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Home My WebLink About10. Authorize the General Manager to execute a construction contract in the amount of $1,035,000 with Alfred Conhagen, Inc. for Aeration Unit 1 Steam Turbine Overhaul, District Project 100054DCENTRALSAN MEETING DATE: JULY6, 2023 BOARD OF DIRECTORS POSITION PAPER Page 1 of 5 Item 10. SUBJECT: AUTHORIZE THE GENERAL MANAGER TO EXECUTE A CONSTRUCTION CONTRACT I N THE AMOUNT OF $1,035,000 WITH ALFRED CONHAGEN, INC. OF CALIFORNIA, FOR THE AERATION UNIT 1 STEAM TURBINE OVERHAUL, DISTRICT PROJECT 100054; AND FIND THAT THE PROJECT IS EXEMPT FROM THE CALIFORNIA ENVIRONMENTAL QUALITYACT (CEQA) SUBMITTED BY: INITIATING DEPARTMENT: ZACHARY LEE, ASSOCIATE ENGINEER ENGINEERINGAND TECHNICAL SERVICES - CAPITAL PROJECTS REVIEWED BY: CLINT SHIMA, SENIOR ENGINEER EDGAR J. LOPEZ, PROVISIONAL DIRECTOR OF ENGINEERING AND TECHNICAL SERVICES NEIL MEYER, PROVISIONAL DIRECTOR OF OPERATIONS GREG NORBY, DEPUTY GENERAL MANAGER, OPERATIONS Roger S. Bailey Kenton L. Alm General Manager District Counsel ISSUE On May 17 and 24, 2023, the Aeration Unit 1 Steam Turbine Overhaul, District Project 100054 (Project) was advertised for public bid and zero (0) responsive bids were received. Central San has met the statutory requirements for public bidding and now proposes to enter into a construction contract with Alfred Conhagen I nc. of California (Conhagen) for the project. July 6, 2023 Regular Board Meeting Agenda Packet - Page 51 of 151 Page 2 of 5 BACKGROUND Central San has two aeration units that can provide essential oxygen to the secondary process and other vital systems at the treatment plant. During normal operations, one unit runs continuously while the other is ready as the standby backup. These units are alternated based on Operations and Maintenance considerations and were overhauled in 2004. Both units have not required major maintenance work or activities since the overhaul, until last year, when Aeration Unit 2 was found to have significant wear within the steam turbine side of the equipment. Maintenance and Capital Projects staff collaborated to urgently repair the equipment, performed a major overhaul, and returned the unit back to service in preparation for the peak aeration season. The aeration units were installed in the 1970s and are roughly 50 years of age. Since the units are alternated, each unit has an estimated operating time of 25 years. The failure experienced in Aeration Unit 2 is uncommon, and according to maintenance history, this is the first time that any of the units have had such repair work completed. Steam turbines can have significant life spans when properly maintained and are well known to have operational life that often exceeds 50 years. Based on expert input and condition assessments, the aeration units have a minimum of 20 years of remaining life and performing an overhaul to Aeration Unit 1 is recommended by staff to reliably operate both units for years to come. This Project will overhaul the Aeration Unit 1 steam turbine and trip safety valves, which includes removing existing diaphragms and rotor from the steam turbine to clean and conduct damage assessment, carrying out necessary modifications to the spare rotor to put it in the steam turbine, machining the nozzle block and labyrinth seal, along with new throttle valve seats, plunger, stem, snap ring, and carbons for the throttle valve. This Project is expected to be completed in 90 days. Aeration Unit 2 will be operated during this time with the new neuro electric blowers as backup to maintain the treatment plant process. Central San staff prepared the plans and specifications for the Project. The Engineer's estimate is $1,100,000. One bid of $1,035,000 from Conhagen was received and publicly opened on June 7, 2023. Upon review of the bid documents, a material omission or mistake was discovered. Conhagen's bid did not include the required bid bond at the time of bid. Conhagen had forgotten to include the bid bond and provided proof after the bid had been opened. Not including a bid bond is clear grounds for declaring a bid non -responsiveness and staff can not recommend any remedy to correct the mistake as a bid bond is a material item. District legal has reviewed staff's recommendation and is confident the District has met the statutory obligations for fair and public bidding, and Central San can now enter into a negotiated contract directly for the work with a Contractor. Conhagen has been contacted by staff and is willing to honor the bid price received on June 7th for the project. Conhagen is a specialty contractor that is uniquely qualified to perform the services required under the project and has worked at Central San in the past as they successfully repaired Aeration Unit No. 2 last year. Central San will administer the construction contract and provide contract administration, inspection, and office engineering. Consultant services maybe required as needed. CEQA Staff has concluded that this Project is exempt from CEQA under Central San 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's independent finding that this Project is exempt from CEQA. July 6, 2023 Regular Board Meeting Agenda Packet - Page 52 of 151 Page 3 of 5 ALTERNATIVES/CONSIDERATIONS This Project was derived from the emergency work performed last year. As an alternative, the Board could decide not to authorize the contract and recommend options such as re -bidding or attempt to negotiate the same scope with another contractor. Staff has evaluated these alternatives and do not recommend proceeding in that manner for the following reasons: 1) turbine contractors are limited in California as the work is specialized and found more in other regions of the United States, such as the mid west or east coast. 2) Only one other contractor was interested in the project and informed staff that they did not participate in the bid due to higher prices in comparison to the engineer's estimate. 3) Time is of the essence as staff recommends this work to be completed within the timeframe identified in the project. FINANCIAL IMPACTS The total estimated project cost is approximately $1,271,000 which includes design, bid price, contingency, inspection, and construction management as detailed in Attachment 2. This Project is included in the FY 2023-24 Budget on page 277 and has a total budget of $1,200,000. Remaining amount is within staff authority and will be funded from the Capital Improvements Budget contingency account. COMMITTEE RECOMMENDATION The Engineering and Operations Committee reviewed this matter at the June 20, 2023 Special meeting and recommended approval. RECOMMENDED BOARD ACTION Staff recommends the following: 1. Find that the Project is exempt from CEQA; and 2. Authorize the General Manager to execute a construction contract in the amount of $1,035,000 with Alfred Conhagen I nc. of California for the Aeration Unit 1 Steam Turbine Overhaul, District Project 100054. Strategic Plan Tie -In 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 ATTACHMENTS: 1. Project Location Map 2. Post Bid/P reconstruction Estimate July 6, 2023 Regular Board Meeting Agenda Packet - Page 53 of 151 D ■ Al !z� 0 200 400 FEET Basin A South PROJECT AREA AERATION UNIT OVERHAUL Page 4 of 5 \� 04, s 0 SOLIDS \�\ NDITIONI BUILDIN 1� I \ o 0 0 II 0 CL IERS (SOU UAD) n j PRIMARY O S DIMENTATI N TANKS u ❑ PbMP ANIS BLOWER BUI DING ° —L POD HOB of IMHOFF PLACE Central Contra Costa Attachment Sanitary District AERATION UNIT 1 STEAM TURBINE OVERHAUL 4A' DISTRICT PROJECT 100054 1 LOCATION MAP July 6, 2023 Regular Board Meeting Agenda Packet - Page 54 of 151 Page 5 of 5 ATTACHMENT 2 AERATION UNIT 1 STEAM TURBINE OVERHAUL DISTRICT PROJECT 100054 POST-BID/PRECONSTRUCTION ESTIMATE No. Item Description Amounts % Of Construction Cost 1 CONSTRUCTION a. Construction Contract $1,035,000 b. Contingency at 15% $156,000 SUBTOTAL - CONSTRUCTION $1,191,000 100% 2 CONSTRUCTION MANAGEMENT a. District Forces - Construction Management $50,000 - Operations Support $10,000 SUBTOTAL - CONSTRUCTION MANAGEMENT $60,000 5% 3 PREBID EXPENDITURES a. Engineering (Planning, Design, Drafting, POD Coordination) $20,000 SUBTOTAL - PREBID EXPENDITURES $20,000 2% 4 TOTAL ESTIMATED PROJECT COST $1,271,000 July 6, 2023 Regular Board Meeting Agenda Packet - Page 55 of 151