Title
Adoption of Resolution Amending the Sewer Enterprise Fund Operating and Capital Budget for Fiscal Year 2018-19; and Recommendation to Award a One-Year Contract, with the Option for Four One-Year Extensions, for an Amount Not to Exceed $5,391,277, Including Contingency, for a Total Five-Year Expenditure Not to Exceed $25,505,838.67, Not Including Contingency, to McGuire and Hester for Cyclic Sewer Replacement Project, Phase 15, No. PW 03-18-10. (Public Works 602)
Body
To: Honorable Mayor and Members of the City Council
From: David L. Rudat, Interim City Manager
EXECUTIVE SUMMARY
Public Works publicly bid the construction of Project Year 4 of the 20-Year Rehabilitation Program contained in the Sewer Master Plan. The project entails the replacement of 2.8 miles of sewer main in locations prioritized based on condition assessment and possible consequence of pipe failure. McGuire and Hester is the low responsible bidder of four total bids submitted. Staff recommends approval to award the contract to McGuire and Hester for a total amount of $5,391,277, which includes a 10% contingency, with the option of up to four yearly extensions for a total five-year expenditure not to exceed $25,505,838.67.
BACKGROUND
The work in this contract serves as Project Year 4 of the 20-Year Rehabilitation Program included in the City’s Sewer Master Plan, 2015. The Sewer Master Plan utilized information collected through maintenance, inspection, and monitoring activities to assess system condition and capacity. The results were used to identify and prioritize sewer system capital improvement needs in a 20-Year Rehabilitation Program structured to maintain compliance with the Consent Decree and be consistent with the City’s sewer rate structure.
Project Year 4 replaces approximately 2.8 miles of existing old and deteriorating sanitary sewer main. Completion of this work is required for compliance under the Final Consent Decree for Consolidated Case Nos. C 09-00186-RS and C 09-05684-RS, which requires the City to rehabilitate no less than 2.6 miles of sewer main and associated lower laterals and manholes per year, based on a cumulative total. This work is also consistent with and furthers the objectives of the City’s 2017 Sewer System Management Plan and adopted Capital Improvement Program.
Project Years 2 and 3 of the 20-Year Rehabilitation Program included sewer main located in easements in private property backyards. As that work was different from replacing sewer mains in the street, the City separately designed and bid this work to ensure a contractor with suitable skills and appropriate equipment completed the work. On February 20, 2018 City Council awarded a $2.8 million dollar contract to Ranger Pipelines to execute this easement work. This contract award was in addition to the Project Year 3 award to Ranger Pipelines in September 6, 2017 for $4.5 million.
DISCUSSION
Project Year 4 includes approximately 2.8 miles of sewer main, associated manholes, and lower laterals replacement, as part of this project. The locations were prioritized for replacement based on condition assessment via closed circuit television inspection and possible consequences of a pipe segment’s failure. The locations are as follows:
• Brush Street, between Second Street and Third Street;
• Cypress Street, between Third Street and End;
• Haight Avenue, between Pacific Avenue and Third Street;
• Taylor Avenue, between Third Street and Fifth Street;
• Eighth Street, between Buena Vista Avenue and Stewart Court;
• Buena Vista Avenue, between Ninth Street and Chapin Street;
• Pacific Avenue, between Chapin Street and Sherman Street;
• Eagle Avenue, between Chapin Street and Sherman Street;
• Lafayette Street, between Santa Clara Avenue and Lincoln Avenue;
• Union Street, between San Antonio Avenue and End;
• Foley Street, between Tilden Way and Buena Vista Avenue;
• Noble Avenue, between Everett Street and Broadway;
• Chester Street, between Regent Street and Broadway;
• Jackson Street, between Grove Street and Mound Street;
• Briggs Avenue, between High Street and Fernside Boulevard;
• Washington Street, between Doris Court and Versailles Avenue;
• Clay Street, between Versailles Avenue and Mound Street;
• Post Street, between San Jose Avenue and End;
• Toyon Terrace, between Post Street and End;
• Adams Street, between Post Street and Peach Street;
• Oyster Pond Road, between Robert Davey, Jr. Drive and Basinside Way.
To solicit the maximum number of bids and most competitive price, plans and specifications were provided to builders exchanges throughout the Bay Area and published in the Alameda Sun on July 5, 2018. After the bidding period of 21 days, four contractors submitted bids, and the bids were opened on July 26, 2018. The bid results are as follows:
|
Bidder |
Location |
Base Bid Amount |
|
McGuire and Hester |
Alameda, CA |
$4,901,161 |
|
Ranger Pipelines, Inc |
San Francisco, CA |
$5,442,813 |
|
Cratus, Inc |
San Francisco, CA |
$5,473,664 |
|
Darcy & Harty, Inc |
San Francisco, CA |
$6,427,418 |
After reviewing the bids and contacting several references provided by the contractor, staff recommends awarding the contract to McGuire and Hester for the bid amount plus a 10% contingency for a total amount of $5,391,277. The contractor is not guaranteed any of the contingency and its use will be at the sole discretion of the Public Works Director for work not originally anticipated in the specification. This contract may be mutually extended on a year-by-year basis, for up to four additional years, based, at a minimum, on satisfactory performance of all aspects of the contract and upon the sole discretion of the Public Works Director. If extended, the contract would be for the same terms and costs, plus an annual increase equal to the consumer price index (CPI) increase for the San Francisco Bay Area. The total five year contract price shall not exceed a total five year expenditure of $25,505,838.67. The specification also informed the successful bidder that it shall not pay less than the prevailing rate of per diem wages as determined by the Director of the California Department of Industrial Relations and required the contractor to enter into the City Project Stabilization Agreement. Construction of this project is anticipated to commence on or about September 10, 2018 and is expected to be complete by the end of August 2019. A copy of the contract is attached as Exhibit 1.
FINANCIAL IMPACT
The project is budgeted in the Capital Improvement Program (Project No. 99502602) as part of the Sewer Capital Improvements Enterprise Fund (Fund 602.3). Council approved $6,002,600 and $6,182,000 for FY2016-17 and FY 2017-18, respectively, for the Sewer Rehabilitation Project (99502602). With the award of Project Year 3 and the additional easement project, a subset of Project Years 2 and 3, the current unencumbered balance in 99502602 is $5,312.335, which is $78,942 underfunded to award Project Year 4 with contingency.
Staff recommends the City Council amend the Fiscal Year 2018-19 Sewer Capital Improvement Fund (Fund 602.3) Project 99502602 Budget by appropriating $477,942 from the Sewer Enterprise Fund (Fund 602). This amount includes $78,942 needed to award Project Year 4 and $399,000 for other emergency repairs. Sufficient funds are available in the Sewer Enterprise Fund (602) to absorb these additional capital costs.
There is no impact to the General Fund.
|
Contract |
Estimated Consumer Price Index (CCI) |
CPI Total Each Year |
TOTAL |
|
Original FY18-19 |
0% |
$ 0.00 |
$ 4,901,161.00 |
|
1st Amend FY19-20 |
2% |
$ 98,023.22 |
$ 4,999,184.22 |
|
2nd Amend FY20-21 |
2% |
$ 99,983.68 |
$ 5,099,167.90 |
|
3rd Amend FY21-22 |
2% |
$101,983.36 |
$ 5,201,151.26 |
|
4th Amend FY22-23 |
2% |
$104,023.03 |
$ 5,305,174.29 |
|
TOTAL FIVE YEARS |
8% |
$404,013.29 |
$25,505,838.67 |
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
This action does not affect the Municipal Code.
ENVIRONMENTAL REVIEW
In accordance with the California Environmental Quality Act (CEQA), this project is Categorically Exempt under CEQA Guidelines Section 15301(b), Existing Facilities.
RECOMMENDATION
Adopt a resolution amending the Sewer Enterprise Fund and Operating Budget for Fiscal Year 2018-2019 and award a one-year contract, with the option for four one-year extensions, for an amount not to exceed $5,391,277, including contingency, for a total five-year expenditure not to exceed $25,505,838.67, not including contingency, to McGuire and Hester for cyclic sewer replacement project, phase 15, No. PW 03-18-10.
Respectfully submitted,
Liam Garland, Public Works Director
By,
Scott Wikstrom, City Engineer
Financial Impact section reviewed,
Elena Adair, Finance Director
Exhibit:
1. Contract