Title
Report regarding a resolution awarding a construction contract to Dryco Construction, Inc. of Sacramento, California, for the 2026 Street Surface Seal Project (No. st2505, Bid No. 2708) in an amount not to exceed $3,031,894.22 and related actions (Jeffrey Chou, Senior Civil Engineer)
label
RECOMMENDATION
Recommendation
Staff recommends that the City Council adopt a resolution awarding a construction contract to Dryco Construction, Inc. of Sacramento, California, for the 2026 Street Surface Seal Project (No. st2505, Bid No. 2708) in an amount not to exceed $3,031,894.22 authorizing a total construction contract authority budget of $3,486,678.35 and authorizing the City Manager to execute the agreement on behalf of the City; rejecting all bid protests and approving associated Budget Amendment Number 26.064.
Body
BACKGROUND/DISCUSSION
The 2026 Street Surface Seal Project (“Project”) will resurface streets within the Winston Manor and Serra Highlands neighborhoods as part of the City’s ongoing Pavement Management Program.
The Project includes applying a protective surface treatment, commonly referred to as a surface seal or slurry seal, to approximately 440,000 square yards of existing asphalt streets (see Attachment 1 for Project Location Map).
The surface seal is designed to protect pavement from water infiltration and prolonged sun exposure, both of which can lead to cracking, surface deterioration, and eventual structural failure. Application of the slurry seal will help preserve roadway conditions, extend pavement life, and improve skid resistance. This cost-effective treatment supports the City’s proactive approach to maintaining local streets for the benefit of residents and the traveling public.
The Project includes the following improvements:
• Repairing localized areas of damaged pavement through base repairs
• Sealing existing cracks throughout the roadway
• Applying slurry seal to the full street surface
• Refreshing painted curbs
• Replacing existing pavement markings with new, highly visible lane striping to enhance safety
• Installing new protected bike lanes along Hickey Boulevard, consistent with the City’s Bicycle and Pedestrian Master Plan
To minimize construction impacts, the contractor will implement traffic control measures, including detour routes with appropriate signage. Residents in affected areas will receive advance notification of scheduled work. Temporary street parking restrictions and limited access within active work zones will be required, with priority access maintained for local residents. In addition, electronic message boards and temporary “No Parking” signs will be posted in advance to inform residents of specific dates and times when restrictions will be in effect.
Bid Process and Results
The Project was advertised using formal bid procedures for public projects greater than $200,000 in accordance with the City’s purchasing policy, which falls under Procurement Type 1: Competitive Bidding for Construction Projects. For more details on the City’s Procurement Process, refer to Attachment 2.
This procedure awards the contract to the lowest responsive and responsible bidder.
Staff advertised a notice inviting bids for the Project on March 18 and March 23, 2026. On April 14, 2026, staff received six (6) bid proposals in response to the notice inviting bids.
The following is a summary of all bids received:
|
Rank |
Contractor |
"Base Bid" Results |
“Alternative Bid” Results |
|
1 |
Dryco Construction, Inc. of Sacramento, CA |
$ 2,751,614.22 |
$ 280,280.00 |
|
2 |
VSS International, Inc. of West Sacramento, CA |
$ 2,778,120.00 |
$ 304,000.00 |
|
3 |
Pavement Coatings Co. of Sacramento, CA |
$ 2,884,570.39 |
$ 251,002.85 |
|
4 |
American Pavement Systems Inc. of Modesto, CA |
$ 2,905,425.92 |
$ 284,076.83 |
|
5 |
Graham Contractors, Inc. of San Jose, CA |
$ 2,929,825.10 |
$ 309,637.00 |
|
6 |
American Asphalt Repair & Resurfacing Co., Inc. of Hayward, CA |
$ 3,053,682.56 |
$ 272,996.37 |
|
|
|
|
Engineers Estimate (by NCE) |
$ 3,230,000.00 |
$ 233,000.00 |
The project was advertised with both a “Base Bid” and “Alternative Bid” schedule. Award of the contract is based on the lowest responsive bid for the Base Bid schedule. The Alternative Bid schedule was included to account for an overlapping area with a PG&E gas main replacement project, which requires a certain level of roadway restoration.
On April 17, 2026, staff received a bid protest letter, included as Attachment 3, from the second lowest bidder, VSS International, Inc., claiming that the lowest bidder, Dryco Construction, Inc., was non-responsive for the reasons outlined in the protest. After careful review of the protest and consultation with the City Attorney’s Office, staff determined that Dryco Construction, Inc.’s bid is responsive.
Staff has reviewed the low bidder’s proposal and determined that Dryco Construction, Inc. is both responsive and responsible. The City’s response to the bid protest is included as Attachment 4. Staff also verified that the contractor’s license is active and in good standing with the California Contractors State License Board.
Dryco Construction, Inc. submitted a base bid approximately 15% below the Engineer’s Estimate. Upon evaluation, staff determined the bid to be competitive and not materially unbalanced.
The PG&E gas main replacement project is currently underway and is anticipated to be completed this summer. As the extent of roadway restoration required by PG&E has not yet been finalized, staff recommends including the Alternative Bid schedule to account for this potential work within the project budget.
Staff recommends awarding both the Base Bid and Alternative Bid schedules to Dryco Construction, Inc.
The proposed project construction budget is:
|
Dryco Construction, Inc.’s Construction Contract |
$ 3,031,894.22 |
|
Construction Contingency (15%) |
$ 454,784.13 |
|
Total Project Construction Budget |
$ 3,486,678.35 |
The construction contingency will be used for any additional costs related to design changes during the construction operations. There are no Disadvantaged Business Enterprise (DBE) requirements since no federal funds are being utilized on the Project.
FISCAL IMPACT
The Project (CIP No. st2505) is included in the City of South San Francisco’s Fiscal Year 2025-26 Capital Improvements Program.
Budget Amendment Number 26.064 will amend the current CIP to:
1. Include $350,000 in unallocated Citywide Traffic Impact Fee; these funds will support the bicycle improvements along Hickey Boulevard
2. Include $200,000 in unallocated SB1 funds; these funds will support roadway repairs and resurfacing streets.
The proposed project expenses and budget are detailed below:
|
Purpose |
Estimated Costs |
|
Design Budget |
$ 200,000.00 |
|
Construction Budget |
$ 3,486,678.35 |
|
Construction Management and Inspection |
$ 230,000.00 |
|
Miscellaneous (including staff time) |
$ 50,000.00 |
|
Total Expenses |
$ 3,966,678.35 |
|
|
|
|
Funding Source |
Amount |
|
Measure A |
$1,200,000.00 |
|
SB1 |
$2,300,000.00 |
|
Citywide Traffic Impact Fee Fund* |
$ 350,000.00 |
|
SB1 (additional)* |
$ 200,000.00 |
|
Total Project Budget |
$ 4,050,000.00 |
*Budget Amendment Number 26.064
RELATIONSHIP TO CITY COUNCIL PRIORITIES ACTION PLAN
Approval of this action will contribute to the City Council Priorities Action Plan’s Major Focus Areas of Infrastructure and the Environment and Quality of Life by maintaining and improving infrastructure to serve the public.
CONCLUSION
Awarding the construction contract to Dryco Construction, Inc. of Sacramento, California, for the 2026 Street Surface Seal Project will prolong the useful life of the streets that will receive this surface treatment and will help the City maintain the City’s Street Pavement Index at an acceptable level.
Attachments:
1. Vicinity Map
2. Overview of City’s Procurement Process
3. Bid Protest Letter
4. Bid Protest Response