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SR-502-002-03 (5) SUPPLEMENTAL STAFF REPORT TO ITEM 1A EPWM: CP: AA: DB: SL: F:\DATA\SPFILES\Sp1792 \Supplemental cc1792award.1doc Deleted: SP1609 Council Meeting: February 12, 2002 Santa Monica, California TO: Mayor and City Council FROM: City Staff SUBJECT: Supplemental Report for Award of Contract for the Riviera Reservoir Rehabilitation Project Introduction This supplemental report provides additional information regarding the recommendation to award a construction contract for the Riviera Reservoir Rehabilitation Project to the best bidder Spiess Construction Co., Inc. Discussion Because the Riviera Reservoir is located on land owned by the Riviera Country Club, construction activities must be coordinated with the Country Club. The Country Club has a narrow window of time where construction would not interfere with ongoing club activities. Thus, adherence to schedule is particularly crucial to this project. In staff?s experience, a contractor?s adherence to schedule and performance on previous jobs is a good indicator of future performance. Accordingly, staff conducted a detailed reference check on the two lowest monetary bidders. Deleted: ¶ MERCO Construction Engineers, Inc., the lowest monetary bidder, submitted 50 Deleted: ¶ references of which five were selected as representative in project scope, construction cost 1 SUPPLEMENTAL STAFF REPORT TO ITEM 1A and relevant time period. These projects were: ? Booster Pump Station Improvements for the City of Ventura. ? Hill Canyon Wastewater Treatment Plant Phases II and I, for the City of Thousand Oaks ? Seawater System Renewal for the University of California at Santa Barbara. ? Wastewater Reclamation Facilities Upgrades for the City of Ventura. ? Antelope Valley/Acton Chlorination Stations for the Los Angeles County Department of Public Works. Contacts to the agencies reported the following: ? While they submitted the lowest bid, their primary goal was to obtain change orders. ? Delayed project by submitting excessive extra work requests, which impacted the schedule adversely. ? Had difficulty staying on schedule. ? Their personnel in general had difficulty taking instruction from agency staff or representatatives. ? Lack of coordination between the superintendents and subcontractors developed into time delays and associated claims asserted by the contractor. ? Poorly qualified and non-responsive construction superintendents ? Project manager difficult to work with (i.e. lacking in cooperation). ? Numerous disputes. ? Sub-contracted out most of the work and did not adequately control sub-consultants 2 SUPPLEMENTAL STAFF REPORT TO ITEM 1A resulting in a poor quality final product. ? Sub-contractors did not follow the inspector?s instructions in many cases. Additionally, staff conducted an independent review with the City of Los Angeles Department of Public Works (LADPW) for the San Pedro City Hall Seismic Upgrade Restoration Project. The findings regarding MERCO Construction Engineers, Inc., are listed below: ? Generally behind schedule and over budget. ? Being the lowest bidder resulted in excessive, unjustified change order requests. ? Their sub-consultants and their construction crew were generally uncooperative and non-responsive. ? Lack of communication regarding the contract documents to their construction personnel brought uncertainty to the project that resulted in delays and disputes. ? Submittals often late and incomplete. ? Half way into the project, the Los Angeles Department of Public Works (LADPW) requested a change in the project scope and presented it to MERCO Construction Engineers, Inc., to renegotiate the contract. MERCO Construction Engineers, Inc. responded with the threat of unjustified, excessive claims. The LADPW decided that it was in the City?s best interest to cancel the contract with MERCO Construction Engineers, Inc., in part due to MERCO?s overly aggressive and unjustifiable pricing for the requested scope changes. ? The LADPW completed the balance of the construction through the use of City forces. 3 SUPPLEMENTAL STAFF REPORT TO ITEM 1A In addition, staff checked references provided by Spiess Construction Co., Inc., for projects with a similar project scope, construction budget and relevant time period. Spiess Construction Co., Inc., submitted 50 references of which staff selected six that were very similar in scope and construction cost. All contacts consistently reported that the quality of their work was excellent, on schedule, conducted in a cost efficient manner, and performed with minimal change orders. Based on the staff reference checks on both companies, staff recommends that Spiess Construction Co., Inc. be selected as the best bidder in order to avoid project schedule creep, to minimize contract disputes and potential claims, and to avoid administrative problems within contractor's personnel. Deleted: ¶ Recommendation 1. Staff recommends that Council take the actions specified in the original staff report. Prepared by: Craig Perkins, Director of Environmental and Public Works Management Anthony Antich, P.E., City Engineer Gilbert Borboa Jr., P.E., Utilities Manager Dave Britton, P.E., Sr. Civil Engineer Charmaine Yambao, P.E., Utilities Engineer Bob Harvey, Water Production Treatment Superintendent Cara Silver, Deputy City Attorney Spiros A. Lazaris, P.E., Project Manager Attachment: Copy of Staff Report for Item 1D, January 22, 2002. 4 SUPPLEMENTAL STAFF REPORT TO ITEM 1A Supplemental llcc1792award.chg.doc 5