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Council Meetmg February 23, 1999 Santa MOnica, California
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FES 2 3 1999
TO Mayor and City Council
FROM City Staff
SUBJECT Recommendation to Award a Construction Contract for the Dry Weather
Runoff Reclamation FacIlity to Pacific Mechanical Corporation, Authonze
the City Manager to Negotiate and Execute a Contract with Black &
Veatch for Construction Management, Accept a State Revolving Fund
Loan from the State Water Resources Control Board, Authorize the City
Manager to Negotiate and Execute an Agreement for Cost-Shanng with
the City of Los Angeles, and Authorize the City Manager to NegotIate and
Execute a Contract wIth the Metropolitan Water District for Recycled
Water CredIts for the Dry Weather Runoff ReclamatIon Fac/llty
IntroductIon
This report recommends that the City Council award a contract to PaCIfiC Mechanical
Corporation In the amount of $5,663,000 for construction of the Dry Weather Runoff
Reclamation FaCIlity (DWRRF) - Phase 1 Phase 1 consists of construction of the
treatment facJlity Phase 2 will consist of construction of the recycled water distribution
system Staff will return to Council at a later date to award the Phase 2 contract
In concert With this award, staff recommends that the City Council authOrize the City
Manager to negotiate and execute a profeSSional services contract With Black & Veatch
In an amount not to exceed $458,380 for construction management, accept a State
Revolvmg Fund (SRF) loan from the State Water Resources Control Board, authOrize
the City Manager to negotiate and execute an agreement for cost-sharing With the City
of Los Angeles, and, authOrize the City Manager to negotiate and execute a contract
With the Metropolitan Water District for recycled water credits for the project
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FEB 2 3 1999
Backqround
Since 1987, the City has conducted several feasibility studies on constructmg a facility
for the treatment of dry weather flows from the Plco-Kenter and Santa MOnica Pier
storm drains It has been determined from these studies that dry weather runoff caused
by Irrigation, spIlls, and paved area wash downs carnes With It sufficient run-off pollution
(011 and grease, heavy metals, pathogens) to warrant the construction of a permanent
dry weather runoff reclamation faCIlity (DWRRF)
The pnmary function of the proposed facility will be to treat water from the Plco-Kenter
and Santa Monica PIer storm drams for reuse As a state-of-the-art faCility, the DWRRF
will provide environmental, educational, and health benefits The treatment faCIlity will
filter and dlsmfect the storm dram water so that It may be reused for vanous applications
Includmg Irrigation and dual plumbing City Irrigation sites will Include Woodlawn
Cemetery, the OlympIC Boulevard medIan, Memorral Park, the CIVIC Center, and
Palisades Park Caltrans has also expressed Interest In uSing the water for the Santa
MOnica Freeway landscaping
The proposed location for the faCIlIty IS adjacent to the Moss Avenue Sewage Pumpmg
Station located at Appian Way and Moss Avenue Just south of the Pier Bndge The
faCIlity WIll Include educational exhibits to raise awareness of runoff pollution and
present pollution prevention options On July 14, 1998, the City CounCil approved the
fmal deSign of the faCIlity The Arts CommiSSion, Architectural ReVIew Board, and
Coastal CommiSSion have also approved the DWRRF plans
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DIscussion
Construction Contract
A Notice Inviting Bids for the construction of the DWRRF project was published In the
Argonaut on November 19 and 26, 1998 The Notice InViting Bids, along with the plans
and speCifications, was also submitted to eight construction Journals, and was sent to
SIX women/mmorlty bUSiness enterprise (WMBE) aSSOCiations Bid packages were
requested by 36 contractors The City Clerk's Office received four sealed bids which
were publicly opened and read aloud on December 30, 1998 by the Deputy City Clerk
The bId results were as follows
PacifiC Mechanical Corporation
United Co n stru cto rs
Hensel Phelps Construction Co
Steve P Rados,lnc
$ 5,663,000
$ 6,048,569
$ 6,138,000
$ 6,568,673
City Engineer's EstImate
S 4,900,000
The low bidder, Pacific Mechanical Corporation, supplied the City with several
references and all simIlar projects reported that the contractor's work was satisfactory
In additIon, staff called two prOjects not supplied by the contractor as references and
those projects reported that the contractor's work was satisfactory These referenced
projects Include $12,000,000 wastewater treatment plants In EI Dorado Hills, CA and
Cameron Park, CA, and a $4,000,000 wastewater treatment plant In Palm Desert, CA
PacIfic Mechanical Corporation performed satisfactorily on a prevIous project for the
City, the construction of the Moss Avenue Pump Station Structural Shell The State
Contractors' License Board verified that the contractor's license and all listed
subcontractors are current, active, and In good standing Staff has also verified that the
contractor and listed subcontractors are not listed In the current book of federally
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debarred contractors Staff anticipates that construction of the DWRRF (Phase I) will
begin In March 1999 and will be completed In 12 months Construction of Phase Ills
expected to begin approximately In July 1999 and continue for 6 months Phase II
consists of the Installation of the recycled water distribution system
Construction Management
City staff Issued a Request for Proposal (RFP) for construction management services
for the DWRRF construction on October 20, 1998 Staff received responses from three
firms A staff committee consIsting of representatives from Engmeenng, Utilities, and
Administration divISions of the Environmental and Public Works Management
Department reViewed the responses and Interviewed the three firms Selection cntena
mcluded an understandmg of the work and other Impacted projects, the proposed
approach, expenence With Similar work, qualifications of staff, publiC relations plan, and
blllmg rates
The review committee recommends the firm of Black & Veatch for the constructIon
management of the DWRRF project Black & Veatch has managed several City
projects Includmg the Moss Avenue Pump Station Structural Shell, the BIG project,
and peer review for the Coastal Interceptor, all With excellent reviews The maJontyof
the tasks associated With the DWRRF Include overseeing the contractor dUring
constructron to ensure that the contractor conforms With plans and speclflcatrons,
mOnltonng traffiC control and detour plans, revlewmg change order requests, and
proViding Information to the contractor on an as-needed basIs
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SRF Loan
In January 1998, the City Council adopted a resolution authorizing City staff to apply for
a State Revolving Fund (SRF) loan from the State Water Resources Control Board The
SRF loans funds authorized under the Federal Clean Water Act to munrclpalltles for
construction of wastewater treatment plants These loans are used to upgrade
antiquated systems or bUild new treatment plants Staff submitted a proposal to the
State Water Resources Control Board for DWRRF construction funding and was
awarded a $5,000,000 loan The terms of the loan are 20 years at 2 5% Interest rate
The amortIzed repayment cost of the Joan IS $320,000 per year ThJS cost, as wIth the
cost of operations and mamtenance of the DWRRF, will be parhally offset by the sale of
the recycled water and the Metropolitan Water Dlstncts' credits In order to qualify for
the SRF loan, construction of the treatment faCility must commence by May 1999
Cost Sharing with the City of Los Angeles
In 1998, representatives from the City of Los Angeles Board of Public Works committed
to becoming a full partner In the construction and operation of the DWRRF su bJect to
fmal confirmation by the Los Angeles City Council Full partnership will Include sharing
the costs of design, construction, and operation and mamtenance of the plant and
repayment of the SRF loan City staff have been negotlatmg the final terms of the
agreement with Los Angeles for the past few months Staff antiCipates that a final
agreement Will be approved by the Los Angeles City Council and Signed by both Cities
by June 1999
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Metropolitan Water Dlstnct Agreement
Through Its Local Resources Program (LRP), the Metropolitan Water District (MWD)
makes avaIlable funds to encourage water recycling projects The proposed agreement
with the MWD Involves a $150 per acre foot rebate on all recycled water sold from the
DWRRF Staff submitted the DWRRF for participation and was selected to partIcipate In
the LRP In order to proceed as part of the LRP, City Council authorizatIon to allow the
CIty Manager to negotiate and execute a contract with the MWD IS necessary Once the
DWRRF IS operational, the rebate WIll appear as a credit on the City's water bill from the
MWD ThIs rebate will be transferred to the Stormwater Management Fund to offset on-
gOing and annual costs assocIated wIth the DWRRF
Budget/Financial Impact
The followmg are the sources and uses of funds associated with Phase I construction
and project management for the total Dry Weather Runoff Reclamation FaCIlity
(DWRRF)
FUNDING SOURCES
$5,000,000 - Loan from the State Revolvmg Fund of the State Water Resources
Control Board
$ 440,000 - Reimbursement from the CIty of Los Angeles for 50% of the deSIgn costs
already Incurred
$1,000,000 - Proposition A grant from the Los Angeles County Parks and Open Space
District (20-760-661-20098-8900-99395)
$ 238,941 - Wastewater CI P budgeted for stormwater system Improvements pnor to
separation of the Stormwater Management Fu nd from the Wastewater
Fund (31-760-661-24990-89000-99209)
$ 54,577 - Wastewater CIP budgeted for stormwater system Improvements pnor to
separation of the Stormwater Management Fund from the Wastewater
Fund (31-760-661-20093-8900-99208)
$6,733,518 - Total
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FUNDING USES
TOTAL
S 5,663,000
$ 458,380
$ 612,138
S 6,733,518
Construction (Phase 1)
Construction Management (Phase 1 & 2)
Contingency
The SWRCB loan and Proposition A grant WIll be periodically drawndown followmg
actual expenditures by the Stormwater Fund To provide adequate cash flow during the
project, It will be necessary for the Water Fund to loan the Stormwater Fund
$1,500,000 Upon completion of the project, the loan will be repaid with Interest at the
Interest rate actually earned by City funds durmg the construction period
To award the construction and project management contracts, the following budget
actions are necessary to award thiS project
1 Appropriate 55,440,000 from the Stormwater Management Fund balance to CIP
account # 34-760-661-20099-8900-99395 The $1,000,000 Proposition A grant has
already been approprrated at CIP account #20-760-661-20098-8900-99395
2 Budget revenue at the following account numbers
$ 440,000 at 34-500-661-00000-0273-10000
$1,000,000 at 20-500-661-00000-0625-10000
Recommendation
Staff recommends that the C,ty CouncIl
1 Award a contract to Pacific Mechanical Corporation, the lowest responsible bidder, In
the amount of $ 5,663,000,
2 Award a contract to Black & Veatch for construction management services In the
amount of S 458,380,
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3 Authonze the City Engmeer to Issue any necessary change orders to complete
additional work within budget authonty,
4 Approve above outlined budget actions Including the loan from the Water Fund,
5 Accept a $5,000,000 SRF loan from the State Water Resources Control Board,
6 Authonze the CIty Manager to negotiate and execute an agreement for With the City of
Los Angeles for a 50% cost-shanng partnership on the project, and,
7 AuthOrize the City Manager to negotiate and execute a contract With the Metropolitan
Water Dlstnct for recycled water credits for the DWRRF
Prepared by
Craig Perkins, Director, Environmental & Public
Works Management
Anthony Antlch, P E , City Engineer
Greg de Vrnck, P E , CIVil Engineer
Roger Gorke, Stormwater Management Coordmator
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