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sr-052510-1bGity Council Meeting: May 25, 2010 Agenda Item: ~ ~g To: Mayor and City Council From: Lee E. Swain, Director of Public Works Subject: Design-Build Agreement for the Resource Recovery Center Recommended Action Staff recommends that the City Council: 1. Authorize the City Manager. to negotiate and execute a contract with Morley Construction Company -for preconstruction services of the Resource, Recovery Center in an amount not to exceed $65,000 (including a 10% contingency); and 2. Authorize the City Engineer to issue any necessary change orders to complete the work within budgetary authority. Executive Summary The City is working with Southern California Disposal, Allan Company, and design consultant J.R. Miller & Associates to finalize a site plan for the proposed Resource Recovery Center (RRC) that meets the needs. of all the public/private partners, On November 17. 2009, the City Council approved a conceptual design that fulfills many of the commitments previously made to the team members and the public. In order to ascertain the current costs associated with the project and integrate cost controls early in the design process, staff recommends contracting with Morley Construction Company for preconstruction services in an amount not to exceed $65,000 (including a 10% contingency). This first agreement is to confirm the- design consultant's project schedule, develop a baseline cost estimate from the conceptual plans, and establish project goals. Once the criterion is identified, adesign-build agreement will establish a Guaranteed Maximum Price (GMP) for completing the design and construction document services and be amended for constructing the project. Background Over the past three years; the City has been engaged in a review of the .City's solid waste operations. On October 30: 2007, the City Council reviewed the results of an extensive Request for Proposals (RFP) process to provide transfer and recycling services for municipal solid waste. At that time, Council directed staff to explore the 1 possibility of having either the City or a private company provide transfer services. In both options, Allan Company would provide recycling services. On May 22, 2008, Council approved a public/private partnership with Southern .California Disposal to provide transfer services and Allan Company to provide recycling services. On November 25. 2008, Council approved a Professional Services Agreement with J.R. Miller & Associates for the design of the Recycling Drop-Off Center. This agreement would be included in the first GMP with Morley Construction Company for design and construction document services. On November 17. 2009, Council reviewed and approved the concept design for the RRC, formerly known as the Recycling Drop-Off Center. On March 24. 2010, staff presented an Information Item to Council regarding the history of environmental studies implemented at the proposed RRC site and the implications of pursuing the Leadership in Energy and Environmental Design (LEED) Gold or Platinum Certification for the project. Discussion In order to ascertain the current costs associated with the RRC project and integrate cost control measures early in the design process, staff concluded that there was an immediate need to determine the potential budget impact of the conceptual plans and provide real-time cost assessment of the ongoing design development phase. By introducing adesign-build contractor into the design process, the contractor can facilitate integration of the technical criteria with current construction cost controls and efficient scheduling. Contractor Selection The City issued a Request for Bids for design-build services of the RRC on February 27, 2010. The bid. consisted of a preconstruction amount for both the RRC and the Delaware Street Improvement Project, and it included a percentage fee for construction profit and overhead. The preconstruction amount includes the general contractor's cost 2 for estimating, scheduling, constructability review, as well as value engineering services.. The project fee percentages include the general contractor's overhead and profit for design and construction services. The City received the following five bids on March 19, 2010: Delaware Street RRC Facility Profit & Firm Preconstruction Preconstruction Overhead Amount Amount Percentage of Construction Amoroso Construction $15,000 $250,000 5.00% Bernard's Builders $19,250 $140,000 4.75% Diffenbaugh $15,000 $110,000 3.00% Morley Construction $9,500 $49,450 2.00% USS Cal Builders $62,000 $1,200,000 9.00% USS Cal Builders proposal included fees for design consultants, contrary to the instructions in the Request for Bids. Staff from the Solid Waste Management and Architecture Services Divisions reviewed the proposals and selected Morley Construction Company based on their proposed project fee percentages, qualifications of the team members, and experience in public. works projects, several of which were with the City of Santa Monica. Morley's past projects include the construction of the Santa Monica Main Library, Santa Monica Big Blue Bus Maintenance Facility, Getty Villa remodel and addition, Cathedral of Our Lady of the Angels, and UCLA Royce Hall renovation. Next Steps in the Design-Build Process The scope of the preconstruction services agreement includes preparing a project schedule, developing a baseline cost estimate from the conceptual plans, and establishing overall project .goals. If necessary, staff will present a prioritized list of adjustments to the scope of the project to Morley Construction Company to align the conceptual plans with the proposed budget. Upon completing the preconstruction 3 services, staff will return to Council with two additional GMPs: the first for design and construction document services and the second for the construction of the RRC. The first GMP will incorporate the previously approved J.R. Miller & Associates contract for architectural and engineering design services with Morley Construction Company's fee for preconstruction.and design services. Staff anticipates presenting the first GMP to Council in July 2010. After the completion of the design and construction documents, Morley Construction Company will obtain bids for the construction of the RRC and Delaware Street Improvements. Staff will negotiate a second GMP with Morley Construction Company for these construction costs. Staff will present the second GMP to Council in fall of 2010 and it will include all of the costs associated with constructing the project. Financial Impacts & Budget Actions The contract amount to be awarded to Morley Construction Company is $65,000. (including a 10% contingency) and is available in account number 0274019.589000 Resource Recovery Center. Staff is developing adebt-financing plan for the RRC in conjunction with an ongoing Solid Waste rate study and will return to Council with recommendations when the plan is complete. Costs associated with this project, including those incurred under this design-build agreement with Morley Construction Company, will be reimbursed through debt proceeds upon issuance. Prepared by: Michael Collins, Architect Approved: Forwarded to Council: ~ ~ 5~.." Lee E. Swain Director of Public Works Rod Gould City Manager 4 Reference Contract No. 9215 (CCS).