Agenda Index City of Vancouver

ADMINISTRATIVE REPORT

TO:

Standing Committee on City Services and Budgets

FROM:

Director of Social Planning

SUBJECT:

Redevelopment of Little Mountain Neighbourhood House

 

RECOMMENDATION

CITY MANAGER'S COMMENTS

COUNCIL POLICY

There is no applicable Council policy on this matter.

PURPOSE

After a number of years of searching for a suitable site and planning with the community for a new facility, Little Mountain Neighbourhood House (LMNH) is finally in a position to begin the redevelopment process. This report provides Council with a complete overview of the project, including potential future financial requirements, and seeks Council endorsement of it. This will then enable the LMNH Society to start fund-raising in earnest, and allow the design and permitting processes to begin.

SUMMARY

More than ten years ago, Social Planning staff identified the City-owned Little Mountain Neighbourhood House (LMNH) facility as a priority for replacement and expansion. A functional program, which included a detailed description of program and space needs and a preliminary budget, was prepared and the LMNH Board and staff, with City staff assistance, began work on implementing this plan. The first step was to find a suitable site for the new Neighbourhood House.

After several years of searching the local neighbourhood for a suitable site, Real Estate Services has found a property that is for sale and which meets all the site selection criteria for this facility. A companion report to Council from Real Estate Services recommends the purchase of this site. If Council agrees to buy this site, a number of further decisions need to be made to enable the project to proceed:

· Council approval in principle with the construction of a new LMNH facility on the purchased site
· confirmation of the joint-use partnership between LMNH and the Riley Park branch library. Once the joint-use project can be confirmed or set aside, then staff will report back to Council seeking approval of funds to begin the architectural design work and to apply for required permits.
· official City endorsement of an application to the Federal/Provincial Infrastructure Program for funding for this project
· Council agreement that the proceeds from the sale of the current site can be used to help fund the development of the new facility

Cost estimates for this project have been prepared for two scenarios:

1. If funding is approved from the Infrastructure program, development of the entire facility as laid out in the functional program; and
2. A scaled-down version of the project which could be built without Infrastructure funding.

Neither scenario includes costing for the Library component as it would be entirely City funded, and as such is not dependent of the amount of funding from other sources.

Both scenarios are dependent on the LMNH Society raising at least   $550, 000 for the project. A fund-raising consultant, hired by the Society, feels that this is a realistic goal. A further contribution of $1.24 - 1.36 million will be needed from the City, once construction begins (in addition to the $1.2 million already committed for the site purchase and proposed for the design and permitting work, noted above). Also, if agreement is reached on the development of a joint Neighbourhood House/Library project, there will need to be an additional allocation in future capital budgets for the Library component.

A period of 2-3 years is now required for the design and permitting work and for community fund-raising to take place. For this reason, the City's contributions, noted above, are not included in the up-coming Capital Plan; rather, they will be submitted for inclusion in the 2006-2008 Capital Plan.

BACKGROUND

Little Mountain Neighbourhood House was developed in 1976 as part of the Federal/Provincial/Municipal Neighbourhood Improvement Program (NIP). With funding from NIP, the City purchased and renovated a two-storey storefront building at 3981 Main Street for the fledgling Little Mountain Neighbourhood House Society and a small branch library. LMNH leases the facility from the City for $1 per year, and the rent paid by the Library to LMNH helps pay for the operating costs of the Neighbourhood House. City Council has approved the continuation of this lease arrangement on a number of occasions.

When LMNH began 26 years ago, it had 3 staff providing social services in the Riley Park community, a neighbourhood with extensive needs but little in the way of services to meet those needs. Since then it has grown to become one of the larger Neighbourhood House operations, with over 80 staff and an annual budget of just under $2 million. Many of their programs are delivered off-site as there isn't enough room in the Main Street facility for them.

In the late 1980's, Social Planning staff reviewed the facility needs for all 8 Neighbourhood Houses and concluded that Kiwassa Neighbourhood House needed to move to a different neighbourhood, where most of their clients lived, and that Mount Pleasant Neighbourhood House and Little Mountain Neighbourhood House both needed substantially larger, upgraded facilities. These projects were incorporated into subsequent Capital Plans and Kiwassa and Mount Pleasant have since been redeveloped as planned.

As a first step in determining space requirements, LMNH hired a consultant in 1993 to work with the Society, LMNH staff and the community, to produce a functional plan for a new facility. It was agreed that a new building, with approximately 15,500 square feet of space, was needed. This conclusion was in line with the needs that had been articulated for Kiwassa, Mount Pleasant and Collingwood Neighbourhood Houses.

In November 1994 City Council endorsed an application to the Federal/Provincial Infrastructure Program for the "Hillcrest Centre", a multi-purpose facility to be built adjacent to Nat Bailey Stadium, that would have included the Neighbourhood House. This project took up most of the Society's time and resources over the subsequent 2-3 year period. After the group had been notified that the Infrastructure funding was not going to be approved for the Hillcrest project, City Council approved sufficient funding in the 1997-99 Capital Plan to enable the first step in the redevelopment of the Neighbourhood House, the purchase of a suitable site, to proceed.

During 1997-98, Real Estate Services investigated a number of sites for the Neighbourhood House, but nothing suitable was found. Then in 1998, the need for funding for Cityinvolvement in the planning for the newly announced Rapid Transit line suddenly emerged. Consequently, Council decided to reallocate $1 million from the Social Services Facilities part of the Capital Plan budget to the Rapid Transit study. However, in recognition of the continuing high priority for the LMNH project, Council passed a motion that "should Little Mountain Neighbourhood House be in a position to proceed with replacement of its facilities in 1999, Council will obtain the necessary funding".

In February 1999, City Council approved the Facilities Strategic Plan (FSP), which had been prepared by staff to provide some direction for the next Capital Plan. One of the strategies included in the FSP was that staff should look for joint-use possibilities when planning new facilities. Little Mountain Neighbourhood House and a local firehall were mentioned as an example of a possible good mix. Then in April 1999, the City purchased a site at the corner of Main and 32nd that was felt to be suitable for a joint Neighbourhood House/firehall project.

However, after a more detailed review of area needs, the Fire Department determined that Main and 32nd was not the optimum location for a new firehall. Several months later, LMNH found out that Riley Park Community Centre and the Park Board had just completed a plan for a significant expansion of public facilities in the immediate neighbourhood - a plan which did not include a Neighbourhood House or provision for the types of services provided by a Neighbourhood House. In preparing this plan, one of the major concerns was the degree of concentration of public amenities in one location. After extension public consultation, the plan contained what was considered to be the maximum amount of public facilities that would be acceptable in this immediate neighbourhood.. Within this context, it was felt that adding a new Neighbourhood House only two blocks away from the Community Centre and the planned expansion of facilities would not be supported by the community. As the Main and 32nd site was no longer suitable for either of the uses that it had been purchased for, Council agreed in January 2001 to sell it (at a modest profit).

Once the decision was made not to use the Main and 32nd site, LMNH redefined the criteria for a new site, ensuring that it would be a reasonable distance from the proposed Riley Park development, and Real Estate Services again began to try to find a suitable site. Very few properties that meet the LMNH criteria have come on the market over the past few years, and those that did were found to be unsuitable for a number of reasons. Then at the beginning of this year, two lots on Main Street near the current site became available. The possible purchase of this site is the subject of a report to Council that will be dealt concurrently with this report.

THE PROPOSED NEW FACILITY

Once a possible site had been identified, LMNH took a number of steps to ensure that it would indeed be suitable for a new Neighbourhood House:

· the functional program that had been prepared in 1994, was reviewed and updated. It was determined that the facility could be about 1000 square feet smaller than originally proposed, and still meet the needs in the neighbourhood;
· an architect then established that the size and type of building contemplated in the functional program could be built on this site in accordance with the current zoning and building by-laws (and proposed zoning by-law changes);
· Vancouver Public Library was contacted to discuss how their plans might mesh with the LMNH redevelopment plans (more about this later);
· the LMNH Board of Directors reviewed the options available and had discussions with City staff and other community groups before deciding that this site was the optimum location for a new Neighbourhood House. They then asked the City to proceed with the purchase of the site.

At the request of the LMNH Board, the architect considered two scenarios for this project. The first one assumed that sufficient funding could be secured to build the complete facility as contemplated in the functional program. The second one described how the facility could be built in two phases, in case there were problems securing enough funding to do it all at once.

The proposed new facility would be a three-storey building of approximately 15,000 square feet and underground parking for 18 vehicles. Included in this are seven multi-purpose rooms, (which will be used for child-minding, family, seniors and youth programs, a classroom, meeting rooms for small groups and one-to-one counselling, and a computer lab) a seniors lounge, a community kitchen, a staff lunchroom, staff offices and workspaces and a 25-space childcare centre. If the project has to be built in phases, then the first phase would consist of an 11,000 square foot, two-storey building that would not include the childcare centre, an outdoor play area and two of the smaller multi-purpose rooms.

VANCOUVER PUBLIC LIBRARY

Vancouver Public Library (VPL) has operated a small (1400 square feet) neighbourhood branch in the LMNH facility since 1976. The two operations work very well together and there is strong community support for the continuation of this relationship in the new LMNH facility. VPL had planned to amalgamate their Mt. Pleasant and Riley Park branches. However, the site chosen for the Mt. Pleasant partnership project with the Community Centre now locates the library too far north to serve the Riley Park community.

VPL continues to place a high priority for maintaining and improving service in the Riley Park area. Development of a joint project with the Neighbourhood House would enable the realization of this goal.

The VPL has developed a long term capital funding plan that includes a priority listing for future projects. At this point, the Riley Park project is slated for inclusion in the 2006-08 Capital Plan. This would mesh with the proposed funding of the LMNH and their required timeframe for community fund raising.

Social Planning and VPL staff are reviewing the program options to determine if a neighbourhood branch library, located within the Neighbourhood House, would be practical and functional. Staff will report back to Council before the end of the year with the outcome of these discussions.

PROJECT TIMING

While LMNH would prefer to begin construction right away, there are a number of factors that create a delay in the initiation of this project.

· The commercial tenants in the property that has been approved for purchase have approximately three-and-a-half years remaining on their leases. So far, they have shown no interest in negotiating an early buy-out of these leases.
· Typically, the design and permitting process for this type of project could take a year or more. LMNH will want to involve the community in the design work, so this time period could get extended.
· LMNH has committed to raise a considerable portion of the total cost of this project. They couldn't begin the fund-raising until they had a specific site and building proposal. Their fund-raising consultant has estimated that they need a minimum of 2 years, after they have a preliminary design, to raise sufficient funds.
· LMNH intends on applying for funding from the Federal/Provincial Infrastructure Program. There is no specified time-line for processing these funding requests, but applications for community projects that were submitted almost two years ago have just recently received final approval or rejection.

Combining these factors leads to the conclusion that the most likely start date for construction will be in late 2005 or early 2006.

PROJECT BUDGET (excluding the cost of including a branch library in the project)

Expenditures

 

Complete Project

Phase 1

Land Purchase

$ 830,000

$ 830,000

Construction

$2,140,000

$1,448,000

Site Development

$ 493,000

$ 477,000

Development Cost Levy1

$ 38,000

$ 33,000

Fees, Equipment, Contingency

$ 987,000

$ 473,000

Design Contingency

$ 261,000

$ 189,000

SUB-TOTAL

$4,749,000

$3,450,000

Escalation to Start of Building

$ 361,000

$ 240,000

TOTAL

$5,110,000

$3,690,000

1. A policy on DCL's and how they do or don't apply to City-owned properties is currently under discussion. This figure may increase or decrease in accordance with the new policy once it's adopted.

2. Each year of delay in starting construction will add approximately 3% to the total cost.

Funding

A total of $2,100,000 was included in the 2000-2002 Capital Plan for the LMNH project. Of that, $1,100,000 was included in the 2001 and 2002 Capital budgets. This will be the source of funds for the purchase of the site and preliminary design and permit costs. As it was clear that the $1,000,000 remaining in the allocation for LMNH could not be spent this year, it was removed from the Capital budget, on the understanding that it would be submitted in a future Capital Plan when it was needed. Based on the time-line described above, this submission would go in the 2006-2008 Capital Plan. The $1,000,000 that will, in effect, be deferred will have to be increased in recognition of the increased costs arising from the time delay until the start of construction.

The costs of constructing the childcare centre in the Neighbourhood House are funded separately. For a centre of this type and size, the City would normally contribute a capital grant of approximately $250,000 and approximately $150,000 should be available from the city-wide DCL's. The Province would normally contribute about $150,000 to the childcare centre.

The existing LMNH facility is a City Capital Asset. The newly purchased property and the new facility are replacements for the current one. In similar circumstances, with the redevelopment of Kiwassa and Mt. Pleasant Neighbourhood House, Council approved making the value of the current asset available as part of the funding for the replacement. The existing LMNH facility is assessed at approximately $550,000. If Council doesn't approve the use of the proceeds from the sale of the current facility for this project, then the shortfall in funding will be such that the project will probably not be able to proceed.

LMNH is going to apply for funding from the Federal/Provincial Infrastructure program. One of the requirements of this program is that the local municipal government formally endorse such applications, and provide to the senior levels of government a priority rating for all submissions. Given the high priority for City funding that Council has placed on this project, staff are recommending that Council support the Infrastructure application and that it be placed high on the City priority rating list. The Federal/Provincial Infrastructure Program has recently approved funding for the redevelopment of South Vancouver Neighbourhood House, which would indicate that funding for these types of projects can be realized.

LMNH has hired a fund-raising consultant who has been involved in a number of similar projects. She has advised the Society that they should be able to raise $500,000 - $600,000 within a 2-3 year period.

To put these funding needs in perspective, particularly with regards to the City contribution, staff reviewed the budgets for the two previous Neighbourhood House redevelopment projects. Kiwassa Neighbourhood House was developed in two phases (1991 and 1995) at a total cost of $3,290,000, which included a total of $934,700 for the purchase of a new site and the proceeds from the sale of the old site. The City's total contribution, including the land, was $1,457,000 (44%). Mt. Pleasant Neighbourhood House was developed in 1993 for a total cost of $3,205,700, including $1,125,000 for the purchase of the new site and the sale of the old one. The City's total contribution for this project, including the land, was $1,249,700 (39%). In comparison, the proposed LMNH project is estimated to cost approximately $5,100,000, and the total City contribution, including land value, would be $3,410,000 (67%). Unfortunately, such comparisons are difficult to make as we are operating within a substantially different context now. The other two projects were developed up to 10 years ago when costs were substantially lower ($175/sq ft. compared to $285/sq ft now), significant contributions from senior levels of government were easier to come by and there are considerable differences among these societies in terms of their fund-raising capabilities.

In summary, the revenue sources for this project are:

 

Complete Project

Phase 1

City (Current Capital Plan)

$1,100,000

$1,100,000

City (Future Capital Plan)

$1,360,000

$1,240,000

City (Childcare Grant)

$ 250,000

  

City (City-Wide DCL for Childcare)

$ 150,000

  

Sale of the Existing site

$ 550,000

$ 550,000

F/P Infrastructure

$1,000,000

  

Province (Childcare)

$ 150,000

  

Province (Capital Grant)

  

$ 250,000

LMNH Fund-raising

$ 550,000

$ 550,000

TOTAL

$5,110,000

$3,690,000


 

 

 

 

 

 

 

Note that these figures, for both expenditures and revenue, are very preliminary. Construction costs are potentially the most variable, as they are dependent on the specific design for the facility and the construction industry environment when bids are sought some three years from now. Once we are closer to the commencement of construction, and these costs and revenue sources can be firmed up, staff will be reporting to Council seeking specific financial commitments.

In the meantime, once the site has been purchased, the LMNH Society needs to get their architect working on a design for the new facility. Once this work is completed, they need to apply for development and building permits. Securing these permits will help in the preparation of more accurate cost estimates and will assist the Society in their fund raising efforts.

An amount of $1,100,000 has been included in the 2001-02 Capital Budgets for this project. Real Estate Services has recommended that $830,000 be allocated for the purchase of the site. Social Planning is recommending that, once the issue of inclusion of the Library in this project has been resolved, the balance of $270,000 be used to help pay for the architectural and permit costs over the next two to three years.

CONCLUSION

Now that a suitable site for the redevelopment of LMNH has been found, the next steps in the project implementation can begin. The viability of developing a joint Neighbourhood House/Library project needs to be determined quickly. Once that's done, the new building can be designed and permits applied for. The LMNH Society can begin fund-raising in earnest. In 2-3 years' time, after this preliminary work has been completed, all the required funding should be in place and construction can begin. Then after many years of waiting, the residents will have a new multi-purpose social service facility that can serve as the hub for the entire community.

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