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SR-505-001-04 (4) EPWM:CP:AA:RS:SL: F:\Data\spfiles\sp1804\ CC1804.DOC Council Meeting: November 28, 2000 Santa Monica, California TO: Mayor and City Council FROM: City Staff SUBJECT: Recommendation to Reject Bid Received for Project 15A - Repair of Earthquake-Damaged Sanitary Sewer Mains in the area Bounded by the Easterly City Limits, Lincoln Boulevard, Ocean Park Boulevard, and Southerly City Limits; and Authorize the City Manager to Negotiate and Execute a Construction Contract and a Professional Services Agreement for Construction Management and Inspection for the Project Introduction This report recommends that the City Council reject the bid received for the repair of earthquake-damaged sewer mains in the area bounded by the easterly city limits, Lincoln Boulevard, Ocean Park Boulevard, and southerly city limits, and authorize the City Manager to negotiate and execute a construction contract with the Preussag Pipe Rehabilitation, Inc in an amount not to exceed $2,413,158. Staff also recommends that the City Council authorize the City Manager to negotiate and execute a professional services agreement in an amount not to exceed $435,080 with Harris & Associates, Engineering Consultants, for construction management and inspection services for the Project. Background After the Northridge Earthquake of January 17, 1994, the City initiated a citywide inspection program of the sewer system to identify the locations that were damaged and to 1 request that the Federal Emergency Management Agency (FEMA) and the State?s Office of Emergency Services approve funds for repair work. The City subsequently accepted a Grant Acceleration Program (GAP) offer from FEMA of $78 million for repair of the earthquake damaged sewer system throughout the City of Santa Monica. This project, one of eighteen sewer repair projects, will repair earthquake damaged sewer mains in various residential streets in the central section of the City. In order to minimize the impact of this construction project on the public, the repair of the sewer mains will be done using trenchless methods, where possible. These proposed methods include the installation of a ?liner? inside the existing sewer pipe or the installation of a larger pipe through the existing pipe by a method called ?pipe bursting.? These methods are preferred to traditional excavation/replacement methods since access to the area can be maintained during construction, thus minimizing disruption to local residents and businesses. In areas where repair by trenchless technology methods is not feasible, the existing damaged sewer pipes will be replaced with new sewer pipe by traditional methods. In addition, City staff has identified other sewer repair work that is best done in conjunction with the earthquake sewer repairs. These repairs will also be paid for with the GAP funds, following FEMA?s ?GAP Guidelines for Improved Projects.? This work includes lining utility access holes, replacing existing obsolete access hole frames and covers, and installing additional utility access holes where required for maintenance purposes throughout the project area. 2 Discussion Construction Contract A Notice Inviting Bids was published on September 17 and 21, 2000, in ?The Argonaut? as well as in four construction journals, and with one electronic plan room and one Internet advertising consultant. In addition, bidding documents were sent to eight women/minority- owned business enterprise associations. Bid packages were requested by 17 contractors. The City Clerk's office received one sealed bid, which was publicly opened and read aloud on October 12, 2000, by the Deputy City Clerk. The bid results were as follows: 1. Preussag Pipe Rehabilitation, Inc............ .....................$2,488,157.20 City Engineer's Estimate.......... .....................$2,550,000.00 Preussag Pipe Rehabilitation, Inc., has completed the six (6) most recent sewer rehabilitation projects for the City of Santa Monica and has provided excellent construction crews and staff. Also, Preussag Pipe Rehabilitation, Inc., was recently awarded Contract 7790 (CCS), to carry out pipe rehabilitation work elsewhere in the City. The State Contractors? License Board verified that the Contractor's license is current and in good standing. After the bid opening, staff determined with Preussag Pipe Rehabilitation, Inc. 3 representatives, that cost savings, of approximately $75,000, could be realized by the City by rejecting the bid and negotiating directly with the Contractor. This savings is due to the reduction in mobilization expenses and consolidation of cost of additional labor, equipment, and overhead. One protest was received from Insituform Technologies, Inc., which alleges that the project specification sections that define pipeline rehabilitation methods have been negated by staff not enforcing the specifications listed. This allegation has been investigated and found to be without merit. Construction Management and Inspection Services Requests for Proposals were sent to five construction management firms inviting them to submit proposals for construction management and inspection services for the construction work described above. The City received four proposals. Two firms, Harris & Associates and ASL Consulting Engineers, were found to be best qualified and to best satisfy the City?s requirements. Of the two, Harris & Associates is considered most suitable for this project, based on their current workload projections and their available staff. Harris & Associates has supplied the City with references from the Cities of Burbank, Camarillo, Compton, Oceanside, San Diego, and West Hollywood and all project representatives reported that the Consultant?s work was excellent. Additionally, Harris & Associates has provided highly satisfactory services to the City on several similar sewer repair projects. 4 Public Outreach The residents and businesses affected by this project will receive four informational letters outlining construction schedules for their neighborhood. The first letter will be sent one month prior to the start of construction and will have overall information about the upcoming project. The second letter will be sent 10 days prior to the start of the project to residents and businesses with specific information about the dates of construction in their area. The third letter will serve as a reminder two days prior to construction and the final letter will announce the completion of the project. Public calls with questions and concerns will be responded to 24 hours a day, 7 days a week by the construction management firm. Residents and businesses will be provided a toll free telephone number in the informational letter. Budget/Financial Impact FUNDS REQUIRED FOR CONSTRUCTION CONTRACT Contract.......................................$2,413,158 Contingency ...................................$361,973 SUB -TOTAL................................$2,775,131 FUNDS REQUIRED FOR CONSTRUCTION MANAGEMENT CONTRACT Contract .........................................$435,080 Contingency......................................$65,262 SUB -TOTAL.................................. $500,342 5 TOTAL FUNDS REQUIRED $3,275,473 Sufficient budget authority for all of the contract expenses which are eligible for FEMA/OES reimbursement exists in Account No. E13315A00.555010.40000 for construction and contingency of $2,775,131, and in Account No. E13315A00.555060.50000 for construction management and contingency of $500,342.00. The Wastewater Fund will set aside 10% of the construction costs in the amount of $241,315.00 in City Match Account No. E31315A04.555010.40000 for construction, and the associated construction management and inspection costs in the amount of $43,508.00, in City Match Account No. E31315A04.555010.40000 which, FEMA/OES withholds from reimbursement until final audit, which may occur several years from now. Recommendation Staff recommends that the City Council: 1. Make a finding that the materials or services may be purchased more reasonably on the open market, and that the best interest of the City would be served by a rejection of all bids, pursuant to Section 2.24.071 of the Santa Monica Municipal Code; 2. Reject bid received for the Project #15A - Repair of earthquake-damaged sewer mains in the area bounded by the Easterly City Limits, Lincoln Boulevard, Ocean Park Boulevard, and Southerly City Limits; 6 3. Authorize the City Manager to negotiate and execute a construction contract with Preussag Pipe Rehabilitation, Inc in an amount not to exceed $ 2,413,158 and authorize a contingency amount of $361,973; 4. Authorize the City Manager to negotiate and execute a professional services contract with Harris & Associates for construction management and inspection services in an amount not to exceed $ 435,080 and a contingency amount of $65,262; and 5. Authorize the City Engineer to issue any necessary change orders to complete additional work in conformance with the Administrative Instructions on change orders. Prepared by: Craig Perkins, Director of Environmental & Public Works Mgmt. Anthony Antich, P.E., City Engineer Jack Schroeder, P.E., Sewer Repair Program Manager Eugenia Chusid, Project Manager 7