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  Agenda Item   19.    
City Council Meeting
Meeting Date: 05/02/2023  
FROM: Bill Gallardo

Subject:
Acceptance of Country Hills Subdivision Pavement and Water Improvements, Project No. 7322 
RECOMMENDATION
  1. Authorize increasing the Contract Contingency by 1.8%;
  2. Accept project as complete and authorize City Clerk to record Notice of Completion;
  3. Accept the Warranty Bond; and
  4. Authorize City Clerk to release the Performance Bond upon acceptance of the Warranty Bond, and release the Payment Bond upon further notification from the Public Works Department.
BACKGROUND/DISCUSSION
On August 17, 2021, the City Council awarded a Construction Contract ("Contract") to Williams Pipeline Contractors, Inc. ("Williams") for $4,791,264.52 for the Country Hills Subdivision Pavement and Water Improvements, Project No. 7322 ("Project") and approved a 10% construction contingency for a total approved construction budget of $5,270,390.97. The Project replaced and upgraded the existing water mains and appurtenances, completed street resurfacing, and reconstructed ADA ramps, sidewalks, and curb and gutters throughout the subdivision. See Attachment A for reference as to the project location.

Staff issued the Notice-to-Proceed with the construction on October 11, 2021, and on November 18, 2022, the contractor completed the Project. During the construction, there were several Contract Change Orders, including the final quantity balancing Change Order for the Project, totaling $567,079.35. The change orders exceeded the contract amount plus a 10% contingency by $87,952.90. Therefore, staff is requesting the City Council consider approving an increase of 1.8% to the contingency for the construction budget. The final accepted Contract cost is $5,358,343.87, 11.8% over the Construction Contract. The contractor completed the improvements and staff recommends the City Council approve the acceptance work performed by Williams.
 
The following is a summary of contract costs:
Original Construction Contract Amount $4,791,264.52
Approved Change Orders $567,079.35
Final Construction Contract Amount $5,358,343.87
Approved Construction Budget with 10% Contingency $5,270,390.97
Remaining Construction Budget ($87,952.90)
Requested Contingency Increase (1.8%) $87,952.90
COMMISSION/COMMITTEE RECOMMENDATION
Finance Committee reviewed this item on April 25, 2023, and recommended for City Council approval with additional information regarding using funds beyond the original construction contract amount. Additionally, the Finance Committee requested that in moving forward, at future Finance Committee Meetings, City staff provide an update on CIP project expenditures that go beyond the original construction contract amount, and staff agreed.

During the initial stages of construction, several existing water main breaks occurred within the subdivision streets as part of installing the new water main. Watermain breaks were mainly due to the age of the existing pipe. Additionally, the area has had many water main and service lateral repairs within the last several years. The initial project scope included approximately 12,800 linear feet of new water main within the subdivision area west of Wandering Lane and replacing 430 new services and water meters. However, the easterly area called out to remove and replace only the services laterals and not replace the existing main. Pavement rehabilitation was part of the initial scope for both areas. Therefore, based on the age of the existing pipe and potential future breaks and repairs to the mainline, the Public Works Department decided to modify the scope of work to replace an additional 6,500 linear feet of new water main in the easterly areas inclusive of Wandering Lane. This change in work also included adding over 200 new service laterals and meters, 15 new Fire Hydrants, and 23 new gate valves with water appurtenances, which led to the main change order to the project. The total cost of this change is in CCO#1 and CCO#4, with some minor cost changes included in CCO# 2 and CCO#3.

The following table and subsequent Change Order Narrative summarize each chamber's total amount and describe the items included within each Change Order.
 
Change Order
No.
Total Agreed Upon Price
1 $54,097.07
2 $72,487.66
3 $38,760.36
4 $401,734.26
Total $567,079.35

Change Order Narrative
  • CCO#1 – Change Order #1 was issued to the Contractor concerning modifications to the scope of work, including 6,500 additional LF of 8" water main, 200 new service laterals and meters, 15 new Fire Hydrants, and 23 gate valves with appurtenances and tie-ins for the Streets of Wandering Ln., Roundtree Ct., Winding Ln., Stony Ln., Foothill Ln., Sunrise Rd., Grove Hill Ct., and Hill Top Ln.
  • CCO#2 – Change Order #2 addressed several unmarked utility conflicts, added potholing, traffic control, tie-ins for Wandering Lane water main, and miscellaneous work.
  • CCO#3 – Change Order #3 added curb walls around the new Fire Hydrants, modifications to the striping on Wandering Ln., and other utility conflicts.
  • CCO#4 – Change Order #4 balanced bid quantities (over and under contract quantities) and additional compensable working days for the various changes. 
FISCAL IMPACT/SUMMARY
The final Contract amount for the Project is $5,358,343.87, which is over the approved Construction Contract budget by $87,952.90. There are sufficient funds in the Project budget to cover the overage. Therefore, the staff is requesting the City Council consider increasing the Construction Contract budget by $87,952.90. The source of funds for this Project is the Water Utility Fund (Fund 420), Gas Tax (Fund 220), Measure M (Fund 260), and RMRA (Fund 221). Therefore, there is no impact on the General Fund. The Project replaced and upgraded 19,300 linear feet of existing water mains with appurtenances, 500 new services and meters, 3.6 miles of new street resurfacing, and reconstructed ADA ramps, sidewalks, and curb and gutter within the Country Hills Subdivision. Williams has completed the Project and fulfilled its obligations to the City according to the subject Contract.

Furthermore, Williams provided a Warranty Bond of 100% of the final Contract amount to guarantee the work for one year after the recordation of the Notice of Completion. Therefore, staff recommends the City Council consider accepting the Project as complete, accept the Warranty Bond (Attachment B), and authorize the City Clerk to record a Notice of Completion (Attachment C). Additionally, staff recommends authorizing the City Clerk to release the Performance Bond upon acceptance of the Warranty Bond and release the Payment Bond upon further notification from Public Works Department.
RESPECTFULLY SUBMITTED:
William Gallardo, City Manager
Prepared by:   Ryan Chapman, P.E., Assistant City Engineer
Concurrence:  Michael Ho, P.E., Public Works Director/City Engineer
Attachments
Attachment A - Location Map
Attachment B - Warranty Bond
Attachment C - Notice of Completion

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