SR-09-23-1980-11ASanta Monica, California
To: Mayor and City Council
M
SEP 9 '980
September 3, 1980
/IA
SEP 2 3 1980
From: City Staff
Subject: Award of Contract for Construction of Arcadia Reservoir Roof
Introduction
This report describes the bids received and recommends the award of a contract
to the lowest and best bidder.
Background
Arcadia Reservoir was built in 1924 with reinforced concrete walls and a wood
roof. The wood roof is now deteriorated and has become a health and safety
hazard. The California State Department of Health has requested, in its
yearly survey, the repair of this reservoir. This contract includes replacing
the existing wood roof with a wood substructure and an aluminum roof, sealing
the reservoir, repairing the gutter around the reservoir and replacing an
effluent line.
The bids were received on August 20, 1980, for the construction of the subject
project. Nine Bids were received as follows:
Harman B. J. Gladd Construction Co . .................. $463,576.40*
Lang - Miller Construction ............................. $483,750.00
Cushman Contracting Corporation ...................... $504,526.00
Equinox - Malibu ...... ............................... $516,720.00
Joseph W. Eubanks, General Building Contractor ....... $517,448.50*
Merco Construction Engineers, Inc . ................... $520,565.00
Kruse Construction Company ........................... $524,950.00
Ecco Contractors, Inc . ............................... $526,450.00
Gerstenberger Corp . ... ............................... $589,215.04*
*Corrected Amount
It
Several of the proposals contained various errors which could render them SEP 2 3
informal and invalid if the City Council chooses to make such a determination.
ee�
SEP'9 i�
To: Mayor and City Council -2
September 3, 1980
These errors included failure to show the unit or lump prices in words,
interlineations, mathematical errors in extensions and totals, failure to
apply a corporate seal to the proposal, omission of title of party signing
the proposal, failure to include a statement of qualifications listing
previous projects completed, and not using the form of bidders bond contained
in the bidding package.
Informalities relating to the proposal submitted by the low bidder, Harman
B. J. Gladd Construction Company, included failure to show unit and lump sum
prices in words, mathematical errors in extensions and total amount of bid,
and not using the form of bidder's bond contained in the bidding package.
This bidder also failed to submit a list of structures constructed with
shot -crete equipment proposed to be used on this project. The contractor
has subsequently submitted this list.
The Contractor's qualifications have been reviewed and have been found to be
acceptable. The low bidder holds a valid license to perform the work to be
done from the State Contractors' License Board.
The informalities in the low bid have been reviewed with the City Attorney's
office. The City Attorney's office concurs in the opinion that all the
informalities in the low bid can be waived in accordance with Article A -16
of the Advertisement for Bids and by the Specifications.
Funds for this project were appropriated in past fiscal years and were lost at
the end of those years. The funds required to be appropriated for this
project are $463,576.40 plus 15 percent for contingencies or a total of
$533,112.86.
To: Mayor and City Council -3- September 3, 1980
Recommendation
It is recommended that Council appropriate $533,112.86 from the Water
Depreciation fund, waive the informalities in the bid by Harman B. J. Gladd
Construction Company, and authorize the City Manager to sign a contract with
Harman B. G. Gladd Construction Company in the amount of $463,576.40 for the
construction of the Arcadia Roof and appurtenances.
Prepared by: Stan Scholl
Ed Lash
II
I LM
ME 1,
1231 South La Cienega Boulevard Los Angeles, California
September 12, 1980
City Council
City of Santa Monica
1685 Main Street
Santa Monica, California 90291
A etd,
265956 SEP 2 J IZ)uU
P U B L I C WO+�](R�Kc.yS AND
COMMERCIAL
In
9 :1
(213) 652- 0022 -5 655 - 9212 -3
G� t� F,h Via° ilr8a (;a +• i,i lt�
Re: Agenda Item 11 G - Recommendation for Appropriation of
$533,112.86 and Authorization to Award and Execute a
Contract to Harman B. J. Gladd Construction Company in the
Amount of $463,576.40 for Construction of Arcadia Reservoir
Roof
Dear Members of the Council:
Our company submitted the low bid to perform the con-
struction work on the Arcadia Reservoir. Our bid was over
$20,000.00 lower than the bid of the second low bidder, who,
I understand, is protesting the award of the contract to our
company on the grounds that we made certain technical errors
in filling out our bid.
In considering this matter, I believe the council should
keep in mind the purpose behind the law requiring competitive
bidding for public works contracts. The purpose is to obtain
a competent contractor to perform the work at the lowest possible
price, not to see who can submit the lowest bid without any errors.
Errors in bids are common, and almost are an inevitable
result of the competitive bidding process. In preparing a bid
for a public works project, a prime contractor will obtain in-
itial quotes from material suppliers for the construction ma-
terial required for the work. In most cases he also will obtain
initial quotes from subcontractors who are particularly qualified
to perform certain items of work on the project. As the time
approaches for submission of the prime contractor's bid to the
public agency, the prime contractor invariably will receive last
minute telephone calls from most, if not all, of the material
suppliers and subcontractors from whom he has obtained quotes,
advising him that they will reduce their price if he will use
their material or services. In some cases, this price cutting
process literally takes place minutes before the deadline for
submission of the prime contractor's bid. This last minute
price cutting causes the prime contractor to adjust and re-
calculate his bid. As may be imagined, the conditions existing
in a prime contractor's office just prior to submission of his
bid are chaotic and mistakes are often made, but it is the
CA Lori
II A
SEP 2 3 1980
City Council -2- 9/12/80
free exercise of this competitive process which insures that the
public agency will obtain the lowest price possible for the work.
The council need look no further than the bids sub-
mitted on this project for proof of the fact that minor, tech-
nical errors are the rule rather than the exception in com-
petitive bidding. A majority of the bids submitted on this
project contained a certain amount of minor errors in form.
That non - material errors may occur in preparing and sub-
mitting a bid is well recognized, and, thus, public agencies are
vested with full authority to waive any such irregularities. Of
course, material mistakes or errors (i.e., those affecting the
amount of the bid for the work) are a different story. If,
for example, the prime contractor mistakenly includes two dif-
ferent prices for doing the work, such an error clearly would
invalidate the bid. But where the error is non - material, the
irregularity can and should be waived by the public agency.
The second low bidder claims that the council should
award the contract to him because his bid did not contain any
errors. Such a position is to place form over substance. Sup-
pose, for example, that Lang- Miller was not the second low bidder
on this project, but rather that their total bid was $1,000,000
and that their bid was the eighth lowest. Suppose further
that the first seven bidders all had technical, non - material
errors in their bids. Would the council be forced to award
the job to the eighth low bidder at more than twice the price
of the low bid? Of course not. Such action would not only be
contrary to common sense, it would be a violation of state law
which requires that public contracts be awarded to the lowest
responsible bidder.
Here, the council has the full legal authority to
waive the non - material errors contained in our company's bid.
By doing so, the council will save the city over $20,000. To
award the contract to the second low bidder simply because
their bid contained no errors in form would not only be an
abuse of the discretion vested in the council, but it would
be an unwarranted gift of public funds.
We respectfully request the council to award the con-
tract to our company.
Very truly yours,
HARMAN B._J- GLADD CONSTRUCTION CO.
By
rm
September 12, 1980
City Council
City of Santa Monica
1685 Main Street
Santa Monica, California 90291
Re: Agenda Item 11 G - Recommendation for Appropriation of
$533,112.86 and Authorization to Award and Execute a
Contract to Harman B. J. Gladd Construction Company in the
Amount of $463,576.40 for Construction of Arcadia Reservoir
Roof
Dear Members of the Council:
Our company submitted the low bid to perform the con-
struction work on the Arcadia Reservoir. Our bid was over
$20,000.00 lower than the bid of the second low bidder, who,
I understand, is protesting the award of the contract to our
company on the grounds that we made certain technical errors
in filling out our bid.
In considering this matter, I believe the council should
keep in mind the purpose behind the law requiring competitive
bidding for public: works contracts. The purpose is to obtain
a competent contractor to perform the work at the lowest possible
price, not to see who can submit the lowest bid without any errors.
Errors in bids are common, and almost are an inevitable
result of the competitive bidding process. In preparing a bid
for a public works project, a prime contractor will obtain in-
itial quotes from material suppliers for the construction ma-
terial required for the work. In most cases he also will obtain
initial quotes from subcontractors who are particularly qualified
to perform certain items of work on the project. As the time
approaches for submission of the prime contractor's bid to the
public agency, the prime contractor invariably will receive last
minute telephone calls from most, if not all, of the material
suppliers and subcontractors from whom he has obtained quotes,
advising him that they will reduce their price if he will use
their material or services. In some cases, this price cutting
process literally takes place minutes before the deadline for
submission of the prime contractor's bid. This last minute
price cutting causes the prime contractor to adjust and re-
calculate his bid. As may be imagined, the conditions existing
in a prime contractor's office just prior to submission of his
bid are chaotic and mistakes are often made, but it is the
Dfl��ifl�
fl. J.
GCflDD
CO�SI�IJCI 0�
CO.
COMMERCIAL
CONTRACTORS
1231 South La Cienega Boulevard
Los Angeles, California 90035
(213) 652 - 0022 -5
655 - 9212 -3
September 12, 1980
City Council
City of Santa Monica
1685 Main Street
Santa Monica, California 90291
Re: Agenda Item 11 G - Recommendation for Appropriation of
$533,112.86 and Authorization to Award and Execute a
Contract to Harman B. J. Gladd Construction Company in the
Amount of $463,576.40 for Construction of Arcadia Reservoir
Roof
Dear Members of the Council:
Our company submitted the low bid to perform the con-
struction work on the Arcadia Reservoir. Our bid was over
$20,000.00 lower than the bid of the second low bidder, who,
I understand, is protesting the award of the contract to our
company on the grounds that we made certain technical errors
in filling out our bid.
In considering this matter, I believe the council should
keep in mind the purpose behind the law requiring competitive
bidding for public: works contracts. The purpose is to obtain
a competent contractor to perform the work at the lowest possible
price, not to see who can submit the lowest bid without any errors.
Errors in bids are common, and almost are an inevitable
result of the competitive bidding process. In preparing a bid
for a public works project, a prime contractor will obtain in-
itial quotes from material suppliers for the construction ma-
terial required for the work. In most cases he also will obtain
initial quotes from subcontractors who are particularly qualified
to perform certain items of work on the project. As the time
approaches for submission of the prime contractor's bid to the
public agency, the prime contractor invariably will receive last
minute telephone calls from most, if not all, of the material
suppliers and subcontractors from whom he has obtained quotes,
advising him that they will reduce their price if he will use
their material or services. In some cases, this price cutting
process literally takes place minutes before the deadline for
submission of the prime contractor's bid. This last minute
price cutting causes the prime contractor to adjust and re-
calculate his bid. As may be imagined, the conditions existing
in a prime contractor's office just prior to submission of his
bid are chaotic and mistakes are often made, but it is the
City Council -2- 9/12/80
free exercise of this competitive process which insures that the
public agency will obtain the lowest price possible for the work.
The council need look no further than the bids sub-
mitted on this project for proof of the fact that minor, tech-
nical errors are the rule rather than the exception in com-
petitive bidding. A majority of the bids submitted on this
project contained a certain amount of minor errors in form.
That non - material errors may occur in preparing and sub-
mitting a bid is well recognized, and, thus, public agencies are
vested with full authority to waive any such irregularities. Of
course, material mistakes or errors (i.e., those affecting the
amount of the bid for the work) are a different story. If,
for example, the prime contractor mistakenly includes two dif-
ferent prices for doing the work, such an error clearly would
invalidate the bid. But where the error is non - material, the
irregularity can and should be waived by the public agency.
The second low bidder claims that the council should
award the contract to him because his bid did not contain any
errors. Such a position is to place form over substance. Sup-
pose, for example, that Lang - Miller was not the second low bidder
on this project, but rather that their total bid was $1,000,000
and that their bid was the eighth lowest. Suppose further
that the first seven bidders all had technical, non - material
errors in their bids. Would the council be forced to award
the job to the eighth low bidder at more than twice the price
of the low bid? of course not. Such action would not only be
contrary to common sense, it would be a violation of state law
which requires that public contracts be awarded to the lowest
responsible bidder.
Here, the council has the full legal authority to
waive the non - material errors contained in our company's bid.
By doing so, the council will save the city over $20,000. To
award the contract to the second low bidder simply because
their bid contained no errors in form would not only be an
abuse of the discretion vested in the council, but it would
be an unwarranted gift of public funds.
We respectfully request the council to award the con-
tract to our company.
Very truly yours,
HARMAN B._J_- -GLADD CONSTRUCTION CO.
C _.i /
By �x-
/ GENE HARMAN
rm / "
�Ifl fl� fl. J. GCflDD tR ItiON CO. COMME CIAL CONTRACTORS
1231 South La Cienega Boulevard Los Angeles, California 90035 (213) 652 - 0022 -5 655- 9212 -3
September 12, 1980
City Council
City of Santa Monica
1685 Main Street
Santa Monica, California 90291
Re: Agenda Item 11 G - Recommendation for Appropriation of
$533,112.86 and Authorization to Award and Execute a
Contract to Harman B. J. Gladd Construction Company in the
Amount of $463,576.40 for Construction of Arcadia Reservoir
Roof
Dear Members of the Council:
Our company submitted the low bid to perform the con-
struction work on the Arcadia Reservoir. Our bid was over
$20,000.00 lower than the bid of the second low bidder, who,
I understand, is protesting the award of the contract to our
company on the grounds that we made certain technical errors
in filling out our bid.
In considering this matter, I believe the council should
keep in mind the purpose behind the law requiring competitive
bidding for public works contracts. The purpose is to obtain
a competent contractor to perform the work at the lowest possible
price, not to see who can submit the lowest bid without any errors.
Errors in bids are common, and almost are an inevitable
result of the competitive bidding process. In preparing a bid
for a public works project, a prime contractor will obtain in-
itial quotes from material suppliers for the construction ma-
terial required for the work. In most cases he also will obtain
initial quotes from subcontractors who are particularly qualified
to perform certain items of work on the project. As the time
approaches for submission of the prime contractor's bid to the
public agency, the prime contractor invariably will receive last
minute telephone calls from most, if not all, of the material
suppliers and subcontractors from whom he has obtained quotes,
advising him that they will reduce their price if he will use
their material or services. In some cases, this price cutting
process literally takes place minutes before the deadline for
submission of the prime contractor's bid. This last minute
price cutting causes the prime contractor to adjust and re-
calculate his bid. As may be imagined, the conditions existing
in a prime contractor's office just prior to submission of his
bid are chaotic and mistakes are often made, but it is the
City Council -2- 9/12/80
free exercise of this competitive process which insures that the
public agency will obtain the lowest price possible for the work.
The council need look no further than the bids sub-
mitted on this project for proof of the fact that minor, tech-
nical errors are the rule rather than the exception in com-
petitive bidding. A majority of the bids submitted on this
project contained a certain amount of minor errors in form.
That non - material errors may occur in preparing and sub-
mitting a bid is well recognized, and, thus, public agencies are
vested with full authority to waive any such irregularities. Of
course, material mistakes or errors (i.e., those affecting the
amount of the bid for the work) are a different story. If,
for example, the prime contractor mistakenly includes two dif-
ferent prices for doing the work, such an error clearly would
invalidate the bid. But where the error is non - material, the
irregularity can and should be waived by the public agency.
The second low bidder claims that the council should
award the contract to him because his bid did not contain any
errors. Such a position is to place form over substance. Sup-
pose, for example, that Lang - Miller was not the second low bidder
on this project, but rather that their total bid was $1,000,000
and that their bid was the eighth lowest. Suppose further
that the first seven bidders all had technical, non - material
errors in their bids. Would the council be forced to award
the job to the eighth low bidder at more than twice the price
of the low bid? Of course not. Such action would not only be
contrary to common sense, it would be a violation of state law
which requires that public contracts be awarded to the lowest
responsible bidder.
Here, the council has the full legal authority to
waive the non - material errors contained in our company's bid.
By doing so, the council will save the city over $20,000. To
award the contract to the second low bidder simply because
their bid contained no errors in form would not only be an
abuse of the discretion vested in the council, but it would
be an unwarranted gift of public funds.
We respectfully request the council to award the con-
tract to our company.
Very truly yours,
HARMAN B.__J - GLADD CONSTRUCTION CO.
By Z
GENE HARMAN
rm
G'
R M fl. J. GCflDD tR t ON CO. COMMERCIAL CONTRACTORS
1231 South La Cienega Boulevard Los Angeles, California 90035 (213) 652 - 0022 -5 655- 9212 -3
T R A N S M I T T A L R E C O R D
TO: City Counsil
City of Santa Monica
1685 Main Street
Santa Monica, California 90291
Attn: Clerk of the Board
TRANSMITTED HEREWITH PLEASE FIND:
DATE September 16, 1980 JOB NO.
JOB NAME Arcadia Reservoir Contract Award
YOUR JOB OR CONTRACT NO.
The enclosed sets are for each board member which you are kindly requested
to distribute them individually to each member.
It is imperative that this information be available to them prior to the
board meeting of September 23, 1980.
Thank you for your detailed attention to the above.
cc: Woodside /Kubota & Assiciates, Inc.
Mr. Stanley Scholl, Director
General Services
FOR YOUR *A=XT&X=
FOR YOUR FILE
DATE APPROVED
DATE RETURNED
XX
Yours very truly,
HARMAN B. J. GLADD CONSTRUCTION CO.
DATE DISTRIBUTED BY: Gene Harman
11-4
Agenda Item 11 -A: Presented for consideration was a recommendation f
an appropriation and authorization to award and execute a contract to
Harmon B. G. Gladd Construction Company for construction of the Arcad
Reservoir roof (tabled at meeting of September 10, 1980). The staff'
report was presented. Mayor Pro Tempore Yannatta Goldway moved to
remove this item from the table for consideration Z111--1 time. Second'
by Councilmember Rhoden. The motion was approved as follows:
Council Vote: Unanimously approved 6 -0
Absent: Councilmember van den Steenhoven
Discussion was held. Councilmember Jennings moved to approve the staff
recommendation, i.e., authorizing the appropriation of $533,112.86>
from the Water Depreciation fund, waiving the informalities in the bid
by Harman B. J. Gladd Construction Company, and authorizing the City
Manager to sign Contract No. 3557(CCS) with the Harman B. G. Gladd
Construction Company in the amount of $463,576.40 for construction oft
Arcadia Reservoir Roof and appurtenances, with the addition that not on
does the City waive the informalities, but the contractor must also wai
any claim arising out of such irregularities or informalities. Second
by Councilmember Scott. The motion was approved by the following vote:
Council Vote
I
Affirmative
Negative
Absent:
Councilmembers Yannatta
Jennings, Rhoden, Scott
Mayor Bambrick
Steenhoven
Councilmember Reed
Councilmember van den
Goldway,
and
MINUTES OF CITY COUNCIL MEETING
September 24, 1980
ve