Subject: HELLYER-PIERCY IMPROVEMENT DISTRICT NO. 99-218SJ, CONTRACT #1
COUNCIL DISTRICT: 2
Report on bids and award of contract for Improvement District No. 99-218SJ (Hellyer-Piercy), Contract #1 (“Contract #1”) to the low bidder, Granite Rock Company dba Pavex Construction Division, in the amount of $13,433,163, and approval of a contingency in the amount of $2,015,000. CEQA: Resolution No. 69699.
BACKGROUND
The Hellyer-Piercy
Improvement District 99-218SJ (the “District”) area has been planned for
industrial development since 1979 when it was adopted as a Redevelopment
Project Area (see Attachment A). On
June 27, 2000, the City Council took the necessary steps to initiate the
process of forming the District. On
August 15, 2000, the City Council tabulated the ballots, approved the District,
and adopted the Engineer’s Report and the assessments. On May 15, 2001, the City Council confirmed
the Amended Engineer’s Report and the assessments and authorized the issuance
of limited obligation improvement bonds of $27,595,000.
The improvements
proposed to be constructed by the District have been split up into two
zones. Zone A includes the extension of
Hellyer Avenue, improvements to Silver Creek Valley Road and Piercy Road,
related water, sanitary, storm, and utility improvements (“Infrastructure
Improvements”), and numerous traffic mitigation improvements including the
gateway improvements at Silicon Valley Road Bridge over Coyote Creek and
interchanges at Route101/Blossom Hill Road and Route101/Hellyer Avenue. Zone B includes an extension from the Silver
Creek Valley Road bridge and roadway construction to serve the parcel located
between Route 101 and Coyote Creek.
Improvements for both zones will require at least four construction contracts. Contract #1 includes Zone A’s Infrastructure
Improvements and is being recommended for award at this time.
Bids for this project were received on May 10, 2001. The bid results are as follows:
|
Contractor
|
Bid Amount |
Variance Amount |
Over/(Under) Percent |
|
|
|
|
|
|
Engineer’s Estimate |
$17,320,000 |
--- |
--- |
|
Brundidge Construction (Clackamas, OR) |
16,866,478 |
(453,522) |
(3) |
|
Granite Construction (San José, CA) |
15,601,298 |
(1,825,418) |
(10) |
|
Top Grade Construction (Livermore, CA) |
15,410,010 |
(1,909,990) |
(11) |
|
FERMA Corp. (Mountain View, CA) |
14,868,683 |
(2,451,317) |
(14) |
|
Desilva Gates Construction (Dublin, CA) |
14,457,130 |
(2,862,870) |
(17) |
|
RGW Construction (Livermore, CA) |
14,212,664 |
(3,107,336) |
(18) |
|
Granite Rock Co. DBA Pavex Construction Division (Redwood City, CA) |
13,433,163 |
(3,886,837) |
(22) |
The low bid submitted by Granite Rock Co.
dba Pavex Construction Division is 22 percent below the Engineer’s Estimate.
The lower cost can be attributed to the highly competitive market for this type
of work.
A contingency of $2,015,000 (15% of the cost of construction) is requested for any unforeseen conditions that may arise during construction. In part, this contingency request - an increase over the standard 10% of construction costs - is being sought to cover any possible additional costs related to utility companies’ joint trench items. Although the joint trench design was coordinated with utility companies, PG&E was unable to meet design review deadlines when Contract #1 moved forward and it is possible modifications to the joint trench design may be required. Bids for joint trench and other related electrical items ranged from $2M to $3.6M, a variance of $1.6M. Therefore, the additional 5% ($672,000) is a reasonable addition to the standard 10% contingency to cover unforeseen joint trench costs.
This proposed project was listed on the City’s Internet bid line and advertised in the San José Mercury News and San José Post Record. Bid packages for all Department of Public Works construction projects are routinely provided to a standard list of various contractor organizations, builder’s exchanges and disadvantaged business organizations, including United Minority Business Enterprises and the San José Minority Business Development Center.
This project has been coordinated with the Departments of Planning, Building and Code Enforcement, Transportation, and Finance and the Offices of the City Attorney, Risk Manager, and Equality Assurance, the Redevelopment Agency (the Agency), the Santa Clara Valley Water District and the California Department of Fish and Game.
1. COST OF RECOMMENDATION:
Costs of
Contract #1 ($13,433,163 contract amount and $2,015,000 contingency) will be
funded through the proceeds of the sale of the City of San José Limited
Obligation Improvement Bonds, Improvement District 99-218SJ (Hellyer-Piercy)
Bond Series 24Q. The bonds will be
secured by assessments imposed upon each property owner in the District. The Redevelopment Agency is paying for the
cost of right-of-way acquisition.
2. ESTIMATED COST OF TOTAL PROJECT (Contracts 1 – 4):
Construction $20,659,000
Gateway Improvements 10,053,000
Design Development 854,000
Design
& Construction Management 1,763,0001,006,000
District Financing 6,105,000
TOTAL $39,434,00038,677,000
3. SOURCE OF FUNDING:
Sale of Improvement Bonds $27,595,000
Advance
from Redevelopment Agency 10,810,00010,053,000
Cash Prepayment 1,029,000
TOTAL $39,434,00038,677,000
In addition to the
above referenced source of funding, the Agency is contributing approximately
$15 million to cover costs associated with right-of-way
acquisition, civil
engineering, environmental, and other related consultant services,
and a portion of City’s Design & Construction Management fee.
4. ESTIMATED START DATE OF CONSTRUCTION: July, 2001
5. ESTIMATED COMPLETION DATE OF CONSTRUCTION: December, 2002
Fund: Established after the receipt of bond proceeds
Amount: $27,595,000
The City of San José Nondiscrimination Requirements are included in this project as required by Chapter 4.08 of San José Municipal Code.
RAJEEV BATRA
Acting Director, Public Works Department