HomeMy WebLinkAbout276-22 RESOLUTION113 West Mountain Street
Fayetteville, AR 72701
(479) 575-8323
Resolution: 276-22
File Number: 2022-1008
FAYETTEVILLE ADVERTISING AND PROMOTION COMMISSION SOLAR
CONTRACT:
A RESOLUTION TO AUTHORIZE MAYOR JORDAN TO SIGN A CONTRACT WITH THE
FAYETTEVILLE ADVERTISING AND PROMOTION COMMISSION FOR THE
REPAYMENT OF SOLAR ARRAY INSTALLATION COSTS AT THE FAYETTEVILLE
TOWN CENTER, AND TO AUTHORIZE A CHANGE ORDER TO THE CITY'S ENERGY
SAVINGS PERFORMANCE CONTRACT WITH JOHNSON CONTROLS, INC.
WHEREAS, on August 16, 2022, the City Council approved Resolution 191-22 authorizing Mayor
Jordan to sign an Energy Savings Performance Contract with Johnson Controls Inc. and to negotiate
and sign agreements with the Advertising & Promotion Commission and the Fayetteville Public Library
for the payment of their respective project costs; and
WHEREAS, on September 26, 2022, the Fayetteville Advertising and Promotion Commission
authorized Chief Executive Officer Molly Rawn to negotiate and enter into an agreement with the City
of Fayetteville for the repayment of costs associated with the installation of a 148.5kW rooftop solar
array on the Fayetteville Town Center; and
WHEREAS, execution of this contract will add $407,185.00 to costs of the Energy Savings
Performance Contract with Johnson Controls, Inc. which will be offset by any federal rebates received
by the Inflation Reduction Act that can be applied to this project and will be repaid to the City by the
A&P Commission via annual payments over 20 years.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
FAYETTEVILLE, ARKANSAS:
Page 1 Printed on 1217122
Resolution: 276-22
File Number: 2022-1008
Section 1: That the City Council of the City of Fayetteville, Arkansas hereby authorizes Mayor Jordan
to sign a contract with the Fayetteville Advertising and Promotion Commission, a copy of which is
attached to this Resolution, for the repayment of solar array installation costs at the Fayetteville Town
Center, and further authorizes Mayor Jordan to sign a change order to the City's Energy Savings
Performance Contract with Johnson Controls Inc. to expand the scope of services to provide for the
installation of a 148.5kW rooftop solar array on the Fayetteville Town Center.
PASSED and APPROVED on 12/6/2022
Attest: '. ER K % TI�i�
`��\�.• CITY0 *,i.G
Kara Paxton, City Clerk Treasurm-31 �p� •.�
r
Page 2 Printed on 1217122
City of Fayetteville, Arkansas 113 West Mountain Street
Fayetteville, AR 72701
(479)575-8323
Text File
File Number: 2022-1008
Agenda Date: 12/6/2022 Version: 1 Status: Passed
In Control: City Council Meetinq File Type: Resolution
Agenda Number: A.7
FAYETTEVILLE ADVERTISING AND PROMOTION COMMISSION SOLAR CONTRACT:
A RESOLUTION TO AUTHORIZE MAYOR JORDAN TO SIGN A CONTRACT WITH THE
FAYETTEVILLE ADVERTISING AND PROMOTION COMMISSION FOR THE REPAYMENT OF
SOLAR ARRAY INSTALLATION COSTS AT THE FAYETTEVILLE TOWN CENTER, AND TO
AUTHORIZE A CHANGE ORDER TO THE CITY' S ENERGY SAVINGS PERFORMANCE
CONTRACT WITH JOHNSON CONTROLS, INC.
WHEREAS, on August 16, 2022, the City Council approved Resolution 191-22 authorizing Mayor Jordan to
sign an Energy Savings Performance Contract with Johnson Controls Inc. and to negotiate and sign agreements
with the Advertising & Promotion Commission and the Fayetteville Public Library for the payment of their
respective project costs; and
WHEREAS, on September 26, 2022, the Fayetteville Advertising and Promotion Commission authorized
Chief Executive Officer Molly Rawn to negotiate and enter into an agreement with the City of Fayetteville for
the repayment of costs associated with the installation of a 148.5kW rooftop solar array on the Fayetteville
Town Center; and
WHEREAS, execution of this contract will add $407,185.00 to costs of the Energy Savings Performance
Contract with Johnson Controls, Inc. which will be offset by any federal rebates received by the Inflation
Reduction Act that can be applied to this project and will be repaid to the City by the A&P Commission via
annual payments over 20 years.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
FAYETTEVILLE, ARKANSAS:
Section 1: That the City Council of the City of Fayetteville, Arkansas hereby authorizes Mayor Jordan to sign a
contract with the Fayetteville Advertising and Promotion Commission, a copy of which is attached to this
Resolution, for the repayment of solar array installation costs at the Fayetteville Town Center, and further
authorizes Mayor Jordan to sign a change order to the City's Energy Savings Performance Contract with
Johnson Controls Inc. to expand the scope of services to provide for the installation of a 148.5kW rooftop
solar array on the Fayetteville Town Center.
City of Fayetteville, Arkansas Page 1 Printed on 121712022
Peter Nierengarten
Submitted By
City of Fayetteville Staff Review Form
2022-1008
Legistar File ID
12/6/2022
City Council Meeting Date - Agenda Item Only
N/A for Non -Agenda Item
11/15/2022 SUSTAINABILITY/RESILIENCE (631)
Submitted Date Division / Department
Action Recommendation:
Staff recommends approval of this contract with the Advertising and Promotion Commission for repayment of solar
array installation costs at the Fayetteville Town Center. Execution of this contract will initiate a change order to the
City's Energy Savings Performance Contract with JCI to expand the scope of services to provide for the installation
of a 148.5kW rooftop solar array on the Fayetteville Town Center, as detailed in Resolution 191-22.
Budget Impact:
1010.090.6600-6884.08
(Proceeds from - A&P Energy Loan)
General
Account Number Fund
52201.2201 Energy Loan (Solar Array) - A&P Commission
Project Number
Budgeted Item? No
Does item have a cost? No
Budget Adjustment Attached? No
Current Budget
Funds Obligated
Current Balance
Item Cost
Budget Adjustment
Remaining Budget
Project Title
V20210527
Purchase Order Number: Previous Ordinance or Resolution #
Change Order Number:
Original Contract Number:
Comments:
Approval Date:
CITY OF
FAYETTEVILLE
ARKANSAS
MEETING OF DECEMBER 6T", 2022
TO: Mayor and City Council
THRU: Susan Norton, Chief of Staff
Peter Nierengarten, Environmental Director
CITY COUNCIL MEMO
CC: Wade Abernathy, Director of Bond Projects and Facilities
FROM: Chris McNamara, Sustainability Project Manager
DATE: November 15th, 2022
SUBJECT: Contract with AP Commission for Repayment of Solar Array Installation
Costs
RECOMMENDATION:
Staff recommends approval of this contract with the Advertising and Promotion Commission for
repayment of solar array installation costs at the Fayetteville Town Center. Execution of this
contract will initiate a change order to the City's Energy Savings Performance Contract with JCI
to expand the scope of services to provide for the installation of a 148.5kW rooftop solar array
on the Fayetteville Town Center, as detailed in Resolution 191-22.
BACKGROUND:
August 16, 2022, the Fayetteville City Council approved Resolution 191-22 authorizing Mayor
Jordan to execute an Energy Savings Performance Contract with Johnson Controls, Inc. to
implement energy efficiency upgrades in City facilities.
Resolution 191-22 also provided that the contracted scope of work could be expanded to
include a rooftop solar array at the Fayetteville Town Center upon approval by the Fayetteville
Advertising and Promotion Commission and the negotiation of a contract with the City of
Fayetteville for the payment of the costs associated with the solar array.
September 26, 2022, the Fayetteville Advertising and Promotion Commission authorized Chief
Executive Officer Molly Rawn to negotiate and enter into an agreement with the City of
Fayetteville for the repayment of costs associated with the installation of a 148.5kW rooftop
solar array on the Fayetteville Town Center.
Mailing Address:
113 W. Mountain Street www.fayetteville-ar.gov
Fayetteville, AR 72701
DISCUSSION:
Execution of this contract will initiate the City to execute a change order to its contract with
Johnson Controls, Inc. to expand the scope of services to provide for the installation of a
148.5kW rooftop solar array on the Fayetteville Town Center. The City shall pay the amount of
$407,185 to Johnson Controls, Inc. for the installation of the rooftop solar array on the
Fayetteville Town Center. Term of the repayment contract between the City and the Advertising
& Promotion Commission is 20 years. Annual payments will be made to the City by December
1It starting after project completion. Annual Payments will be 1/20th the project cost.
Cost to the A&P Commission for the solar installation project is $407,185. The City or JCI will
also apply for federal grants from the Inflation Reduction Act (IRA) when available and apply
any grants available to this project to reduce the cost further. Current estimates of IRA grants
available for this project are $116,000. Likely timeframe to receive these grants is 2024. Total
project savings, payment schedule and impact to A&P Commission budget is detailed in
Attachment B.
BUDGET/STAFF IMPACT:
Execution of this contract will add $407,185 to costs of the Energy Savings Performance
Contract with Johnson Controls, Inc. These costs will be offset by any federal rebates received
by the Inflation Reduction Act that can be applied to this project. Project cost minus grant and
rebates will be repaid to the City by the A&P Commission via annual payments over 20 years.
Attachments:
Attachment A: Contract with AP Commission for Repayment of Solar Array Costs
Attachment B: Town Center _ESPC_20yr Savings Calcs
Attachment C: Resolution 191-22
b. The A&P Commission shall work with Johnson Controls, Inc. to ensure that the
Fayetteville Town Center roof is sufficiently structurally sound for the installation
of the rooftop solar array.
c. The A&P Commission shall provide reasonable access as requested by Johnson
Controls, Inc., which shall include its agents and subcontractors, for the
installation of the solar array.
d. The A&P Commission shall promptly notify the City of any repair or
maintenance issues with the solar array of which it becomes aware during the
term of this contract.
4. Contract Amendments. Changes, modifications or amendments to the scope, price or
fees dictated by this Contract shall not be allowed without a prior formal Contract
amendment approved by City and by the authorized agent of the Fayetteville
Advertising and Promotion Commission in wh ance ofthe change.
S. A waiver by either party of any of the terms or conditions herein shall be limited to that
particular instance and shall not be construed as a general waiver of any other breaches by
either party.
6. This Agreement constitutes the entire understanding of the parties, and no modification or
variation of the terms of this agreement shall be valid unless made in writing and signed
by the duly authorized agents of the City and the A&P Commission.
IN WITNESS WHEREOF, the parties hereto have caused their signatures to be set by
their authorized representative effective the date set forth below.
FAYETTEVILLE ADVERTISING
AND PROMOTION COMMISSION
Molly Raw Chief Executive Officer
Date:�--
CITY OF FAYETTEVILLE,
Date: (L" (D - Z Z
ATTEST:
Kara Paxton, City
CONTRACT
FOR REPAYMENT OF SOLAR ARRAY INSTALLATION COSTS
WHEREAS, on August 16, 2022, the Fayetteville City Council approved Resolution
191-22 authorizing Mayor Jordan to execute an Energy Savings Performance Contract with
Johnson Controls, Inc. to implement energy efficiency upgrades in City facilities; and
WHEREAS, Resolution 191-22 also provided that the contracted scope of work could be
expanded to include a rooftop solar array at the Fayetteville Town Center upon approval by the
Fayetteville Advertising and Promotion Commission and the negotiation of a contract with the
City of Fayetteville for the payment of the costs associated with the solar array; and
WHEREAS, on September 26, 2022, the Fayetteville Advertising and Promotion
Commission authorized Chief Executive Officer Molly Rawn to negotiate and enter into an
agreement with the City of Fayetteville for the repayment of costs associated with the installation
of a 148.5kW rooftop solar array on the Fayetteville Town Center at a total cost of $407,185.
NOW, THEREFORE, THIS CONTRACT is made by and between the City of
Fayetteville, Arkansas ("City") and Fayetteville Advertising and Promotion Commission ("A&P
Commission"), and the parties agree as follows:
1. Term. The term of this contract shall begin on /2' (I - 22 and shall end twenty
(20) years thereafter or upon the last payment from the A&P Commission to the City,
whichever occurs later.
2. City of Fayetteville's Rights and Responsibilities.
a. The City shall execute a change order to its contract with Johnson Controls, Inc.
to expand the scope of services to provide for the installation of a 148.5kW
rooftop solar array on the Fayetteville Town Center.
b. The City shall pay the amount of $407,185 to Johnson Controls, Inc. for the
installation of the rooftop solar array on the Fayetteville Town Center.
c. The repayment balance owed to the City shall be $407,185.
d. The City will accept any federal or utility rebates for the installation of the solar
array and subtract the rebate amounts from the repayment balance owed to the
City.
e. The City will fund the repair and rehabilitation of the Town Center Roof.
3. Fayetteville Advertising and Promotion Commission's Rights and Responsibilities.
a. The A&P Commission shall make 20 annual payments to the City, each in the
amount ofl/20'h of the repayment balance owed to the City. Payments shall be
made each year by December I" beginning after the completion date of the solar
array.
IUM
CITY OF
FAYETTEVILLE
ARKANSAS
Below are the financial details for the rooftop solar array at the Town Center as part of the City of Fayetteville's
Energy Savings Performance Contract.
Town Center
20 Year Financing Term
Solar:
Solar Array Size:
148.5kW
Location:
Town Center Roof
Solar Array Productive Life:
30 years
Ownership Model:
Owned by client (building owner)
Solar Developer:
SEAL Solar
System Monitoring & Maintenance:
20 Year Contract
Total Project Cost:
$
4071185
Annual Payment
$
20,359
Loan Payment Period:
20 YEARS
Project Management Cost (excluded):
0%
Financial Incentives: IRA Rebate Estimate
$116,000 (not included in Project Cost)
Interest Rate:
0%
Estimated Annual Utility Savings
$20,000
- $100,000
Estimated Project Net -Savings (@30yrs):
$
1,143,993
The project would save $1.5 million in electricity costs over 30 years.
Town Center Annual Electricity Costs
Normal Ops vs. ESPC Implementation
$180,000
$160,000
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
M � Ln l0 r� 00 M O c1 N M 'zT Ln W I, 00 Q1 O ci N M zt Ln W r, 00 M O r-i N
N N N N N N N M M M M M M M M M M Zq- 4 4 -4 4 t -zq- zt 4 Zt Ln u1 Vl
O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O
N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N
Total Electricity Cost Total Cost After ESPC Projects
Note: Annual payments end after 20yrs (2043),
1
Project cost is $407,185 at 0% financing. An additional $116,000 (estimated) federal rebate can be added in
2024 from the Inflation Reduction Act that will further reduce the project cost. With $1.5 million in projected
savings at year 30 and a cost of $407,185, the net -savings for life of the project are estimated at
$1,143,993.
The City is offering a 20-year financing term for the project with annual payments of 1/20t" of final project cost.
20 Year Financinq Term
Total Project Cost:
$ 407,185
Annual Payment
$ 20,359
Loan Payment Period:
20 YEARS
Project Management Cost (excluded):
0%
Financial Incentives: IRA Rebate Estimate
$116,000 (not included in Project Cost)
Interest Rate:
0%
Estimated Annual Utility Savings
$20,000 - $100,000
Estimated Project Net -Savings (@30yrs):
I $ 713,558
Under a 20yr financing scheme, the A&P commission annual payments will be less than savings generated
after year two. Project payback period is 14yrs (2036) or shorter.
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
$(20,000)
Town Center Rooftop Solar
20 Year Payment Term
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Solar Savings ! 20yr Term Payments A&P Budget Impact
This table details the annual savings generated from the solar array against the annual payments under a 20-
year, 0% interest financing term. The projected impact to the A&P budget is on the far -right column. Savings
generated from solar are projected to be higher than annual payments except for years 1 and 2.
E
Years
Solar Savings
20yrTerm Payments
A&P
Budget Impact
2023
$
19,059
$
20, 359.25
$
(1,300)
2024
$
19,371
$
20, 359.25
$
(988)
2025
$
21,217
$
20, 359.25
$
857
2026
$
23,114
$
20, 359.25
$
2,754
2027
$
25,063
$
20, 359.25
$
4,704
2028
$
27,066
$
20, 359.25
$
6,707
2029
$
29,125
$
20, 359.25
$
8,765
2030
$
31,239
$
20, 359.25
$
10,880
2031
$
33,412
$
20,359.25
$
13,052
2032
$
35,643
$
20, 359.25
$
15,284
2033
$
37,936
$
20, 359.25
$
17,577
2034
$
40,290
$
20, 359.25
$
19,931
2035
$
42,708
$
20, 359.25
$
22,349
2036
$
45,192
$
20, 359.25
$
24,833
2037
$
47,742
$
20, 359.25
$
27,383
2038
$
50,361
$
20, 359.25
$
30,001
2039
$
53,050
$
20,359.25
$
32,690
2040
$
55,810
$
20, 359.25
$
35,451
2041
$
58,645
$
20, 359.25
$
38,285
2042
$
61,555
$
20, 359.25
$
41,195
2043
$
64,542
$
64,542
2044
$
67,608
$
67,608
2045
$
70,756
$
70,756
2046
$
73,987
$
73,987
2047
$
77,303
$
77,303
2048
$
80,706
$
80,706
2049
$
84,199
$
84,199
2050
$
87,783
$
87,783
2051
$
91,462
$
91,462
2052
$
95,237
$
95,237
Total
$
1,551,178
$
1,143,993
3
113 West Mountain Street
Fayetteville, AR 72701
(479) 575-8323
Resolution: 191-22
File Number: 2022-0718
JOHNSON CONTROLS INC.:
A RESOLUTION TO AUTHORIZE MAYOR JORDAN TO SIGN AN ENERGY SAVINGS
PERFORMANCE CONTRACT WITH JOHNSON CONTROLS INC., PURSUANT TO RFQ
20-06, 1N THE AMOUNT OF $4,448,399.00, TO AUTHORIZE MAYOR JORDAN TO
NEGOTIATE AND SIGN AGREEMENTS WITH THE ADVERTISING & PROMOTION
COMMISSION AND THE FAYETTEVILLE PUBLIC LIBRARY FOR THE PAYMENT OF
THEIR RESPECTIVE PROJECT COSTS, AND TO APPROVE A BUDGET ADJUSTMENT
WHEREAS, on January 2, 2018, the City Council adopted an Energy Action Plan by Resolution
25-18 to build a policy, program, and project framework and initiate action for Fayetteville's efforts to
be a resource and energy efficient community; and
WHEREAS, Ark. Code Ann. § 14-164-801, etseq, provides the authority for cities to enter into
guaranteed energy cost savings contracts in order to reduce energy consumption or operating costs of
government facilities; and
WHEREAS, on February 18, 2021 the City Council approved Resolution 64-21 authorizing Mayor
Jordan to sign a Project Development Agreement with Johnson Controls, Inc. to conduct an Energy
Audit and to identify potential energy and cost saving measures for City facilities; and
WHEREAS, approval of the Energy Savings Performance Contract will authorize Johnson Controls
to begin executing 84 energy efficiency upgrades across 47 City -owned buildings as well as the
Fayetteville Public Library and Fayetteville Advertising & Promotion Commission; and
WHEREAS, the fully scoped Energy Savings Performance Contract price is $8,087,014; however,
the City has elected to remove certain projects at City Hall, the Police Headquarters, the Town
Page 1 Printed on 8118122
Resolution: 191-22
File Number: 2022-0718
Center, and the Fayetteville Public Library at this time for a revised project cost of $4,448,399.00;
and
WHEREAS, the upgrades are expected to produce $3,990,724.00 in savings over 20 years, reduce
energy consumption by 27%, and increase the city's clean energy percentage to 75%; and
WHEREAS, the contract scope of work may be expanded upon City Council approval of a change
order to include improvements to the Town Center and Fayetteville Public Library, contingent on the
successful negotiation of reimbursement terms with the A&P Commission and the Fayetteville Public
Library Board of Trustees.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
FAYETTEVILLE, ARKANSAS:
Section 1: That the City Council of the City of Fayetteville, Arkansas hereby authorizes Mayor Jordan
to sign an Energy Savings Performance Contract with Johnson Controls Inc., a copy of which is
attached to this Resolution, in the amount of $4,448,399.00 to implement energy efficiency upgrades in
City facilities.
Section 2: That the City Council of the City of Fayetteville, Arkansas hereby authorizes Mayor Jordan
to negotiate and sign agreements with the Fayetteville Advertising & Promotion Commission and the
Fayetteville Public Library to provide for the payment of costs associated with energy efficiency
upgrades at properties under the control of those governing bodies.
Section 3: That the City Council of the City of Fayetteville, Arkansas hereby approves a budget
adjustment, a copy of which is attached to this Resolution.
PASSED and APPROVED on 8/16/2022
Attest: ■'���G�Eg` �►'rREq ffr.
7) 4 1,1A
r ; FAYETTEVILLE;�
r •
1. 4
Kara Paxton, City Clerk Treasurer �'.pif',5hA
G ONp p;�
Page 2 Printed on 8118122