HomeMy WebLinkAbout12. Authorize to amend an existing contract with J.T. Thorpe for completed Multiple Hearth Furnace repairs Page 1 of 2
Item 12.
CENTRAL SAN BOARD OF DIRECTORS
POSITION PAPER
MEETING DATE: AUGUST4, 2022
SUBJECT: AUTHORIZE THE GENERAL MANAGER TO AMEND AN EXISTING
CONTRACT I N AN AMOUNT NOT TO EXCEED $39,500 WITH J.T. THORPE
& SON, I NC., I NCREASI NG THE COST CEI LI NG TO $236,900 FOR
COMPLETED REPAIRS TO THE MULTIPLE HEARTH FURNACE
REFRACTORY
SUBMITTED BY: INITIATING DEPARTMENT:
CLI NTSHIMA, SENIOR ENGINEER OPERATIONS-RELIABILITYENG INEERING
REVIEWED BY: NEIL MEYER, PLANT MAINTENANCE DIVISION MANAGER
STEVE MCDONALD, DIRECTOR OF OPERATIONS
Roger S. Bailey
General Manager
ISSUE
In accordance with purchasing procedures, Board of Directors (Board) authorization is required for the
General Manager to amend a services agreement when the total amount exceeds the staff authority of
$200,000.
BACKGROUND
Central San operates two multiple hearth furnaces (MHFs)to incinerate sludge before it is hauled off for
soil amendment and disposal. Each furnace is operated in alternating years, which allows for preventive
maintenance (PM) activities before beginning its year-long operation. There are approximately 50 PM
procedures and multiple contractors hired to complete all the critical activities that must occur prior to
starting up the furnace. One of these activities is the refractory repair. Every year, staff hires the original
equipment manufacturer, BSP Thermal Systems, Inc. (BSP)to perform a thorough inspection. BSP
provides a report, which includes recommended repairs. Competitive pricing is obtained for the refractory
repair work by Purchasing using the informal Request for Quotations process. The repair scope includes
report recommendations, as well as any outstanding issues identified by staff. J.T. Thorpe & Son, I nc. (JT
August 4, 2022 Regular Board Meeting Agenda Packet- Page 62 of 94
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Thorpe) submitted a low bid of$111,800 and was awarded the contract. The second bid was $291,000
by BSP.
Upon partial removal of the west wall section in the gas outlet area, JT Thorpe discovered that additional
refractory was not anchored securely and had to be removed. Almost 20,000 pounds of gunite and 400
stainless steel anchors were added to repair the gas outlet area, increasing the original contract amount by
$85,600. After all the loose refractory was removed, the underlying steel was found to be severely
corroded. The deteriorated steel had to be removed and there were even some areas of breakthrough of
the steel shell, which required welding new steel plates. Staff proceeded with the steel repair work at that
time because the additional costs would have increased if JT Thorpe stopped and remobilized at a later
date to complete the work. The cost for these additional repairs was $39,500, bringing the total contract
amount above the $200,000 General Manager authority limit. Staff authorized the additional work to
proceed as time was of the essence. The work is now complete and staff is seeking the Board's approval
to amend the contract.
ALTERNATIVES/CONSIDERATIONS
JT Thorpe has completed the refractory and steel repairs for the reasons stated above; therefore, there is
not a suitable alternative to consider.
FINANCIAL IMPACTS
Funds to cover this contract amendment are available in the Plant Maintenance Fiscal Year 2022-23
Budget.
COMMITTEE RECOMMENDATION
This item was not reviewed by the Engineering & Operations Committee.
RECOMMENDED BOARD ACTION
Authorize the General Manager to amend an existing contract in an amount not to exceed $39,500 with
J.T. Thorpe & Son, I nc., increasing the cost ceiling to $236,900 for completed repairs to the multiple
hearth furnace refractory.
Strategic Plan Tie-In
GOAL SIX: Infrastructure Reliability
Strategy 1 - Manage assets optimally
August 4, 2022 Regular Board Meeting Agenda Packet- Page 63 of 94