Shadowridge P1-3-CS130118 T H • C 1 T Y •
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F R �s. 6 9
MEMORANDUM
TO: Jennifer Miller,Director of Finance
FROM: Ken Griffin, P. E., Director of Engineering and Public Works
DATE: January 18,2013
REF: Escrow#02 and#04 for Coppell Road (ST00-03)
On January 15, 1989, Centex escrowed$56,891.00 to the City of Coppell for the future construction
of Coppell Road adjacent to Shadowrid e Estates LTT (escrow#02). Also, on July 19, 1989, Centex
escrowed $90,070.00 to the City of Coppell for the future construction of Coppell Road adjacent to
Shadowwood Estates (escrow #04). On June 24, 2003, the City of Coppell awarded a design
contract to Ffuitt-Zollars, Inc. in the amount of $200,000.00. And, on April 8, 2008, the City of
Coppell awarded a construction contract to Tieso Paving in the amount of$3,057,846.30.
The original escrow amount was based on a fee of $100 per adjacent front foot. Shadowridge
Estates III had 568.73 feet adjacent to Coppell Road and Shadow Estates had 900.06 feet adjacent
to Coppell Road. Therefore, the escrow amount was arrived at by multiplying the adjacent front
foot times $100.00 (568.73 x 100 = $56,873 and 900.06 x 100 = $90,006. — rounding on the
adjacent front foot likely accounts for the slight discrepancy).
The front foot cost is made up of several cost components. Those are: excavation; subgrade.
preparation; lime; paving; sidewalk; drainage; incidentals; and engineering. The final construction
cost of the project was $2,966,679.36 (a slight savings). Of that amount, $380,682.90 was for a
new water line. Therefore, the total construction cost to be apportioned to the adjacent property is
$2,585,996.60. In addition to that, the engineering cost $191,023.90. The percentage of the water
line cost versus the total project cost is 12.83% (380,023.90/2,966,679.36). Therefore, 12.83% of
the engineering cost was deleted making the engineering cost associated with the paving
$166,511.80 (191,023.90 - .1283 x 191,023.90).
The question has been raised as to whether or not the original escrow would have exceeded the cost
to design and construct the road if the construction had been performed in a timelier manner. To try
to determine the effect of the time delay on the cost, I reviewed the consumer price index (CPI) and
the producer price index (PPI) from the time the escrow was placed with the city until such time as
the city let a design and a construction contract. The CPI was used for the design since it's a service
and the PPI was used for the construction since a large component of any construction cost is the
actual supplying of materials.
I compared the CPI from January 1989 to the CPI from June 2003 to determine if there had been
any increase in the CPI. The CPI for January 1989 was 117.5 and the CPI for June 2003 was 176.5.
This indicates that the cost for services went up 50.21% from the time a design contract could have
been let till the date it was actually let. The actual design cost was $166,511.80 in 2003. Using the
CPI increase, the same design contract theoretically would have cost $110,850.63 in 1989
(166,511.80/1.5021 = 110,850.63).
I compared the PPI from January 1989 to the PPI from April 2008 to determine if there had been
any increase in the PPI. The PPI for January 1989 was 105.0 and the PPI for April 2008 was 218.5.
This indicates that the cost for materials went up 108.10% from the time a construction contract
could have been let till the date it was actually let. The actual construction cost was $2,585,996.60
in 2008. Using the PPI increase, the same construction contract theoretically would have cost
$1,242,698.60 in 1989 (2,585,996.60/2.0810=1,242,698.60).
After the CPI and PPI adjustments, we can now determine if the escrow amount exceeded the
theoretical cost. Using the above bolded, italicized and underlined numbers, the theoretical street
cost was $1,353,549.23. The length of the project was 3,400 feet; and because there are two sides
to the road,the actual length used to calculate the front foot cost is 6,800 (2 x 3,400).
Finally, the front foot cost for property adjacent to Coppell Road, using the theoretical cost is
$199.05 (1,353,549.23/6,800). This is still almost twice as high as the amount escrowed with the
city in 1989.
Pro'ect Escrow Paid Theoretical Cost
Shadowridge Estates III escrow#02 $56,891.00 $113,205.71
Shadowwood Estates escrow#04 $90,070.00 $179,156.94
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Databases, Tables & Calculators by Subject FONT SIZE: =
Change Output Options: From: 1989 To: 2010 1
include graphs
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Data extracted on: May 1,2013(11:38:43 AM)
Producer Price Index Industry Data
Series Id: NDUBHWY--BHWY--
Industry: Material and supply inputs to highway and street construction
Product: Material and supply inputs to highway and street construction
Base Date: 198606
250-
m 200-
il
11 150-
100-
1 1 I I 1 i 1 I I 1
1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009
Month
Download: .xls
Year Jan Feb Mar Apr May Jun Jul r Aug i Sep Oct Nov Dec An nual
1989 j 105.0 105.4 105.9;107.4 108.1' 107.8 107.4 106.7 107.2;107.6 1O7.5107.4; 107.0
1990_]1094;108.4_ 108.2 108.4 108.6 108_41108.3110.4;1131!115.411159 114.2 _110.7
99111133.37112.01110.3.110.1 110.57110.41109.97110.3110.4!110.1 110.2 109.3 110.6
11992!108.8(109_1 109.3;1094', 1099 11051110.4 110.4;11061105 1106 110.1 110.0
;19931104! 110.7 111.2i1117I112011121 111.8 111.7!1121,112611125 111.7, 111.7
1994 112.1 112.7 112.8 113.2 113.511141`, 114.8 115.7!;115.5 11531115.9 115.6 114.3
16 - -- ,118.5 I .0 11 .4
1995 1165 116.8 1171' ; 119.0 1193 118.9 119.0 119.2 1187;118.7 119.1 118.4
1996 119.9 119.8 120.6;122.0:, 122.6 122.0 122.0 122.3 123.0 123.5 123.8!124.0 r 122.1
1997 124.6! 124.7 124.2 124.3 1 124.5 1 124.4 124.2', 124.9 125.0'124.9 124.9!124.3 124.6
1998 123.8' 123.4 123.0 123.6 124.0 123.9 124.0 123.4 123.6 123.6 123.3 122.3 123.5
1999!122.8; 122.6 123.3 125.4 125.9' 126.0 126.9 128.1 129.0 128.8 129.6`,130.7 126.6
2000 132.0 134.0 136.0 135.6 135.8 137.6 137.1 136.6 138.9 138.5 138.4 137.3 136.5
2001'137.8 138.2 137.4!, 138.5: 139.9:138.8 136.6 137.0 138.4!135.4 134.1 132.4 137.0
Year ; Jan Feb Mar Apr May Jun ; Jul Aug Sep Oct Nov Dec i Annual
2002 132.9 132.4 132.7`133.3 133.8 133.9 134.1 134.2;134.4 134.4 133.9 133.7' 133.7
2003; 134.7 135.7 1 136.8 i 137.1 137.0'136.9;136.7'136.9•136.8 136.7;137.1 137.2; 136.6
- ,
2004, 140.5 j 141.2; 142.51145.2 147.9 i 147.0;149.2;150.5;151.8;155.5 155.4;152.0 152.0 148.2
2005 154.3; 156.5 160.4;162.9 162.4 163.7, 167.6 170.0 176.1 180.8`173.1 I 173.4 166.8
2006! 177.5 175.9■ 179.4 185.4 187.9 190.4 191.8'192.9 185.9 183.2;182.9 184.1. 184.8
2007'183 1 185.2 190.0^194.6 197.6 196.8 200.0 195.9 197.5 197.5 204.9 202.7 195.5
200$:204.7 205.9'213.8 218.5 227.3 234.4 243.5 239.3 241.1 226.9 212.0'201.5• 222.4
;2009 202.9 199.3 198.2 200.8 204.1 208.7;206.1 209.0 208.1'207.5 209.5 209.3 205.3
2010 212.6•211.6 215.0 217.5 218.9;217.1;
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