Published by Ark Valley Voice
Posted by  | Jun 18, 2022
Buena Vista Town Hall Photo by Henry DeKam

TRUSTEES APPROVE FUNDING AND ASSIGN CONTRACT FOR NEW BUENA VISTA POLICE STATION

On June 14, 2022 The Town of Buena Vista Board of Trustees (BOT) met to discuss the future of several ongoing projects the town has been overseeing. At the top of the agenda was an update on financing approval for the construction of the new police station, and the award of the construction contract.

The BOT was asked whether they should approve the adoption of Ordinance No. 21, Series 2022, entitled “An Ordinance of the Town of Buena Vista, Colorado authorizing the execution and delivery of a site lease, and a lease-purchase agreement

Per the recommendation of the BOT to continue pursuing finance for the new police station, Town of BV Staff have partnered with Collegiate Peaks Bank, Stifel Finance, Hoffman, Parker, Wilson, and Carberry, and Butler Snow Bond Attorneys to reach a lease-purchase agreement. Alan Matlosz, Managing Director in Stifel’s Colorado Public Finance Group, addressed the BOT via Zoom with details of the site lease agreement and financing of the new police station.

Matlosz explained that Ordinance No. 21 addresses the approval of a $3,100,000 lease-purchase finance with Collegiate Peaks Bank in Buena Vista. After an extensive and competitive search for the best financing options, Collegiate Peaks Bank won the bid and provided a 15 year lease agreement at a fixed 3.25 percent interest rate. The financing presented to the BOT was for a lease-purchase agreement “whereby the Town agrees to lease the building to Collegiate Peaks Bank, receive $3.1 million in proceeds to renovate the building and then lease the building back from the bank for 15 years”, according to a Stifel Public Finance memo.

The law firm Butler Snow prepared several financing documents for the BOT to review including the ordinance, the site lease, and the lease agreement. Included in these three documents are all the parameters and finance guidelines of the leasing of the new police station. Of particular note, within the site lease it states that Collegiate Peaks Bank will hold the lease of the property for 25 years, a decade longer than the lease agreement, to give the bank additional time to recoup the loan amount in the “slight chance the town decides to not appropriate the lease payment. Once the site lease is paid off, the site lease goes away”, according to the Stifel memo.

Trustees said they were pleased with the opportunity to use a local BV bank to support the community in yet another way through this project and the ordinance was unanimously approved.

The next order of business was  Resolution No. 45, Series 2022, which approved an agreement with MW Golden Constructors for the construction work on the new police station.

Town of Buena Vista Planning Director Joseph Teipel took the floor to explain the details of the resolution. Teipel explained the Town is waiting to hear back from the Department of Local Affairs (DOLA) regarding the acceptance of a $600,000 grant to help fund the construction. As of Tuesday evening, the Town had not received a confirmation or rejection of receipt of the grant.

Meanwhile, Teipel explained, the prices of building materials continue to go up at an exponential rate. In Resolution No. 45, Series 2022, Teipel lays out two separate options for the BOT to consider and act on. The first: a “forward contract” with MW Golden Constructors to ensure the acquisition of “long-lead-time materials” so that construction can commence as scheduled on the new police station while awaiting a decision from DOLA.

The second scenario proposes a full contract with MW Golden Constructors in the event the DOLA grant is not awarded to the town. Teipel explained that if the DOLA grant of $600,000 is awarded to the town the money would be allowed to “pay for expenses that were committed to, or under contract, prior to the date that a full grant contract is executed by both the Town and the state”. In order to operate most efficiently, the new police station needs to be at least 8,400 square feet to operate safely with compliance; however, Teipel and the town are hoping to build a 10,000 square foot expansion when all is said and done. Teipel said the goals of this construction plan are to provide a “forever home” for the Buena Vista Police Department.

If trustees approve either construction option, the proposed start date would be July 11, 2022, with a nine-month “construction window” and anticipated completion in April 2023. However, Teipel notes, that the construction window could be drastically reduced if critical materials are able to be acquired more quickly than expected.

Moving forward, Teipel presented two scenarios for the BOT to consider. Scenario 1 (Forward Contract Exhibit A2 and B) would require the approval of $961,673 which would allow crucial workers, subcontractors and construction to commence on schedule and proceed until word was received from DOLA, at which point, the contract with MW Golden Constructors would still be within the parameters to satisfy the DOLA grant requirements. If no word was heard from DOLA, Scenario 2 (Full Contract Exhibit A1 and B) would authorize a full construction contract with MW Golden Constructors for the sum of $4,070,238. A proposal was also made to amend the current budget from  $4,460,00 to $5,787,158.

A motion was put forward to pass Resolution No. 45 with Scenario 1 Forward Contract Exhibit A2 and B which trustees passed unanimously in an effort to stay on schedule with construction and to avoid, as much as possible, paying higher costs for building materials in the future while waiting for word on the DOLA award.

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