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Home My WebLink About03.c. (Handout) Draft Position PaperK — V_=T 'p-arco7acra" (7cw's- X MEETING DATE SUBJECT: SUBMITTED BY: DRAFT CENTRAL SAN BOARD OF DIRECTORS POSITION PAPER NOVEMBER 16, 2017 Page 2 of 13 Item 8. AUTHORIZE THE GENERAL MANAGER TO TRANSFER ADDITIONAL FUNDS, INCREASE THE CONTINGENCYAMOUNTAND CHANGE ORDER LIMIT FOR THE PLEASANT HILL—GRAYSON CREEK TRUNK SEWER PROJECT, DISTRICT PROJECT 8412 INITIATING DEPARTMENT: EDGAR J. LOPEZ, CAPITAL PROJECTS DIVISION ENGINEERING AND TECHNICAL SERVICES -CAPITAL MANAGER PROJECTS REVIEWED BY: JEAN -MARC PETIT, DIRECTOR OF ENGINEERING AND TECHNICAL SERVICES ISSUE Board of Directors' authorization is required to transfer more than $500,000 in the Capital Improvement Budget (CI B); authorization is also required to increase the contract contingency above the budgeted amount at award; and to execute a construction change order in an amount greater than $100,000. BACKGROUND The Pleasant Hill -Grayson Creek Trunk Sewer, District Project 8412, installed over 10,000 feet of replacement trunk and main sewers in the public right of way, with the majority of the work within the City of Pleasant Hill and a section impacting the City of Martinez. Three major creek crossings, construction on Pleasant Hill Road (major arterial roadway), and abandonment of several sewers in private easements including along Grayson Creek was completed during this project. Central San included the Pleasant Hill Corridor Project, which replaced the trunk sewer on Pleasant Hill Road to build ahead of Pleasant Hill's proposed paving plans. Constructing the sewers prior to Pleasant Hill's project avoids additional paving reconstruction, mobilization costs, and public impacts. This project was awarded to Mountain Cascade, I nc. (MCI) on February 18, 2016 for a Construction Contract valued at $10,401,854. A Notice to Proceed was issued early April of 2016 with an anticipated completion date in May of 2017. The project has experienced many unanticipated time extensions and cost overruns. MCI was able to achieve substantial completion of the contract by November 1, 2017, ahead of the upcoming winter season, and is currently working on the final project punch -list items. The reasons for the time extension and cost overruns are outlined below: 1) Unexpected Heavy Rains in the 2016-17 Winter: During the winter of 2016-17, the East Bay was hit with significant rain events and wet weather not experienced in many years. During this time, MCI was working in the residential neighborhood sites in Pleasant Hill. Although the design included trenchless construction methods, the rain impacted the construction sites by increasing dewatering operations and resulting in saturated soils that impacted the area for several months, and slowing the project pace more than planned. Additional costs were incurred during this period, which included dewatering equipment rental, settlement monitoring, spoils removal costs, and other unforeseen items. Performing construction during parts of the winter was critical to the project schedule. However, this work did result in more restoration in the residential streets (new asphalt paving or micro -surfacing). 2) Changed Site Conditions: In addition, many of the existing residential streets were constructed below the standard specifications used today and the sewer construction had to be coordinated in a manner to prevent major street damage. Additional costs were incurred to remedy these deficiencies, which included settlement monitoring, spoils removal costs, unknown utilities, and other unforeseen items. 3) Hard Rock Excavation: A change order was agreed to by Central San and MCI to cover the additional costs for hard rock excavation which was encountered at Westover Drive and Pleasant Hill Road. The cost of this work was $97,900. November 7, 2017 EOPS Regular Committee Meeting Agenda Packet - Page 9 of 28 [REVISED] Page 3 of 13 4) Coordination with the City of Pleasant Hill (City): The contract with MCI included requirements for traffic control plans and permit conditions within the City. The City required multiple revisions to the permit issued under the bid phase and repeatedly issued multiple conditions as work progressed under the project. Sometimes, these changes were issued daily. There were many unanticipated items required by the City, which included numerous traffic control plans (over 30 plans were submitted), additional CalTrans traffic changeable message signs (CMS) boards, notifications, work hour changes, residential work -zone barriers, City meetings, and inspections. The City also hired a contract inspector and consultant to review and oversee the work since City staff was unavailable and consumed in other projects. Central San staff worked diligently on a daily basis with the City and its consultants to coordinate the contractor activities and stay ahead of the construction, but the permit conditions and the sewer installation sequencing made it difficult to construct the project in a linear fashion, and rendered the progress slow at times. To reach the progress to date, MCI elected to work weekends and nights on many occasions since the work hours were less restricted and more construction could be facilitated. Additional costs were incurred due to the permit conditions such as the CMS boards, flaggers, steel plates, standby or loss production, inspection overtime, and other related work. The wet winter and the unanticipated requirements from the City of Pleasant Hill, changed site conditions, and unforeseen conditions contributed to the additional time needed to complete the project, also resulting in higher overall project costs. ALTERNATIVES/CONSIDERATIONS Reject all actions, which is not recommended. FINANCIAL IMPACTS The Board authorized a total project budget of $13,700,000 at award. As of November 3, 2017, staff has projected that the total budget may reach $15,100,000, which is $1,400,000 (approximately 10 -percent budget overrun) to complete the project. The $1,400,000 estimated budget is needed for the following items: Description Budaet Added New Construction Contract (MCI) $10,401,854 $0 $10,401,854 Contract Contingency to 8.5% $626,146 $258,000 $884,146 Permits $50,000 $360,000 $410,000 Central San Forces $465,000 $366,000 $831,000 Consultants $757,000 $416,000 $1,173,000 Prebid Costs $1.400.000 $0 $1.400.000 Totals $13,700,000 $1,400,000 $15,100,000 This project is expected to be closed -out by March 2018. Staff is recommending transferring the remaining Fiscal Year 2017-18 CIB Contingency budget of $1,260,000 and $140,000 from the Pipe -Bursting Contract 2017-2020, District Project 8440, to cover the budget overrun. This action will leave a remaining balance of zero ($0) in the CIB contingency account. The General Manager has the authority to transfer the $140,000 from District Project 8440. COMMITTEE RECOMMENDATION This subject was presented and discussed at the Engineering and Operations Board Committee on November 7, 2017, and recommended approval of the additional budget for the Project. RECOMMENDED BOARD ACTION Staff recommends the following: 1. Authorize the General Manager to transfer $1,260,000 from the Cl B Contingency Account to the Pleasant Hill -Grayson Creek Trunk Sewer, District Project 8412; and 2. Authorize a contract contingency budget not to exceed 8.5 -percent and allow the General Manager to execute change orders up to $200,000 to finalize the contract. November 7, 2017 EOPS Regular Committee Meeting Agenda Packet -Page 10 of 28 [REVISED]