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CITY COUNCIL AGENDA ITEM NO. 12

Meeting Date: February 14, 2006

Subject/Title: Adopt a Resolution approving the Contract Documents and authorizing the City Manager to execute a Construction Contract for the Chloramination of Wells, CIP Project No. 562-5617 to Manito Construction, Inc. in the amount of $1,009,350, plus a 10% contingency, for a total amount of $1,110,285 and amend the CIP Budget Sheet to reflect increased industry construction and labor costs.

Prepared by: Engineering: P. Eldredge

Submitted by: Engineering: B. Grewal

RECOMMENDATION
Adopt a Resolution approving the Contract Documents and authorizing the City Manager to execute a Construction Contract for the Chloramination of Wells, CIP Project No. 562-5617 to Manito Construction, Inc. in the amount of $1,009,350, plus a 10% contingency, for a total amount of $1,110,285 and amend the CIP Budget Sheet to reflect increased industry construction and labor costs.

PREVIOUS ACTION
On January 11, 2005, by Resolution No. 2005-6, the City Council authorized the City Manager to execute a Professional Services Agreement with Raines, Melton & Carella, Inc., to provide Design Services for the Chloramination of Wells, CIP Project No. 562-5617.

On April 26, 2005, by Resolution No. 2005-94, City Council authorized the termination of the contract with Raines, Melton & Carella, Inc. for Design Services for the Chloramination of Wells, CIP Project No. 562-5617, and authorized the City Manager to execute a Contract with Camp Dresser and McKee, Inc. to provide Design Services for the Chloramination of Wells project.

On May 24, 2005, by Resolution No. 2005-115, City Council adopted the City’s 2005/06 – 2009/10 Capital Improvement Program that included the Chloramination of Wells, CIP Project No. 562-5617.

On December 13, 2005, by Resolution No. 2005-292, City Council rejected the bid received for the Chloramination of Wells, CIP Project No. 562-5617 and authorized staff to re-advertise the project for bid.

BACKGROUND
The City has been working on securing a long term treatment option for its surface water supply obtained from the East Contra Costa Irrigation District (ECCID). The City has entered into an agreement with the Contra Costa Water District (CCWD) to provide interim treatment services of this water and has since purchased existing capacity at the Randall-Bold Water Treatment Plant (RBWTP) and is in the process of designing a new treatment facility adjacent to RBWTP in partnership with CCWD.

The City currently uses chlorine as its potable water disinfectant for the groundwater pumped from the City’s wells. As groundwater is low in naturally occurring organic matter, chlorine is a suitable choice; however, surface water such as that taken from the Delta (Brentwood’s ECCID supply) is generally higher in organic material. Most of the organic material is removed during the treatment process; however, a very small amount could remain. These organics, when mixed with chlorine, have the potential to form a compound known as Trihalomethanes or THM’s, which are a carcinogenic to humans. Thus, chloramamines are used instead of chlorine since they do not form THM’s. Chloramamines are produced by mixing a small amount of ammonia with the chlorine. The City has been utilizing this surface water supply for several years now; however, the volume of water used has made it more cost effective to remove the ammonia from the surface water supply before it is mixed with Brentwood’s well water through a process known as “break point chlorination.” As the City continues to grow this process will no longer be cost effective for the City; therefore, the City’s groundwater supply needs to be converted to chloramamines.

The City first advertised the project for construction beginning Friday, October 28, 2005 and bids were opened on Tuesday, November 29, 2005. A total of one (1) bid was received, which exceeded the projects construction budget of $690,000. Staff recommended rejecting the one bid of $1,676,600 and re-advertising the project and did not amend the budget sheet at that time even though the project construction budget was thought to be questionable due to industry trends. Staff was of the opining that it would be prudent to recommend any required budget amendments once a reasonable bid was received.

Staff reviewed the existing scope of work to see if there was any ability to reduce the overall scope of the project and therefore possibly reduce the construction cost. However, during this review it was concluded that the project was fairly streamlined to begin with and there was not much opportunity to reduce the scope. The review was somewhat fruitful as the apparent low bid from the rebid is approximately $667,250 lower than the previous apparent low bid.

The City of Brentwood readvertised the project beginning Tuesday, December 7, 2005 and bids were opened on Wednesday, February 1, 2006. A total of four (4) bids were received, the bids were reviewed and the lowest responsive, responsible bid was received from Manito Construction, Inc.

The four (4) bids were:

1. Manito Construction, Inc. $1,009,350
2. Albay Construction Company $1,024,900
3. Tidelands Construction Company $1,014,000
4. Pacific Infrastructure $1,207,000

Staff recommends the award of the construction contract for the Chloramination of Wells, CIP Project No. 562-5617 to Manito Construction, Inc. in the amount of $1,009,350, plus a 10% contingency of $100,935, for a total amount of $1,110,285.

Since the low bid was higher than the construction budget, the CIP Budget Sheet must be amended to reflect this increase, should Council decide to move forward with this project. Since January 2003, the construction industry has seen increases up to 30% in several key construction materials, most notably structural steel, lumber, copper, petroleum products, PVC products (conduit and piping), fiberglass resins and concrete. Similar increases were observed during 2004 and 2005 with 2005 realizing the most significant increases in the fourth quarter primarily due to the natural disasters experienced in the southeast (hurricane Katrina). Therefore, after review of the apparent low bid, it appears that the unit price items are at a reasonable cost, considering these trends in higher material and labor costs.
FISCAL IMPACT
The funds associated with this work are included in the adopted 2005/06 – 2009/10 Capital Improvement Program and the budget contains funds for the construction of the Chloramination of Wells, CIP Project No. 562-5617, in the amount of $690,000 and with the apparent low bid of $1,009,350, being above the construction budget, the project budget requires amendment as indicated in greater detail below with an increase of $401,763, should Council concur with staff’s recommendation and proceed with the project.

Original Budget Amended Budget Difference
Legal $ 10,000 $ 1,000 $ (9,000)
Planning & Design $ 166,522 $ 172,000 $ 5,478
Construction $ 690,000 $1,135,285 $ 445,285
Project Administration $ 50,000 $ 10,000 $ (40,000)
Land/ROW/Acquisitions $ 0 $ 0 $ 0
Total Project Budget $ 916,522 $1,318,285 $ 401,763

This project is funded from Facility Fees and staff has confirmed with the Finance Department that there are sufficient funds to cover the proposed amended budget. This is a one time charge and no revenue offsets are expected due to this amendment and there is no known future reduction of costs to this project.

Attachments:
Resolution
Agreement
Amended CIP Budget Sheet
Site Map

RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BRENTWOOD APPROVING THE CONTRACT DOCUMENTS AND AUTHORIZING THE CITY MANAGER TO EXECUTE A CONSTRUCTION CONTRACT FOR THE CHLORAMINATION OF WELLS, CIP PROJECT NO. 562-5617 TO MANITO CONSTRUCTION, INC. IN THE AMOUNT OF $1,009,350, PLUS A 10% CONTINGENCY, FOR A TOTAL AMOUNT OF $1,110,285 AND AMEND THE CIP BUDGET SHEET TO REFLECT INCREASED INDUSTRY CONSTRUCTION AND LABOR COSTS.

WHEREAS, on May 24, 2005, by Resolution No. 2005-115, City Council adopted the City’s 2005/06 – 2009/10 Capital Improvement Program that included the Chloramination of Wells, CIP Project No. 562-5617; and

WHEREAS, the City currently uses chlorine as its potable water disinfectant for the groundwater pumped from the City’s wells; and

WHEREAS, the City has been utilizing this surface water supply for several years now; however, the volume of water used has made it more cost effective to remove the ammonia from the surface water supply before it is mixed with Brentwood’s well water through a process known as “break point chlorination”; and

WHEREAS, as the City continues to grow this process will no longer be cost effective for the City; therefore, the City’s groundwater supply needs to be converted to chloramamines; and

WHEREAS, the City had previously advertised the project for construction and one bid was received which exceeded the project budget; and

WHEREAS, staff made the recommendation to reject the one bid, review the existing scope of work to see if there was any ability to revise the overall scope of the project and therefore possibly reduce the cost and then re-advertise the project; and

WHEREAS, the project was readvertised beginning Tuesday, December 7, 2005 and bids were opened on Wednesday, February 1, 2006; and

WHEREAS, a total of four (4) bids were received and the lowest responsive, responsible bid was received from Manito Construction, Inc. in the amount of $1,009,350; and

WHEREAS, the low bid was higher than the construction budget, and the CIP Budget Sheet must be amended to reflect this increase.

NOW, THEREFORE BE IT RESOLVED that the City Council of the City of Brentwood does hereby approve the Contract Documents and authorize the City Manager to execute a Construction Contract for the Chloramination of Wells, CIP Project No. 562-5617 to Manito Construction, Inc. in the amount of $1,009,350, plus a 10% contingency for a total amount of $1,110,285 and amend the CIP Budget Sheet to reflect increased industry construction and labor costs.

PASSED, APPROVED AND ADOPTED by the City Council of the City of Brentwood at a regular meeting held on the 14th day of February 2006 by the following vote:

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