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Home My WebLink About07. Authorize execution of an equipment contract with Xylem Water Solutions for pre-purchase of fine bubble diffusers and special services for DP 100019 Page 1 of 4 Item 7. CENTRAL SAN BOARD OF DIRECTORS POSITION PAPER MEETING DATE: APRIL 6, 2023 SUBJECT: AUTHORIZE THE GENERAL MANAGER TO EXECUTE AN EQUIPMENT CONTRACT I N AN AMOUNT NOT TO EXCEED $1.8 MILLION WITH XYLEM WATER SOLUTIONS USA, INC. FOR PRE-PURCHASE OF FINE BUBBLE DIFFUSERS AND SPECIAL SUPPORT SERVICES UNDER THE AERATION BASINS DIFFUSER REPLACEMENT, PHASE 1, DISTRICT PROJECT 100019 SUBMITTED BY: INITIATING DEPARTMENT: WILLIAM GRANT, ASSOCIATE ENGINEER ENGINEERING AND TECHNICAL SERVICES- CAPITAL PROJECTS REVIEWED BY: CRAIG MIZUTANI, SENIOR ENGINEER EDGAR J. LOPEZ, CAPITAL PROJECTS DIVISION MANAGER DANEA GEMMELL, PROVISIONAL DIRECTOR OF ENGINEERING AND TECHNICAL SERVICES Roger S. Bailey General Manager ISSUE The Board of Directors (Board) authorization is required for contracts above $200,000 in the Capital Improvements Program. BACKGROUND In 2019, Central San initiated a comprehensive asset evaluation of the secondary process facilities at the treatment plant, including its four aeration basins. The diffuser system within the basins was identified as an aging asset that was beyond its remaining useful life. The system was tested by an independent party, and it was determined to have an extremely low efficiency due to routine clogging and leaks. Many of the diffusers have been found with irreversible fouling during routine inspection and maintenance. April 6, 2023 Regular Board Meeting Agenda Packet- Page 79 of 176 Page 2 of 4 The Board authorized staff and the project designer, HDR Engineering, Inc. (HDR)to prepare the final design for the four basins and related work on May 6, 2022 as part of the Aeration Basins Diffuser Replacement and Seismic Upgrades Project. Since then, staff has recommended to sequence the replacement work in two project phases. The first project, Phase 1, will consist of replacing the diffusers in two aeration basins, and then Phase 2 will consist of the remaining two basins. This sequence allows Operations the flexibility to meet the normal maintenance requirements or other associated improvements anticipated during the project timelines. Due to the seasonal constraints and efforts to complete the project work, replacing the diffusers in a basin is expected to be on a yearly basis. The Aeration Basins Diffuser Replacement, Phase 1, District Project 100019 (Project), has further evaluated the existing diffuser system and associated piping, especially the large underground aeration piping serving the basins. Full replacement of the aeration diffusers is recommended, and staff has concluded that the underground piping has remaining life with no structural defects. The condition assessment has also indicated that the air leaks are likely due to plenum cracks in the concrete and/or coatings. Prior to finalizing the design, staff has decided to select the diffuser equipment to better ensure the design accuracy and for consistency in diffusers or standardization across all four basins. Pre-purchasing the diffuser equipment may alleviate potential construction schedule delays and result in a lower construction cost to Central San allowing for consistent competitive pricing in the future project. The final design should be ready by July of this year, and staff plans to purchase the equipment after the award of the installation contract for the first basin to be retrofitted in 2024. Staff, with the assistance of HDR, prepared the diffuser equipment procurement package which was based on qualifications and price. On November 21, 2022, staff advertised a formal public solicitation and bid on PlanetBids and the District's website for fine bubble diffusers, associated piping, and special support services. The Engineer's estimate is $1,500,000. Central San received two bids, $1,537,853 and $1,880,274, on February 7, 2023.A summary of the bidders is shown in Attachment 1. The Capital Projects Division conducted a technical and commercial review of the qualifications and bids, and determined that Xylem Water Solutions USA, Inc. is the lowest responsive and responsible bidder with a bid amount of$1,537,853. ALTERNATIVES/CONSIDERATIONS The Board could consider the following alternatives: • Do nothing, which includes not proceeding with the project. This alternative is not recommended by staff since the existing diffuser system has reached the end of its useful life and the system is critical to the secondary treatment of wastewater. Continuing with the existing system would increase maintenance, costs of repairs, and operational challenges associated with a fouling diffuser system. • Staff plans to pre-purchase the equipment; however, an alternative would be to include the equipment into the bid for the installation contractor. This alternative would not guarantee diffuser pricing since the diffuser installation is planned to be split into two phases. In addition, the proposed equipment contract allows for the designer and Central San to work together with the vendor to fine- tune a system that would be optimal for the District's maintenance staff and still meet the fabrication or delivery time for the installation contractor. • Reject bids, which is not recommended. This equipment contract will ensure continuity and costs for the aeration basins improvements and increase reliability and efficiency in the secondary process area in the treatment plant. April 6, 2023 Regular Board Meeting Agenda Packet- Page 80 of 176 Page 3 of 4 FINANCIAL IMPACTS The total estimated cost for the equipment and services is expected to reach $1.8 million which includes vendor engineering, diffuser equipment and material costs, piping, sales tax, delivery, and contract contingency. These costs will be funded by the Aeration Basins Diffuser Replacement and Seismic Upgrades, District Project 100019, and has an estimated total budget of$61.3 million. The project can be found on page 255 in the Fiscal Year 2022-23 Budget and includes adequate available funding in future fiscal years. The equipment contract duration is expected to be four or five years from execution and will be used for the two project phases. The contract contingency is roughly$260,000 and will be potentially used for upgrading materials or diffuser equipment changes requested by Central San and for cost escalation if, for some reason, the project timelines are postponed. The equipment contract has strict provisions for cost escalation and/or de-escalation based on material index pricing. COMMITTEE RECOMMENDATION The Engineering & Operations Committee reviewed this matter at its March 13, 2023 meeting and recommended approval. RECOMMENDED BOARD ACTION Staff recommends authorizing the General Manager to execute an equipment contract in an amount not to exceed $1.8 million with Xylem Water Solutions USA, Inc. for pre-purchase of fine bubble diffusers and special support services under the Aeration Basins Diffuser Replacement, Phase 1, District Project 100019. Strategic Plan re-In GOAL TWO: Environmental Stewardship Strategy 1 -Achieve compliance in all regulations, Strategy 4- Identify and advance sustainability initiatives, including reducing energy usage and emissions GOAL FIVE: Safety and Security Strategy 2- Protect personnel and assets from threats and emergencies GOAL SIX: Infrastructure Reliability Strategy 1 - Manage assets optimally, Strategy 2- Execute long-term capital renewal and replacement program GOAL SEVEN: Innovation and Agility Strategy 2- Implement organization-wide optimization ATTACHMENTS: 1. Summary of Bids April 6, 2023 Regular Board Meeting Agenda Packet- Page 81 of 176 Page 4 of 4 ATTACHMENT 1 REQUEST FOR QUALIFICATIONS AND BID: DIFFUSER SELECTION & PROCUREMENT PACKAGE FOR THE AERATION BASINS DIFFUSER REPLACEMENT PROJECT, DISTRICT PROJECT 100019 SUMMARY OF BIDS PROJECT NO.: N/A NO. OF ADDENDA: 2 DATE/TIME: FEBRUARY 7, 2023/2:00 PM PROJECT NAME: RFQ AND BID: DIFFUSER SELECTION & PROCUREMENT PACKAGE FOR THE AERATION BASINS DIFFUSER REPLACEMENT PROJECT, DISTRICT PROJECT 100019 PROJECT MANAGER: WILLIAM GRANT PROJECT LOCATION: 5019 IMHOFF PLACE, MARTINEZ, CALIFORNIA ENGINEER'S ESTIMATE: $1,500,000 NO. BIDDER BID PRICE 1 Xylem Water Solutions USA, Inc. $1,537,853 Charlotte, NC 28217 2 SSI Aeration, Inc. $1,880,274 Poughkeepsie, NY 12603 BIDS OPENED BY /s/ Katie Young DATE: February 7, 2023 April 6, 2023 Regular Board Meeting Agenda Packet- Page 82 of 176