New Moran plan falls apart, demolition costs revealed

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New Moran plan falls apart, demolition costs revealed

Fri, 09/01/2017 - 3:01pm -- tim

Mayor Weinberger announces major infrastructure upgrades to the area around the Moran plant in August 2014. VBM photo

Vermont Business Magazine Burlington Mayor Miro Weinberger today announced that the City of Burlington and New Moran, Inc (NMI) have agreed to cease discussions regarding a redevelopment of the Moran Plant, as the two sides have been unable to reach agreement on a term sheet that would have defined the City’s granting of TIF funds and a long-term lease of the building and site to NMI.

In addition, the Community and Economic Development Office (CEDO) City released today an unredacted version of its March 2017 Demolition Report, which provides an initial outline of the costs and uncertainties associated with different demolition scenarios, and which had previously been withheld because of its potential impact on the term sheet negotiations.

The Moran electric plant operated from 1954 until its decommissioning in 1986. It initially was a coal-fired plant, which eventually mixed in wood chips. Refurbishing of the prominent and largely unused plant on the city's waterfront have come and gone since. 

In March 2014, the New Moran proposal was approved by 70 percent of Burlington voters for a $6.3 million allocation of City Tax Increment Financing. In May 2014, New Moran, Inc was founded as a nonprofit organization to be the governing organization of the projectin partnership with the City of Burlington.

Costs of demolition run from $4.0 million (low bid for demolition down to current grade level) to $10.7 million (high bid for complete remediation). Under all scenarios the void created after demolition would be backfilled with clean structural fill.

The 2014 Tax Increment Financing (TIF) ballot measure authorizing the City to work with NMI articulated two possible outcomes: either the New Moran team would succeed in a final attempt at a visionary and ambitious re-purposing of the space, or the City would be authorized to resolve the decades of uncertainty regarding the northern waterfront by utilizing the TIF funds for demolition and stabilization of the Moran Plant site. With the inability to reach agreement around the most recent term sheet discussion and detailed analysis of the proposal’s risks to the City, the City will now turn its attention to creating a Site Resolution Plan that will explore a range of demolition and reuse options for the Moran site.  The Mayor has invited the leaders of the NMI effort to serve as advisors to the City during the creation of new plan. 

J. Edward Moran Municipal Generating Station under full throttle. It operated for over 30 years. Undated BED photo.

“In 2014, as part of a broad community effort to breathe new life into our northern waterfront, we made a commitment to the voters to resolve the future of the Moran Plant,” said Mayor Weinberger. “The New Moran team brought passion, dedication, and an exciting vision for Moran. The team galvanized hundreds of community members who dedicated their time over four years to try and help our community resolve a challenge that had eluded the City for 30 years. Since long before I was Mayor, I have admired the Moran building, and I am grateful to the New Moran team and the many who shouldered this effort to restore it, and I share the disappointment that we could not find a way forward. We worked hard with the New Moran team, who brought focus, commitment, and every capacity they could to bear on this challenge, but ultimately we could not find a way forward that adequately protected the City from financial risk. It has now been more than three and a half years since the public vote, and it is time to turn the page on this effort and find a reuse of the site that expands and complements the major progress on the northern waterfront that we have enjoyed over the past five years. I am confident that today’s decision to shift our focus away from the long-standing goal of full Moran redevelopment, though difficult, will open up new, creative options for the site that will finally allow the public to fully reclaim the northern waterfront from its post-industrial past.”

“Our team came together around the vision of a redeveloped Moran Plant and the vibrant year-round energy it would create on the waterfront,” said Tad Cooke on behalf of New Moran. “Our work since has been possible thanks to the tremendous generosity of a top-notch professional team, diverse partners, selfless volunteers and hundreds of charitable supporters. Together, we built a once in a generation opportunity for Burlington – and we are deeply disappointed we could not reach common ground with the City. Over the months ahead, we will be working to thank the many community members who contributed to the project.”

Next Steps

The 2014 ballot measure was clear that, after three decades of failed efforts, the NMI effort would be the City’s last attempt at an ambitious redevelopment of the former coal burning plant. If that challenging effort failed, the City would turn its attention towards demolition and reuse of the site. 

Now that the City has ceased its efforts with NMI, the City, through the CEDO office, will create a Site Resolution Plan with the goal of using the Tax Increment Financing (TIF) funding held in reserve since the 2014 vote to secure the best possible outcome for the public in a way that complements progress on the northern waterfront over the last five years. The Site Resolution Plan, which is expected to be completed in fall of 2018, will consider:

●       All applicable land use and environmental regulations

●       Options for the future reuse of the site

●       Based on these options, the scope of the demolition

It is critical that the reuse of the site be determined before the building is removed for cost reasons, and because the City’s reuse options will be limited if the site sits vacant for more than twelve months. CEDO’s estimates are that the costs will range from $3 million to $10 million depending in part on how much of the structure’s foundation is removed.

History of the NMI Moran Plant project negotiations

Following the public vote in March 2014, the City signed a Memorandum of Understanding (MOU) with New Moran, Inc. in August 2014, giving the nonprofit company the exclusive opportunity to redevelop the Moran Plant. The New Moran team helped ignite a passion for waterfront activity, much of which was also authorized by the 2014 vote. These other projects include the new Skate Park (opened in November 2015), the Waterfront Access North project (completed in 2016), the new Community Sailing Center (scheduled to open by October 2017), the rehabilitation of Waterfront Park (completed in 2015), the renovation and enhancement of the corresponding stretch of the Burlington Bike Path (completed in 2015), the construction of a new marina (through permitting and slated to begin construction in the fall of 2017) and improvements to ECHO scheduled to be completed in the fall of 2018.

For two years following the 2014 vote, NMI worked through a variety of scenarios ranging in estimated cost from $15 million to $34 million, but was unable to establish the feasibility of a project to the satisfaction of the City. In July 2016, the Mayor announced plans to withdraw from and dissolve the August 2014 MOU, and that decision was ratified by the Council the following month.

The City released a request for qualifications regarding the Moran Plant in the fall of 2016. NMI was the only respondent to that request, with a submission in December 2016 that included Hemisphere Development, a nationally recognized Brownfield redevelopment partner, and significantly reduced the cost of the project while honing in on innovative uses for the space. Following a review of that NMI submission, the City entered into negotiations with NMI. The two parties worked diligently to attempt to agree upon terms for the project to move forward. Ultimately, the City and NMI were unable to reach agreement around the most recent term sheet discussion and financial risk analysis, resulting in today’s announcement.

Demolition Scenarios

Scenario 1: building would be demolished to current grade, (approximately 103 feet above sea level (fasl);

Scenario 2: building would be demolished to a depth of 2-feet below current grade (101 fasl);

Scenario 3: building would be demolished to a depth of 96 fasl (assumed current elevation of lower basement floor); and

Scenario 4: building would be demolished to a depth of 86 fasl, which would include the removal of concrete footers, foundations, and subsurface structure.

2.5.4.1 Scenario 1: Removal of All Building Materials above 103 fasl (Current Ground Surface)

This option involves demolition of the building superstructure to the current ground surface. The basement would then be backfilled with appropriate fill consistent with the redevelopment goals. If the redevelopment is construction of a replacement building, then the basement will need to be partially-backfilled with clean structural fill and a vapor intrusion mitigation system installed. Additionally, the sediment in the sub channels will need to be addressed in manner that prevents the potential impact of surrounding groundwater by either sequestering the contaminated sediment in place or removal and offsite disposal.

Moran Plant Demolition Scenario 1 - Summary

*includes historic preservation compliance, administration by city staff, preparation of demolition bid package, permitting fees and contingency.

Time frame for completing remediation and demolition: 4 months - assuming 6 days/wk @ 10 hr/day (This does not include pre deconstruction activities or permitting)

2.5.4.2 Scenario 2: Removal of All Building Materials above 101 FASL (2-Ft below Current Ground Surface)

This option involves demolition of the building superstructure to a depth of two feet below current ground surface. As with Scenario 1 above, the basement would then be backfilled with appropriate fill consistent with the redevelopment goals, and sediment would need to be appropriately managed. If the redevelopment is construction of a replacement building, then the basement will need to be partially backfilled with structural fill and a vapor intrusion mitigation system installed. This demolition scenario will be more expensive than Scenario 1, because additional material will require removal and disposal. It is considered unlikely that the degree of disturbance required to remove the building to 2-feet below ground surface will result in the need for soil disposal or dewatering and treatment.

Moran Plant Demolition Scenario 2 - Summary

*includes historic preservation compliance, administration by city staff, preparation of demolition bid package, permitting fees and contingency.

Time frame for completing remediation and demolition: 5 months - assuming 6 days/wk @ 10 hrs/day (This does not include pre deconstruction activities or permitting)

2.5.4.3 Scenario 3: Removal of All Building Materials Above 96 Fasl (Assumed Basement Floor Elevation)

This option involves demolition of the building to the level of the basement floor (approximately 96 fasl). At that point, walls and a structural slab could be poured for a new building or the excavation could be backfilled. The advantage of this option is that the remaining large concrete objects would be at depth and would be less likely to interfere with redevelopment, should a new building with new foundation be approved in the footprint of the former building. The down-side of this option is that given the groundwater elevation is typically above the basement floor level and the sandy nature of the soils around the Moran Plant, it is likely that dewatering and groundwater treatment would be required to complete the excavation. In addition, the deeper concrete removal effort of building foundation walls would result in a much greater volume of material requiring disposal. Furthermore, there is a greater likelihood that soils would be encountered that are unsuitable for re-use from a structural and/or environmental perspective, therefore requiring off-site disposal. Soil stockpiling and management may also be required depending on the sequencing of demolition.

Moran Plant Demolition Scenario 3 - Summary

*includes historic preservation compliance, administration by city staff, preparation of demolition bid package, permitting fees and contingency.

Time frame for completing remediation and demolition: 6 months - assuming 6 days/wk @ 10 hrs/day (This does not include pre deconstruction activities or permitting)

2.5.4.4 Scenario 4: Removal of All Building Materials Regardless Of Depth This option involves demolition and removal of all building materials associated with the Moran building, including the basement floor and any footers or foundation blocks. This option gives the most flexibility in terms of redevelopment, as no sub-surface impediments will remain. However, this option will require a significant dewatering effort given that the work will be taking place 10-feet or more below the water table and off-site soil disposal is more likely to be required due to the extensive soil disturbance required. In addition, soil would likely need to be stockpiled and managed on-site during the demolition. Lastly, there are significant uncertainties associated with this scenario which include:

1. Soil or groundwater quality assessments beneath the building have not been conducted and although unlikely a wide variety of contamination affecting various media could potentially exist beneath the slab, having significant cost and schedule implications;

2. Considering PCBs were found in the basement concrete floor at concentrations of up to 15 ppm, although unlikely, the potential exists for more extensive PCB impacts below the building. If PCB concentrations were identified that exceed the 50 ppm hazardous threshold significant cost and schedule implications would be expected; and

3. Considering the depth of excavation required and the assumed thickness of the basement floor, foundation, and footers is uncertain, the potential for complications and unrealized costs to implement Scenario 4 are likely to be significant.

Moran Plant Demolition Scenario 4 - Summary

*includes historic preservation compliance, administration by city staff, preparation of demolition bid package, permitting fees and contingency.

Time frame for completing remediation and demolition: 9 months – assuming 6 days/wk @ 10 hrs/day (This does not include pre deconstruction activities or permitting)

Sources: City of Burlington, NMI, BED. 9.1.2017

VBM vermontbiz.com