Progress on the River Valley Sports Complex inched forward Tuesday (Feb. 25) during a study session of the Fort Smith Board of Directors, but not without serious questions about how the city can protect itself from investing money in the project should it not be completed.
At issue was a proposed agreement between the RVSC and the city of Fort Smith, which outlines contractual agreements and expectations of both parties for the city to eventually purchase the completed facility to be built at Chaffee Crossing.
In changes RSVC would like to see to the agreement, RSVC partner Lee Webb requested the removal of a section requiring a construction bond, a change that City Director Keith Lau said put the city at risk.
City Director Philip Merry came to the defense of RSVC, explaining that Webb and RSVC partner Jake Files were individuals organizing the tournament-level softball facility.
"You've got two citizens who do not have an entity, that they are giving sweat equity to the city to coordinate a benefit to the city and then they have an aggregate group of commitments for in-kind donations and such."
Merry went on to explain that for a group like RSVC, which has no assets, to secure bonding, Webb and Files would have to personally put up collateral to secure a bond, something he said neither men should have to do.
"Lee and Jake are offering up concepts to the city and trying to help coordinate an effort, but I don't think either one of them should be asked to bond and tie up their net worth, which is what a bond would require."
City Administrator Ray Gosack told the Board that in most other situations, the city would require a bond in order to make sure a project involving the city would be completed as promised. But he said the specifics of the situation with RSVC were different enough to not have such a requirement. He added that he was confident in the ability of Webb and Files to deliver on the project, which was sold as a project that would be funded with the passage of a sales tax initiative in 2012.
During discussion about the bonding, the Board came back to an issue discussed during the last study session on the ballfields, which was the cost estimates presented by RSVC and the city. According to Parks and Recreation Director Mike Alsup, the city estimates completing the ballfields to cost between $6 million and $8 million. The cost estimate of RVSC is considerably lower — just more than $4 million.
Due to the differences in estimates, City Director George Catsavis said it sounded like a "big gamble" to him and said he'd need some sort of assurance that RSVC could complete the project for the estimate the group has quoted to the city.
Merry asked, "How can they (Webb and Files) be so wrong?"
In order for the Board to feel secure in funding the project without performance bonds, and to feel comfortable that the eight field facility can be built for stated price of little more than $4 million, the Board requested that formal letters detailing donations, bids and other items that detail how the project will be built and financed.
Webb said he would start securing letters to have to the Board in time for their March 4 regular meeting, which will include a vote on moving forward with the project as part of the Board's consent agenda.
In other business, the Board moved to place a vote on the March 4 agenda that would renew the city's fleet and property insurance. The only change from the previous year to this year is the raising of property insurance deductibles from $25,000 to $50,000 for wind and hail occurrences, an increase that was partially due to the level of catastrophic weather events to take place in the last year or more, according to City Purchasing Manager Alie Bahsoon.