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08.f. Street Resurfacing ProjectTO: MEMORANDUM CITYCOUNCIL dV FROM: TERESA MCCLISH,.~OMMUNIN DEVELOPMENT DIRECTOR BY: MIKE LINN, ASSISTANT CITY ENGINEER SUBJECT: CONSIDERATION OF AN AWARD OF CONTRACT TO AMERICAN ASPHALT SOUTH, INC. FOR CONSTRUC'TION OF 'THE 2012 STREET RESURFACING PROJECT, PW 201 2-05 DATE: JUNE 26,2012 RECOMMENDATION: It is recommended the City Council: 1. Award a contract for the 2012 Street Resurfacing Project to American Asphalt South, Inc. in the amount of $689,712; 2. Authorize the City Manager to approve change orders up to $25,000, for unanticipated costs during the construction phase of the project (total construction costs = $689,712 + $25,000 = $714,712); 3. Approve the proposed adjustments to Local Sales Tax expenditures; and 4. Appropriate an additional $30,000 for the project from the Local Sales Tax balance. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: After funding appropriated for the digout project and other preparatory costs are deducted, there is currently $468,000 in the pavement management capital improvement program (CIP) budget for FY 2012-13, based upon the revised Local Sales Tax 5-Year Plan approved by City Council at the April 10, 2012 meeting. 'This includes $398,000 from Local Sales Tax funds and $70,000 from Urban State Highway Account (USHA) funds. There was originally an additional $130,000 in Transportation Fund revenues anticipated from being designated as a Federal urbanized area, which was included in the CIP budget. However, staff has determined this funding source will not become available until FY 2013-14. Due to this reduction and bids well above estimates, a number of adjustments are necessary to both the list of projects and revenues. After recommended streets are deleted from the project, it will leave a remaining shortfall of approximately $240,000. It Agenda Item 8.f. Page 1 CITY COLlNClL CONSIDERATION OF AN AWARD OF CONTRACT TO AMERICAN ASPHALT SOUTH, INC. FOR CONS'rRUCTION OF THE 2012 STREET RESURFACING PROJECT AND APPROPRIATE FUNDS FOR SHORT STREET IMPROVEMENTS JUNE 26,2012 PAGE 2 is recommended that the following adjustments to Local Sales Tax Fund appropriations be approved to address this shortfall: Reduce costs for digouts by eliminating streets where slurry seal will be delayed $30,000 ~el'ay and transfer funds for the FY 201 1-12 study on the Paulding Wall project $40,000 Transfer FY 201 1-12 funds for future property acquisition for Le Point St parking lot $60,000 Transfer FY 201 1-12 funds budgeted for miscellaneous engineering studies $5,000 Transfer excess FY 201 1-12 funds remaining from tree inventory project $40,000 Transfer from FY 2012-13 Street Maintenance due to projected savings $35,000 Appropriate funds from Local Sales Tax fund balance (will remain above 15%) $30,000 Total $240,000 The project requires significant staff time, but is a top priority in the City's Critical Needs -, Action Plan. Funding is included in the project budget for construction manqgement services. BACKGROUND: The scope of work involves the application of a surface membrane; a Type II slurry seal for residential streets and Type II microsurfacing on arterial and collector streets. Since the membrane applications completely cover the roadway, striping and pavement markings will also be performed. Staff developed the project scope of work to correspond to the recommendations of ,the Pavement Management Master Plan, adopted by Council in September 201 0. The item was presented to the City Council at the June 12, 2012 meeting. Concerns were expressed regarding utilization of funds set aside for the Le Point Street parking lot acquisition. Therefore, staff was directed to return with additional funding alternatives. ANALYSIS OF ISSUES: On May 8, 2012, six bids were opened for the 2012 Street Resurfacing Project. The lowest bid, from American Asphalt South, Inc. was in the amount of $888,980. Since the bid prices were higher than originally intended (mostly due to the striping scope of work), staff recommends awarding Schedules A, a portion of Schedule B (El Camino Real to West Branch Street), D through L, and a portion of Schedule N (Mason Street and Station Way) and delaying the performance of a portion of schedule B (E. Grand Avenue to El Camino Real), Schedules C, M, a portion of Schedule N (Allen Street and Cherry Avenue), 0, P and Q to future resurfacing projects. The revised scope of work is as follows: Street - To Schedule A - Microsurfacing Ash Street South Elm Street Walnut Street Ash Street South Elm Street Alder Street Agenda Item 8.f. Page 2 CITY COLlNClL CONSIDERATION OF AN AWARD OF CONTRACT TO AMERICAN ASPHALT SOUTH, INC. FOR CONSTRUCTION OF THE 2012 STREET RESURFACING PROJECT AND APPROPRIATE FUNDS FOR SHORT STREET IMPROVEMENTS JUNE 26,2012 PAGE 3 Elm Street (South) City Limit Elm Street (South) Farroll Ave Elm Street (South) The Pike Schedule B - Microsurfacing Brisco Road . El Camino Real Schedule D - Microsurfacing Camino Mercado West Branch Street Oak Park Boulevard Farroll Ave Schedule E - Microsurfacing Huasna Road La Cresta Drive Huasna Road Branch Street (East) Huasna Road Stagecoach Road Rosewood Lane Huasna Road Schedule F - Microsurfacing Mason Street (North) E. Branch Street " Tally Ho Road James Way Tally Ho Road Le Point Street Schedule G - Slurry Seal Branch Street (East) Mason Street Schedule H - Slurry Seal Chilton Street Oak Park Blvd Hillcrest Drive Montego Street Hillcrest Drive Sierra Drive Montego Street Newport Avenue Robles Place Sierra Drive Robles Road El Camino Real Sierra Drive Oak Park Blvd Schedule I - Slurry Seal Bakeman Lane Farroll Ave Bakeman NE Farroll Ave Bakeman NW Farroll Ave Carmella Drive Carol Place Del Sol Street The Pike Dixson Street Oak Park Blvd Golden West Place Farroll Ave La Vista Court The Pike Lancaster Drive The Pike Noel Street End of Cul-de-sac Paul Place The Pike Russ Court Paul Place Rice Court Bakeman Lane Tierra Street The Pike Wilson Court Bakernan Lane Schedule J - Slurry Seal Alder Street Cameron Court Alder Street Farroll Ave Beech Street Farroll Ave Cameron Court Alder Street Diana Place End of Cul-de-sac The Pike Ash Street Farroll Ave West Branch Street Rancho Parkway City Limit City Limit Stagecoach Road La Cresta Drive End of Culde-Sac Le Point Street Route 227 James Way Huasna Road Robles Road El Carnino Real Montego Street End of Culde-Sac End End of Street Hillcrest Drive Farroll Ave Bakeman NW Bakeman NE Farroll Ave End of Cul-de-Sac End of Culde-Sac End of Culde-Sac End of Cul-de-Sac Elm Street (South) Oak Park Blvd Elm Street (South) End of Cul-de-Sac End of Culde-Sac End of Street End of Culde-Sac Farroll Ave Fair Oaks Ave Fair Oaks Ave Halcyon (South) Farroll Ave Agenda Item 8.f. Page 3 CITY COUNCIL CONSIDERATION OF AN AWARD OF CONTRACT TO AMERICAN ASPHALT SOUTH, INC. FOR CONSTRUCTION OF 'THE 2012 STREET RESURFACING PROJECT AND APPROPRIATE FUNDS FOR SHORT STREET IMPROVEMENTS JUNE 26,2012 PAGE 4 Garfield Place The Pike Gaynfair Terrace The Pike Magnolia Drive Sycamore Drive Mulberry Lane Magnolia Drive Pacific Pointe Way Elm Street (South) Palm Court End of Cul-de-sac Pecan Street Farroll Ave Rogers Court End of Cul-de-sac Sandalwood Ave Alder Street Sycamore Court End of Cul-de-sac Sycamore Drive Gaynfair Terrace Sycamore Drive Magnolia Drive Verde Place The Pike Victoria Way Rogers Court Schedule K - Slurry Seal Alder Street Fair Oaks Ave Dodson Way Alder Street Maple Street Elm Street (South) Maple Street Walnut Street Pecan Place Fair Oaks Avenue Pine Street Maple Street Sunset Drive Elm Street (South) Walnut Street Ash Street Walnut Street Farroll Ave Wallace Place Maple Street Wood Place Dodson Way Schedule L - Slurry Seal Crown Hill East Branch Street Crown Terrace Crown Hill Harrison Street McKinley Street Le Point Terrace Crown Hill Le Point Terrace Crown Hill May Street Crown Terrace McKinley Street Crown Hill Paseo Street May Street . Schedule N - Microsurfacing Mason Street (South) E. Branch Street Mason Street (South) Nelson Street Station Way Fair Oaks Ave End of Cul-de-sac Farroll Ave End of Culde-Sac Sycamore Drive Elm Street (South) Walnut Street Fair Oaks Ave Victoria Way Halcyon Road (South) Sycamore Drive Halcyon Road (South) Gaynfair Terrace End of Culde-Sac Garfield Place East Grand Ave Halcyon Road Walnut Street Alder Street End End of Culde-Sac Alder Street End of Street Ash Street End End of Culde-Sac Corbett Canyon Road Le Point Street End of Culde-Sac End East Branch Street McKinley Street May Street Route 227 Nelson Street Allen Street Traffic Way The following streets are eliminated from the scope of work and will be deferred to future projects: Street - To Schedule B - Microsurfacing Brisco Road East Grand Avenue Linda Drive Brisco Road Linda Drive El Camino Real Schedule C - Microsurfacing Farroll Avenue City Limit Elm Street (South) Agenda Item 8.f. Page 4 CITYCOUNCIL CONSIDERATION OF AN AWARD OF CONTRACT TO AMERICAN ASPHALT SOUTH, INC. FOR CONSTRUCTION OF THE 2012 STREET RESURFACING PRO.IECT AND APPROPRIATE FUNDS FOR SHORT STREET IMPROVEMENTS JUNE 26,2012 PAGE 5 Farroll Avenue Elm Street (South) Farroll Avenue Pecan Street Farroll Avenue Halcyon Road (South) Schedule I - Slurry Seal Glenbrook Bakeman NE Schedule M - Slurry Seal Bridge Street Branch Street (East) Garden Street Allen Street Garden Street Allen Street Nelson Street Traffic Way Nelson Street Mason Street (South) Noguera Place Myrtle Street PC Railway Allen Street PC Railway East Cherry Ave Poole Street Traffic Way Short Street Allen Street Short Street Nelson Street Trinity Ave Traffic Way Village Court Trinity Ave Whiteley Street Poole Street Whiteley Street End of Street Schedule N - Microsurfacing Allen Street Traffic Way Cherry Avenue (East) PC Railway Cherry Avenue (East) Traffic Way Schedule 0 - Slurry Seal Brighton Avenue Oak Park Blvd. Schedule P - Slurry Seal White Court Ridegeview Way Ridegeview Way White Court Schedule Q - Microsurfacing Corbett Canyon Road Route 227 Pecan Street Halcyon Road (South) End of Cul-de-sac Bakeman NW Traffic Way Ide Street East Cherry Street Mason Street (South) End of Cul-de-sac End of Cul-de-sac End of Street Allen Street Mason Street (South) Nelson Street End of Street (creek) End of Street End of Cul-de-sac Nelson Street Poole Street Garden Street Branch Mill Road PC Railway Courtland Street End of Cul-de-sac - Tally Ho Road . - City Limit Staff has determined the bid to be responsive and recommends the award of a construction contract to American Asphalt South, Inc. in the revised amount of $705,094. Please note that the deletion of schedules does not affect the order of the bidders and American Asphalt South, Inc. remains the lowest responsive bid for the revised scope of work. The contract time is 30 calendar days. Work is expected to begin in early August and complete in September. It is important to emphasize again the general pavement management strategy that the City has been pursuing since the Local Sales Tax measure was approved. It includes an effort to concurrently improve some of the worst streets each year, while also providing maintenance to those streets that are in good condition. This sometimes results in confusion by the public when they see streets improved, while there are Agenda Item 8.f. Page 5 CITY COUNCIL CONSIDERATION OF AN AWARD OF CONTRACT TO AMERICAN ASPHALT SOUTH, INC. FOR CONSTRUCTION OF THE 2012 STREET RESURFACING PROJECT AND APPROPRIATE FUNDS FOR SHORT STREET IMPROVEMENTS JUNE 26,2012 PAGE 6 others in worse condition. However, since street reconstruction work is -so expensive, the City would fall further behind each year if all the funds were invested in those projects. Under the current strategy, more streets are brought up to good condition each year, while preventative maintenance is provided to those in good condition to avoid more expensive treatments in'the future. The recommendations for adjustments to Local Sales Tax expenditures were based on transferring funds from lower priority projects and those not identified in the Critical Needs Action Plan. Acquisition of the Le Point Street parking lot property was originally planned to be funded by the Redevelopment Agency. When the Redevelopment Agency was dissolved, partial funding was transferred from the Car Corral by limiting those improvements to resurfacing, which would be paid for from the Downtown Parking Fund. 'The lease on the Le Point Street Parking Lot property will expire.in 2021. It is anticipated that $500,000 to $700,000 will eventually be needed based upon current values. The funding program can be extended beyond 2021 through'debt service if necessary. As part of the FY 2012-1 3 budget report, a new 5-Year Plan is proposed~for Local Sales Tax funds. In order to address the funding loss to the Le Point Street Parking Lot, it includes a recommendation to begin budgeting funds for property acquisition in FY 14- 15; which would be increased each year. Based on the recommended 5-Year Plan, it is anticipated that sufficient funding would be accumulated by the expiration of the lease. Therefore, utilizing available funding now for street improvements will help reduce future costs and increase available revenue by preventing more costly street repairs. ALTERNATIVES: The following alternatives are provided for the Council's consideration: . 1. Approve staff's recommendations to award a construction contract to the lowest responsive bidder for the 2012 Street Resurfacing Project and .the proposed adjustments to Local Sales Tax expenditures; 2. Approve the 2012 Street Resurfacing Project, but maintain funding reserved for the Le Point Street Parking Lot property acquisition and instead defer streets in Schedule L, Sunset Drive from Schedule K, and Mason Street from Schedule N; 3. Approve the 2012 Street Resurfacing Project, but maintain funding reserved for the Le Point Street Parking Lot property acquisition and instead defer projects to connect the existing drop inlet at Platino Lane and Oro Drive to the nearest drop inlet downstream and construction of an underground drainage system to collect and discharge underground water at Miller Way; 4. Do not award a construction contract for the project; or 5. Provide direction to staff. Agenda Item 8.f. Page 6 CITY COUNCIL CONSIDERATION OF AN AWARD OF CONTRACT TO AMERICAN ASPHALT SOUTH, INC. FOR CONSTRUCTION OF 'THE 2012 STREET RESURFACING PROJECT AND APPROPRIATE FUNDS FOR SHORT STREET IMPROVEMENTS JUNE 26,2012 PAGE 7 ADVANTAGES: The consistent application of slurry seals and microsurfacing is part of. a yearly maintenance program essential to ensure the integrity of the City's roadway network. The program is designed to apply maintenance treatments to every street in the City on an ongoing seven year cycle. The recommendations maintain funding for the highest priority projects and minimize deferring improvement of streets in the approved pavement management program. DISADVANTAGES: . There is a slight inconvenience to the traveling public as vehicles are rerouted when the surface treatments are applied. The recommendations delay savings for acquisition of the Le Point Street Parking Lot property, as well as other budgeted projects. ENVIRONMENTAL REVIEW: '. The project is categorically exempt from CEQA pursuant to Section 15301 (c). PUBLIC NOTIFICATION AND COMMENTS: The agenda was posted on Thursday, June 21,2012. The agenda and staff report was posted on the City's website on Friday, June 22, 2012. No public comments were received as of the time of preparation of this report. Attachment: 1. Bid Tabulations Agenda Item 8.f. Page 7 Attachment No. 1 BID OPENING LOG SHEET CITY OF ARROYO GRANDE SUBMITTED BY: Graham Contractors, Inc. San Jose, CA DEADLINE: MAY 8, 2012, 2:00 PM 2012 STREET RESURFACING PROJECT Roy Allan Slurry Seal, Inc. Santa Fe Springs, CA Valley Slurry Seal Co. Sacramento, CA TOTAL $1,038.142.95 California Pavement Maintenance Co., Inc. $1,012,005.87 Sacramento, CA ~merican Asphalt South, Inc. Fontana, CA Asphalt Maintenance Company of California $1,146,979.06 Visalia, CA c: Director of Community Development Asslstant City Engineer City Manager Agenda Item 8.f. Page 8