funds or in-kind services. The remaining estimated costs of $1,750,000 will be funded through anticipated FY 19 year-end General Fund surplus, to the extent it is available, or General Fund operating reserves, if necessary. An appropriation increase in the amount of $5,150,000 in the Capital Projects Fund Group in the Public Works Department, is requested, offset by $3,400,000 in grant revenues and an estimated $1,750,000 transferred from the General Fund Group. An appropriation increase in the amount of $1,750,000 in the General Fund Group in the Citywide Activities Department is requested, to transfer funds to the Public Works Department, offset by FY 19 year-end surplus.
Health Department staff are currently in negotiations with the County Chief Executive Office and LAHSA regarding identifying an operator and ongoing funding for operations and maintenance costs of the ABC Project. The Health Department expects the ABC Project to operate at near its 125-bed capacity each night of the year. As a result, the County funding for operations would total approximately $2 million annually for operations and maintenance of the facility. The Health Department anticipates these funds to be sufficient to support daily operations and ongoing maintenance, including utilities. Once operating funds are secured, the Health Department will return to the City Council to enter into an agreement and request an increase in appropriation for the operating funds. Because of the limited life of Measure H, there is no assurance that the funding will run longer than eight years (2027) unless Measure H is extended. In addition, there is currently no identified funding source for major maintenance or life-cycle replacement that may be needed in the intermediate-long term. Funding for these costs, when needed, may need to come from the General Fund. This recommendation has moderate staffing impact beyond normal budgeted scope of duties and a minimal impact on existing City Council priorities. There is no local job impact associated with this recommendation.
SUGGESTED ACTION
Approve recommendation.
BODY
[Enter Body Here]
Respectfully Submitted,
CRAIG A. BECK
DIRECTOR OF PUBLIC WORKS
KELLY COLOPY
DIRECTOR OF HEALTH & HUMAN SERVICES
APPROVED:
THOMAS B. MODICA
ACTING CITY MANAGER