DATE: December 4, 2024
TO: Honorable Mayor and City Councilmembers
FROM: Water Utilities Department
TITLE: CHANGE ORDER 3 TO THE PUBLIC WORKS AGREEMENT WITH GSE CONSTRUCTION; AMENDMENT 1 TO THE PROFESSIONAL SERVICES AGREEMENT WITH MKN & ASSOCIATES FOR THE COMPLETION OF THE PILGRIM CREEK SEWER LIFT STATION IMPROVEMENTS PROJECT AND BUDGET CHANGE WITHIN SEWER FIXED ASSET REPLACEMENT FUND
RECOMMENDATION
title
Staff recommends that City Council approve Change Order 3 to the Public Works Agreement with GSE Construction Company, Inc. (GSE), in the amount of $195,621, for a total contract amount of $2,749,439; approve Amendment 1 to the Professional Services Agreement with MKN & Associates (MKN), in the amount of $93,483, for a total contract amount of $871,403, to provide additional funding for the completion of the Pilgrim Creek Sewer Lift Station Improvements Project; approve a budget change in the amount of $65,000; authorize the City Engineer to execute the Change Order upon receipt of all supporting documents; and authorize the City Manager, or designee, to execute the amendment.
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BACKGROUND AND ANALYSIS
The Pilgrim Creek Lift Station was originally constructed in 1976 and is located at 855 Douglas Drive. The existing lift station is comprised of a concrete wet well, modified dry well, two submersible pumps, valves, piping, flow meter, motors, electrical and controls. The pump station became an operational risk for Collections and had reached the end of its useful life.
On March 23, 2022, the City Council awarded a contract with GSE for the rehabilitation of the Project in the amount of $2,342,000. Work included upgrading outdated equipment and modifications to the existing structure to increase emergency storage.
Change Order 1 to GSE’s contract included provisions for upgraded electrical equipment and additional power to support existing antennae and pumps.
Change Order 2 provided monies to relocate new piping around the existing unknown utilities.
Change Order 3 includes modification to the gravity sewer line into the lift station, new low-voltage programming for the control system, rehabilitation of the pavement outside of the lift station, and City-requested revisions for operations. The subsequent additional costs have exceeded the Council-approved contingency of 10 percent of the original contract amount. This change order encompasses the final work items needed to close out the Project.
On December 4, 2019, the City Council awarded MKN & Associates a Professional Services Agreement (PSA) in the amount of $777,920 for the construction management and inspection (CM&I) services of three sewer lift station rehabilitation projects. Pilgrim Creek Lift Station was one of the three lift stations identified in the scope of work.
Amendment 1 to the PSA includes additional work, overtime, special inspection and testing due to unforeseen conditions, weather, and contractor delays that extended the construction schedule of the Pilgrim Creek Lift Station Project. Additionally, changes in other capital projects adjusted the overall scope of work of the original agreement. The contractor, GSE, was also back charged for additional construction management and inspection services during the negotiations of Change Order 3 for delays caused by the contractor. MKN’s amendment request for $93,483 covers the remaining amount to be paid by the City for MKN’s additional services to complete the Project.
FISCAL IMPACT
The original construction contract with GSE is for $2,342,000. The City Council authorized the City Engineer to approve Change Orders up to $234,200 or 10 percent of the contract amount. To date, a total of $211,818 has been approved for the first two Change Orders.
To cover Change Order 3, totaling $195,621, an additional $173,239 will require Council approval. MKN’s Amendment 1 requests an extra $93,483 for expanded construction management and inspection services, increasing the original agreement amount from $777,920 to $871,403.
Change Order 3 in the amount of $195,621 will be charged to the Sewer Lift Stations Upgrades project account 909953000722.5703.10600, which has a balance of $2,244,259. There are sufficient funds for this change order.
Amendment 1 to the MKN contract in the amount of $93,483 will be charged to the project account 909953000722.5305.10600 which has a balance of $31,864. To address the shortfall, staff recommends that Council approve a Budget Change from 5305.10400 to 5305.10600, in the amount of $65,000. With this change, there will be sufficient funds for this amendment.
Table 1 Sewer Lift Stations Upgrades Project Account Changes
|
Description |
Amount |
Account Number |
Available Balance |
|
Change Order 3 with GSE |
$ 195,621 |
909953000722.5703.10600 |
$ 2,244,259 |
|
Amendment 1 with MKN |
93,483 |
909953000722.5305.10600 |
|
|
Total |
$ 289,104 |
|
|
|
Budget change of $65,000 from 909953000722.5305.10400 to 909953000722.5305.10600 |
Funding for this project comes primarily from Sewer Flow and Sewer Service Charges in the Sewer Fixed Asset Replacement Fund 722.
COMMISSION OR COMMITTEE REPORT
The Utilities Commission approved staff’s recommendation at its regularly scheduled meeting on November 12, 2024.
CITY ATTORNEY’S ANALYSIS
The referenced documents have been reviewed by the City Attorney and approved as to form.
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Prepared by: Mabel Uyeda, Principal Water Engineer
Reviewed by: Lindsay Leahy, Water Utilities Director
Submitted by: Jonathan Borrego, City Manager
ATTACHMENTS:
1. Staff Report
2. GSE Change Order 3
3. MKN Amendment 1