SR-912-000 (3)
PCD:SF:AA:f:\plan\admin\psbldg\approval\PSFREJECTBIDS.DOC
Council Meeting: May 2, 2000 Santa Monica, California
TO: Mayor and City Council
FROM: City Staff
SUBJECT: Recommendation to Reject All Bids and Authorize the City Manager to
Negotiate on the Open Market for Construction of the Public Safety Facility
and Olympic Drive.
INTRODUCTION
This report recommends that the City Council (1) reject all bids for construction of the Public
Safety Facility and Olympic Drive and (2) authorize the City Manager to negotiate on the
open market for the construction, pursuant to Municipal Code Section 2.24.071(e)(2).
BACKGROUND
In February 1997, the City Council approved a financing plan for the Public Safety Facility
and authorized staff to move forward with the preparation of detailed design documents for
Olympic Drive and the new facility for Police, Fire and Emergency Operations. The
construction contract for the first phase, excavation and utility relocation, was awarded in
June 1999 while the construction documents for the second phase, building and road
construction, were being finalized. Since that time, the construction documents for the
second phase were finalized and put out to bid. Completion of construction and building
occupancy is projected for the summer of 2002. Attachment A provides background and
update information on the project.
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PROJECT COST ESTIMATES
The project architect, Dworsky Associates, and the construction manager, The JCM Group,
completed independent cost estimates at each of the critical stages of project design,
including schematic design, design development and construction documents. For each
stage of design, the cost estimates of the architect and construction manager were
reconciled to within one percent of each other. At the 50 percent construction documents
stage, a third independent estimator was hired to verify that the unit cost estimates were in
line with current market conditions. Following final completion of construction documents,
the architect and construction manager completed independent estimates that projected a
total construction cost of approximately $33 million.
CONSTRUCTION BIDDING FOR THE PROJECT
In July 1999, a Notice Inviting Prequalification Statements for the building and road
construction phase of the project was published in the Argonaut newspaper and the F.W.
Dodge construction green sheets and sent to 12 women/minority business (WMBE)
associations. On August 26, 1999, nine firms responded with completed statements of
qualification. Seven firms were deemed to be qualified to complete the project and on
November 27, 1999, those firms were sent the bid notice and the plans and specifications.
Six of the firms attended the job walk and pre-bid conference on December 21, 1999. At bid
opening on February 23, 2000, three (3) firms submitted sealed bids as follows:
S.J. Amoroso Construction $42,050,000
J.A. Jones Construction $44,280,111
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Hensel Phelps Construction $46,065,000
Due to the $9 million difference between the engineer?s estimate and the lowest responsive
bid, funding that has been allocated for this project is insufficient to complete construction.
Including construction contingencies, the project budget shortfall is over $11 million.
ANALYSIS OF BIDS
Following receipt of bids, an independent cost estimate was completed by Hanscomb
Associates. Hanscomb?s analysis indicates that based on current market prices, the
estimated construction cost is within the range of the contractors? bids. The construction
manager has also completed an analysis of the bids relative to the cost estimates. This
analysis indicates that there are several critical elements of the building where the architect
and construction manager underestimated the extent of recent market prices increases,
including concrete, drywall, steel, security systems, and glazing. However, the increase in
market prices only explains part of the bid variation. The analysis indicates that the
bidders? fees for general conditions, overhead and profit are considerably higher than what
is common in the construction industry.
AVAILABLE OPTIONS
In light of the large discrepancy between the contractors? bids and the project budget, the
City Council has several options in this matter, including:
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A. Award the contract to the low bidder
While the lowest bid is considerably higher than the project budget, the construction market
has tightened dramatically over the last several months. Several of the firms who initially
applied to be prequalified for this project chose not to bid because they were overloaded
with projects. In such a market, contractors, subcontractors and suppliers can demand high
premiums to perform the work. As a result, the City may be unable to move forward with this
project at a lower price within the current construction market. However, awarding the
construction contract eliminates the City?s ability to attempt to negotiate a more equitable
contractor fee for general conditions, overhead and profit. In addition, the City would have
to allocate over $11 million dollars toward this project, which would require other City
projects and priorities to be underfunded or delayed.
B. Reject all bids and rebid the project without a prequalification process
The prequalification process is designed to ensure that qualified contractors are engaged in
the construction of City projects. However, qualified contractors tend to be engaged in
many projects and their services and expertise often come at a higher price. By opening the
project to any contractor with the necessary license and bonding capacity, the City may
receive bids from smaller contractors who are anxious to complete a project of this size and
scope and are thereby willing to bid a lower amount to secure the project. However, what
the City gains in lower initial construction costs could be eclipsed by long-term costs if the
contractor is unable to perform or if the facility is constructed in a lower quality manner.
Such a process would delay the project by 4 to 6 months.
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C. Reject all bids and redesign the project
A primary opportunity to significantly reduce the cost of the building is to completely
redesign the building. To accommodate the necessary cost reductions, a dramatic
reduction in the building size would be required. This could be accomplished by removing
one or two floors of the building and requiring certain functions to remain within the existing
police and fire facilities. The project could also be designed for an alternative site that is not
constricted by limited land and adjacency to existing police and City Hall operations, an
underground storm drain, and the Santa Monica Freeway. While such strategies could
accomplish the project?s financial goals, they would defeat many of the project?s public
safety goals, such as providing modern facilities for police and fire operations, a better
environment for managing and coordinating public safety, and a dedicated emergency
operations center. In order to redesign the facility and secure necessary Planning
Commission, Architectural Review Board and Coastal Commission approvals, a delay of 18
to 24 months is expected. An alternative site strategy would require at least three years of
delay and would require a new plan for the current site that has already been excavated.
Such delays would not only further impact public safety operations, but would be
incongruous with the City?s commitment to spend the project bond proceed within 3 years.
D. Reject all bids and authorize the City Manager to negotiate on the open market
Section 2.24.071(e)(2) of the Municipal Code allows for open market negotiation if the City
Council finds that a service or product may be procured more economically in this manner.
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Analysis of the contractor bids indicate that there may be some opportunity to negotiate the
contractors? fees for general conditions, overhead and profit. Given current market prices, it
is not expected that negotiations will bring the project within budget. However, there may be
opportunities to reduce the costs to the City. Staff recommends this option as it gives the
City an opportunity to procure the desired construction project with a qualified contractor at
a more favorable price. In order to keep the project moving forward, a deadline of May 16
would be established for completion of negotiations. If the negotiations prove unsuccessful,
the project may go back out to public bid.
BUDGET/FINANCIAL IMPACT
Rejecting all bids will have no impact on the budget. If staff is able to secure a favorable
negotiated price, the recommended award of contract and a supplemental financing plan will
return to Council for review.
RECOMMENDATION
It is recommended that the City Council:
1. Reject all bids for construction of the Public Safety Facility and Olympic Drive, and
2. Find that the construction can be procured more economically on the open market
and authorize the City Manager to negotiate on the open market for the
construction, pursuant to Municipal Code Section 2.24.071(e)(2).
Prepared by: Ettore Berardinelli, Fire Chief
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Jim Butts, Police Chief
Suzanne Frick, Director of Planning and Community Development
Craig Perkins, Director of Environmental and Public Works Management
Katie Lichtig, Assistant to the City Manager
Andy Agle, Deputy Director, Planning and Community Development
Attachment: A. Project Background and Update
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ATTACHMENT A
PROJECT BACKGROUND AND UPDATE
SANTA MONICA PUBLIC SAFETY FACILITY
For many years, members of the Santa Monica community have questioned the ability of
the existing Police, Fire and Emergency Operations facilities to adequately provide for
current and future needs. An architectural programming analysis of Police, Fire and
Emergency Operations completed in 1994 confirmed the facilities inadequacies and
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recommended that a new facility be constructed. Additional experience in managing the
emergency response and recovery operations following the 1994 Northridge earthquake
highlighted the shortcomings of the existing facilities and illustrated the importance of
centralizing and coordinating the activities of all City public safety and law enforcement
operations.
Current Facilities
The existing Police Department headquarters and jail facility is located in the east wing
of City Hall and occupies approximately 44,000 square feet. The Police wing was added
to the original City Hall building in 1957 to house approximately 160 employees. The
existing building does not provide an effective environment for administering a large
municipal police force or for managing and coordinating emergency response efforts.
The building is difficult to secure due to multiple access points. Basic spaces for police
operations are missing or shared with other functions, such as the squad room, which
becomes unavailable when the EOC must be activated. The crime lab, photo lab,
identification unit and technical departments are severely undersized and in need of
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modernization. The Property and Evidence Room is filled beyond its capacity and the
secure storage of weapons and drugs is problematic. Lack of space has required
several functions to be moved offsite, resulting in a fragmented administrative structure,
which impacts overall coordination of law enforcement and emergency response
activities.
The existing building does not meet current seismic codes or comply with ADA
accessibility requirements and has antiquated and ineffective mechanical, electrical,
plumbing and security systems. The facility?s infrastructure is unreliable and costly to
operate and maintain. While the current building functions as an essential facility, it
lacks the structural and building systems necessary to be fully operational following a
major earthquake.
The existing jail is the second oldest in the state and does not meet current code
requirements of the Board of Corrections or Uniform Building Code. Problems of
inadequate space configuration, lack of space, incorrect adjacencies, and disruptive and
unsafe circulation are typical throughout the jail. Direct supervision of all inmates from
one central security point does not exist, nor does a sallyport for the safe and effective
transfer of inmates between secured vehicles and the jail. The existing inmate booking
area is undersized, outdated, and lacking in basic automated support systems.
The Northridge Earthquake highlighted the disadvantages of having the Fire Department
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operate at locations away from City Hall, the Police Department and the Emergency
Operations Center. The coordination of emergency response activities is less effective
due to the physical separation of the functions. The current Santa Monica Emergency
Operations Center (EOC) operates from the basement of the existing Police building and
doubles as the Police Squad Room. When the EOC is activated, the Police Department
loses its only department-wide briefing room at a time when its need is critical. The
existing EOC not only lacks computerized support systems necessary for automated
emergency management, but also modern communication, data and building support
systems.
Initial Planning for the New Public Safety Facility
Because of these deficiencies in the existing facilities, the City Council and community
recognized the need for the development of a new facility to house the Police
Department, Fire Administration and Emergency Operations Center. The Civic Center
Specific Plan (CCSP), which was approved by the voters in June 1994, calls for the
construction of a new public safety building. In August 1994, the City Council
authorized staff to begin interviewing firms to design the Santa Monica Public Safety
Facility and then in August 1995, the Council authorized a contract with Dworsky
Associates to begin preparation of schematic designs.
Schematic designs, preliminary floor plans, and an initial cost estimate were presented
to the City Council in June 1996 and the Council placed a bond measure on the
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November 1996 ballot. The bond measure received 62.5 percent of the vote, yet
narrowly missed the two-thirds vote required for approval of a general obligation bond.
In January 1997, the Council ranked development of the Public Safety Facility as their
top priority and in February 1997, the Council approved a funding plan for the facility that
included the issuance of lease-revenue bonds.
The Santa Monica Public Safety Facility will be located immediately east of Santa
Monica City Hall. The approximately 118,000-square foot facility will serve as the
headquarters for the Police Department and will house the Fire Department's
administrative offices, Fire Prevention services, and the City's Emergency Operations
Center. The building will include a new City jail facility and modern dispatch facilities
that are coordinated between police and fire services. Included with the Public Safety
Facility project is the construction of Olympic Drive from Fourth Street to Main Street.
The Public Safety Facility is designed to resolve the deficiencies associated with the
existing Police, Fire and EOC facilities, while using modern technology and sound
design principals to maximize the operational efficiency of the building. The new facility
will be constructed in accordance with the Essential Services Seismic Safety Act to help
ensure that the building is able to withstand a major earthquake. The facilities will
provide for better coordination between Police and Fire services, will enable the 911
system and dispatch equipment to be located in one facility for all emergencies, will
enhance emergency response times by providing a direct link to Fourth Street and the
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Interstate 10 on-ramp, will provide the community with a state-of-the-art facility to
respond to future disasters, and will facilitate better public access to Police and Fire
services.
The Public Safety Facility is designed to be 56 feet high with four stories above grade.
The Facility also will consist of two subterranean levels, including parking for official
vehicles. Upper-level step backs and compatible building materials provide a consistent
transition between City Hall and the new facility. The majority of the building will be clad
in a beige precast concrete with sandstone along the front (south) elevation. The interior
of the building will be highlighted by a two-story public lobby that includes integration of
the exterior sandstone and extensive use of natural light. Michael Davis, the project
artist, has also created two prominent art works for the public lobby: one is a skylight that
casts a blue line of light into different parts of the lobby depending on the time of day
and time of year; the second element involves light walls that are sequenced to create a
subtle transition of gradient light. The interior also features a three-story atrium that
provides extensive natural lighting into the center of the building.
The public entrance is on the south side of the Facility, opening onto a public plaza and
fountain at Olympic Drive. Creating the public entrance and plaza along Olympic Drive
is designed to open the building toward the rest of the Civic Center area and provide
pedestrian access from adjacent uses and parking areas. Pedestrian access is provided
from Fourth Street through the plaza area and from Main Street via a wide pedestrian
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promenade along Olympic Drive. The public plaza occurs on two levels. The upper
plaza is at grade with Fourth Street and features the upper element of the water feature -
a thin sheet of water flowing across a granite surface. Water cascades from the upper
plaza to a pool filled with aquatic plants in the lower plaza. The lower plaza is at grade
with Avenida Mazatlan and the public entrance to the facility.
Completion of Design
Since approval of the financing plan and authorization to proceed with detailed design in
late 1997, the project architects have prepared design development drawings and
construction documents. An interdepartmental policy team, including the Police, Fire,
Environmental and Public Works Management, and Planning and Community
Development Departments and the City Manager's Office has advised the design team in
their preparation of the detailed design documents.
The Public Safety Facility is planned to be a showcase of Green building design
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measures. These measures are intended to minimize the impact of the building on
scarce natural resources. In concert with the initiation of the design development phase
of the project, the design team and City staff participated in the ?Greening of the Public
Safety Facility?, a detailed process to review and consider a variety of environmentally
sensitive measures to be incorporated into the building design. The building is also
designed to maximize the efficiency of the Police and Fire operations within the facility.
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Some of the most innovative and notable elements of the building include:
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Underfloor Air Distribution System - This system provides for the distribution of heating,
ventilation, and air conditioning to work spaces from a raised floor. The system is
much more energy efficient than traditional ceiling air distribution systems. Underfloor
air distribution provides for improved indoor air quality through better delivery of fresh
air to building occupants and reduced likelihood of contamination of ductwork. The
system increases comfort levels for building occupants through individual control of
air flow and provides increased flexibility in configuration of electrical and data
conduit runs.
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Gray Water - A dual plumbing system will allow recycled, treated storm drain water
(gray water) to be used in the building's toilets and urinals, rather than potable
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water. In addition, the public fountain and the landscape irrigation for the building
and Olympic Drive will use gray water.
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Building Commissioning - Building Commissioning is a process to ensure that all
building systems operate as intended, designed and operationally required. This
process involves a systematic testing and review of the operational and maintenance
efficiencies of the building's mechanical, electrical, plumbing, life safety, and energy
management systems. This process not only helps ensure that building's systems
meet the original building criteria, but it also helps identify and resolve design and
construction conflicts before they become problems.
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Emergency Power - The building is designed to remain fully operational in the event of
an emergency that affects the energy supply by providing for three 800 kW diesel-
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powered generators. Providing three separate generators allows for partial power to
the building in the event that any of the generators fail during an emergency.
Other sustainability and efficiency design elements which are incorporated into the
building include daylighting, high-efficiency lighting, lighting occupancy sensors, indirect
and direct ambient lighting with high-efficiency task-lighting, an energy management
control system, and a storm-water runoff system which minimizes runoff into Santa
Monica Bay. The measures that were considered during design development, solar
panels above the skylights and a City-owned electric vault, were not included in the final
design as a result of poor cost-benefit results.
Project Financing
Financing for construction of the Public Safety Facility and Olympic Drive comes from a
variety of sources, including:
Proposition C transportation funds that have been allocated for the construction of
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Olympic Drive.
Funds that have been set-aside by the City over the last five years for construction of
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the Public Safety Facility.
Lease-revenue bonds that were issued in September 1999.
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Grant funds related to front-line security mechanisms.
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Water Demand Mitigation funds for installation of the dual plumbing/gray water system.
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Savings by Design program grant funds from Southern California Edison.
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