Municipal Facilities Committee. From: Mahmood Kanmzadeh, AIA Municipal Facilities Program Manager Bureau of Engineenng. Subject: Recommendation:

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1 GEN. FORM 160 (Rev. 6-80) Municipal Facilities Committee From: Subject: Mahmood Kanmzadeh, AIA Municipal Facilities Program Manager Bureau of Engineenng CHANNEL 35 TELEVISION STUDIO RELOCATION AND DIGITAL EQUIPMENT UPGRADE IN THE EL PUEBLO DE LOS ANGELES HISTORIC PARK- 22,000,000 PROJECT BUDGET FOR DESIGN AND CONSTRUCTION, COMMITTEE MEETING OF JANUARY 29, 2014 Recommendation: 1. That the MFC approve a revised project budget of 22,000, That the MFC approve a revised the project completion date from July, 2017 to October That the MFC provide direction to move forward with the remaining phases of the project Updates within this report are in bold lettering. Councilmember Huizar, CD 14 PROJECT: CHANNEL 35-Relocation and Tenant Improvements to N Main - Masonic Hall and Merced Theatre in the El Pueblo de Los Angeles Historic Park. Page 1 of 7

2 1. Background : The Channel 35 Studio relocation and equipment upgrade project was prompted by several operational needs. The Studio requires a digital equipment upgrade and also needs to be located closer to the City Hall campus to facilitate live feeds by the City's Leadership during an emergency. i The facility is also a financial burden to the city due to the lease ; agreement. The two leases required to house the Channel 35 studio and I office space were scheduled to expire in the 2012 / 2013 fiscal year. Those leases have been extended to December 2017 and December 2015, and include options for month to month extensions as needed. The Channel 35 lease space is currently funded by the City s receipts of 5% gross revenue cable TV franchise fees or 5% fund. These monies are general fund monies and may be used without limitation by the City. In January of 2011 a report was submitted to the Information Technology and Government Affairs (ITGA) Committee, which details the 5 year plan for the use of the Public, Educational and Governmental Access (PEG) funds (CF No S1; see attachment #1). Funding for this project will be provided by the City s PEG fee fund (1% fund). The City receives roughly 6 million dollars a year in 1% PEG gross franchise fee receipts. These funds are restricted and may only be used for PEG capital expenditures. The Municipal Facilities Committee (MFC) approved the new location and project schedule, and authorized the expenditure of 1.3 million dollars of PEG funding to be used for Design, on February 28, The Mayor and Council concurred with the assignment of the space and authorized the expenditure of 1.3 million for design in April, 2013 (CF No ). Mayor and Council concurred with the additional scope of the live audience television studio and inclusion of the Masonic Hall into the project in April, 2014 (CF S2) 2. Scope of Work The scope for this project entails the design and construction of the new Channel 35 studios within the Historical Merced Theatre building. Upon MFC approval the BOE will begin the process for hiring consultants to perform design for the following fields: - Structural - Mechanical - Electrical - Plumbing - Gas Fire Suppression - Fire and Security Alarm - Television Studio -Landscape Design - Historical Preservation Documentation Architectural Design and Construction Administration The Bureau of Engineering will provide the following services for the project: - Environmental Review - Project Management - Geotech Investigation - Construction Management - Survey Page 2 of 7

3 Additional Scope After the design consultant was selected, Council District 14 and the Department of El Pueblo requested the BOE and ITA include the design and construction of a live audience TV studio on the first floor of the Merced Theatre. BOE has met with Council District 14, the Department of El Pueblo, and ITA to develop the additional scope. The live audience TV studio will provide additional programming for Channel 35. It may also provide opportunities for the development and airing of additional educational and public access programming content, which is a goal for development projects within the El Pueblo De Los Angeles Historic Park. The design consultant has provided a revised fee proposal to address the additional scope, which can be accommodated within the design contingency. The Masonic Hall, adjacent to the Merced Theatre, can provide 2,500 sq. ft. of needed space, which will increase the operational efficiency of the Studio, and accommodate future growth. Currently, the Masonic Hall is a vacant structure that is available for use to meet the need of the expanded Channel 35 Studio project. Design Consultant Selection On March 28, 2013, the Bureau of Engineering (BOE) distributed Task Order Solicitation (TOS) No. 320 to the 17 architectural firms within the Pre-Qualified On Call (PQOC) consultant list. Seven responses were received by the TOS deadline. After evaluation of the proposals, five firms were selected for interviews. The interview panel consisted of executive and senior management representatives from the BOE and ITA. The interview scoring resulted in the selection of Roto Architects to provide the Architectural design and Engineering services. The negotiated fee for the requested services at that time was 1,465,800. The Design fees have since then been re-negotiated, to address the additional scope, which includes addition of a live audience TV studio and build out improvements for the Masonic Hall. The fee has increased by 157,050, to an amount of 1,622,850. A contingency of 377,150 is recommended, which increases the total recommended design appropriation to 2M. The BOE will report back to the MFC with an updated cost and schedule, once the schematic design is completed, and a Class C estimate has been developed. Page 3 of 7

4 3. Budget/ Cost Analysis BOE Preliminary Estimate.1/30/2014 MFC Report Schematic Design Estimate -12/18/14 MFC Low Hifch Construction Costs 10,800,000 12,540,000 13,700,000 Digital Studio Equipment, Fiber, Satellite Dish 3,000,000 4,000,000 Hardscape Landscape 350, ,000 NA Relocation Costs 30,000 60,000 60,000 Project Contingency {± 15%) 2,000,000 2,600,000 Const Contingency ( + 25%) Escalation (5% for 2years) * 4,750,000 Building Permit Fees 250, , ,000 Cultural Affairs Art Fee 150, , ,000 Soft Costs 2,000,000 2,600,000 2,600,000 Inspection & Testing 500, , ,000 Total with Digital Equipment 19,080,000 23,350,000 Subtotal Without Digital Equipment 16,080,000 19,350,000 22,000,000 Digital Studio Equipment * 10,500,000 The Budget increase detailed above was caused by the following reasons: Scope increase: Live Audience/ Multipurpose Studio- This additional scope was added to the project in the January 30, 2014 MFC report (See attachment). This new program element also requires additional support spaces such as a Studio Control Room, an Audio Control Room, Men s and Women s Dressing Rooms, a Green Room, and a Restroom. Masonic Hall- The Masonic Hall was added to the project in order to address the space needs for the Live Television Multipurpose Studio. The retrofit of the building systems and architectural improvements in the Masonic Hall increases the total project budget. Construction Cost escalation: Our previous budget included 3% cost escalation within the final project budget. Due to increased construction activities, the industry standard escalation for Los Angeles has increased to 5%. The Studio Equipment costs are now listed independently of the design & Construction Budget, and have been increased due to the following: o Addition of the live audience television studio and the various supporting equipment needed for independent operation of this studio. o Cost escalation of equipment from 2011 to the estimated purchase date in o Full studio scope development for the Master Control Rooms and Studio Space revealed equipment left out in the original scope developed in 2011, such as: an emergency generator, fiber optic runs and data equipment within the building, and the installation of data/power outlets to facilitate filming in remote locations in El Pueblo. Page 4 of 7

5 Availability of Funding: The ITA has earmarked 0.300M within the City of Los Angeles adopted budget to initiate the feasibility study for the studio relocation and displaced tenants M, accrued through the 1% PEG fund, has been appropriated to a capital account for this project. The remaining funding required for construction is available in the 1% fund PEG fund, and will be appropriated when needed. 1% PEG funding will be accrued and distributed to the project in the following manner. IS PEG FEES THROUGH FY 2018 FOR CHANNEL 35 RELOCATION EQUIPMENT UPGRADE PEG RECHPTS FROM PREVIOUS FY CURENT RECEIPTS PREVIOUS + CURRENT NON STUDIO BUDGETED APPROPRIATIONS/ EXPENDITURES STUDIO BUDGETED APPROPRIATIONS/ EXPENDITURES AVAILABLE PEG RECEIPTS FY FY ,345, , , FY , ,401, ,929, FY FY ,277, ,361, ,764, S 5,868, , ,230, , ,212, , S 10,361, ,718, FY ,718, ,430, ,148, , FY FT FY 15-16** ,211, ,800, S ,763, B ,100, ,211, FY , ,800, S ,9D0, ,218, ' Revenue tor FY14-15 ana subsequent years Is estimated. ** Budget appropriations for FY and thereafter are based upon budget requests to be submitted for that year and thereafter which will Include annual base funding tor Ch 35 equipment (430K), CH 36 equipment(250k) and 150K1br Miscellaneous Expenses, fatal 830KL The 1% PEG fund will cover all of the costs associated with the management, design and construction of the project. Based on the chart above, it is anticipated that sufficient funding will be available at the time of the construction contract award. This project will not negatively impact the General Fund. Funding Usage: In order to ensure that the PEG funding can be used to cover all of the costs associated with this project, ITA sought further clarification from the City s outside legal counsel. The City s outside counsel explains in its memo to the City that capital costs refer to those costs incurred in or associated with the construction of PEG access facilities. The City Attorney s Office has stated that it agrees with the opinion of the City's outside legal counsel. The 1% PEG costs will also pay for the construction and relocation costs associated with the project. The 5% general franchise fee funds will continue to cover the operational and maintenance costs associated with the project upon completion of the construction of the facilities and the upgrading of the studio facilities to the digital format necessary for the modernization of the studio facilities. It has been determined that the 1% PEG fund cannot be used to subsidize the costs of a proposed lease, because the facilities are owned by the City- Page 5 of 7

6 Operational Costs All operational costs for Channel 35 must be borne by the General Fund or as Channel 35 operations are currently funded, the 5% franchise fee revenues. The City will need to address the issue of additional funding for operations related to the live audience TV studio facility and need for additional staff. ITA has preliminarily estimated that if proposed hours of operation exceed 9 hours per day, then up to six additional staff members may be needed to operate the live audience TV studio. The City could also rely on a reduced number of additional staff in combination with outside contractors to staff the live audience TV studio when necessary. In order to mitigate any budget impacts for live audience TV studio userequests made external to Channel 35 s normal operations, a costrecovery fee structure may be implemented to recoup associated maintenance and staff costs for the use of the live audience TV studio. In addition, in keeping with current budget restrictions, City departments that would like to use the Channel 35 studios for its programming needs must provide funding for ITA s staff costs. ITA intends to address these issues in an updated 5-year TDA Budget Plan Report on the proposed future use of the 5% franchise fees and 1% PEG fees to City Council and Mayor. (See CF No S1; see attachment #1.) Design Funding: The MFC, Mayor and Council have authorized 1.3 million for design to date. Additional funding Authorized 1.0 Million on February 28th, 2013 for design services needed to prepare a class C construction cost estimate to evaluate the projected construction costs presented. The! City Council previously approved 300,000 in the City Budget, i and has directed the transfer of the authorized funds in CF I The preliminary MFC funding authorization was based on the approach of using City Staff to deliver the Architectural Services. However, the approach has since changed. The project management team has decided to utilize consultant services for the entire project. I Funding is available within the PEG accounts to cover the costs, including contingency. i 4. Schedule

7 1 5. Current Activities Schematic Design Completion The Project was successfully presented to the El Pueblo Commission The Schematic Design was successfully presented to the ITA Executive Management The design has been coordinated with the Department of Planning, Historical Resources Section, and has garnered their support for the Historical Preservation approach Pico House; The Structural Engineer has performed a structural analysis of the Masonic Hall, Merced Theatre and Pico House and has determined that buildings are structurally tied together. Therefore the structural upgrades of the Merced Theatre and Masonic will trigger the need for structural upgrades within the Pico House. We suggest that the structural retrofits of all three structures occur concurrently to take advantage of the savings gained by the project s economy of scale. The total project budget listed in this report does not include the cost for structurally separating the Merced Theatre from the Pico Housel. If Pico House will not be structurally rehabilitated under the El Pueblo Capital Projects program, then the BOE has to evaluate the cost increase for the structural separation of the two buildings, and report back in coming months. The costs for the Mechanical, Electrical, Plumbing and Structural retrofits of the Pico House will be presented in a separate MFC report. Rick Cole, Office of the Mayor Miguel Sangalang, Office of the Mayor Dan Caroselli, Office of the Mayor Zara Bukirin, Office of the Mayor Rick Coca, Office of Councilmember Huizar, CD 14 Stephanie Magnien, Councilmember Blumenfield Ramon Soto, City Administrative Officer Maria Cardenas, City Administrative Officer Jacqueline Wagner, City Administrative Officer Raoul Mendoza, City Administrative Officer Sharon Tso, City Legislative Analyst Clay McCarter, City Legislative Analyst Mandana Khatibshahidi, City Legislative Analyst David Paschal, General Services Department Chris Espinosa, El Pueblo Steve Reneker, Information Technology Agency Mark Wolf, Information Technology Agency Tony Ighani, Information Technology Agency Laura Ito, Information Technology Agency William Imperial, Information Technology Agency Ted Lin, Information Technology Agency Deborah Weintraub, Bureau of Engineering Reza Bagherzadeh, Bureau of Engineering Ohaji Abdallah, Bureau of Engineering Candice Arnold, Bureau of Engineering Karen Dacres, Bureau of Engineering Page 7 of 7