TO: Honorable Mayor & Members of the North Port Commission
FROM: A. Jerome Fletcher II, ICMA-CM, MPA, City Manager
TITLE: Discussion and Possible Action Regarding the Public Private Partnership Pathway for Warm Mineral Springs Park.
Recommended Action
Discussion and possible action regarding the Public Private Partnership pathway for Warm Mineral Springs Park.
Background Information
During the City Commission Workshop held on July 10, 2023, the Commission reviewed results from the Random Sample Community Survey, Threatened and Endangered Species Survey, outreach results and explored various pathways forward for Warm Mineral Springs Park. Additionally, Warm Mineral Springs Development Group, LLC, provided a presentation on an updated proposal for the parcel. At the conclusion of the workshop, the following consensuses were approved by the Commission.
Ø There was consensus to approve using Gulf Coast Community Foundation to conduct and pay for the charrettes.
Ø There was consensus to approve using Trust for Public Land to initiate the Legacy Trail connection to Warm Mineral Springs.
Ø There was consensus to have staff prepare for daily admission, 10-day visit, and 30-day visit with a 90-day expiration, using pre-Hurricane Ian rates.
During this meeting, general guidance was provided outlining support to move forward with discussions to further define the updated proposal from Warm Mineral Springs Development Group, LLC.
Following the City Commission Workshop on July 10, 2023, which included extensive public participation, the Gulf Coast Community Foundation completed additional review of stakeholder input and completed interviews with the City Commissioners to evaluate engagement opportunity strategies. On July 19, 2023, the Gulf Coast Community Foundation sent correspondence to the City of North Port indicating that the City’s continued outreach would not be recommended until after the City had determined a pathway.
As such, staff seeks Commission direction to continue to pursue a Public Private Partnership with Warm Mineral Springs Development Group, LLC.
If direction is received to proceed along the Public Private Partnership route, next steps will include:
Ø Continued due diligence efforts. In accordance with the Code of the City of North Port, Section 2-420 (c) (10) which states: If an unsolicited P3 detailed proposal involves architecture, engineering, or landscape architecture, the city will engage licensed professionals for review and evaluation of the initial and any subsequent proposals…” staff will seek to engage professional services.
ü Commercial real estate and investment evaluation services. Based on code requirements and best practices, staff will engage the professional services of CBRE, Inc. to provide guidance and a neutral third-party review of the proposal. CBRE, Inc. will complete financial and constructability analysis of the unsolicited offer. This will including full financial modeling of the project including cash flow and Net Present Value (NPV) analysis, review of the development budget and all cost assumptions to ensure the proposed project is financially viable. In addition, they will review the current market and if the proposed uses can be supported. The CBRE, Inc. team will assist in the developer negotiations to ensure the City’s best interest is protected and reflected in the business terms of any resulting agreement. The cost for this in-depth evaluation of financial, real estate and construction is $375,000.
ü Geotechnical evaluation services. Staff will bring to Commission for consideration a proposal received from Ardaman and Associates, in response to RLI No. 2023-11 for engineering services to complete a geotechnical investigation / survey of the proposed building areas relative to the presence of potential underground feeder veins of the spring, cavities, sinkholes, or other conditions to determine potential impact from the proposed development. The cost for this in-depth evaluation of the geological aspects of the parcel is $264,377.
As indicated within the Code of the City of North Port, Florida, Section 2-420 Section (e) (8), reports from these evaluations will be provided to the City Commission for consideration prior to the City entering into a comprehensive Agreement.
Ø Begin Negotiation Team efforts. In accordance with the Code of the City of North Port, Florida, Section 2-420 and as communicated via Warm Mineral Springs P3 Update Memo dated March 28, 2023, the negotiation team has been identified as Jason Yarborough, Assistant City Manager, Sandy Pfundheller, Parks & Recreation Director, Alaina Ray, Development Services Director, Kim Williams, Finance Director and Mike Acosta, P.E., Utilities Engineering Division Manager.
ü P3 Negotiation Training. The Negotiation Team will complete training with Special Counsel and meet with CBRE, Inc. to receive guidance on best practices for P3 negotiations. Future efforts will include evaluation of the responsibility of expenses, such as the Geotechnical study cost, and proposed modifications to the development plan.
ü Agreement Development. The Negotiation Team, with legal assistance, will draft agreements as needed to outline terms and conditions of access, operation and development, as appropriate.
ü Coordinate with Trust for Public Land regarding the Legacy Trail connection to Warm Mineral Springs.
In accordance with the Code of the City of North Port, Florida, Section 2-420 Section (e) (7), Any negotiated agreement will be brought to the city commission for consideration and approval.
Ø Continue efforts for a Comprehensive Plan Amendment. Development Services will continue efforts to draft Comprehensive Plan amendments and Unified Land Development Code revisions to support proposed development.
Ø Continue opportunities for stakeholder engagement. Although the proposed charrettes will not move forward in conjunction with the Gulf Coast Community Foundation, staff will work to identify additional opportunities for stakeholder input and to engage specialists within the community to assist with the implementation of this partnership.
Strategic Plan
Quality of Life
Economic Development & Growth Management
Good Governance
Financial Impact
Funding for CBRE, Inc. services in the amount of $375,000 is available in account number 152-3036-572-31-05, Project #WM19BR, Warm Mineral Springs Building Restoration.
Procurement
Per the Code of the City of North Port, Florida, the procurement of P3 Agreements by the City must follow the provisions of Section 2-420 Public-Private Partnerships (P3). CBRE, Inc. services will be procured under the State of Florida Agreement which complies with Purchasing exemptions outlined in the Code of the City of North Port, Sec. 2-403 (4)(a); the work assignment for the Geotechnical Services scope proposed by Ardaman and Associations for $264,000 will be brought to the Commission for approval at a later date.
Attachments:
1. Draft 07.10.23 Commission Workshop Minutes
2. 07.10.23 WMS DG LLC Updated P3 Proposal
3. 07.19.23 Communication from Gulf Coast Community Foundation
4. Code of the City of North Port, Section 2-420
5. CBRE, Inc. Proposal
6. Ardaman & Associates Proposal
Prepared by: Tricia Wisner, Assistant Director of Public Works
Department Director: Sandy Pfundheller, Director of Parks & Recreation