Title
[Memorandum of Understanding] Fund Transfer from North Sacramento-Hagginwood Library Relocation (NSHLR) Project (C15000850) to Sacramento Public Library (SPL) and Change Order John F. Otto Inc., dba Otto Construction
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FileID
File ID: 2026-00857
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Location
Location: 1124 Del Paso Boulevard, District 2
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Recommendation
Recommendation: 1) pass a Motion: a) authorizing the City Manager or designee to execute Change Order No. 3 to Contract No. 2025-4573 with John F. Otto Inc. dba Otto Construction, for an amount not-to-exceed $207,754 for a new total amount not-to-exceed of $7,823,339; b) ratifying Change Orders 1 and 2 for this project issued under City Manager authority; and c) resetting the City Manager’s or designee’s authority to issue change orders for Contract No. 2025-4573; and 2) adopt a Resolution: a) authorizing the City Manager or designee to execute a Memorandum of Understanding (MOU) between the City of Sacramento and the Sacramento Public Library Authority (SPL) in an amount not-to-exceed $430,000 for the North Sacramento-Hagginwood Library Relocation Project (NSHLR); and b) transferring $430,000 (General Fund, Fund 1001) from North Sacramento-Hagginwood Library Relocation Project C15000850 to the SPL CIP.
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Contact
Contact: Ezra Roati, Senior Architect, (916) 808-5877, eroati@cityofsacramento.org; David Avila, Supervising Architect, (916) 808-7501, dravila@cityofsacramento.org; James Christensen, Facilities Manager, (916) 808-5863, jechristensen@cityofsacramento.org; Department of Public Works
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Presenter
Presenter: None
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Attachments
Attachments:
1-Description/Analysis
2-Resolution
3-Change Order No. 3 - John F. Otto Inc., dba Otto Construction
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Description/Analysis
IssueDetail
Issue Detail: The City of Sacramento, in collaboration with SPL, is undertaking the renovation of an existing building and relocation of the North Sacramento-Hagginwood Library to address the community’s growing need for a larger facility. Originally established in 1987 through the merger of the North Sacramento and Hagginwood branches, the current 4,000-square-foot facility is outdated and no longer meets the operational needs of the community. The new 19,000-square-foot branch, currently under renovation, will allow the SPL to better serve the surrounding community through services and access to resources. As part of the ongoing renovation, the City is responsible for funding the opening day collections and making associated improvements that assist in operations and security of the facility.
Under the 2007 Joint Powers Authority (JPA) Agreement with SPL, Sacramento must provide, maintain, and improve library facilities, including funding opening day collections within their boundary. The City has committed to funding these collections for NSHLR project, ensuring a diverse range of books, DVDs, audiobooks, digital resources, and other materials upon the library opening.
The opening day collection will cover a broad range of formats and subjects to meet community needs. This includes print titles for adults, teens, and children; large print materials; multilingual resources; and popular media for entertainment and lifelong learning. The aim is to open the library with an inclusive collection that matches the interests and informational needs of its patrons from day one.
The City will also fund the purchase of a new automated material handling system (AMHS) so that this library can be a regional location for sorting and distributing books back to nearby branches.
On October 7th, 2025, the City Council awarded a $7,076,000 contract to John F. Otto, Inc. dba Otto Construction for remodeling the building as the new North Sacramento-Hagginwood Library. Change Orders No. 1 and 2 totaling $539,585 have been executed under the City Manager’s Authority to address changes to the bid documents, drawing coordination issues, unforeseen site conditions, and City or Library-initiated changes encountered during construction.
Change Order No. 3, totaling $207,754, includes on-site electrical revisions, coordination of low-voltage systems (such as CCTV, public address, security alarm, and card reader modifications), as well as updates to door materials and hardware. This scope was largely excluded from the original construction contract because the design details were not yet fully developed and there was a need to begin construction. Incorporating this work later through a change order allowed the project to proceed without further delay.
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PolicyConsiderations
Policy Considerations: The recommendations in this report are in accordance with the provisions of the City Code Chapter 3.56, which requires City Council approval for contracts over $250,000 or more. Per City Code Section 3.04.20, “For contracts originally awarded for a price of at least $1,000,000 but less than $10,000,000”, the City Council must review and approve any change order which exceeds 8% of the original contract price
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EconomicImpacts
Economic Impacts: The recommended Contract Change Order No. 3 is expected to create 1.54 (0.98 direct jobs and 0.56 job through indirect and induced activities) and create $202,876 in total economic output ($130,049 of direct output and another $72,827 of output in indirect and induced activities).
The indicated economic impacts are estimates calculated using a calculation tool developed by the Center for Strategic Economic Research (CSER). CSER utilized the IMPLAN input-output model (2009 coefficients) to quantify the economic impacts of a hypothetical $1 million of spending in various construction categories within the City of Sacramento in an average one-year period. Actual impacts could differ significantly from the estimates and neither the City of Sacramento nor CSER shall be held responsible for consequences resulting from such differences.
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EnvironmentalConsiderations
Environmental Considerations:
California Environmental Quality Act: No environmental review is necessary because the recommendations in this report involve the repair of an existing structure with no expansion beyond the previously existing level of use and are therefore considered to be an exempt project or activity in accordance with Section 15301 of the CEQA Guidelines.
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Sustainability
Sustainability: Not applicable.
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Commission/Committee Action
Commission/Committee Action: Not applicable.
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RationaleforRecommendation
Rationale for Recommendation: Executing an MOU between the City and the SPL will provide a documented agreement on how the funds will be transferred from the City to SPL for the reimbursement of the opening day materials, as well as the purchase of the new automatic material handling system (AMHS). Any remaining funds after the purchases will be returned to the City and transferred back to the originating CIP. If the costs of the opening day material and AMHS exceed $430,000, SPL will be required to fund any cost overruns.
Consistent with SPL's Procurement Policy outlining what is qualified under a micro purchase provision, purchases of books and materials are exempt from competitive bidding due to their specialized nature.
SPL uses established jobbers like Brodart and Ingram for timely delivery and efficient implementation of books and materials. Brodart will fulfill the opening day collection for diverse and community-responsive resources.
Approving the fund transfer enables compliance with the JPA Agreement and ensures the North Sacramento-Hagginwood Library opens equipped and ready to serve the community.
Ratifying Change Orders No. 1 and 2, approving Change Order No. 3 and resetting the City Manager’s authority to approve change orders will facilitate the completion of the North Sacramento -Hagginwood Library replication project.
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FinancialConsiderations
Financial Considerations: There are sufficient funds in the North Sacramento-Hagginwood Library Relocation Project (C15000850), General Fund (Fund 1001), to transfer $430,000 to SPL for the opening day materials and the AMHS and cover the costs of Change Orders No. 1 and No. 2 for a total not-to-exceed amount of $539,585, and Change Order No. 3 for a total not-to-exceed amount of $207,754, bringing the total not-to-exceed amount to $7,823,339 for Contract No. 2025-4573. There are also sufficient funds in C15000850 to cover the costs for change orders and management required to complete the project.
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LocalBusinessEnterprise
Local Business Enterprise (LBE): John F. Otto Inc., dba Otto Construction is an LBE and meets those requirements. For the SPL fund transfer, the minimum LBE participation requirement is waived for the City’s use of cooperative purchase agreements that have been competitively bid, evaluated, and awarded by other governmental agencies that may or may not have similar LBE programs.
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