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Home My WebLink About07.b. Award a construction contract in the amount of $555,000 to D. W. Nicholson Corporation, the lowest responsive and responsible bidder for the Treatment Plant Energy – Cogeneration Unit Optimization, District Project 7320 7. b. Central San ' BOARD OF DIRECTORS POSITION PAPER Board Meeting Date: May 18, 2017 Subject: AWARD A CONSTRUCTION CONTRACT AND AUTHORIZE THE GENERAL MANAGER TO EXECUTE CONTRACT DOCUMENTS SUBJECT TO SUBMITTAL REQUIREMENTS WITH D.W. NICHOLSON CORPORATION FOR THE CONSTRUCTION OF THE TREATMENT PLANT ENERGY— COGENERATION UNIT OPTIMIZATION, DISTRICT PROJECT 7320 Submitted By; Initiating Dept./Div.: Craig Mizutani, Senior Engineer Engineering and Technical Services/Capital Projects REVIEWED AND RECOMMENDED FOR BOARD ACTION: E. Lopez—Division Manager JM. Petit—Director of Engineering and Technical Services Roger S.Baile General Manag r ISSUE: On April 19, 2017, three (3) bids were received and opeAwl for the construction of the Treatment Plant Energy— Cogeneration Unit Optimization, District Project 7320 (Project). Authorize the General Manager to execute the Contract Documents subject to submittal requirements. BACKGROUND: The Project aligns with Central San's Energy Policy and Strategic Plan as follows: • This Project has a total project payback period of about three and a half years (minimum 15 years per Energy Policy); • Goal 2, Strategy 1 — Strive to Achieve 100-percent Permit Compliance by installing a carbon monoxide (CO) catalyst to reliably operate the system below regulatory CO limits; and • Goal 3, Strategy 2 — Manage Costs by optimizing the power production of the treatment plant to reduce costs. The purpose of this project is to increase energy efficiency, reduce utility costs, and decrease CO emissions at the treatment plant. There has been a significant increase in Pacific, Gas & Electric Company (PG&E) import costs due to CO emission limits imposed by the Bay Area Air Quality Management District (BAAQMD) on the cogeneration system. Based on utility bills last year, the yearly increase is approximately $300,000. This Project will reduce CO emissions by installing an oxidation catalyst, and increase energy efficiency for operation during hot weather operations by installing an evaporative cooling system. These improvements will help ensure regulatory compliance and reduce the added PG&E costs. Page 1 of 6 POSITION P Board Meeting Date: May 181 2017 Subject. AWARD A CONSTRUCTION CONTRACT AND AUTHORIZE THE GENERAL MANAGER TO EXECUTE CONTRACT DOCUMENTS SUBJECT TO SUBMITTAL REQUIREMENTS WITH D.W. NICHOLSON CORPORATION FOR THE CONSTRUCTION OF THE TREATMENT PLANT ENERGY-- COGENERATION UNIT OPTIMIZATION, DISTRICT PROJECT 7320 Central San staff and Carollo Engineers (Carollo) prepared the plans and specifications for the Project. The Engineer's estimate for construction was $600,000 and was revised to $650,000 to include replacement of the obsolete and old reverse osmosis system that supplies purified water to the cogeneration system and needed for the evaporative cooler. This Project was advertised on March 17 and 27, 2017. Three sealed bids ranging from $555,000 to $739,000 were received and publicly opened on April 19, 2017. The Engineering and Technical Services Department conducted a technical and commercial review of the bids and determined that D.W. Nicholson Corporation is the lowest responsive and responsible bidder with a total bid amount of $555,000. A summary of bids received is shown in Attachment 2. Staff recommends retaining Carollo to provide support services during the construction phase, which includes reviewing shop drawings and submittals, responding to design questions, evaluating change order requests, performing site visits to verify compliance with the design, electrical inspection, coordination with Solar Turbines, and other related activities. An as-needed construction support services agreement amendment with a cost ceiling of $90,000 has been negotiated with Carollo. On November 3, 2016, the Board authorized a professional consulting agreement for $120,000 with Carollo for the design of the project. The new cost ceiling for the Carollo agreement, including the amendment, will be $210,000. ALTERNATIVES/CONSIDERATIONS: Reject all bids, which is not recommended. Not performing the Project will result in additional PG&E costs of $300,000 or more per year to the Operations and Maintenance Budget. CEQA: Staff has concluded that this project is exempt from the California Environmental Quality Act (CEQA) under District CEQA Guidelines Section 15301, since it involves minor alterations to existing public facilities involving no expansion of use. Approval of this project will establish the Board of Directors' independent finding that this project is exempt from CEQA. FINANCIAL IMPACTS: The total estimated project costs is $1,094,000 (updated for Fiscal Year 2017-18), which includes planning, predesign, detailed design, bid, construction contract, contingency, and construction management costs as shown in Attachment 3. The Project is being funded under the Plant Energy Optimization District Project 7320 included in the Fiscal Year 2016-17 Capital Improvement Budget on page 133 with a total estimated project budget of $1,400,000. The project description, budget, Page 2of6 POSITION PAPER Board Meeting Date: May 181 2017 subject AWARD A CONSTRUCTION CONTRACT AND AUTHORIZE THE GENERAL MANAGER TO EXECUTE CONTRACT DOCUMENTS SUBJECT TO SUBMITTAL REQUIREMENTS WITH D.W. NICHOLSON CORPORATION FOR THE CONSTRUCTION OF THE TREATMENT PLANT ENERGY— COGENERATION UNIT OPTIMIZATION, DISTRICT PROJECT 7320 and schedule revision was presented to the Engineering and Operations Committee meeting on October 21, 2016. COMMITTEE RECOMMENDATION: The Engineering and Operations Committee reviewed this subject at the meeting on May 9, 2017, and recommended approval of the Project. . RECOMMENDED BOARD ACTION: Staff recommends the following: 1. Find that the Project is exempt from CEQA; 2. Award a construction contract in the amount of $555,000 for the construction of the Treatment Plant Energy— Cogeneration Unit Optimization, District Project 7320 to D.W. Nicholson Corporation, the lowest responsible and responsive bidder; 3. Authorize the General Manager to execute the Contract Documents subject to submittal requirements and include up to 10-percent contingency; and 4. Authorize the General Manager to execute an amendment with Carollo Engineers, Agreement 044520, to increase the cost ceiling from $120,000 to $210,000 to provide as-needed construction support services for the Project. Attached Suppo�Documents: 1. Project Location Map 2. Summary of Bids 3. Post-Bid/Preconstruction Estimate Page 3of6 V ATTACHMENT 1 TREATMENT PLANT ENERGY — COGENERATION UNIT OPTIMIZATION DISTRICT PROJECT 7320 LOCATION MAP _k V, ID • I ` 0 ion 900 FEET 0 x` r• ` PROJECTY, �+ SITE KUDS wY CON U Y rvwx CN C3 � k e � •"' � / i•/r , 401, v nJ y QJ U Central contra costa TREATMENT PLANT ENERGY- Attachment Sanitary District ,COGENERATION UNIT OPTIMIZATION District Project 7320 1 Martinez, California Page 4 of 6 v ATTACHMENT 2 TREATMENT PLANT ENERGY— COGENERATION UNIT OPTIMIZATION DISTRICT PROJECT 7320 SUMMARY OF BIDS PROJECT NO.: 7320 NO. OF ADDENDA: 2 DATE/TIME: APRIL 19, 201792:00 PM PROJECT NAME: TREATMENT PLANT ENERGY-COGENERATION UNIT OPTIMIZATION PROJECT MANAGER: CRAIG MIZUTANI PROJECT LOCATION: 5019 I M HOFF PLACE, MARTINEZ, CALIFORNIA ENGINEER'S ESTIMATE: $650,000 NO. BIDDER BID PRICE D.W. Nicholson Corporation 1 $555,000 Hayward, California ACCO Engineered Systems 2 $651,542 San Leandro, California Blocka Construction, Inc. 3 $739,000 Fremont, California BIDS OPENED BY: /s/ Elaine R. Boehme, CMC DATE: April 19, 2017 Page 5of6 ATTACHMENT 3 TREATMENT PLANT ENERGY— COGENERATION UNIT OPTIMIZATION DISTRICT PROJECT 7320 POST-BID/ PRECONSTRUCTION ESTIMATE No. Item Description Amounts % of Total Estimated Project Cost 1. CONSTRUCTION a. Construction Contract $555,000 b. Contingency at 10% $55,500 SUBTOTAL- CONSTRUCTION $610,5100 55.80% 2. CONSTRUCTION MANAGEMENT a. District Forces - Construction Management $20,000 - Operations Support $15,000 - Control System Integration $20,000 b. Consultants - Carollo Support Services $90,000 - I nspection $30,000 SUBTOTAL- CONSTRUCTION $175,000 16.0% MANAGEMENT 3. PREBID EXPENDITURES a. Staff Engineering and Operations $92,500 b. Consultant Fees $120.,000 TOTAL PLANNING AND DESIGN EXPENDITURES $212,500 c. Prior Expenditures $96,,000 SUBTOTAL - PREBID EXPENDITURES $308,500 28.25% 4. TOTAL ESTIMATED PROJECT COST $1,094,000 Page 6of6