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HomeMy WebLinkAboutMemo - Read Before Packet - 2/10/2015 - Memorandum From Ken Cooper, Loveland Facilities Operations Manager, Re: Regional Training Campus- Reduced Capital Plan Option (Feb. 12, 2015 Joint Work Session)CITY OF LOVELAND PUBLIC WORKS FACILITIES MANAGEMENT 410 East 5th Street  Loveland, Colorado 80537 (970) 962-2635  FAX (970) 962-2908  TDD (970) 962-2620 www.ci.loveland.co.us Memo TO: Loveland City Manager Bill Cahill Fort Collins City Manager Darin Atteberry FROM: Ken Cooper, Loveland Facilities Operations Manager DATE: February 6, 2015 RE: Regional Training Campus – Reduced Capital Plan Option CC: Loveland Police Chief Luke Hecker Fort Collins Police Chief John Hutto The Regional Training Campus (RTC) project includes a number of critical components required to effectively meet the current and long-term Police training needs for Fort Collins and Loveland:  Pistol training up to a 50-yard distance  Rifle training up to a 100-yard distance  SWAT / Simunitions shoot house  Classroom space to support weapons training  Driving track for high-speed vehicle training  Skid pad & other vehicle training features  Storage needs for the campus Considering these critical elements of the proposed campus, the RTC project team has carefully reviewed options to reduce the overall capital investment, while keeping intact the basic project needs. The following project elements can be removed or reduced:  Reduce the pistol range from 25 lanes to 20 lanes  Remove the proposed street grid – build at a later date  Reduce the vehicle maintenance building to a basic storage building These changes maintain the integrity of the project, but reduce by nearly 13 percent the estimated total project cost to the cities. The shared capital investment is reduced by about $3M, from $23.5M down to $20.5M. At the upcoming joint study session with the two City Councils on February 12, CITY OF LOVELAND PUBLIC WORKS FACILITIES MANAGEMENT 410 East 5th Street  Loveland, Colorado 80537 (970) 962-2635  FAX (970) 962-2908  TDD (970) 962-2620 www.ci.loveland.co.us 2015, the project team will cover in more detail the impact on maintenance and operations from this reduced project plan. The attached PowerPoint presentation for the February 12 joint study session has been updated. It includes additional slides with financial summary information about the reduced RTC plan. To ensure clarity at the joint study session, this new presentation should replace the one distributed to City Councils on February 4. Thank you. LIST OF ATTACHMENTS: 1. Updated PowerPoint presentation for joint study session on February 12, 2015 Regional Training Campus Joint Study Session Fort Collins & Loveland City Councils February 12, 2015 Fort Collins – Loveland Airport Purpose of Presentation Express the need Compare alternatives Answer previous questions Establish clear path forward 2 Risk, Consequence, Liability 3 Shooting, High Speed Driving Traffic Stops, Daily Vehicle Operations Intermittent, Admin Tasks Non-EM Police Calls, Report Writing Project History & Needs Loveland Firearms Training  Late ‘60’s – bulldozer + open ground = gun range  No capital investment since  Noise concerns grow with increased use, spike after reservoir  Treatment Plant expansion, site increasingly incompatible 4 5 Loveland Firearms Training - WTP 6 Loveland Firearms Training - WTP Project History & Needs Fort Collins Firearms Training  Current indoor range built 1984, purchased 1990  Half as many staff in 1990 – too small now  Unsafe, needs considerable & costly repair  Cannot train all systems  Rifle training 80 mile roundtrip – subject to owner demands 7 8 Fort Collins Firearms Training Range 9 Fort Collins Firearms Training Range 10 Fort Collins Rifle – Pawnee Grasslands Project History & Needs Loveland Firearms Training  2007 – Capital project to improve existing range  Canopy structure to mitigate noise  $3M project to Loveland Council in early 2008  Neighbors of range are clear – “Move it, don’t improve it” 11 Project History & Needs Loveland Firearms Training  2008 - Developers reach out  Preliminary drawings, regional thoughts include CBI Lab  By 2010, no investment community interest  FRGC provides short-term, pistol training supplement 12 Project History & Needs Fort Collins Driving Training  No resource in Northern Colorado  Closest is Adams County – 120 mile roundtrip  Restricted scheduling across many agencies  Unable to EVOC train in 2014, slow speed at TransFort 13 Project History & Needs Loveland Driving Training  Cones in parking lot – Fire Training Grounds  Minimal systems, site is unsustainable 14 Project History & Needs Fort Collins & Loveland continue to grow up – but ability to best train Police does not 15 Loveland City Council Directive January 2013 - Council makes Police training facility top priority at Workshop  $18.2M in Loveland capital plan - fill Loveland needs  Gun range as part of campus, include driving & other training  Other agency use, but Loveland to own & operate 16 Fort Collins & Loveland Team Up Summer 2013  Early design, site selection process  Loveland asks Fort Collins in – FC commits resources as equal partner in July  Larger project, longer-term solution for Cities Project grows from $18.2M to $24M, but Loveland’s capital reduced by over $6M 17 Loveland & Fort Collins – Priority One-stop shop – firearms & vehicles  Pistol & rifle, tactical throughout  SWAT / Simunitions shoot house  EVOC driving, street grid, dynamic movement to shoot house  Classrooms, support – future Academy  Phased approach, grow on 43-acre Airport campus site Constructed, owned, & managed by Loveland & Fort Collins 18 Excess Campus Capacity? Yes - here’s why  Size driven by best methods to train, optimal class sizes  Cities’ needs today fill less than half total campus capacity  8 percent of training in RTC is “best practice” – not performed today due to lack of facilities  If no other agencies ever use it, campus size doesn’t change 19 Best Excess Capacity Use? Encourage other agency use  Ideal regional site  Shared benefit when other Police improve training  Letters of intent – eleven agencies, 1,100 officers  Rental fee revenue – help cover O & M  Staff growth in Cities to eventually squeeze users, will take decades 20 Other Capacity Issues? Sufficient training capacity – exception is classrooms However...  Training segments are M-F, 8am-10pm  Capacity significantly higher  Some classroom training at HQ (small dent in classes sold)  Some training at HQ’s transition to RTC, small added soft costs for travel 21 Revenue Projection Project due diligence  Demand exists – Adams Co turning agencies away  Letters of intent  75% rental income from Track – no similar resource in NoCo  Projections assume rental of 25% of unused capacity  Market / Demand pricing – $150 added per segment = $150K annually 22 Expenses O & M – $710K in year two Variable costs: campus manager & admin support Capital renewal costs included in O & M Land lease costs already within both Cities’ budgets  $350K annually with escalation  Shared by two Cities – keeping with current in post-Allegiant  19 cents per sq ft meets FAA mandate for developable land 23 Capital Required 24 • Source of Cash: • Loveland - $6M CEF, $1.7M GF, $4.3M Tabor Reserve • Fort Collins - $1M GF, $11.1M COP Debt Anticipated Capital Spend Timing ($ millions) 2015 2016 2017 Total Loveland $ 1.0 $ 4.0 $ 7.0 $ 12.0 Fort Collins 1.0 4.1 7.0 12.1 Total $ 2.0 $ 8.1 $ 14.0 $ 24.1 Training Campus Summary Financials 25 • Year 1 is Track only, Range & Classrooms online Year 2 • Market/Demand Opportunity assumes additional $150 rental income • Budget Savings within each dept assumed to be transferred to facility Training Facility Operating Costs ($ 000's) Year 1 Year 2 Year 3 Year 4 Year 5 Revenue Class Charge to Outside User $ 73 $ 110 $ 114 $ 117 $ 121 Facility Rental 85 287 295 304 313 Total Revenue $ 158 $ 397 $ 409 $ 421 $ 434 Expenses Personnel 115 302 312 322 332 Operations, Supplies, Maint 47 303 303 318 319 Capital Reserve 18 105 106 107 108 Total Expense $ 180 $ 710 $ 721 $ 748 $ 760 Training Facility Income/(Loss) $ (22) $ (314) $ (312) $ (327) $ (326) Market/Demand Revenue Opportunity 148 153 157 162 Facility Income/(Loss) with Opportunity $ (22) $ (166) $ (159) $ (170) $ (164) Budget Savings Loveland 59 61 63 64 66 Budget Savings Fort Collins 77 79 82 84 87 Net Facility Income/(Loss) $ 114 $ (25) $ (15) $ (21) $ (11) 26 • Budget savings do not include productivity from reduced driving - $125K • Opportunity - additional $150 per segment of rental • Fort Collins budget impact driven by financing cost on $11.1M Budget Impact Training Facility Budget Impact ($ 000's) Year 1 Year 2 Year 3 Year 4 Year 5 Loveland Travel & Fee Savings $ 59 $ 61 $ 63 $ 64 $ 66 Fort Collins Travel & Fee Savings 77 79 82 84 87 Loveland Financing Cost $ - Fort Collins Financing Cost - @ 4% 20 yrs (809) (809) (809) (809) (809) Shortfall w/o Opportunity $ (22) $ (314) $ (312) $ (327) $ (326) Shortfall with Opportunity (22) (166) (159) (170) (164) Budget Impact - Loveland w/o Opportunity $ 52 $ (43) $ (41) $ (43) $ (41) Budget Impact - Fort Collins w/o Opportunity (747) (940) (937) (944) (941) Budget Impact - Loveland with Opportunity $ 52 $ 6 $ 10 $ 9 $ 12 Budget Impact - Fort Collins with Opportunity (747) (841) (835) (839) (833) Alternatives • Terminal Value of RTC at year 20 not included in NPV, but significant • Combined analysis for both Loveland & Fort Collins • Adams County alternatives: • Not practical given inability to schedule time in late 2014 & all of 2015 • Does not include lost productivity associated with travel time 27 Alternative Comparison ($ millions) Initial Capital 20 Year Additional Operating NPV of Total Cashflow Regional Training w/o Rev Opportunity $ 24.1 $ 3.9 $ 26.3 Liberty Arms & Build Track 8.5 34.1 25.5 Adams County for All - 28.3 16.8 Alternative – Adams County 120 mile roundtrip – obvious inefficiencies No control over scheduling, limited capacity Theoretical only – cannot effectively schedule 28 Alternative – Liberty Arms Proposal to two Cities – Nov 2014, updated Jan 2015 $1.1M annually – five year window, then undefined Not competitive with RTC’s O & M, which includes driving, etc. No long-term control, solution for Cities unsustainable 29 Alternative – RTC with Reduced Capital 20 lane pistol range (from 25) Build street grid at later date Vehicle maintenance reduced to storage building Critical training props remain 30 Capital Required – Reduced RTC 31 • Source of Cash: • Loveland - $6M CEF, $1.7M GF, $2.5M Tabor Reserve • Fort Collins - $1M GF, $9.2M COP Debt Anticipated Capital Spend Timing ($ millions) - Reduced Capital 2015 2016 2017 Total Loveland $ 1.0 $ 2.5 $ 6.7 $ 10.2 Fort Collins 1.0 2.6 6.6 10.2 Total $ 2.0 $ 5.1 $ 13.3 $ 20.4 Summary Financials – Reduced RTC 32 • Year 1 is Track only, Range & Class rooms online Year 2 • Market/Demand Opportunity assumes additional $150 rental income • Budget Savings within each dept assumed to be transferred to facility Training Facility Operating Costs ($ 000's) - Reduced Capital Year 1 Year 2 Year 3 Year 4 Year 5 Revenue Class Charge to Outside User $ 73 $ 110 $ 114 $ 117 $ 121 Facility Rental 85 240 247 255 262 Total Revenue $ 158 $ 350 $ 361 $ 372 $ 383 Expenses Personnel 115 301 310 320 320 Operations, Supplies, Maint 47 283 283 297 297 Capital Reserve 18 102 103 104 105 Total Expense $ 180 $ 686 $ 696 $ 722 $ 723 Training Facility Income/(Loss) $ (22) $ (335) $ (335) $ (350) $ (340) Market/Demand Revenue Opportunity 148 153 157 162 Facility Income/(Loss) with Opportunity $ (22) $ (187) $ (182) $ (193) $ (178) Budget Savings Loveland 59 61 63 64 66 Budget Savings Fort Collins 77 79 82 84 87 Net Facility Income/(Loss) $ 114 $ (47) $ (38) $ (44) $ (25) 33 • Budget savings do not include productivity from reduced driving - $125K • Opportunity - additional $150 per segment of rental • Fort Collins budget impact driven by financing cost on $9.2M Budget Impact – Reduced RTC Training Facility Budget Impact ($ 000's) - Reduced Capital Year 1 Year 2 Year 3 Year 4 Year 5 Loveland Travel & Fee Savings $ 59 $ 61 $ 63 $ 64 $ 66 Fort Collins Travel & Fee Savings 77 79 82 84 87 Loveland Financing Cost $ - Fort Collins Financing Cost - @ 4% 20 yrs (677) (677) (677) (677) (677) Income/(Loss) w/o Opportunity $ (23) $ (335) $ (335) $ (350) $ (340) Income/(Loss) with Opportunity (23) (187) (182) (193) (178) Budget Impact - Loveland w/o Opportunity $ 51 $ (50) $ (48) $ (51) $ (46) Budget Impact - Fort Collins w/o Opportunity (615) (822) (820) (827) (818) Budget Impact - Loveland with Opportunity $ 51 $ (1) $ 3 $ 1 $ 8 Budget Impact - Fort Collins with Opportunity (615) (723) (717) (722) (710) Alternatives – Reduced RTC • Terminal Value of RTC at year 20 not included in NPV, but significant • Combined analysis for both Loveland & Fort Collins • Adams County alternatives: • Not practical given inability to schedule time in late 2014 & all of 2015 • Does not include lost productivity associated with travel time 34 Alternative Comparison ($ millions) - Reduced Capital Initial Capital 20 Year Additional Operating NPV of Total Cashflow Regional Training w/o Rev Opportunity $ 20.4 $ 4.2 $ 22.9 Liberty Arms & Build Track 5.5 33.8 22.4 Adams County for All - 28.3 16.8 Why Now? Requirements only increase & waiting is expensive  Ideal site, stakeholders supportive Partnership saves each City millions DOLA cycles – up to $4M User agencies in position  Infrastructure to Airport, development 35 Governance Jointly owned & operated Steering Committee for communication Day to day operations support from Loveland Possible building authority – LLBA model 36 Questions to Address 50-50 capital partnership between Cities Weld County as potential capital partner Simulation to replace live training for firearms & driving 37 Desired Project Schedule 38 DESCRIPTION YEAR EXPECTED DURATION Project programming – info gathering 2014 1st & 2nd Quarters Early design – schematic design 2014 3rd & 4th Quarters Budgets finalized – Council approvals 2015 1st Quarter Design development & construction drawings 2015 1st , 2nd , 3rd , & 4th Quarters Construction bid process 2015 4th Quarter Project construction – campus infrastructure, driving areas 2016 1st , 2nd , 3rd , & 4th Quarters Project construction – indoor ranges 2017 1st , 2nd , 3rd , & 4th Quarters Recommendation Move forward now with Regional Training Campus 39 40 Aerial looking NW at Range Building 41 Aerial looking NW at Campus 42 Proposed Site Plan 43 Proposed Plan Diagram