Northampton County Consolidated Department of Human Services (DHS) Facility (Not including Gracedale) County Council Questions and

Answers
1. Why A Northampton County Consolidated Human Service Facility On Emrick Blvd.? It resolves long time issues with existing facilities, most notably the Wolf Building. If a new site is not found, the County will have no choice but to invest a minimum of $4.3M into the existing buildings over the next 3 5 years. The proposed consolidated Northampton County Human Services corrects operational inefficiencies caused by multiple locations. It will also improve the quality of service delivery and convenience to the citizens of Northampton County, by offering one-stop access for all County human services, including Veterans Affairs, and encouraging better coordination among the various offices and divisions within the Department of Human Services. It is ideally located in the center of the service area, with easy access to all points in Northampton County. It will cost roughly the same amount as operating the current two buildings. It is the lowest cost option as it was chosen from competitive proposals and confirmed by two separate independent appraisals of the lease agreement. It can be completed within a year.

2. Why doesnt Northampton County just build and own a consolidated DHS building? The Project Team initially evaluated the best alternatives for creating a consolidated DHS facility. That evaluation included an alternative where Northampton County would BUILD and own the building. The LEASE / PURCHASE approach was widely preferred because of the following:

The cost for Northampton County to build would be approximately the same as the Lease / Purchase arrangement if purchase is executed after 5th year. The LEASE / PURCHASE could be built in a year. The Northampton County BUILD scenario would take 2 - 3 years to accomplish (at minimum). The BUILD scenario requires time and resources not currently available without use of outside consultants (e.g. Project Manager, Civil Engineer, Architect, Mechanical Engineer, Construction Manager, etc.). The LEASE / PURCHASE scenario can be accomplished primarily with existing County resources. The BUILD scenario would require Northampton County to float $21.3M worth of bonds. The LEASE / PURCHASE scenario does not. The LEASE / PURCHASE scenario allows Northampton County to purchase the facility every 5 years, should it be of benefit to the County. Northampton County has not had a very good record of building new facilities (e.g. Courthouse Addition, etc.) 3. How much more does the consolidated facility at 2801 Emrick Blvd. cost Northampton County compared to current costs and projected improvements to Bechtel & Wolf Buildings? While you can never know for sure the exact operating costs of a proposed large facility until complete, our Initial comparison of the Department of Human Services operating budget for facilities indicate that the new facility will not cost significantly more, or significantly less than currently being spent on the existing facilities for the DHS. That may be about $160K-$300K or about 0.12% - 0.23% of the total $130M, 2012 DHS Operations Budget (not including Gracedale)

4. Why not locate a consolidated DHS Building at Gracedale instead of 2801 Emrick Boulevard? Gracedale is not conveniently located near the population centers of Northampton County. As demonstrated by the matrix below, it would take about 10 minutes longer to reach Gracedale vs. Emrick Boulevard site from Bethlehem, Easton & Hellertown. It

takes 3 minutes longer to get from Bangor to Gracedale than to Emrick Boulevard despite the fact that Gracedale is closer to Bangor.
BANGOR Market & 1st Sts BETHLEHEM Main & W. Broad Sts EASTON 3rd & Northampton Sts HELLERTOWN Main & Water Sts

2801 Emrick Blvd. Bethlehem Twp. 2 Gracedale Ave. Nazareth Wolf Building N. 2nd & Church Sts., Easton Bechtel Building 520 E. Broad St., Bethlehem

16.5 Mi / 24 Min

6.4 Mi / 15 Min

5.3 Mi / 13 Min

8.9 Mi / 14 Min

13.5 Mi / 27 Min

9.8 Mi / 23 Min

10.4 Mi / 24 Min

15.9 Mi / 24 Min

14.0 Mi / 25 Min

16.6 Mi / 25 Min

0.6 Mi / 3 Min

12.2 Mi / 20 Min

22.4 Mi / 33 Min Source - Google Earth

0.9 Mi / 4 Min

10.2 Mi / 22 Min

4.1 Mi / 10 Min

Furthermore the roads leading to Emrick Blvd. are primary roads. Those leading to Gracedale are secondary roads. The time differential in access would significantly impact employee time, productivity, and therefore ongoing operational cost. Gracedale location would also negatively impact client convenience. 5. What is the availability of Public Transportation for the new DHS facility? Emrick Blvd. Served by TWO LANTA routes, 101 and 220. 101 actually travels on Emrick Blvd. between stop 5 (NCC) and stop 6 (St. Lukes Riverside). These are hourly stops from @ 7:19 AM to 11:24 PM M-F. LANTA is exploring more frequent stops due to the popularity of this route. They will also consider a bus stop in front of the DHS building - http://www.lantabus.com/route101.html 220 also follows the William Penn Highway with a stop (9) at Emrick Blvd., but continues down WPH. It does not travel down Emrick. In a pinch though, a rider could get off there and walk down to the DHS building. These stops are hourly as well. http://www.lantabus.com/route220.html In contrast
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Gracedale/Nazareth served by Route 217, Slate Belt route. 217 provides a rather convoluted route that begins in Bethlehem. Unlike the east-west routes of 101 and 220 between Bethlehem and Easton, the two largest congregations of DHS clients, this is primarily a north-south route. An Easton resident would have to travel to Bethlehem and transfer to the 217 bus to go to Gracedale. The LANTA bus stops only 7 times a day at Gracedale (stop 3) M-F with stops approximately two hours apart. This is versus 17 stops on an hourly basis for Route 101. http://www.lantabus.com/route217.html 6. Why is there only 5.36 acres of land in 2801 Emrick Blvd. site, when original deed was for 7 acres of land? Jim Gentile, President of Polaris Emrick Development, LP, has informed us that he needed the additional 1.64 acres for an adjacent lot that he previously developed. So had it subdivided off of this parcel of land. The 2801 Emrick Blvd. lot is approved for development as a 5.36 acre lot. Jim Gentile has also informed us that he recently sold another lot in this area for $250K per acre. 7. The City of Easton had plans prepared for a multi deck parking garage on the rear of the Wolf building, has any consideration been given to that alternative? The multi deck parking facility on Wolf parking lot is no longer being considered by the City of Eason on this site. 8. Are there any leads on the sale of the Wolf and Bechtel buildings? If so please provide an update on the status of those leads. Yes there are leads on the Wolf Building & Parking lot. We have not yet reached out for potential buyers for the Bechtel Building as we feel it is an easier sell. The Administration will be glad to update you on status of leads in a CONFIDENTIAL way so as to not publicly disclose information that may jeopardize Northampton Countys negotiating position.

9. Who are the owners of the properties neighboring 2801 Emrick Blvd?

10. Please provide a breakdown of the projected capital expenses projected for the Bechtel & Wolf Buildings. Who (what firm) conducted the review of the conditions of Wolf Building?

Please see the list below. We believe that these are conservative estimates.
DEPARTMENT OF PUBLIC WORKS CAPITAL IMPROVEMENTS DHS LOCATION BECHTEL BECHTEL BECHTEL BECHTEL BECHTEL BECHTEL BECHTEL BECHTEL BECHTEL BECHTEL BECHTEL TOTAL WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF WOLF TOTAL GRAND TOTAL DESCRIPTION EMERGENCY GENERATOR UPGRADE HEATING PUMP REPLACEMENT ELECTRICAL UPGRADES ADA BATHROOM RENOVATIONS OUTSIDE LIGHT UPGRADES PAVING RELOCK FACILITY GENERATOR UPGRADE/EMERGENCY PANELS DUCT CLEANING HANDICAP RAMP REPLACEMENT HVAC UPGRADES EXTERIOR REPAIRS REPAVE LOT FLOORING EXTERIOR REPAIRS AND PAINTING ATTIC GYM REMEDIATION PLASTER CEILING REPAIR/REMOVAL ARC FLASH ANALYSIS SIMPLEX FIRE PANEL REPLACEMENT TUNNEL WINDOW REPAIRS PAVING SLATE ROOF REPLACEMENT DUCT CLEANING HVAC UPGRADES THERMOGRAPHY CONCRETE REPAIRS CHILLER REPLACEMENT FLOORING REAR LOT LIGHT REPAIR ROOFING ELEVATOR UPGRADES EXTERIOR REPAIRS VAV BOX REPLACEMENT PAINTING BOILER REPLACEMENT EXTERIOR WALL & WINDOW REPAIR/REPLACE ELECTRIC PANEL UPGRADE/REPLACE COST 50,000 15,000 50,000 250,000 100,000 150,000 35,000 100,000 17,500 200,000 $ 967,500 100,000 100,000 150,000 25,000 100,000 100,000 150,000 30,000 100,000 200,000 700,000 150,000 25,000 25,000 20,000 100,000 175,000 25,000 50,000 125,000 100,000 100,000 50,000 25,000 200,000 300,000 100,000 $3,325,000 $4,292,500

This list was compiled by Northampton County Department of Public Works for a 3 year capital plan based on operations & maintenance experience and in some cases professional outside analysis. Please note that duplicate improvements were planned for different year implementation and / or multiple roofs, parking lots, etc. Should you have an inquiry on specific capital improvement(s), we will respond with more detail.

11. The 5.6 acres of land, according to owners, sat idle for approximately 8-9 yearsdid we negotiate in good faith for the best possible price/lease based upon selling off county assets and carrying the full costs and risk on the county for a 5-15 year period, or did we accept what was offered by the builders and consultants without negotiations. Northampton County sought and received competitive, detailed lease cost and terms proposals for four (4) shortlisted parcels. The 2801 Emrick Boulevard, Bethlehem Township proposal was the least expensive and most ideal (more parking, more centrally located) for Northampton County needs. Furthermore Northampton County has obtained two (2) independent appraisals of the proposed lease indicating that the proposed lease is well within the going office market rate. That is significant considering the fact that the office buildings that were compared to 2801 Emrick Boulevard were not built utilizing Prevailing Wage and our proposed lease does. 12. What are the costs of making repairs to the Bechtel building? What are the costs of keeping the Bechtel building, selling the Wolf Building, and building a replacement building for Wolf at Gracedale? The estimated costs are as follows: 1. The short term Capital repairs for Bechtel building are at least $967,500 as detailed in Answer #10 above. 2. The cost to build a replacement building for Wolf at Gracedale is approximately $13.1M 3. The cost to completely renovate Bechtel to modern office space is approximately $5.2M, this includes swing space relocation for employees during Bechtel renovations, and improvements listed in #7 above. 4. TOTAL for both facilities to be built / modernized is approximately $18.4M

Please note that the stated objective of the current Lease / Purchase proposal was to: CONSOLIDATE NORTHAMPTON COUNTYS HUMAN SERVICES, AND OTHER COUNTY OFFICES, INTO A COST EFFECTIVE, STATE OF THE ART, CENTRALIZED FACILITY The approach suggested in this question, would: NOT consolidate Human Service Offices NOT be centrally located NOT be State of the Art NOT be a Cost Effective Operation It is important to note that a Gracedale approach would require a lengthy planning process. The overall project would take about 2 - 3 years to achieve, vs. the 1 year for the proposed Lease / Purchase approach.

13. How does this 15 year lease with option to buy compare to Northampton County building its own building? SCENARIO #1 Lease for 15 years vs. Build & Own If Northampton County Leases for 15 years only, the total cost to Northampton County over that time frame is $19,198,847. The project can be done in 1 year. If Northampton County Builds and Owns a building the cost over the same 15 years is $21,308, 750. If you include financing it would cost $27,372,318. It would take at least 2 - 3 Years to complete, but as owner Northampton County would have use of the building beyond the 15th year. SCENARIO #2 Lease for 5 years then Purchase vs. Build & Own If Northampton County Leases for 5 years only, and then executes its option to purchase the total cost to lease and purchase would be $21,510,174. The project can be done in 1 year and Northampton County has ongoing use of the building. If Northampton County Builds and Owns the total cost to build only would be $21,308,750. The project would take at least 2 - 3 Years to complete and Northampton County would have ongoing use of the building.

LEASE / PURCHASE (15 YEARS)

Lease / Purchase Cost (15 Years)

SF Rent Option To Purchase Price TOTAL CUMULATIVE RENT $ $ $ $ $ $ $ $ $ $ 16,370,041 $ $ $ $ $ 959,119 1,942,215 2,949,890 3,982,756 5,041,443 6,126,598 7,238,882 8,378,973 9,547,566 10,745,374 11,973,127 13,231,574 14,521,482 15,843,637 $ 29,115,415 $ 21,510,174 TOTAL COST RENT, TI, AND BUY OUT $ 2,000,000 Per SF/Yr @ $30/SF 66,375 TI Annual Price 7.5% CAP NorCo Contribution to Tenant Improvements (TI) Year 1 $ 14.45 $ 959,119 Year 2 $ 14.81 $ 983,097 Year 3 $ 15.18 $ 1,007,674 Year 4 $ 15.56 $ 1,032,866 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Year 11 Year 12 Year 13 Year 14 Year 15 $ $ $ $ $ $ $ $ $ $ $ 15.95 16.35 16.76 17.18 17.61 18.05 18.50 18.96 19.43 19.92 20.42 $ 1,058,688 $ $ $ $ $ $ $ $ $ 1,085,155 1,112,284 1,140,091 1,168,593 1,197,808 1,227,753 1,258,447 1,289,908 1,322,156 $ 14,468,731

$ 1,355,210

$ 18,521,199

$ 17,198,847 $ 19,198,847

36,397,694

TOTAL 15 YEAR LEASE & TENANT IMPROVEMENT COSTS

Timeframe 1 Year

NORTHAMPTON COUNTY BUILD AND OWN

Build New
Assumptions Unit Cost TOTAL

Square Feet 66,375 Cost Per SF Construction $ 200.00 Cost Per SF Professional Fees $ 30.00 Acres of Land 7 Cost Per Acre $ 250,000 Capital Improvements to Bechtel & Wolf TOTAL COST Finance Term Interest Annual Fee Total 15 Year Cost $ 21,308,750 15 Years 3.50% $ 1,824,816 $ 27,372,318

$ $ $ $ $

13,275,000 1,991,250 1,750,000 4,292,500 21,308,750

Timeframe 2 1/2 - 3 Years

14. What is the hurry in doing this now? Without action that can be implemented this year the Bechtel & Wolf buildings would require at least $4.3M of improvements just to keep them operational. Without a major investment of tens of millions of dollars into these facilities, this would be tossing good money after bad. We currently have an Administration and County Council experienced in the needs and delivery of Human Services to the citizens of Northampton County and the advantage of a One Stop Access approach. We also know the current shortcomings in the existing fragmented delivery and problem facilities.
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Change in Administration and County Council will require additional time and consideration before acting. Short of status quo, the alternatives are as costly as the Lease / Purchase proposal being recommended. 15. Why would Northampton County require Polaris to utilize Pennsylvania Prevailing Wage in construction of the new leased facility at 2801 Emrick Blvd.? All Northampton County construction projects exceeding $25K are required to utilize PA Prevailing Wage. While Northampton County is leasing this facility, there is an option in the lease for Northampton County to purchase the facility. It is important to note that utilizing PA Prevailing Wage is not exclusive, it is open and applies to both Union and Non-Union trades.

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