La Collette, St. Helier, Phase II - approval of drawings and funding of bus workshop facility

LA COLLETTE, ST. HELIER, PHASE II: APPROVAL OF DRAWINGS AND FUNDING FOR BUS WORKSHOP FACILITY

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Presented to the States by the Planning and Environment Committee and lodged au Greffe on 23rd April 2002

by Deputy J.L. Dorey of St. Helier

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STATES OF JERSEY

STATES GREFFE

150             2 0 0 2    P . 6 1          

Price code: B

PROPOSITION

THE STATES are asked to decide whether they are of opinion -

  (a ) to approve Drawing Nos.  4281/10,12,13 and 14 showing the construction and fitting out of a new public bus

service maintenance workshop of approximately 12,500  square feet and associated parking areas on reclaimed land at La Collette Phase  II, St.  Helier (as shown on Drawing Nos. 1171/02/42 and 4281/07) for occupation b the authorised operators of the Island's public bus service, and to authorise the Greffier of the States to sign the said drawings on behalf of the States;

(b ) to authorise the Finance and Economics Committee on behalf of the Public to enter into an agreement with an authorised lending institution for the direct external borrowing of a maximum of £2,200,000 (two million two

hundred thousand pounds) to finance the construction of the building and parking areas described in paragraph (a) on terms, and at a date, to be agreed by the Finance and Economics Committee;

  (c ) to authorise the Planning and Environment Committee on behalf of the Public to enter into a fixed price

development agreement with A.C.  Mauger and Son Limited for the design and construction of the building and parking areas described in paragraph (a);

  (d ) to authorise the Treasurer of the States to credit a suspense account established for this purpose in the name

of the Planning and Environment Committee under Articles 7(1)(e) and 20(2) of the Public Finance (Administration) (Jersey) Law 1967, as amended, and to authorise that Committee to pay from the account the costs of the development and all professional and legal fees associated with the development and funding arrangements; and

  (e ) to authorise the Attorney General and the Greffier of the States to pass, and the Greffier of the States to sign,

as appropriate, on behalf of the Public, such contracts or agreements as may be necessary.

PLANNING AND ENVIRONMENT COMMITTEE

Notes:  1. T  he Planning and Environment Committee approved the plans on 19th March 2002 under Development

Permit No.  P/2002/0141.

2. The Public Services Committee supports this proposition.
3. The Finance and Economics Committee considers that the funding mechanism proposed is appropriate for this development as the loan sum can be fully repaid from an income stream not previously available to the States. In so agreeing, the Committee also recognises the need to develop the bus depot in a very short timescale to meet the contractual obligations resulting from the States' decisions under Projet P.104/2001.

REPORT

Introduction

On 4th July 2000, the Planning and Environment Committee lodged au Greffe a Report and Proposition (P.128/2000) asking the States to approve the lease by the Public to Sunburst Investments Limited (holding company of JMT (1987) Limited trading as Jersey Bus) an area of land on reclaimed land at La Collette, Phase II, following satisfactory completion of the in- filling and infrastructure works, for the purpose of constructing a building for the garaging and maintenance of its public service vehicle fleet.

The States were not asked to decide the Proposition at that time pending the outcome of on-going consideration by the Public Services Committee of the future of the public bus service. The proposition has now been withdrawn.

In July 2001, the States declared their intent to introduce a revised basis through which to secure the provision of local bus services in the Island, replacing the present system founded in the Motor Traffic (Jersey) Law 1935.

It was proposed that new legislation will be introduced to allow the placing of the whole Island bus network out to competitive tender, with one operator gaining the exclusive contract for an initial period of seven years.

The Planning and Environment Committee brought forward an initiative which provides the Public with greater control over a bus garage/workshop operation, which involves the Committee, through its Department of Property Services, constructing a facility on the La  Collette, Phase  II site, using either public or private sector funding, and leasing this to any company which operates the public bus service, or part thereof, for the Island. This proposal received the support of the Public Services Committee and in October 2001 the Finance and Economics Committee, recognising the urgency of the situation, approved a Planning Vote of £35,000 to progress a procurement and preliminary design package for the workshop facility and associated bus parking on an identified and completed infill site at La  Collette, Phase II.

A Project Design Team led by the Director of Property Services completed a feasibility study in January 2002 which was supported by both the Planning and Environment and Public Services Committees. On 20th February 2002, the Finance and Economics Committee supported in principle the development of the bus workshop at La  Collette, Phase  II as proposed. Th Planning and Environment Committee approved the plans on 19th March 2002.

In February 2002, first stage tenders were invited for a Design and Build' contract for the construction of the building and parking areas at La Collette II.

Choice of site

The benefits of developing the reclaimed site at La  Collette  II were obvious in that it-

  (1 ) is available for immediate development following completion of the infill in that area of La Collette;   (2 ) a l lows completion within the required timescale;

  (3 ) is in a location which has adequate access and is relatively close to the centre of St. Helier and the proposed

Transportation Centre;

(4 ) is capable of providing relatively uncomplicated site construction;

  (5 ) is of sufficient area to accommodate a maintenance workshop, small operational offices, and bus parking

areas with fuelling and washing facilities of the required size and layout; and

  (6 ) is close to existing roads and services and does not depend upon the eventual infrastructure required for the

further development of La Collette, Phase  II.

Initial brief

The initial brief for the facility, prepared by the Department of Property Services, was for a bus maintenance garage with associated facilities and ancillary parking on the identified La  Collette site adjacent to the existing Fuel Storage Depot. The facility is required for the planned commencement of the new public bus service contract.

The building requirement is for an economical facility with a minimum of six bays suitable for bus maintenance with vehicle inspection pits and/or provision for heavy vehicle lift hoists. The building is likely to be of steel-framed construction of sufficient size and height to accommodate single deck bus maintenance in full compliance with best current or projected health and safety practice. It is also to include lost property/vehicle parts/equipment/tyre stores, reception, a small offices provision for fleet maintenance administration, toilets, showers, crew rooms with locker facilities and a secure cash handling area. The tenant bus operator will be required to undertake the fitting-out to meet its own requirement.

The building is to include heating to the required standard for maintenance workshops and office, with appropriate energy conservation features to provide a low maintenance/low running cost premises. It should be equipped with fixed compressed air lines and a safe area for electric/gas welding/small panel fabrication equipment operation with provision for the operator to fit an enclosed low bake' point spray booth and rolling road equipment for brake/suspension testing. Waterproof vehicle inspection pits and waste oil storage facilities are also to be provided. Adequate general and localised lighting facilities are to be provided within the building, together with appropriately positioned three phase electrical connection points and socket outlets for connection of the operator's maintenance equipment.

Parking space is to be provided for a minimum of 60 buses and 20 cars. Allowance is to be made for the tenant operator to fit an external bus wash facility, high pressure water or steam cleaning area for degreasing/cleaning the underside of buses, a 50,000 litre diesel fuel oil storage tank and fuel filling point. Due consideration is to be given to the safe circulation of vehicles, in both the maintenance building and throughout the site, to ensure reversing is kept to a minimum. Special importance is to be given to the minimum bus turning/manoeuvring requirement and the maximum gradient of vehicle ramps/slopes/approach roads for "low ride" vehicles. The building is to meet all the current requirements of the Planning, Building Control, Health and Safety and Vehicle Standards authorities.

Project Tenders

Due to the timescale for the completion of the building, it has been agreed that a Design and Build' fixed price contract would be the most appropriate solution for the project. The Consultant Design Team and Property Services worked closely with representatives of the Public Services Department and its consultants in preparing a comprehensive Schedule of Requirements, including indicative layout plans.

A Building Specification and Brief of Employer's Requirements was issued to four local building contractors. Four comprehensive proposals were received from the first phase tender process, based on a notional Bill of Quantities.

These were assessed by the Director of Property Services, the Project Manager and representatives of the Planning and Environment Committee, with advice from the Consultant Design Team.

The submitted proposals were evaluated for -

  (a ) a c ceptable design;

  (b ) c o mpliance with Employer's Requirements and Specification;   (c ) p r acticality;

  (d ) c o st;

  (e ) v a lue for money;

  (f ) fu ture maintenance and likely running costs;

  (g ) p r ogramme and contract periods;

(h ) p e rformance bond, guarantees, warranties, insurances and collateral warranty requirements.

The proposal based on notional rates put forward by A.C. Mauger and Son Ltd. best met the criteria. The building and ancillary works proposed offers good value for money and the contract period of 26 weeks is sufficient to enable the work to be completed within the timescale.

A.C. Mauger and Son Limited and the Design Team have made progress by submitting the Building Byelaws application in order to achieve the final approvals to enable the contractor to commence on site as soon as practical, subject to States approval.

The project budget of £2,158,754 is recommended, which includes the contract price, preliminary costs, professional fees, enabling works and a small contingency provision. An additional second stage negotiation construction contingency has been included to allow for any alterations which become necessary following completion of the final designs and approval of the Building Byelaw application.

The proposed funding arrangement

The Committee, in consultation with its advisers, has considered the available options for the funding of the project, which was not included in the Capital Projects Bids for 2002.

1. D ir e ct external funding

L e a d in g financial institutions have informally quoted for the direct borrowing of £2 million to£2.2 million for

periods of 20 to 23  years at both floating and fixed rates of interest. The quoted arrangement fees and costs associated with direct external funding are not significant and would not require an external audit opinion.

  A lth  o u g h this is an exception to normal policy under the Public Finance (Administration) (Jersey) Law 1967, the

Finance and Economics Committee is able to borrow funds commercially, subject to the approval of the States. Subject to the agreement of the States, the Committee would negotiate the most favourable terms with one of the lending institutions subject to the final agreement of the Finance and Economics Committee.

2. I n te r nal borrowing

  T h e alte   rnative to direct external borrowing is for funding to be advanced from the Capital Fund utilising States

cash balances and charging notional interest. This arrangement has the advantage that there are no arrangements fees, but would require States' approval to set up a specific special fund.

  Sim ila r funding arrangements have been used by the Housing Development Fund for Housing Committee projects

and by the Planning and Environment Committee for the construction of Jubilee Wharf offices for the Housing Department.

  T h e u s e of internal cash reserves to support term borrowing over a period of 20 to 25  years could place constraints

on the States' ability to provide sufficient cash flow for other projects. It is, therefore, proposed that the Finance and Economics Committee provide funding initially from internal cash reserves but externalise the loan balance as soon as the necessary agreements can be put in place.

Rentals

The Planning and Environment  Committee will administer the proposed bus workshop  facility and enter into a lease agreement on behalf of the Public with the bus service operator for a period of seven years to coincide with the period of the contract for the operation of the public bus service.

The rental payments from the bus operator will be set at a level to meet the regular repayments of the funds borrowed internally and from the external lending institution through the Finance and Economics Committee plus interest received.

It is proposed that a full economic rental will be charged which will be subject to regular periodic review to ensure that it does not become out of step with the open market.

Summary

In order to achieve the timescale for completion, to coincide with the commencement of the bus operator's contract, it is essential that the construction of the building and parking areas begins as soon as possible. All the target dates for the design, tendering and approval process have been met to date. The funding arrangements and legal agreements can, subject to the agreement of the States, be finalised to achieve the construction timescale.

The design proposed by the contractors provides a value for money solution which meets the identified needs of bus service operators generally. It also meets the requirements for a functional facility with good access to available services and the proposed Transportation Centre in St.  Helier.

There are no additional manpower implications for the States.