To: HONORABLE MAYOR AND From: Katy Allen

CITY COUNCIL

Subject: 60-INCH RCP INTERCEPTOR Date: 11-03-03

REHABILITATION PHASE VB

Council District: 4

RECOMMENDATION

Report on bids and award of contract for the 60-inch RCP Interceptor Rehabilitation Phase VB project to the low bidder, Spiniello Companies, Inc. in the amount of $5,675,180, and approval of a contingency in the amount of $600,000.

CEQA: Exempt, PP03-07-243.

BACKGROUND

The 60-inch RCP Interceptor Rehabilitation Phase VB Project is located on Zanker Road from Trimble Road to Old Bayshore Highway (map attached). The project also includes rehabilitation of portions of an adjacent interceptor, commonly referred to as the 84-inch Reinforced Concrete Pipe (RCP). Internal video inspection revealed that this reinforced concrete pipe (RCP) interceptor is moderately to severely corroded. The project will be funded from two appropriations that have been established for the interceptors commonly referred to as the 60-inch RCP and the 84-inch RCP.

ANALYSIS

Bids were opened on October 23, 2003 with the following results:

Contractor	Bid Amount	Variance Amount	Over/(Under) Percent
Engineer’s Estimate	$7,078,180	---	---
Insituform Technology, Inc. (Benicia)	$6,385,818	($692,362)	(10)
Spiniello Companies (New Jersey)	$5,675,180	($1,403,000)	(20)

The low bid submitted by Spiniello Companies is 20 percent under the Engineer’s Estimate. Staff considers this reasonable for the work involved. The contractor’s price for this project is approximately $1.4 million less than the Engineer’s Estimate. The lower price is attributed to: 1) a recent trend in the falling price of large diameter sewer liners, and 2) the competitive bidding nature of the sewer rehabilitation industry due to current economic conditions. Staff considers this reasonable for the work involved.

Council Policy provides for a standard contingency of ten percent on public works projects involving utilities. The standard contingency is appropriate for this project.

PUBLIC OUTREACH

To solicit contractors, this project was listed on the City’s Internet Bid Line and advertised in the San José Post Record. Bid packages for all Department of Public Works construction projects are provided to various contractor organizations and builder’s exchanges.

COORDINATION

This memo and project have been coordinated with the Departments of Finance and Planning, Building and Code Enforcement, the City Attorney’s Office and the City Manager’s Budget Office.

COST IMPLICATIONS

1. AMOUNT OF RECOMMENDATION: $5,675,180

2. COST OF PROJECT:

Project Delivery	$1,524,820	*
Construction	5,675,180
Contingency	600,000
TOTAL	$7,800,000

*$106,460.08 of the Project Delivery Costs was expended in prior fiscal years

3. SOURCE OF FUNDING: 545 – Sewer Service and Use Charge Capital Improvement Fund

4. FISCAL IMPACT: The proposed operating and maintenance costs of this project have been reviewed and it has been determined that the project will have no significant adverse impact on the General Fund operating budget.

BUDGET REFERENCE

Fund #	Appn. #	Appn. Name	RC #	Total Appn.	Amt. for Contract	2003-2004 Adopted Capital Budget Page	Last Budget Action (Date, Ord.No.)
545	4269	60” Reinforced Concrete Pipe	105893	3,500,000	3,200,000	Page 139
545	4695	84” Reinforced Concrete Pipe	129105	6,000,000	2,475,180	Page 140
		Total		9,500,000	5,675,180

CEQA

Exempt, PP03-07-243.

KATY ALLEN

Director, Public Works Department