Yellowstone County will expand its office space across the street to the former federal building, now known as the Stillwater Building. County Commissioners made the decision on Tuesday based upon the recommendation of the committee they appointed to review proposals.
The proposal to lease space on the third floor of the building was from EEC, one of six responses received by the county in a “request for proposals.” EEC is developer of the former federal building for owner, WC Commercial LLC.
The county needs to find space for fourth floor county offices, so that the fourth floor can be remodeled for the addition of two new district court judges.
A review committee unanimously recommended a five-plus –five year lease of about 15,000 square feet that will be built to suit county needs. Deputy County Attorney Dan Scwharz who headed the committee that evaluated the proposals said that the competition was close but the parking was a compelling issue and the price at $15 per square foot, which includes the cost of building the interior office space, was competitive.
It came down to four factors, the proximity of parking for the public, the cost comparison, the efficiencies that can be gained by the county in being able to “built to suit,” and the flexibility going forward, said Schwarz. Schwarz was joined in the committee by Director of Finance Kevan Bryan and Public Works Director Tim Miller.
The decision was difficult, “but that is what we get paid to do,” said Schwarz.
Bryan said that the total cost to the county for the first five years would be $1.78 million, at $15 per square foot plus an annual escalator of 3 percent. The county asked for 14,818 square feet of space, which will use about half of the Stillwater third floor. The county will also pay $6.02 cents for “CAMS”, which is a total for all expenses including utilities, maintenance, security, janitorial, etc. (Janitorial services are only for the building’s common areas the county is responsible for cleaning their own offices.) The charge for CAMS will be determined each year based on actual costs.
Future flexibility was also important since county officials expect to be facing much the same expansion issues in another 10 to 12 years.
Schwarz emphasized the importance of timing in the decisions made. The schedule faced to complete the remodeling of both spaces is “ungodly tight,” said Schwarz. The push was on to get signatures on lease documents by county commissioners at their meeting, November 21. They want building to begin immediately after that.
The county departments which will move from fourth floor, including that of the commissioners, auditor, clerk and recorder, finance and purchasing, must be out by April 1 to enable remodeling to begin of the fourth floor of the Courthouse, which will include the building of two court rooms. The new judges will take office on January 1, 2019.
Early estimates on remodeling the fourth floor were $2.4 million, said Bryan. The county has $3.7 million in its Capital Improvement Fund.
Bryan said that department heads will be consulted in the design process and hope to increase efficiencies in being able to design to their specific needs, but no department will be able to expand on the square footage they already have.
County commissioners will be making many decisions in regard to the renovations including the process of developing designs and overseeing construction. They will consider whether to pursue the design- build approach used in building the jail addition or if they will go with a more traditional bidding process. The numbers will dictate, too, whether to remodel the entire fourth floor or postpone some remodeling until it is needed later. It was noted that district court judges are urging that they consider plans to build the court rooms according to model court room designs that are available through the state.
The committee evaluated the six proposals based upon a point system. An evaluation sheet scored the Old Masonic Lodge building, beautiful but not conducive to public offices, with 95 points; the Miller Building, lacking common space and too far away, scored 100 points. The build to suit round-building proposal was eliminated due to impossible timing, but it is an idea that was called “intriguing” for future needs. Simply renovating the round building brought high costs with no options for future expansion and it scored 134 points.
US Bank scored 146 points and its two-floor proposal was “fairly close to what the County was looking for” with the lowest rates, but it had undetermined costs. It had a hefty cost increase in the fifth year of the lease with no certainty about lease costs after that. It had poor parking options and it is over three blocks to the county courthouse.
The Wells Fargo proposal scored 140 points and was considered “very nice.” It offered only a ten-year term which made comparisons to five year terms difficult. Cost was “in the middle.” The main disqualifying factor was lack of flexibility going forward and lower-cost options.
The Stillwater 5+5 year lease proposal scored 167 points, with another proposal for 5 year lease with possible purchase being rejected since purchase price was left undetermined. Future flexibility, close county parking, proximity to other county offices, and that the county could dedicate its own fiber crossing 3rd Avenue North which would be of better quality to the county, and the build-to-suit option with no tear-down – all appealed to county officials.