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Home My WebLink About03.c. Amend Existing Professional Engineering Services Agreement with MWH Constructors, Inc. increasing the cost ceiling from $2.6 Million to $3.0 Million for Construction Management Services; Filter Plant and Clearwell Improvements, DP 7361;Page 1 of 3 Item 3.c. DCENTRALSAN MEETING DATE: MAY8, 2023 BOARD OF DIRECTORS POSITION PAPER DRAFT SUBJECT: REVIEW DRAFT POSITION PAPER TO AUTHORIZE THE GENERAL MANAGER TO AMEND AN EXISTING PROFESSIONAL ENGINEERING SERVICES AGREEMENT WITH MWH CONSTRUCTORS, INC., INCREASING THE AGREEMENT COST CEILING FROM $2.6 MILLION TO $3.0 MILLION FOR CONSTRUCTION MANAGEMENT SERVICES FOR THE FILTER PLANT AND CLEARWELL IMPROVEMENTS, DISTRICT PROJECT 7361; AND AUTHORIZE A BUDGET TRANSFER IN THE AMOUNT OF $1.8 MILLION FROM THE CAPITAL IMPROVEMENT BUDGET CONTINGENCY SUBMITTED BY: INITIATING DEPARTMENT: CRAIG MIZUTANI, SENIOR ENGINEER ENGINEERING AND TECHNICAL SERVICES - CAPITAL PROJECTS REVIEWED BY: EDGAR J. LOPEZ, PROVISIONAL DIRECTOR OF ENGINEERING AND TECHNICAL SERVICES ISSUE Authorization from the Board of Directors (Board) is required to execute an amendment to a professional engineering services agreement for amounts greater than $200,000 and transfer more than $500,000 within the Capital Improvement Program. BACKGROUND On August 20, 2020, the Board awarded a $26.6 million construction contract to C. Overaa & Co. (Overaa) for the Filter Plant and Clearwell I mprovements, Phase 1 A, District Project 7361 (Project). This project includes major civil; electrical, instrumentation and controls; mechanical; and process renovations and improvements for the Recycled Water/Filter Plant area. Major elements of the Project include: • Construction of two (2) new Recycled Water Storage Tanks and associated filtered effluent lift station; • Construction of a new 12kV electrical substation, including feeders, transformers, switchgear and motor control centers (MCCs); • Replacement of pump motors and variable frequency drives (VFDs); • Rehabilitation of one (1) of the existing four (4) filters with new underdrain system and media; and • Raising of levees near wet weather basin C and construction of new roadways around the clearwell. May 8, 2023 EOPS Regular Committee Meeting Agenda Packet - Page 21 of 25 Page 2 of 3 Construction of the Project commenced in October of 2020 and was scheduled to be completed by October 14, 2022. MW H is the construction manager (CM) for the project. The Board authorized a professional engineering services agreement for as -needed CM services at the August 20, 2020 Board Meeting for $2.1 million. The cost ceiling for the agreement was increased to $2.6 million at the September 2, 2021 Board meeting to include additional services and flexibility to support construction at the treatment and filter plant. The original project completion date was revised to March 27, 2023 due to multiple supply -chain -related issues in equipment delivery. Most notably, delivery of major electrical components such as VFDs, transformers, MCCs was delayed by months and to date, some of this equipment has still not been received. The delay in electrical equipment has had a trickle -down affect on the entire project which has resulted in a revised completion date of August 2023. This change will result in MW H using up the remaining funds in the current agreement by June 2023. To ensure the continuation of CM services through the end of the project, an additional $400,000 in funding is required. As the CM for the project, MW H is the primary contact with Overaa and handles all contractor questions, consultant design clarifications and reviews change orders. They provide inspectors for both general construction and specialty electrical inspection. They also provide detailed review of critical path method (CPM) construction schedules utilizing Primavera software. The original construction contract amount was $26,584,000. To date, with the addition of approved change orders, the current contract value is $28,608,975. The value of outstanding and future change orders is anticipated to be approximately $1,000,000 (Outstanding and future change orders include some of the following additional expenses: additional electrical costs, sales tax increase, hard rock excavation, turbidimeters, and costs related to fire department access road modifications and changes for State of California Title 22 recycled water compliance). The total construction contract amount at project completion is anticipated to be around $30,000,000. ALTERNATIVES/CONSIDERATIONS Staff considered several alternatives and does not recommend any of the following: Alternative 1 — Perform all or some of the CM services utilizing District staff. This is not recommended as MW H has provided in-depth CM services that would be difficult to provide at this point in the project. MW H is providing specialty electrical inspection services during a crucial time in the project and would still have to be provided. Furthermore, MW H has provided detailed schedule review that the District cannot perform without specialty software and expertise. Alternative 2 — Perform the CM services utilizing one of the other consulting firms with as -needed construction services agreements to complete the project. The District has agreements for construction - related services with other consulting firms. However, those firms would have to learn the details of a project that has been ongoing for over two years. The current as -needed contracts are also limited to inspection and resident engineering services and may need to be amended to include CM services. The cost and time required to bring another firm on -board makes this alternative unfeasible. Consideration 1 — The time being added to the project is per the Contract Documents, as time is granted for excusable delays such as the electrical supply chain issues experienced. The Contractor is allowed the time; however, is not allowed to be compensated for overhead or other costs associated with extending the completion date. May 8, 2023 EOPS Regular Committee Meeting Agenda Packet - Page 22 of 25 Page 3 of 3 FINANCIAL IMPACTS The total project budget at the time of award is $38,589,000 and, to date, $34,903,641 has been spent. Staff recommends increasing the total project budget by $1,800,000 to cover the additional project costs caused by extending the completion date, which would result in a new total project budget of $40,389,000 (under 105-percent of the original total budget). The increase will cover the additional engineering, design, construction, testing, CM services, staff time, regulatory expenses, and other expenses to complete the project. Adequate funds are available within the Fiscal Year (FY) 2022-23 Capital Improvement Budget Contingency; therefore, upon Board approval, a budget transfer in the amount of $1,800,000 would be completed to fund this additional scope of work. COMMITTEE RECOMMENDATION The Engineering and Operations Committee reviewed this matter at its May 08, 2023 meeting and recommended RECOMMENDED BOARD ACTION Staff recommends the following: Authorize the General Manager to amend an existing professional engineering services agreement with MW H Constructors Inc., increasing the agreement cost ceiling from $2.6 million to $3.0 million for construction management services under the Filter plant and Clearwell Improvement project, District Project No. 7361; and Authorize a budget transfer in the amount of $1,800,000 from the FY 2022-23 Capital Improvement Budget Contingency to fund the Project. Strategic Plan Tie -In GOAL TWO: Environmental Stewardship Strategy 1 - Achieve compliance in all regulations GOAL FIVE: Safety and Security Strategy 2 - Protect Personnel and assets from threats and emergencies GOAL SIX: Infrastructure Reliability Strategy 2 - Execute long-term capital renewal and replacement program GOAL SEVEN: Innovation and Agility Strategy 1 - Leverage data analytics to become a more efficient utility May 8, 2023 EOPS Regular Committee Meeting Agenda Packet - Page 23 of 25