Fact Check and Chronology: Fiore-Irgens Efforts on behalf of Library

The issues surrounding the Madison Central Library project are complex, and do not lend themselves to “sound bite” answers. So we have created this resource for those interested in factual background.

Price Commitment by Fiore-Irgens
In September 2008 the City requested proposals to build and sell a “Grey-Box Shell” to the City, which the City would then complete as a public works project.

As the Mayor prepared his capital budget in August, 2009, Fiore-Irgens recommended a minimum Project budget of $38.5 million, including the Grey-Box Shell at a fixed cost of $23.9 million (excluding construction period interest and future parking). This revised pricing represented a $3.1 million reduction from the original cost for the Grey-Box, and was achieved by savings under the current construction environment and across-the-board decreases in professional fees. It also anticipated a $1.6 million reduction in the subsequent City costs to complete the project.

We further advised the City that the cost of the grey box Shell could not be reduced by more than this $3.1 million without impacting the conceptual design of the building. Nonetheless, the Mayor and his Staff made a unilateral decision to establish a $37 million budget for the Project. Fiore-Irgens expressed concern about the adequacy of this budget, but affirmed our willingness to help find a way for the City to accomplish it. Fiore-Irgens’ responsibility was to deliver the shell for $23.9million. And it was the City’s responsibility to complete the project within the proposed $37 million capital budget. Here is the relevant correspondence on pricing for the Grey-Box Shell:
Letter_to_Mayor_08-21-2009.pdf
Letter_to_Mayor_08-24-2009.pdf

Madison’s Common Council approved the Mayor’s capital budget request on November 10, 2009, but amended the budget to provide that “The City will not commence any significant portion of the construction of its portion of the project until it has received assurance that the federal New Markets tax Credits are available.”

Fiore-Irgens met with Mayor and his staff on Nov 17, 2009 to discuss next steps. (Here is the meeting agenda.)  We suggested that a approach to consider may be a "developer services approach" for public works construction that could yield significant process efficiencies and cost savings by integrating the shell and interior work. Although questions were raised about the implications of “public works” on the schedule and development roles, the City Attorney confirmed that the City could choose to directly hire the professional services from the Fiore-Irgens team. We proceeded to explore this alternative approach in good faith.
Fiore-Irgens prepared a fairly comprehensive analysis of Project Issues and Development Roles / Responsibilities. This draft was intended as a collaborative document and was distributed to the Mayor and others on December 29th as background for emerging media inquiries.

On January 11, 2010 the Mayor informed us that the City wished to proceed with a public works approach, but without the participation of Fiore-Irgens. We met with City staff on January 15th and were told that the condo approach approved by the Common Council was now "off the table." Fiore-Irgens formally protested this decision in a letter to the Mayor. (No response received.)

Two weeks later, the City sent a draft Letter of Intent that excluded both Fiore and Irgens from any further development role, and required Findorff and EUA to bid for the right to perform their services. No price was proposed for the existing structure and no provision was reflected for pre-development services already performed by Fiore-Irgens. We immediately sent back suggested changes to the LOI that would allow it to be acceptable to our team.

The Mayor responded to our proposal with a written ultimatum on February 9th demanding i) a $2 million reduction in our price for the Library Shell (to $23 million including construction interest and future parking), or ii) sell the site to the City for public works process that would exclude the Fiore-Irgens team. Otherwise, the City would look at other options including remodeling or obtaining a site by “purchase or exercise of condemnation powers.” In order to evaluate these options, Fiore-Irgens requested a specific proposal for purchase of the site including structure in place and pre-development services already provided by Fiore-Irgens. The Mayor asked for clarification on the development services already provided, and we provided this response.

And here we stand today… Fiore has advised the City that we are disappointed to be unable to continue development under the City’s proposed approach, but we do wish to see this project completed. Therefore we have suggested a "project acquisition price" that includes the site (air rights, improvements in place, and underground parking) and compensation for developer services already provided by Fiore-Irgens.