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Home My WebLink AboutA001 - Council Action Form dated August 11, 2026ITEM #:28 DATE:08-11-26 DEPT:P&R SUBJECT:STORY CONSTRUCTION CHANGE ORDER #3 FOR CONSTRUCTION MANAGEMENT SERVICES FOR FITCH FAMILY INDOOR AQUATIC CENTER COUNCIL ACTION FORM BACKGROUND: On December 13, 2022, the City entered into a contract with Story Construction for Construction Management services related to the construction of the Fitch Family Indoor Aquatic Center for the amount of $1,392,229. At that time, Story Construction was unable to provide a cost estimate for construction support services without knowing the full scope of the project. The cost estimate was later provided and on February 27, 2024, City Council approved Change Order (CO) #1 in the amount of $978,886 for Construction Support Services (Bid Package #5). The new contract total after Change Order #1 was $2,371,115. At its December 16, 2025 meeting, City Council was presented with a CO #2 request for $211,000. CO #2 reflected changes to the different components of the contract and aligned with a 25-month construction duration versus an 18-month duration which was used for Story's initial proposal. An estimated construction cost of $18,500,000 was used versus a $20,500,000 that was used in Story's proposal. Council approved CO #2 which increased the contract total to $2,582,115. Change Order #3 is now being presented to City Council for approval. As explained in the attached request, Story Construction is projecting that its billings will exceed the current purchase order by $298,586. The overrun falls into two categories: 1) Direct Supervisory Personnel Expense/Jobsite Office & Support ($166,316), and 2) Temporary Facilities per Bid Package #5 ($132,270). This increase in cost is due to a delay in the completion of the work. Story cites several factors, but identifies a large amount of change order work that was added very late in the project as the primary driver (for example the av equipment modifications, and other minor carpentry and electrical changes identified during the building systems start-up and commissioning work). Even though there are multiple factors for the delay, Story, as Construction Manager, acknowledges it played a role in the project's delayed finish. Therefore, Story is suggesting a compromise and not requesting reimbursement for the Supervisory Staff/Site Office & Support cost of $166,316. However, Story is requesting Change Order #3 be approved for the expenses associated with Temporary Facilities (Bid Package #5) which is $132,270. Please note that according to the contract with Story Construction, the City Attorney has advised that the City is required to pay the $298,586 if requested. 1 A breakdown of the original contract and change orders are shown below. Service Original Contract Change Order #1 Change Order #2 Change Order #3 Revised Contract Pre- construction Phase $ 135,327 $ 135,327 Construction Management Fee $ 430,500 ($ 42,000) $ 388,500 Construction Staffing Fees $ 765,022 $335,689 $1,100,711 Reimbursables $ 61,380 $ 17,050 $ 78,430 Construction Support Services $ 0 $978,886 ($ 99,739)$132,270 $1,011,417 Totals $1,392,229 $978,886 $211,000 $132,270 $2,714,385 Below is a breakdown of project expenses and funding at this time. EXPENSE AMOUNT Conceptual Design / Environmental Testing $ 64,893 Land Acquisition $ 2,900,000 Relocate Electric Lines $ 85,355 Design $ 1,783,850 Construction Manager $ 2,582,115* Construction (Total of awarded contracts)$17,922,200 Construction Change Orders $ 618,886 Other Project Related Costs $ 960,621 Available Balance ($2,720) TOTAL Project Cost (As of 7/6/26)$26,917,920 *This does not include the requested amount of $132,270. Total available funding for the project is as follows: REVENUE AMOUNT Hotel / Motel Tax $ 64,893 Grants / Donations $ 9,420,472 G.O. Bonds $17,429,835 TOTAL $26,915,200 As shown in the table, there is a negative available balance of $2,720. When added to this change order request of $132,270, the total shortfall is $134,990. This overage will be covered by savings from the Ada Hayden Heritage Park Trail Project ($89,734) and $48,000 is available in Fitch donations. 2 ALTERNATIVES: 1. Approve Change Order #3 for Construction Manager services to Story Construction in the amount of $132,270. 2. Do not approve Change Order #3 for Construction Manager services to Story Construction. 3. Refer this item back to staff and provide further direction. CITY MANAGER'S RECOMMENDED ACTION: Story Construction has managed the construction of the Fitch Family Indoor Aquatic Center which is now open. The opening was delayed due to multiple factors and as a result, Story has expended more resources than what is reflected in the current purchase order. Story acknowledges some responsibility for these delays and is offering a compromise to the overun of $298,586. As explained earlier, Story is requesting to only be paid $132,270 for Temporary Facilities (Bid Package 5). Per the City Attorney's counsel, the City is obligated to pay the full amount if requested. Therefore, it is the City Manager's recommendation to approve Alternative No. 1 as stated above. ATTACHMENT(S): Story Construction Request for CO#3 8-3-26.pdf 3 GENERAL CONTRACTING | DESIGN+BUILD | CONSTRUCTION M ANAGEMENT 2810 Wakefield Circle Ames, IA 50010 515-232-4358 August 4, 2026 Mr. Keith Abraham, Director of Parks and Recreation City of Ames 1500 Gateway Hills Park Drive Ames, Iowa 50010 Re: Fitch Family Indoor Aquatic Center Dear Mr. Abraham, Beginning this spring, Story communicated to you that we were incurring costs in excess of the budgets for both the Professional Supervisory Staff and the Temporary Facilities (titled Bid Package 5) budgets. We have had several communications and discussions since that time. This letter represents the consolidation of those communications and a request for reimbursement of costs outlined below, as provided in the Construction Manager as Advisor contract. The increase in costs is due to a delay in the completion of the work. While there were several factors, including prime contractor quality control and manpower challenges, the primary driver for the delay was a large amount of change order work that was added very late in the project. The attached graphic illustrates this point. It tracks the timeline of approved prime contractor change orders over the life of the project. Focusing on the finishing stages of the project (late 2025 and early 2026), there was a significant uptick in the amount of change work. Between January 1 and July 31 of this year, 42 Potential Change Items were initiated. Of those, 29 were executed AFTER the planned February turnover date of the project. The bulk of these changes were items identified during the building systems start-up and commissioning work. Discovering and implementing changes in the work during the final stages is highly disruptive. The prime contractors are already consumed in completing their current scopes of work. On this project, it pushed the completion of the job from a planned turnover in mid-February to a Conditional Certificate of Occupancy in mid-March, and ultimately a final Certificate of Occupancy in late-June. The magnitude of change, coming so late in the project, made it impossible to finish in the planned time frame, and the resulting delay drove the cost overruns outlined below. We are projecting that our billings will exceed the current purchase order by $298,586. The breakdown of the total overrun falls into two areas: Direct Supervisory Personnel Expense/Jobsite Office & Support ($166,316), and Temporary Facilities per Bid Package #5 ($132,270). Please note that Story uses the term “Bid Package #5” for expenses consumed in supporting the project as the Construction Manager and should not be confused with the project bid package contractors and their associated contract number references. 4 GENERAL CONTRACTING | DESIGN+BUILD | CONSTRUCTION M ANAGEMENT 2810 Wakefield Circle Ames, IA 50010 515-232-4358 Keith, Story acknowledges that there are multiple factors that contributed to the late completion of the project. Unwinding them all is impossible. And, as the Construction Manager, Story certainly played a role in the lagging project’s finish. Therefore, Story will not be requesting reimbursement for Supervisory Staff/Site Office & Support costs of $166,316. However, we are requesting a change order for the added expenses associated with Temporary Facilities (Bid Package #5) of $132,270. We believe this is a very fair compromise. Finally, as this request is being considered, we also offer that the project was ultimately completed substantially under its initial planned budget, with an excellent safety record, and navigated through several significant issues that disrupted the flow of the project. We strongly believe that the project is being completed sooner and for less cost than it would have been using a more traditional delivery method. A bidding general contractor would likely have requested additional time extensions and would have also pursued impact costs for the delays. We were successful in avoiding those potential costs on behalf of the City. Thank you for your consideration. Please contact me with any questions. Sincerely, Story Construction Co. Troy Turner Senior Project Manager 515-817-2621 5 02040608010 0 12 0 012345678910 PC O ' s P e r M o n t h & C u m m u l a t i v e T o t a l PC O ' s I n i t i a t e d P e r M o n t h Cu m m u l a t i v e T o t a l o f P C O ' s 6