Latest news with #NormanWahl
Yahoo
08-03-2025
- Business
- Yahoo
Why do Rochester projects keep increasing in price?
Mar. 8—ROCHESTER — Norman Wahl says the $175 million estimated price tag for Rochester's planned Link Bus Rapid Transit system requires added transparency. "That cost has been the subject of public conversation," the Rochester City Council member said ahead of a vote to reject a potential contract price that exceeded estimates by roughly $30 million. The mismatch between a city estimate and contractors' bids comes on the heels of some other high-profile underestimates, including ones for the city's proposed sports and recreation complex that was part of a 2023 sales tax extension and a planned new parks and forestry building . Taken in combination, it appears estimates are largely out of whack with reality, but city officials say a variety of factors are in play and no single reason exists for the increased cost estimates. "There's so many layers to what goes into estimating and certain assumptions," Deputy City Administrator Cindy Steinhauser said, pointing out the beginning point in the estimating process comes with the initial proposal, which can happen years before construction starts. "What always is a challenge on projects is the length of time that's allocated to completing the project," she said, adding, "A project that can be completed within a year is different from estimating for a project that's going to be completed over three years." During the years between concept and construction, a project's scope can change, alongside changes in the greater economy. The Link project has been subject to both influences since it first was visualized with a $114 million price tag that since has grown to $175 million. First, the route changed, in order to connect the line to future development envisioned near a new bridge planned in southeast Rochester. That raised the cost estimate to $145 million. And more recently, a federal requirement to increase contingency funds, higher-than-expected property costs and other unanticipated factors has raised the cost estimate still further, to $175 million. State Destination Medical Center funds are expected to cover the costs outside of the nearly $85 million in federal funds dedicated to the project. City Hall isn't alone in facing such circumstances. Mat Miller, director of facilites and building operations for Olmsted County, said similar factors led to a $24 million final cost for what had been planned as a $17.4 million project to expand the county's Public Works Service Center and create a new Public Safety Training Center on the southeast edge of Rochester. He said the project saw a $3 million increase in scope after county commissioners agreed to add a geothermal system to the project, and other costs ended up higher when material and labor prices increased in the wake of the pandemic. Miller said budgeting based on concepts ends up being "more of an art than a science." When it comes to establishing preliminary budgets, Miller and Steinhauser agreed a starting point can be based on the available funding. It can determine what might be done, without taking into account the full desired scope of a project, which could require added funding — and a revised estimate — in future months or years. Miller frequently refers to developing the concept as "drawing in crayon," with the design development being in pencil, often taking into account comments from public review and insights from elected officials. If the budget is tight, it means adding one thing could remove something else — or it could signal the need to find more money to keep both. "Once you get the construction documents, it's in pen," Miller said. "It's final details, and making any major shifts at that point typically is going to cost you more money because the engineering firm or architectural firm is going to have to redesign it." Along the way, he said, estimating can start with a price per square foot based on similar projects, but each project has nuances that could result in needed adjustments. When it comes to the county's planned $42 million exhibition center project in Graham Park, Miller said plans call for including alternates in final designs for bidding, meaning if bids are too high, things have been identified that can be cut from the project to keep it on budget. Steinhauser said similar flexibility didn't exist in the Link bids rejected on Monday, partly due to the complexity of the project. While changes could have been made later, accepting a bid would have committed the city to a contractor. The cost estimate for the Link project was based on a variety of calculations. Some of those, based on a linear-foot calculation for street reconstruction and similar work, actually matched the recent bids. It was the addition of transit station construction and related technology that pushed the bids beyond the city's estimates. Steve Sampson Brown, Rochester's director of construction, said the city's consultants developed estimates for those parts of the project based on costs seen elsewhere for similar work. However, the contractors bidding on the Rochester project didn't have the same level of expertise as the contractors who performed those comparable projects. It's not uncommon for the city to reject project bids to see if a lower price can be obtained. However, doing so can sometimes extend projects. The city's original goal was to finish the project by the end of 2026, but federal funding is contingent upon it being completed by August 2027. That means the city will have time to seek new bids. The potential to split the Second Street portion of the project between contractors could spur added interest from companies equipped to take on the complex shelter and tunnel work, while the street work is done separately. "What we are seeing in the local market, for traditional road construction work, we have a robust set of bidders who are interested in our projects, and the prices have been coming in as we have been estimating them in partnership with our public works and engineering team," Sampson Brown said, noting other bids associated with the Link project have been less than estimated costs. Still, he said, guarantees do not exist amid other pressures. Material prices, he said, rose 4% in January when the recent bids were being prepared, and contractors are in demand amid construction in Rochester that has seen work nearly double in the past five years. "All those blended factors is why we believe the bid came in much higher," he said. When it comes to the city's plans for a new parks and forestry building in northeast Rochester, near the city's existing Public Works and Transit Operations Center at 4300 East River Road NE, Parks and Forestry Division Head Mike Nigbur said the reason that project cost has risen isn't as complex. A new building to house vehicles, equipment and office space was expected to cost $35 million in 2023, when the Minnesota Legislature agreed to support half of the project. Since then, the project has changed to include providing needed space for public works staff, rather than seeking a second project. With City Council approval, the budget increased to $43 million based on the increased scope, but initial design plans include some flexibility, if future bids end up higher than expected. The potential price for the city's proposed sports and recreation complex isn't out of the concept stage. While a 2023 vote to support a sales tax extension included support for spending $65 million on the project, Nigbur and others said that money was never intended to fully fund the project. That wasn't made clear to voters in the runup to the 2023 referendum, say Mayor Kim Norton and others. However, a study conducted in tandem with the political effort did state that the $65 million would be a minimum cost based on 2023 construction cost data. It was not until after voters had approved the sales tax extension that a designer and construction consultant were hired, and their study pointed to the potential that costs for the sports complex would double. However, the ultimate cost for the project still is not known, because a design has not been selected. Or, to use Miller's analogy, the project is still drawn in crayon, with details yet to emerge in pencil. Rochester Recreation and Facilities Division Head Ben Boldt said the City Council's authorization to purchase 160 acres in southeast Rochester provides the opportunity to move from concept to design, and the initial focus on the outdoor complex will provide added time to develop a more complete interior design, as well as a plan to fund it. Additionally, he said the delay could save costs in the long run, since the indoor facility would face complexity similar to the Link project, and the specialized outdoor work won't face competition for contractors, who might bid on work tied to Mayo Clinic's "Bold. Forward. Unbound. in Rochester" expansion project. "We feel in the next few years, it will be a less competitive construction environment," he said, pointing to the potential for reduced bid impacts.
Yahoo
20-02-2025
- Business
- Yahoo
Peace Plaza paver plan moves forward with desire to do more
Feb. 20—ROCHESTER — A $175,000 plan to address pedestrian concerns in Peace Plaza is moving forward with Rochester City Council members saying more still needs to be done. "I think we need to move on and find a solution, find a new solution," Rochester City Council member Norman Wahl said Wednesday, asking for a more aggressive approach. Others agreed that a different approach would be preferred but cited limited funding for options that included pouring cement walkways along the north and south sides of the plaza. Deputy City Administrator Cindy Steinhauser said other approaches could cost significantly more than the $175,000 already approved by the state Destination Medical Center Corp. board and require up to 15 months of disruption along the plaza and First Avenue. "We have heard concerns from businesses about not impacting their front door, and we want to be sympathetic to that," she said, adding that Peace Plaza is expected to be one place downtown without extensive construction in the next year or two. She said taking smaller steps allows a chance to determine whether future plans need to be made for a more aggressive approach. The council voted 5-2 to support the staff plan, with Wahl and council member Shaun Palmer asking for a different approach. Council member Andy Friederichs said it's not ideal, but it's action headed in the right direction. "At this point, not having a great solution and a big bucket of money to throw at something, I I do feel its the best option at the moment," he said. The approved Peace Plaza effort project aims to expand the use of smooth pavers by replacing portions of Ann Hamilton's "A Song for Water" art installation , which features words with raised lettering that can be read when moving through the plaza. Steinhauser said the work is expected to be completed with limited disruption and continued assessment throughout the summer. At the same time, more analysis is expected to determine why pavers are shifting, since underground heating is expected to eliminate the effects of winter frost and other concerns. Steve Sampson Brown, Rochester's director of construction, said the additional study will help determine why pavers are shifting in Peace Plaza but not other downtown areas. He said it could be related to geological conditions or the fact that the plaza sees greater traffic and activity. In addition to resetting the existing smooth pavers and replacing some raised letter pavers, Steinhauser said work will include providing improved visual cues to distinguish between the wider walkway and the artwork, which will remain in the center of the plaza. Mayor Kim Norton said providing more obvious signals to indicate the pathways will guide pedestrian traffic in a way that is similar to what occurred before the Peace Plaza redesign. "When you had a big fountain in the way and green grass, everyone knew to go to the right or left," she said, referring to a larger fountain that occupied the plaza and turf in the middle of the gathering space. Steinhauser said the former design featured smaller walkways than what is currently in place next to the artwork, and the grass was more difficult to navigate with a wheelchair than the raised-letter pavers. She said the current design was intended to open more space and the planned improvements will make the walkways even wider, in addition to adding north and south pathways with the potential for getting closer to the plaza's water feature without crossing the artwork. Council member Dan Doering voted to support the plan, but cited frustration that more isn't being done to address community concerns. "The response I'm hearing from folks is that they want immediate action for a remedy, that this is truly an unusable space for them," he said. Steinhauser said the planned effort will provide the quickest response to start addressing concerns, with work to start as soon as the weather allows.
Yahoo
28-01-2025
- Business
- Yahoo
Rochester council weighs city priorities
Jan. 27—ROCHESTER — A review of the city's key priorities kicked off Monday with the Rochester City Council comparing notes on where the city sits today and what might be a goal for the next decade. "The fact that we have a large turnover creates the opportunity for new ideas," Rochester City Council member Norman Wahl said during the first of two council sessions aimed at setting strategic priorities for the city. The council went through a similar practice in 2023, after Wahl became the sole new council member, but he pointed out the priorities remained largely unchanged, targeting affordable living, economic vibrancy and growth management, and quality services. With four new council members serving their first weeks in office, they cited an appreciation of reviewing city priorities, building from comments heard during their 2024 campaigns and finding ways to intertwine various council viewpoints. "I hope to get out of this process an increased camaraderie with the other elected officials, as well as city staff," council member Dan Doering said. As one of the two senior members, council member Patrick Keane said he anticipates the council discussion will spur some changes to priorities and how they are defined. "Things have changed since 2021, when we first established these," he said. City Administrator Alison Zelms said the outcome of the discussions about the priorities will serve to guide future work of city staff, since they will be used to create an action plan for future staff work. She said department heads were gathered with the council Monday to better understand what elected officials will prioritize in the upcoming years. Leading the council through a series of exercises designed to provide a high-level look at existing priorities and goals, Julia Novak, executive vice president of Charlotte, North Carolina-based Raftelis, said the goal is to create a unified set of strategic priorities for the council to adopt, whether it builds on the existing priories or redefines them. "It is important ... for the governing body, for the elected officials, to come together on this," the session facilitator said. "When you all reinforce where you are going, it sends a very clear message to your staff team on how to align programs and resources to achieve that." With the first group discussion completed Monday, Novak said staff members from Raftelis will reach out to all council members individually in the upcoming weeks to talk about priorities and goals. While council member Andy Friederichs was absent Monday due to a scheduling conflict, Novak said he will be part of the individual interview process. Raftelis staff will also hold an online session with key city members in February to get a better understanding of the current priorities and how they are implemented. Once all the information is gathered, Novak said the council will meet again on March 24 to review the gathered insights and compare notes, which will spur the creation of a proposed document defining priorities that will be used to create action plans to achieve the established goals. Zelms said if the March council discussion goes well and provides the necessary directives, a formal report could be considered for adoption in April. Rochester Mayor Kim Norton said she's hoping the process provides a chance to update the existing priorities to address the city's needs as they continue to change. "It's important for me to have a lot of discussion upfront on issues, so we are together," she said, adding that the ongoing process will help create common goals.
