SUBJECT:     SCHEDULED/EMERGENCY REPAIRS AND INSTALLATION OF NON-POTABLE WATER SERVICES AND MAINS 2003-04 CONTRACT

 

COUNCIL DISTRICTS:  City-wide

 

 

RECOMMENDATION

 

Report on bids and recommendation to: 

 

1.      Reject all bids for the Scheduled/Emergency Repairs and Installation of Non-Potable Water Services and Mains 2003-2004 Contract, and

 

2.      Adoption of a resolution authorizing the City Manager to negotiate and execute a ten-year system-wide repair agreement with San Jose Water Company that includes SBWR facilities, in an amount not to exceed $250,000 per year with a guaranteed cost savings of at least 10% (percent) over the existing (FY 2002-03) contract.

 

 

BACKGROUND

 

The Municipal Water System (Muni Water) has bid for an annual contract for miscellaneous repairs, emergency repairs, and new installations to Muni Water and South Bay Water Recycling (SBWR) Program facilities for many years.  This contract has allowed all emergency repairs non-emergency repairs, and new installations to be made by one contractor for the one-year duration of the contract, instead of processing a separate contract for each repair or installation.

 

On March 18, 2003, City Council directed staff to begin negotiations with San Jose Water Company to contract the Muni Water repairs for a period of ten years.  At that time, the combined repairs and installations for both potable and non-potable facilities were already out to bid.  Because the Treatment Plant Advisory Committee had not been involved in the decision to contract with San Jose Water Company, staff removed the Muni Water facilities from the project, and only requested bids for the SBWR facilities. 

 

 

ANALYSIS

 

Bids for the revised project were opened on April 10, 2003, with the following results:

 

 

Contractor

 

City
 

Bid Amount
Variance Over / (Under)
     Amount         Percent

 

Engineer’s Estimate

 

 

$217,482.00

 

 

San Jose Water Company

 

San Jose

$186,396.00

$31,086.00

(-14%)

Preston Pipeline, Inc.

 

Milpitas

$214,856.91

$2,625.09

(-1%)

Pacific Underground

   Construction

 

San Jose

 

$223,723.16

 

$6,241.16

 

3%

 

The apparent low bid submitted by San Jose Water Company is 14% below the Engineer’s estimate.  The bid submitted by San Jose Water Company omitted some of the requirements, which cannot be waived, and is therefore non-responsive.  However, the bid prices submitted by San Jose Water Company for SBWR facilities are similar to those prices being negotiated in the contract for the repair of Muni Water facilities and there are efficiencies that can be achieved by combining the two repair contracts. 

 

Pursuant to Council direction, staff is in the process of developing a ten-year contract with San Jose Water Company for repairs to the Muni Water potable system.  Combining the potable and non-potable repairs into a single 10-year contract will create added efficiencies.  Therefore, it is recommended that Council:

 

a)      Reject all bids for the Scheduled/Emergency Repairs and Installation of Non-Potable Water Services and Mains 2003-2004 Contract, and

 

b)      Adopt a resolution authorizing the City Manager to negotiate and execute a ten-year system contract with San Jose Water Company for repairs that includes SBWR facilities in an amount not to exceed $250,000 per year, with a guaranteed cost savings of at least 10% over the existing contract.

 

 

 

PUBLIC OUTREACH

 

This project was advertised in March 2003 in the San Jose Mercury News and the San Jose Post Record.

 

 

COORDINATION

 

This project has been coordinated with Risk Management, Equality Assurance and the City Attorney’s Office and was scheduled to be heard at the Treatment Plant Advisory Committee (TPAC) at its May 8, 2003 meeting.

 

 

COST IMPLICATIONS

 

1.   Amount of Recommendation:  Not to exceed $250,000 annually

 

2.   Cost of Project:  Not to exceed $250,000 annually

     

3.   Source of Funding:  513 – San Jose – Santa Clara Treatment Plant Operating Fund

 

This recommendation meets the general principles of the Mayor’s FY 2003-04 Budget Strategy by protecting a core service and reducing costs.

 

 

BUDGET REFERENCE

 

            Fund:                                        San Jose-Santa Clara Treatment Plant Operating

                                                            Fund – 513

          Appn:                                       0762 – Non-Personal/Equipment

            Amount:                                   $31,812,931

            Budget Document:                    2002-2003 Adopted Operating Budget

                                                            Page 888, amended on October 15, 2002, Ordinance Number 26755 

 

Historically, funding for this project has been included as part of the Department’s ongoing budget.  Funding of this contract will be subject to Council approval of the Annual Budget.

 

 

NONDISCRIMINATION

 

The City of San Jose Nondiscrimination Requirements are included in this project as required in Chapter 4.08 of the San Jose Municipal Code.

 

 

CEQA

 

Exempt, PP85-8-183 and PP91-07-173

 

 

CARL W. MOSHER

Director, Environmental Services Department