Title
Report regarding a Resolution accepting $476,487 in grant funding from Metropolitan Transportation Commission’s Transportation Improvement Program, approving Budget Amendments #23.027 and #23.028, awarding a construction contract to Golden Bay Construction, Inc. in an amount not to exceed $537,056.00, authorizing a total construction contract authority of $617,656.00, and authorizing the City Manager to execute the agreements on behalf of the City for the E101 Transit Expansion Project (CIP No. tr2203). (Jason Hallare, Senior Civil Engineer)
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RECOMMENDATION
Recommendation
It is recommended that the City Council adopt a resolution accepting $476,487 in grant funding from Metropolitan Transportation Commission’s Transportation Improvement Program, approving Budget Amendments #23.027 and #23.028, awarding a construction contract to Golden Bay Construction, Inc. in an amount not to exceed $537,056.00, authorizing a total construction contract authority of $617,656.00, and authorizing the City Manager to execute the agreements on behalf of the City for the E101 Transit Expansion Project (CIP No. tr2203).
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BACKGROUND/DISCUSSION
The E101 Transit Expansion Project (“Project” also known as the Quick-Strike Bus Stop Improvement project) will install new bus stops, bus shelters, signage, striping, and high-visibility crosswalks at seven locations throughout the East of 101 area. The project locations are identified on Vicinity Map as Attachment 1.
Grant Funding Acceptance
The City of South San Francisco (“City”) applied for grants to help fund the Project. In 2021, the City applied for federal funding from the Federal Highway Administration through the Metropolitan Transportation Commission (“MTC”) under the Transportation Improvement Program (“TIP”). The City was awarded the grant under the TIP and is required to execute a Program Supplement Agreement (“PSA”). The PSA Number F032 is for $476,487 toward the construction phase of work.
The Project designs are 100% complete. Staff received the E-76, authorization to proceed with construction from Caltrans District Local Assistance Engineer on September 13, 2022. Staff expects to be able to award a construction contract in early November of 2022, with construction completion anticipated by early March of 2023, depending on material lead times.
The administration of state and federally funded local transportation projects is carried out by the benefiting agencies through the Caltrans Local Assistance Program. The City has a program master agreement in place that gives The City general authority as an administering agency, but administration of individual projects requires entering into project-specific supplemental agreements. The program supplemental agreements allow for the reimbursement of project development costs. PSA No. F032 authorizes Federal funding in the amount of $476,487 for construction phase costs and commits the City to provide matching funding of 13% ($61,736).
As a standard condition of the grant, the City adopted Resolution 66-2021 agreeing that any cost increase will be funded by the City. Should bids received be higher, as is the case for this project, the City will be responsible to fund the shortfall to construct and deliver the project.
Overview of City’s Procurement Process
The City’s procurement process is governed by both state and local law. State law requires contracts for construction to be competitively bid pursuant to a set of specific, established rules. In particular, the City is required to award construction contracts to the “lowest responsible bidder” after providing notice in accordance with law. (Pub. Contract Code §§ 20162, 20164.)
However, in awarding contracts for the purchase of professional services, equipment and supplies, the City has some latitude. State law requires the City to adopt regulations and policies to govern such service and supplies procurement, but otherwise provides the City flexibility in determining relevant requirements as long as they are consistent with applicable state law. (Gov. Code § 54202.) Chapter 4.04 of the Municipal Code and the City’s Purchasing Procedures (Administrative Instruction Section IV, No. 1) govern the City’s purchasing policies and contract procurement processes.
The City’s purchasing ordinance distinguishes between three primary types of procurement methods as follows:
1. Competitive Bidding for Construction Projects
Public projects are specifically defined under the Public Contract Code, and generally involve any construction project that is paid with public funds or those projects involving improvements, demolition or other work on public property or facility. Public projects are required to be procured through competitive bidding and the City must award the contract to the lowest bidder whose bid complies with all of the City’s solicitation requirements and demonstrates that the bidder is able to perform the work. Under the City’s policy, different levels of competitive bidding are required depending on the dollar limit of the underlying project.
For these contracts, cost is generally the sole determining factor, and the lowest responsible bidder is awarded the project even if another bidder appears to be more skilled but is more expensive.
2. Open Market Procedures for Vendors (Supplies and Equipment)
Open Market Procedures is the City’s vendor selection process for purchase of goods, supplies, and professional services. These rules do not apply to, and may not be used for, public construction projects.
Contracts for the purchase of goods and services that exceed $10,000 requires staff to utilize open market procedures. If the contract is $25,000 or less, staff must obtain at least three quotes, which are informal offers to perform work at a stated price. If the contract is greater than $25,000, staff will be required to solicit the project, such as issuing a Request for Proposals (“RFPs”) and obtain at least three written responses.
Under this vendor selection process, cost can be only one factor in determining which vendor the City will ultimately select for services, equipment, or supplies. This requirement is similarly reflected under SSFMC § 4.04.080.
Thus, when utilizing the open market vendor selection process, the City is focused on the skill, ability, and expertise of the entity or person to be able to provide the service, equipment, or goods to the City. The selection is based on competence, professional qualifications, and overall value to the City with cost being only one factor in the determination of an award.
Federally Funded Procurements for Vendors (Supplies and Equipment)
Contracts that receive federal funding are required to incorporate and comply with additional terms and conditions. The City’s Purchasing Procedures also provide guidance on procuring supplies and equipment contracts that are federally funded. Federally funded procurements also require a written procedure for conducting evaluations and for selecting recipients and awarding the contract to the responsible firm whose proposal is most advantageous to the City with price being only one factor. It is also important to note that federally funded procurements do not include state or local geographical preferences unless specifically authorized by federal law. Each evaluation is a non-discrimination and equal opportunity for all vendors.
3. Open Market Procedures for Architectural and Engineering (A&E) Professional Services
For certain professional services such as architectural, engineering, environmental, land surveying, or construction project management, the Government Code also specifically requires that such services not be awarded solely based on price, but instead based on demonstrated competence. (Gov. Code § 4526.) Both the state law provision and the City’s policy reflect the legislative view that when acquiring such services, the City does not necessarily receive the best value when it pays the lowest price. (See e.g., California Attorney General Op. No. 94-819 (February 9, 1995)).
Project Bids & Award Recommendation
Quick-strike Bus Stop Improvement Project, TR2203, Bid No. 2673
This project falls under Procurement Type 1: Competitive Bidding for Construction Projects.
Staff advertised a notice inviting bids for the project on September 22, and September 30, 2022. On October 19, 2022, staff received five (5) bid proposals in response to the notice inviting bids. Staff reviewed all bid proposals and identified that the lowest responsible bidder was Golden Bay Construction, Inc. of Hayward, California. Staff has verified the low bidder’s current contractor’s license with the California State Licensing Board and found it to be in good standing.
Pursuant to Public Contract Code Section 20166, City Council is authorized to reject all bids without having to give a reason.
The following is a summary of all bids received:
|
Rank |
Contractor |
"Base Bid" Results |
|
1 |
Golden Bay Construction, Inc. |
$537,056.00 |
|
2 |
Interstate Grading and Paving, Inc. |
$571,587.00 |
|
3 |
Kerex Engineering |
$574,650.00 |
|
4 |
Cazadoro Construction, Inc. |
$672,235.00 |
|
5 |
Sposeto |
$705,114.00 |
|
|
|
|
Engineer’s Estimate (Mark Thomas) |
$485,040.00 |
The project was advertised with a “Base Bid” schedule only with no alternatives. The selection of award of a contract is based on the lowest responsive bid for the Base Bid schedule.
Golden Bay Construction, Inc.’s bid of $537,056 is approximately 11% higher than the Engineer’s Estimate. The higher cost can be attributed to the rapid rise in material costs, such as the bus shelters, as well as overall inflation in the construction industry. A proposed 15% construction contingency will be used for any additional costs related to design changes during the construction operations.
The recommended total construction contract authority adding the contract and the contingency is $617,656.00.
The construction management will be provided by CSG Consultants through our Municipal Engineering On-Call Services contract.
The proposed project construction budget is:
|
Golden Bay Construction, Inc. Construction Contract |
$ 537,056.00 |
|
Construction Contract Contingency (15%) |
$ 80,600.00 |
|
CSG Consulting Construction Management |
$ 87,000.00 |
|
Total Project Construction Budget |
$ 705,156.00 |
FISCAL IMPACT
This project is already included in the City’s fiscal year 2022-23 Capital Improvement Program (as Project TR2203).
Budget Amendment #23.027 accepts $476,487 in grant funding for the purpose of constructing the project. The funding source is the MTC-TIP program.
Budget Amendment #23.028 will transfer $30,000 Citywide Transportation Impact Fees from the Grand Avenue Off-Ramp Project (CIP #TR2201) to this Project.
Grant funding will be used to support the construction costs. The required City match of $61,736 is sufficiently funded entirely from East of 101 Traffic Impact Fees that are already allocated to the Project. The General Fund will not be affected by the Project.
RELATIONSHIP TO STRATEGIC PLAN
Approval of this action will promote to the City’s Strategic Plan Quality of Life Initiative 2.2 by enhancing and improving access to bus and shuttle transit.
CONCLUSION
Staff recommends that the City Council adopt a resolution accepting $476,487 in grant funding from MTC’s TIP program, approving Budget Amendments 23.027 and 23.028, and authorizing the City Manager to execute the PSA with the State of California on behalf of the City. An executed PSA will allow the City to obtain Federal funds for reimbursement in the amount of $476,487 for the E101 Transit Expansion Project under the Program Supplemental Agreement No. F032.
Furthermore, staff recommends awarding Golden Bay Construction, Inc. of Hayward, California for the E101 Transit Expansion Project in an amount not to exceed $537,056 and authorizing a total construction contract authority of $617,656.
Attachments:
1) Vicinity Map