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HomeMy WebLinkAboutDMCC Resolution No. 181-2025 (Approving Amendment to Resolution No. 156-2024 and Resolution No. 174-2025)DESTINATION MEDICAL CENTER CORPORATION RESOLUTION NO. 181-2025 A RESOLUTION APPROVING AMENDMENT TO RESOLUTION NO. 156-2024 AND RESOLUTION NO. 174-2025 The following Resolution was offered by Randy Schubring, seconded by Mark Thein. BACKGROUND RECITALS A. A critical component of the Development Plan adopted by the Destination Medical Center Corporation (“DMCC”) on April 23, 2015, as amended (the “Development Plan”) concerned mobility, transformative transportation strategies, and related development. The Development Plan highlighted the goal of a mode shift in transportation in which a significant portion of community trips downtown shift away from single occupant vehicle trips and towards other modes, including the Link Bus Rapid Transit (the “BRT”) running down 2nd Street. B. In the 2025 Five Year Capital Improvement Plan (the “2025 CIP”), approved by the DMCC on September 26, 2024 per Resolution No. 154-2024, the DMCC approved $13,740,000 in general contingency funding (the “Contingency Funding”) for the BRT project. As a result of the approved Contingency Funding, the DMCC approved on December 5, 2024 per Resolution No. 156-2024, criteria for the preservation and use, approval, and reporting of the Contingency Funding (the “BRT Contingency Criteria”). C. The Destination Medical Center Economic Development Agency (the “EDA”) and the City of Rochester (the “City”) staff have further reviewed the BRT Contingency Criteria and recommend revisions to said criteria as set forth on Exhibit A attached hereto (the “Amended BRT Contingency Criteria”). D. Pursuant to Resolution No. 174-2025, the DMCC approved an increase in the Contingency Funding and authorized the City to use the Contingency Funding, as increased, for the limited emergency purposes set forth on Exhibit B of Resolution No. 174-2025 (the “Emergency Authorization”). E. The EDA requests that the DMCC approve the Amended BRT Contingency Criteria and rescind the approval of the Emergency Authorization. RESOLUTION NOW, THEREFORE, BE IT RESOLVED, by the DMCC Board of Directors, that the DMCC approve the Amended BRT Contingency Criteria and rescind the approval of the Emergency Authorization based on the following conditions: 1. Use of the Contingency Funding, as increased pursuant to Resolution 174-2025, shall be in strict compliance with all requirements set forth in the Amended BRT Contingency Criteria. 2 2. The scope of approval of the Amended BRT Contingency Criteria is set forth in the attached Exhibit A. 3. Any modification to the Amended BRT Contingency Criteria will be subject to subsequent approval by the DMCC. BE IT FURTHER RESOLVED, that the Chair or the Treasurer of the DMCC is authorized and directed to transmit this Resolution to the City and to take such actions as are necessary and appropriate to effectuate the findings and approvals of this Resolution. 40581821v2 The question was on the adoption of the Resolution and there were ______ YEAS and ______ NAYS, as follows: BOARD OF DIRECTORS Destination Medical Center Corporation YEA NAY OTHER Douglas M. Baker, Jr. James R. Campbell Kim Norton Randy Schubring Mark Thein Pamela Wheelock Paul D. Williams RESOLUTION ADOPTED on September 25, 2025. ATTEST: Pamela Wheelock, Chair Destination Medical Center Corporation X X X X X X X 7 0 EXHIBIT A LINK Bus Rapid Transit To: DMCC Board of Directors From: DMC EDA Date: September 19, 2025 Request of the board of directors: Consider amending the Link BRT contingency use guidelines. Proposed Amended Criteria for the Use of Link Bus Rapid Transit Contingency Funding 1. Preservation and use of contingency funds. Contingency funding allocated to various elements of the BRT project should serve as the first source of funding for immediate project needs, with stand- alone contingency funding as a “replenishment” source if needed. Additionally, staff understand that it is the preference of the DMCC board of directors to complete the BRT project without expending stand- alone contingency funds if possible. Careful management of the project budget may permit these DMC transit funds to be reallocated to other transit initiatives following the close-out of this project. 2. Anticipated expenditures. If the use of stand-alone contingency funds is required, city staff anticipate that expenditures will generally be related to: 1) project elements that are deemed an emergency or unforeseen condition, 2) project elements that are deemed necessary for the project to continue, 3) serve to mitigate the impacts of construction through implementing “Business Forward” strategies: i. Emergency or unforeseen conditions: These change orders will detail scopes of work that require immediate or urgent contractor action to avoid a catastrophic loss, mitigate an imminent risk to life or health, or avoid a contractor delay that would risk incurring a delay claim by the contractor of $50,000 or more and that are required to complete the project’s stated purpose as approved by the DMCC. In these occurrences city staff will be authorized to approve change orders following the construction change order approval policy already adopted by the Rochester City Council. ii. Necessary: Necessary change orders will detail scopes of work that are required to complete the project’s stated purpose as approved by the DMCC. Such change orders typically involve work needed to address time-sensitive and unforeseen field conditions, or adjustments with adjacent public infrastructure or private property to ensure a fully functional, resilient, and high-quality project. Examples of this type of expenditure would include needing to modify traffic signals in order to accommodate the technology required to provide Link buses traffic signal prioritization, modifying the foundation of a Link platform to avoid the more costly work of relocating utilities in conflict with the foundation, having to modify or replace a manhole because it is not possible to avoid impacting it due to the functional constraints of the excavation shoring system being used to accomplish the work, needing to adjust a private utility lateral to avoided a more expensive adjustment of the public infrastructure being installed, or modifying a building’s front step entrance and hand railing to be more compatible with the change in grade of the new public sidewalk being installed in front of the building. For necessary change orders, staff would propose a per-change order expenditure limit of $350,000 per occurrence. iii. Business Forward: Business Forward change orders will detail scopes of work that are intended to reduce the impact of construction on individuals and properties in proximity to project construction activities through improved project phasing, communications, and programming/activation. For Business Forward change orders staff would propose an aggregate total not to exceed $300,000. 3. Reporting. Whether stand-alone contingency funding is approved for use or not, City project management staff shall provide a written Link BRT project update at each regular DMCC board of directors meeting. The update will detail: i. A summary of work completed over the previous quarter. ii. Any factors that may risk the on-time completion of the project, such as construction or procurement delays iii. Upcoming project milestones iv. Any factors that may impact the on-budget completion of the project v. A list of all project change orders to include, at minimum, the approval date, scope of work, and amount of the change order vi. The status of project funding, to include any use of the contingency funding allocated to specific project elements, including: • Guideway and Track Elements • Stations, Stops, Terminals, Intermodal • Support Facilities: Yards, Shops, Admin. Buildings • Sitework & Special Conditions • Systems • Right-of-Way, Land, Acquisition Costs • Vehicles • Professional Services • Business Forward engagement and construction mitigation • Additional foreseeable uses of contingency funding Background: Contingency funding for Link BRT comes in two forms: the first form of contingency funding is associated with specific line item elements of the project, while the second form is an overall contingency budget required by federal funding guidelines. The current DMCC-City Link BRT contingency use guidelines require that any use of the overall contingency budget be specifically approved by the DMCC. City staff recommends that the contingency guidelines be modified to allow for staff level expenditure approval for certain time-sensitive and/or condition-driven situations. The proposed changes would allow staff to address unforeseen field conditions, approve change orders necessary to meet as-approved project conditions, and mitigate the impacts of construction to local businesses, residents, downtown employees, and visitors. Any expenditure of these funds would be reported to the board at the next regular board meeting. Additionally, given this recommendation to allow for staff level approval, the revised contingency guidelines do not include the expenditure category of “project optimization” that was originally allowed in the May 2025 DMC Board contingency authorization, as such expenditures seem likely to expand or alter the overall project scope and should be subject to explicit DMCC and City Council approval. The city project team is focused on delivering the project as currently scoped. Project Update: Overview A multi-modal mobility strategy that has been developed by the DMC includes the implementation of Link Bus Rapid Transit (BRT), a system which is the priority focus of DMC’s mobility infrastructure investments. The Link BRT system is a transformative transportation investment designed to enhance mobility, ease congestion, and support the continued growth of Rochester. By providing a fast, fare-free, and reliable transit option, with 12 stops located along the 2.8 mile long, 2nd St. corridor. Link will serve an estimated 11,000 commuters, residents, businesses, and visitors a day, strengthening downtown Rochester’s accessibility and economic vitality. Link BRT Vehicle Procurement - The City received the first Link bus from Newflyer. It is currently being inspected, and it is anticipated it will be accepted by the city which will trigger the process to begin to build the rest of the bus fleet. Bidding Process The City of Rochester has completed bidding 4 of the 5 contracts for the Link BRT project. Final design for the West Transit Village Restrooms will be completed by February 2026, with an anticipated start of construction by Summer of 2026. Volume A: West Transit Village has completed the sanitary sewer relocation required for further development projects, including the Mayo Parking Ramp. Adjacent work in the area is being completed for storm sewer infrastructure and a storm water detention pond. Link infrastructure work will continue in the fall of 2025 with an anticipated project completion date of November 2026. Volume B: The City of Rochester executed this contract on May 5, 2025. Construction continues to proceed between 11th Ave and east of 14th Ave. Crews have been micro-phasing the project to ensure adequate sidewalk opening are available and accessible to the businesses. Work has also been taking place at the 6th Street and 3rd Ave SE intersection, with the underground infrastructure, sidewalk and roadway being updated. Volume C: The City executed this contract on July 21 which is for the stations, transit center, and roadway reconstruction. The contractor has submitted a baseline schedule which will integrate its Volume C work into Volume B where necessary specifically between 12th Ave and 13th Ave SW, the 6th Street SE stations and at 19th Ave SW. Volume D: The City executed this contract on July 21 to complete the Link Bus Maintenance Bay Addition, located at the Public Works Transportation Center. The awarded contractor, has been procuring items and prepping for construction to begin in the fall of 2025, with the majority of construction to take place in 2026. Budget On July 22, 2025, the DMCC board of directors amended the 2025 DMC CIP and contingency funding use criteria to provide full local funding for the as-awarded project bids in accordance with the tables below: Business Forward Construction Mitigation The project team is using the Business Forward strategy as they continue construction for Link BRT. Project team members meet with stakeholders impacted by the construction on a regular basis. The majority of the current disruption is located adjacent to the St. Marys campus. Multiple tools are in place based upon feedback from local business owners including: - A weekly Link BRT Newsletter - Integrating travel information into https://www.downtownrochesterconstruction.org/ - Dynamic pedestrian scale wayfinding Fulfilling the DMC Vision, Mission, and/or Goals: DMC EDA Staff are working in collaboration with the City staff and the city’s consultant SRF, with a continued focus on the goal of creating a world-class experience that centers on equity of access and spotlights BRT as a desirable consumer choice. Timeline: It is anticipated that Link BRT will officially open Q2 of 2027.