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02-04-1997 - City Hall Building Modifications - Community Room Relocation & New Simulator Room - Award of Bid - Project #GP-96302'+ 4 City of West Covina Memorandum TO: City Manager and City Council AGENDA ITEM NO. D-1 FROM: Patrick J. Glover City Engineer/Public Works Director DATE February V. 1997 John T. Distelrath Chief �of Police SUBJECT: PROJECT NO. GP-96302 CITY HALL BUILDING MODIFICATIONS - COMMUNITY ROOM RELOCATION AND NEW SIMULATOR ROOM - AWARD OF BID SUMMARY: Eight bids were received and opened on February 11, 1997, for this project which provides for the enclosure and modification of the existing floor space to accommodate the police simulator training area, a community room, kitchen, and an employee lunch room. The lowest responsible bid is $208,800.00 from Armstrong Construction of Covina, California. BACKGROUND In January 1995, the Police Department opened a Simulator Training Facility in the basement of the Civic Center parking structure. The facility houses three driving simulators and one I shooting simulator in an 800 square foot room. `This room was originally designed as storage space for City Hall. Since its opening, the program has been an overwhelming success providing training for over 1,000 individuals. The simulator training programs allow public agency employees classroom instruction with experiences in a variety of shooting and driving situations. The simulated experience is very beneficial since neither the students nor the simulated victims are at risk of (injury. The training is designed to help students react appropriately under a variety of high risk situations. With the success of the program, the need for expansion has become apparent. The initial solution was to design a room adjacent to the existing facility within the parking structure. Preliminary plans were prepared along with a cost estimate to complete the expansion. The estimated cost of construction was $250,000 for the new simulator classroom and $50,000 for restroom facilities. This proposed project was approved under the 1995-96 Capital Improvement Program with the funding of $300,000 coming from DER (Drug Enforcement Rebate). Prior to finalizing the plans for the parking structure expansion, a review of other potential building locations was investigated. Due to its proximity to the Police Department and the fact that restroom facilities currently existed, the location of the existing community room was examined. This location provided better security, use of existing restrooms, no loss of parking spaces, and improved access. While this location is considerably larger than the existing facility, it Estill requires expansion by 450 square feet to accommodate future programs. The expansion will provide a total simulator training and classroom area of 2,725 square feet. The proposed facility will provide enough space to hold separate training classes for driving and shooting simultaneously and thus increase the class size capacity from its current level of six to twenty. Creating the new Simulator Training Facility using existing building space in City Hall can be accomplished at a ( relatively inexpensive cost. However, the relocation of the existing community room to another location is a more cost intensive process. • 1 • City Manager and City Council February 18, 1997 Page Two For a number of years, the first floor of City Hall has been examined for a variety of potential uses. Currently, the floor houses only the Council Chambers, restrooms, elevators, and small storage rooms. The original design was intended to give an open breeze way feeling to those coming to City Hall. The area was built with possible expansion in mind; however, it has no plumbing, electrical or mechanical infrastructure to facilitate this expansion without extensive modifications. A proposed plan to enclose 3,300 square feet of the first floor has been developed. The space has been designed to provide a community room which could be used by the City and outside groups to hold a variety of functions such as meetings, seminars, group lunches, as well as provide a space where people could watch the City Council meetings on Cable TV if seating is limited inside the Chamber or if they have small children that may disturb the meeting. The anticipated demand for this new community room is higher than the current three to four days per week use in its existing basement location. The new enclosed space! will also contain a kitchen and an employee lunch room. A reduced copy of the plans forlboth parts of this project has been attached. ANALYSIS The project was adv 27, 1997. A manda present. On Februa City Clerk. At the tin was substantially to contact with Mr. Ric that an error was m "Proposals in which be rejected". Furthe the bidder claims a notice within five (5) in detail how the mi,, Industries, the lowe California in the amo The following is a rtised in the San Gabriel Valley Tribune on January 20 and January )ry job walk was held on January 30, 1997, with twenty contractors 11, 1997, eight bids were opened and reviewed in the office of the of bid opening, it was "noted that the bid from Southwest Industries er than staffs in-house estimate and other bids received. Upon and LaBella, President of Southwest Industries, it was discovered 1e. In accordance with Item No. 24 of the Instructions to Bidders, ie prices obviously are unbalanced due to mathematical errors may relief of bidders may be granted in accordance with Item No. 23 "If iistake was made in his bid, the bidder shall give the City written ays after the opening of the bids of the alleged mistake, specifying 3ke occurred". Therefore, with the rejection of bid from Southwest responsive bidder was from Armstrong Construction of Covina, nt of $208,800.00. mary of the bids received. 1. I Southwest Industries Montclair $143,000.00 2. Armstrong Construction Covina $208,800.00 3. SMC Construction Co. Costa Mesa $232,590.00 4. Charles McBurney Contractors West Covina $249,000.00 5. ATEK Construction Mission Viejo $256,000.00 6. Global Construction Artesia $295,000.00 7. Stanhope Co. I Los Angeles $310,931.00 8. Summit Installation Co. Gardena $340,829.00 Construction is schei 1997. Arrangements use their patio and br d to start on March 7, 1997, and to be completed on June 7, ,e been made with the Police Department for City employees to area during the construction period. • City Manager and February 18, 1997 Page Three FISCAL IMPACT Council Approval, and funding in the amount of $250,000 was allocated from the DER for this project in the 1995i96 Capital Improvement Program. An additional $50,000 was also allocated from the same fund to construct restroom facilities for the Police Simulator Training Facility when the facility was scheduled to be constructed at the parking structure. The DERlfunds will be used to fund 70% of this project with the remaining 30% coming from the self insured liability reserve. The self insured liability reserve will be used because the new facility will provide a valuable training experience and reduce the City's liability and training budget. The funding distribution is based on the DER funding the cost of the simulator, room modifications and the pro rata cost of the community room and kitchen space. Because the new simulator room is displacing 2,275 square feet of floor space currently used for the community room and kitchen, the DER funding will pay for the cost to rebuild an equivalent amount of space on the first floor. The DER funding is' a product of the asset/forfeiture law which was signed into law in 1984. It was part of the Comprehensive Crime Control Act of that year. The primary purpose of the asset/forfeiture program is to enhance law enforcement's ability to fund training, equipment, and operations, detention facilities, drug education and awareness programs, as well as law enforcement facilities of equipment._ The funds from asset/forfeiture cannot be used for any other purpose by law enforcement and it cannot supplant local law enforcement budgets. In June 1995, Attorney General Janet Reno issued a report to law enforcement that said the Federal government asset/forfeiture program should... "...encourage la macro approach to the non -supplantation requirements. This "macro" view looks at a law enforcement budget as a whole and allows agencies to use equitable sharing funds for any permissible purpose as long as shared funds increase the entirety of the law enforcement effort. This approach which permits maximum flexibility is consistent with that of the Department of Justice asset/forfeiture law." Based upon these guidelines and discussions with the City Attorney, staff is confident that the use of asset forfeitures as proposed is appropriate. In addition to the $208,800 for the construction contract, a sum of $71,200 is needed for furnishings, audio Ivisual equipment, contract administration, inspection, and contingencies for a total funding of $280,000 to complete this project. The original project estimate was $300,060. The expansion of the simulator training program will provide for increased revenue to the City and with increased program flexibility will allow the Police Department to expand its marketing efforts to attract more program users. The Police Department business plan for the simulator program, prepared in conjunction with the Finance Department, is attached to this reports It shows a potential for revenues of $300,000 annually by the year 2000. It will also provide an improved environment for training City employees from Police, Fire and Public Works. This in-house training facility saves training and travel costs in addition to providing City staff with the latest State of the Art training. I u City Manager and C February 18, 1997 Page Four ALTERNATIVES Council The alternative to the recommendation is to reject all bids and re -advertise. Since a highly competitive and favorable bid was received, it is likely that costs would not be reduced any further. RECOMMENDATION It is recommended that the City Council reject the bid from Southwest Industries as requested and accept the bid of Armstrong Construction in the amount of $208,800.00 as submitted at thel bid opening on February 11, 1997, and authorize the Mayor and City Clerk to execute an agreement with Armstrong Construction of Covina, California for the work to be done. Patrick J. Glover City Engineer/Public PJG:JD:BHL Attachments Director n T. Distelrath Chief of Police EDISON CO. -EQUIPMENT ERISTING ELEVATOR LOBBY• • 4 PUBLIC AREA KITCHEN AREA TELEPHONE ELECTRICAL —EQUIPMENT —EQUIPMENT— I - - 1 4L,' 1 EMATORS SHOOTING SIMULATOR AREA _ NEW I� TRAINING ROOM - - -- - - ---- - - -- I� . CLASS ROOM STORAGE COURT YARD 31 iJ DRIVING SIMULATOR AREA PLANTER I BASEMENT FLOOR PLAN 1/4":1'-O" DE VnnInrcn V/1.T/M UItlININ 11RYRU11!MKNT 1'lIM►ANY Y1717 L Gwrw� fYww, l'+.rr. C�111nr RI71/ I— III III STEPS �-j 04 x x U � a � U 04 z P, o------- U ' I I ' STEPS .711 STORAGE L.. iLb = GX t STORAGE . 6 ' COMMUNITY ROOM I -tfiFd Kal" I _ -v. T—r. gum. KITCHEN 1 now Tv cam. ZAN" � :NMNTf '��• ' �1 �ce`RON" EMPLOYEE LUNCH ROOM „i PAjNTRY 4 STORAGE -.•� r Q NI a I i z' -- --- --- FLOOR PLAN 1/4"?:1'-0" V v�cTOM urawn osvcwrrwr COMPANY C—w C.IW --17a1 1.-.r IN. I.1.-� N Y►�..-I-131►�11- I • CITY OF WEST COVINA POLICE DEPARTMENT BUSINESS PLAN FOR .TOR TRAINING ENTERPRISE FUND BUSINESS PLAN FOR SIMULATOR TRAINING ENTERPRISE FUND BACKGROUND Traffic and shooting accidents are the most costly type of accidents public agencies are confronted with today. Many of these accidents result in large settlements in favor of the victims. Such settlements not only cost the agencies a lot of money when awarded, but also increase the cost of related insurance. Many of these accidents can be avoided if the officers were adequately trained. The simulator allows classroom instruction that gives public agency employees simulated experience in a variety of shooting and driving situations. Classroom experience is very beneficial because neither the student or simulated victims and other participants are at risk of injury. The simulated experiences learned in the classroom are designed to help students react appropriately under a variety of high risk situations. The Police Department acquired three driving and one shooting simulators with drug enforcement rebate money. Another driving simulator was acquired through risk management funds, which, upon installation, will increase the class sizes by two. Additionally, three vehicles (estimated at $70,000) and use of a paved parking lot were donated. The Police Department is on both Honda's and Nissan's lists to receive future vehicle donations. The program is in the process of getting two additional cars, and management believes many cars will be forthcoming. The donated vehicles and use of the parking lot will be used to practice behind the wheel defensive driving techniques. The Police Department has recently negotiated a confidential deal with Firearms Training Systems (FATS), under which FATS will replace the Department's current shooting simulator program with FATS's state of the art system at no cost to the Simulator Program (estimated value of $150,000), . and provide on -going program enhancements (estimated at $100,000) throughout the contract period. The Department is currently negotiating with Doron Corporation. Under the terms of the proposed agreement, The City will become Doron Corporation's premier research and development site for combined driving and shooting simulator programs. Both ventures will result in high publicity and should have a positive impact on filling classes and bringing recognition to the program. In return, the department will move its program to larger facilities (the current multipurpose room in the basement) and jointly advertise with the two companies. The training benefits more than public safety employees. The Police Department has developed, and offers classes in the following areas: 0 • Shooting: Public Safety, Private Security, and Private Citizens. Driving: Public Safety, Commercial, Insurance Companies, City Employees, Private Citizens, and Schools. The shooting simulator class has been certified under plan 3 by Peace Officers Standards and Training (POST). The driving simulator has been certified as a plan 4 class (plan 3 certification has been requested, but yet to be approved). Under the certifications, POST will reimburse public agencies that send law enforcement officers to the training for the following costs: Plan 3 -'- Tuition, travel and per diem costs Plan 4 Travel and per diem costs The actual behind the wheel class has been developed. The outlines are being drafted and the City received a grant which assisted in the purchase of a skid simulator. The Police Department anticipates finalizing the details and offering classes within a few months. BASICS OF BUSINESS Currently the City is offering three basic classes. A 4 or 8 hour class on either the driving or shooting simulators (with an 8 hour combined class available). And a 4 hour hands on driving class. The classes differ slightly for the target students identified above. The City began small by training our own police force. This gave our trainers experience and provided training to our officers at no incremental cost. After the initial start-up, the City offered its classes to other organizations. The City has an agreement to provide $5,800 of training to Rio Hondo College students and an agreement to train employees of Westec Security Company and Regional Occupation Program students. The City has held several POST certified classes, and several independent classes (such as Culver City and Covina Fire Departments). Costs for the classes vary depending upon the contractual agreement with the purchaser, the length of the class and the class content. K i MARKETING STRATEGIES i Currently, advertising in trade journals, mailings of brochures, calling prospective companies and word of mouth have been the sole marketing methods employed. Management knows that a good class is the best advertisement. Thus, the commander that supervises the simulator operations personally reviews each class evaluation form. POST certification is an indirect marketing tool because it reduces the cost of the. class to law enforcement agencies. Currently, the City's major competitor is San Bernardino County's Sheriffs Office. They offer a driving simulator class, but have not been able to couple the class with a shooting simulator. Based upon 8 training hours available during each of the 250 business days, the Department has 12,000 available driving simulator class hours", per year or 18,000 available shooting simulator class hours"' per year (or combination thereof, as the two simulators share one location). During the year ending June 30, 1996, the program billed for a total of 362 hours of classes. Management knows that it needs to develop an aggressive marketing strategy to fill these classroom openings. The Police Department has hired a consultant, Sonny D. Faires, to assist in the development of an aggressive marketing strategy. (" (Hours available per year)*(maximum number of students per class) FINANCES Fees billed during the year ended June 30, 1996 totaled $30,001. Hourly rates range from $16.25 to $24.60 per student per hour. The average fee per class hour is $73. The department held 102 classes during the year ended June 30, 1996 and is currently holding 2 or 3 four hour classes per week. Revenue from classes for the year ending June 30, 1997 is projected to be $58,000. The POST certification is likely to increase this current demand for classes. i Ultimately, the intent is to increase class participation to the point that all the simulators are full every day. At that point, the Police Department will purchase more simulators. The classes are currently very expensive because they are labor intensive. We. currently have 3 operational (and one idle) driving simulators that can train 6 people. Thus, the instructor to student ratio is 1:6. The driving simulator modules are designed to support up to eight driving simulators, which would lower the instructor to student ration to 1:16. The shooting simulator is designed to train 12 people per class. The Police Department currently requires that a minimum of 10 students attend each shooting simulator. If a customer wants to have a class with less than 10 participants, the customer must pay for the unfilled spaces. 3 The department is currently using on' duty officers as trainers, when available. The cost of the officers is being charged to the City as general public safety costs. When.such officers are not available, the City pays the, officers an overtime premium for training, but the premium is contractually set with the trainers at $28.01. For fiscal years beginning July 1, 1997, the simulator program will reimburse the City $28.01 for each hour an available officer is used as a trainer. The City is fully subsidizing the costs of marketing and managing the simulator program, as well as the cost of administration. � For fiscal years beginning July 1, 1997 the simulator will begin bearing those costs. By fiscal year ending June 30, 2000, the full cost of such expenses will be fully born by the simulator program. Pro -forma financial statements through the year ended June 30, 2000, follow. The major assumptions, are as follows: REVENUES • The number of students per. class will increase to 8 upon installation of the recently acquired simulator and the classes will increase steadily as follows: DRIVING SIMULATOR City Employees: The City will continue to train full time employees, volunteers and police reserve officers once annually. Risk Management will `reimburse the simulator program for the cost of training City employees. Fire Departments: Code 3 classes, offered to fire departments outside of the City, will increase to 8 classes per month Police Departments: P.O.S.T. Certified Police classes will increase to 4 classes per month. i Civilian Classes: The City will offer 2 classes per month, on alternating Saturdays. SHOOTING SIMULATOR City Employees: The City will continue to train full time and reserve police officers once annually. Risk Management will reimburse the simulator program for the cost of training City employees. 4 0 . 0 Police Departments: P.O.S.T. certified police classes will increase to four classes per month '(two four-hour and two eight -hour classes). Civilian Classes: The City will offer four classes per month, on `Saturdays. COMBINED DRIVING AND SHOOTING SIMULATOR Police Departments: P.O.S.T. certified police classes will increase to about five 8 hour classes per month. TRACK i Police Departments: P.O.S.T. certified police classes will increase. tI o about two four-hour classes per month. Civilian Classes: The City will offer two classes per month, on alternating Saturdays. FACILITIES LEASE AND RENTAL The City will rent simulator and track facilities to organizations such as colleges and other law enforcement agencies that can provide qualified trainers. EXPENSES • Semi -fixed costs will increase at about 20% per year, variable costs will increase in proportion to revenues, and fixed costs will remain constant from year to year, unless the base upon which the costs are fixed fluctuates. • No repayment of any costs donated by the City prior to July 1, 1997 will be made. Beginning July 1, 1997, the simulator program will reimburse the City for the salaries of simulator trainers at $28.01 per hour. • The City and will donate the cost of remodeling the multipurpose room for simulator training. 5 • • Planned capital donations from the City and outside sources will be realized. Such donations will be recorded as contributed capital, with depreciation upon -such being deducted from the contributed capital account. • The accounting for the operation has been established as an enterprise fund. This accounting method differs from the modified accrual method of accounting used in the City's Governmental funds in that revenues are recognized when earned, depreciation is recognized on fixed assets and both fixed assets and long term debt are recognized in the fund. The Enterprise fund has several categories of costs, as follows: • Salaries and benefits, • Overhead, including building costs, • Material and supplies, and • Depreciation. Salaries and Benefits: The City uses sworn officers to teach classes. Instructors salaries are generally donated by the City, however when all qualified instructors are off duty, or otherwise assigned, officers are paid $28.61 per hour. This special duty and pay is separate from the officers' normal work week. This -special pay arrangement does not draw any benefits, which helps to keep costs down. Salaries and benefits are variable costs. Overhead: Each year the Finance Department calculates an overhead burden for each department, based upon historical data. For the year ending June 30, 1997, the overhead burden is $41,487. The burden will continue to be absorbed by the City through the year ended June 30, 2000. Overhead is a semi -variable cost. Materials and Supplies: The cost of materials and supplies is currently being absorbed by the General and Drug Enforcement Rebate Funds, which will continue into the future. Material and supplies are a semi -variable cost. Depreciation: Annual Depreciation on the Simulators approximated $77,000 for the year ended June 30, 1996. As donations and purchases of fixed assets grow, so will the depreciation expense. Depreciation is a fixed cost. 0 0 C Start-up Costs: Start-up costs, estimated at approximately $343,500 were provided from the Drug Enforcement Rebate and General Funds, and are detailed below. The City anticipates no repayment of such donations. CATEGORY Salaries and benefits (2) Overhead burden, including AMOUNT $ 25;877 ,, ounaing 82,974 Simulators 234,665 Total $343,516 (21 20% of one Commander The City also donates instructor time to the simulator program. If an instructor is available and on duty, that instructor will be asked to teach a class. The instructor's salary will be charged to the general or drug enforcement rebate funds. Additionally, the Commander in charge of the program will continue to be charged to the General Fund. These costs have been estimated at $60,000 for year ending June 30, 1997, and projected to increase by 10 % for the years ending June 30, 1998, 1999 and 2000. All financial pr projected class( only 100% per capacity. Con, operations are 1 the operation, c The operations contributed asse turning a mode donations from dramatically. ;tions are subject to the enterprise being able to schedule and fill the The projections are aggressive in that classes are projected to grow by ir, as the program anticipates significant changes to its programs and ;ely, continued donations from the City, which significantly subsidize ected to be discontinued. Under this scenario, the future profitability of inues to looks promising. )rovided a positive cash flow and modest profit (after depreciation on :s) by the end of the fiscal year ended June 30, 1996. This trend of ;t profit and positive cash flow are projected to continue. Should outside sources not materialize, this profitable picture could change 7 • w CITY OF WEST COVINA SIMULATOR ENTERPRISE FUND PROFORMA BALANCE SHEETS JUNE 30, ASSETS -CASH ACCOUNTS RECEIVABLE INTEREST RECEIVABLE FIXED ASSETS ACCUMULATED DEPRECIATION NET TOTALASSETS LIABILITIES . ACCOUNTS PAYABLE ACCRUED EXPENSE TOTAL LIABILITIES EQUITY RETAINED EARNINGS (DEFICIT) CONTRIBUTED CAPITAL TOTAL EQUITY TOTAL LIABILITIES AND EQUITY 1995 1998 1997 19998 1999 2000 $ S 16,144 $ 53,757 $ 40,922 $ 32,581 $ 23,835 6,595 10,333 ' 20,618 40,553 60,521 161 234,665 234,665 454,665 754,665 754,665 754,665 23,466 70,399 161,332 2BZ265 403,198 524,131 211,199 164,266 293,333 472,400 351,467 230,534 $ 211,199 $ 187,166 $ 357,423 $ 533,940 $ 424,600 $ 314,890 $ 1,819 3,270 4,169 5,385 44 250 1,312 2,107 2,901 44 2,069 4,582 6,276 8,287 (23,467) 2ZB57 62,022 56,960 66,858 76,071 211,199 164,265 293,332 472,399 351,466 230,533 187,732 187,122 355,354 529,359 418,324 306,604 $ 187,732 $ 187,168 $ 357,423 $ 533,940 $ 314,890 424,600 $ 8 -1 w CITY OF WEST COVINA SIMULATOR ENTERPRISE FUND PROFORMA INCOME STATEMENTS JUNE 30, 1995 1996 1_997 1998 1999 2000 CLASS -FEES i i 30,393 i 50,000 3 10Q000 i 200,000 $ 3W,000 INTEREST INCOME - - 565 1,881 1,432 1,140 MISCELLANEOUS INCOME 1,000 1,100 1,210 1,331 1,464 • TOTAL REVENUE - 31,393 51,665 103,091 202,763 302,504 PERSONNEL 7,538 12,500 65,603 105,329 145,055 MATERIALS AND SUPPLIES - 17,000 34,000 51,000 DEPRECIATION 23,466 46,933 90,933 120,933 120,933 120,933 OVERHEAD 25,551 53,535 97,337 TOTAL EXPENSES 23,466 54,471 103,433 229,087 313,797 414,325 NET INCOME (LOSS) i (23,466) $ (23.078) $ (51,768) $ (125,998) s (111,034) 5 (111,721) 11 9