CC 2014-09-09_08.b. Reject Bids for Corp Yard pRRO
INCORPORATED 9Z
° gym MEMORANDUM
JULY 10. 1811
cq'IFOR \
TO: CITY COUNCIL
FROM: GEOFF ENGLISH, PUBLIC WORKS DIRECTORg�
BY: MIKE LINN, CAPITAL PROJECTS ENGINEER
SUBJECT: CONSIDERATION TO REJECT ALL BIDS FOR THE CORPORATION
YARD ADMINISTRATION BUILDING AND EXISTING FACILITY
RENOVATION PROJECT, PW 2013-12
DATE: SEPTEMBER 9, 2014
RECOMMENDATION:
It is recommended the City Council:
1. Reject all bids received for the subject project;
2. Direct staff to rebid the project at a future date after performing value engineering
and modifications to the project specifications.
IMPACT ON FINANCIAL AND PERSONNEL RESOURCES:
The 2014/2015 Capital Improvement Program Budget includes $525,000 for the subject
project. The architect's estimate for the Base Bid of the project is $410,000.
BACKGROUND:
On October 8, 2013, the Council approved conceptual design plans for the renovation of
the Corporate Yard and authorized staff to distribute requests for proposals for
architectural and engineering design services. On January 14, 2014, Council approved
a design contract with Harris Architecture & Design. On April 15, 2014, the Planning
Commission adopted a resolution approving Conditional Use Permit No. 13-004 for the
Corporation Yard project.
The project scope of work involves the construction of a new single story 2,000 square
foot administration building consisting of framed construction with prefinished metal
panel exterior finish, standing seam metal roof, and associated finishes and utility
connections to provide a fully functioning building. The bid documents defined the
project components as follows:
Base Bid — New Administration Building
Work involves the construction of a separate administration building.
Item 8.b. - Page 1
CITY COUNCIL
CONSIDERATION OF AN AWARD OF CONTRACT TO REJECT ALL BIDS FOR THE
CORPORATION YARD ADMINISTRATION BUILDING AND EXISTING FACILITY
RENOVATION PROJECT, PW 2013-12
SEPTEMBER 9, 2014
PAGE 2
Additive Alternate A — Interior Remodel in Existing Building
Involves the remodeling of interior partition walls, plumbing, electrical and
finishes creating separate men's and women's dressing rooms and a revised
entry.
Additive Alternate B — Construct Lead Worker's Office in Existing Building
Involves the conversion of the existing Sewer Parts Shop into office space.
ANALYSIS OF ISSUES:
On August 18, 2014, nine bids were opened for the subject project. The project
specifications stipulated that contract award would be based solely on the Base Bid.
Quincon, Inc., with a listed Base Bid of $412,701, was deemed to be the apparent low
bidder pending review of the bid documentation by Engineering staff. Within two days,
Engineering received two letters of bid protest from Effect Contractors (see Attachment
No. 2) and the Carroll Building Company (see Attachment No. 3).
Carmel & Naccasha, legal consultant to the City, reviewed the protest letters with
respect to the bids received. Although some of the concerns can be waived as minor
irregularities by the City at their discretion, the City Attorney's office noted that the
majority of the bids did not meet the requirements of the Subcontractor Listing Law.
Section 2-3.2 of the City's base specification document, the Greenbook Specifications
(2012 Edition), states the following:
2-3.2 Self Performance
The contractor shall perform, with its own organization, Contract work amounting to at
least 50% of the Contractor Price except that any designated "Specialty Items" may be
performed by subcontract and the amount of any such "Specialty Items" so performed
will be deducted from the Contractor Price before computing the amount required to be
performed by the Contractor with its own organization. "Specialty Items" will be
identified by the Agency in the Bid or in the Special Provisions.
Of the nine bids received, only one contractor, Newton Construction, met the 50%
requirement. The apparent low bidder, Quincon, Co., failed to list the percentages. All
bids exceeded the Architect's Estimate of $410,000. Thus, eight of the nine bids are
deemed non-responsive.
The Greenbook is a widely used document throughout California for public works
engineering projects. Municipalities in San Luis Obispo and Santa Barbara County
either reference the Greenbook Specifications or the Caltrans Specifications as their
base document. In comparison, the Caltrans Specifications requirement for the
percentage of work that a contractor must perform with their own forces is 35%. Upon
interviewing the contractors, staff discovered that building contractors were unfamiliar
with the Greenbook Specifications as it is not normally referenced in commercial
building construction. Hence, the contractors were apparently unaware of the 50%
Item 8.b. - Page 2
CITY COUNCIL
CONSIDERATION OF AN AWARD OF CONTRACT TO REJECT ALL BIDS FOR THE
CORPORATION YARD ADMINISTRATION BUILDING AND EXISTING FACILITY
RENOVATION PROJECT, PW 2013-12
SEPTEMBER 9, 2014
PAGE 3 -
requirement as it is not explicitly stated in the project specifications, only referenced in
the base document (Greenbook Specifications). All the contractors believed that the
50% requirement, although valid for public works projects, exceeds the industry
standard for building projects.
Based on the City Attorney's office findings, staff recommends that Council reject all
bids received and direct staff to rebid the project at a future date. Staff proposes
performing the following actions to facilitate rebidding of the project:
• Research the percentage requirement for building construction with surrounding
agencies to determine a reasonable percentage for work performed by the
general contractor's forces. Staff will include the percentage (if revised) directly
in the project specifications.
• Work with the project architect to perform value engineering to attempt to fit
within the available budget as follows: review the project's base bid scope of
work to determine if it can be scaled back or modified, potentially substitute lower
cost components and determine whether the Public Works Department can
perform more of the work with their own forces.
• Review the budget to determine if additional available funding can be identified.
ALTERNATIVES:
The following alternatives are provided for the Council's consideration:
1. Reject all bids received and direct staff to rebid the project at a future date
following value engineering and modification of the project specifications; or
2. Provide direction to staff.
ADVANTAGES:
Reevaluating the project scope of work and specifications may yield more competitive
pricing and eliminate confusion with the Subcontractor Listing requirements.
DISADVANTAGES:
Readvertising the project will push construction into the winter months.
ENVIRONMENTAL REVIEW:
The project is categorically exempt from CEQA pursuant to Section 15301(d),15303 (c).
PUBLIC NOTIFICATION AND COMMENTS:
The agenda was posted at City Hall on Thursday, September 4, 2014. The agenda
and staff report was posted on the City's website on Friday, September 5, 2014.
Item 8.b. - Page 3
CITY COUNCIL
CONSIDERATION OF AN AWARD OF CONTRACT TO REJECT ALL BIDS FOR THE
CORPORATION YARD ADMINISTRATION BUILDING AND EXISTING FACILITY
RENOVATION PROJECT, PW 2013-12
SEPTEMBER 9, 2014
PAGE 4
Attachments:
1. Bid Tabulations
2. Effect Contractors 8/19/14 Bid Protest Letter to City
3. Carroll Building Co. 8/21/14 Bid Protest Letter to City
Item 8.b. - Page 4
ATTACHMENT 1
CITY OF
CITY OF ARROYO GRANDE
BID OPENING LOG SHEET
NK CALIFORNIA
DEADLINE: TUESDAY, AUGUST 18, 2014 -2:00 PM
PROJECT NAME: CORPORATION YARD ADMINISTRATIVE BUILDING
AND EXISTING FACILITY RENOVATION PROJECT
PROJECT NO. PW 2093-92
ARCHITECT'S ESTIMATE: $490,000.00
SUBMITTED BY: *BASE ALT A ALT B ALT C
GLR Construction $450,845.50 $37,373.40 $10,100.55 $10,287.30
Santa Maria, CA
Newton Construction $529,000.00 $16,500.00 $19,000 00 $10,000.00
San Luis Obispo, CA
Pueblo Construction, Inc. $525,438.00 $16,677.00 $17,904.00 $10,494.00
Santa Barbara, CA
Effect Contractors $454,800.00 $19,700.00 $20,100.00 $12,000.00
Nipomo, CA
Kinyon Construction, Inc. $612,457.00 $19,742.00 $8,648.00 $9,802.00
Santa Maria, CA
Quincon, Inc. $412,701.00 $29,186.00 $57,424.00 $9,605.00
Grover Beach, CA
Vernon Edwards $499,374.00 $21,808.00 $21,110.00 $16,728.00
Santa Maria, CA
PBC (Pickard & Butters) $450,806.00 $19,621.00 $14,581.00 $13,549.00
Atascadero, CA
Carroll Building Co. $435,500.00 $27,200.00 $21,000.00' $16,000.00
San Luis Obispo, CA
*The lowest bid shall be the lowest bid amount on the base contract.
p�R�YO eq
Kitty'Nortoobeputy City Clerk ,O� '9yO rn
c: Director of Community Development V �11LY 10.��
Director of Public Works
Assistant City Engineer
City Manager CALIF
Item 8.b. - Page 5
Attachment No. 2
EFFECT
CONTRACTORS
116 West Chestnut St.,Vipomo,CA 93444
805 878 2231 ph 805 929 1193 fax
License 835977
August 19,2014
City of Arroyo Grande
Attn Mike Linn
300 East Branch
Arroyo Grande, CA 93420
Dear Mike:
Please consider this letter as formal notification of a protest by Effect Contractors,regarding
the project"Corporation Yard Administration Building and Existing Facility Renovation,
Project No. PW 2013-12". We request that all of the bids received by the City of Arroyo
Grande for the project noted above be rejected as non-responsive due to the City's failure to
declare project funding prior to opening of bids as required by the Bid Proposal, Item 7,page
Bid-3.
Sincerely:
tGreeis
Owner
"Working effectively to`Hake your plans a reality"
Item 8.b. - Page 6
Attachment No. 3
(DARROLL
BUILDING CO,
CARROLL DEVELOPMENT,INC.
L�N,755672
2653 Victoria Avenue San Luis Obispo,CA 93401 Tel:(605)543-2427 Fax-(805)543-2498
August 21,2014
City of Arroyo Grande
300 E Branch St
Arroyo Grande, CA
Project: #PW 2013-12
Corporation Yard Administration Building&Existing Facility Renovation
Gentleman.
We have just received a copy of the bid documents from the apparent low bidder just before noon today.
We had requested the documents shortly after the bid opening via email and phone. Thank you for your
cooperation in providing the paperwork.
Our review of Quincon's documents indicates some significant omissions.
1. The Bid Schedule indicates that a numerical price and a written price are to be included. This is
further substantiated in the specifications under bid requirements. The paragraph )3 Bid Forms
states that"all bids must give the prices proposed, both in writing and figures." (copy attached for
your reference) It is clear that Quincon did not include the bid numbers in written form as
required by the specifications.
2. On page 7 of the bid forms,the first 2 lines are requesting years in the contracting business and
years of experience in projects of this nature. This information is also omitted.
3. On the List of Subcontractors the information concerning the percentage of each listed
subcontractors of the whole price is also omitted.
It is our opinion that the omitting the bid amounts in written form is the biggest issue. This is required so
that they can be compared to assure correct pricing. In most cases the written price takes precedent over
the numerical price. By omitting the written price there can be no comparison.
Other referclaces
In item 4 Reiection of Bids the paragraph states"Bids may be rejected if they are incomplete bids." This
is clearly an incomplete bid.
Item 6 Award of Contract states--The award of the contract, if awarded, will be to the lowest responsible
bidder whose bid complies with all the requirements prescribed." This bid does not comply with all the
requirements prescribed.
Because of these issues Quincon's bid is incomplete and non-responsive.
Thank you
Bruce Houseman
Estimator/Project Manager
Item 8.b. - Page 7
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Item 8.b. - Page 8