HomeMy WebLinkAbout2026-02-24; City Council; 01; Adopt the revised plans, specifications and contract documents, accept the bids and award a contract to Palm Engineering Construction Company, Inc. for the Poinsettia LanCA Review TL
Meeting Date: Feb. 24, 2026
To: Mayor and City Council
From: Geoff Patnoe, City Manager
Staff Contacts: Daniel Zimny, Utilities Senior Engineer
daniel.zimny@carlsbadca.gov, 442-359-2233
Keri Martinez, Utilities Principal Engineer
keri.martinez@carlsbadca.gov, 442-200-7376
Subject: Adopt the revised plans, specifications and contract documents, accept
the bids and award a contract to Palm Engineering Construction
Company, Inc. for the Poinsettia Lane Sewer Improvements and Bressi
Sewer Manhole Rehabilitation Projects
Districts: 2, 3
Recommended Action
Adopt a resolution adopting the revised plans, specifications and contract documents,
accepting the bids and awarding a contract to Palm Engineering Construction Company, Inc. for
the construction of the Poinsettia Lane Sewer Improvements and Bressi Sewer Manhole
Rehabilitation Projects in an amount not to exceed $3,527,704.
Executive Summary
Two sewer capital improvement projects, Poinsettia Lane Sewer Improvements and Bressi
Sewer Manhole Rehabilitation, will collectively replace a half mile of sewer main, rehabilitate
34 manhole structures and waterproof an underground metering vault at the Poinsettia Lift
Station, as shown in Exhibit 2.
The City Council adopted the plans, specifications and contract documents and authorized the
advertisement for construction bids on this project in Nov. 2025. Staff revised the plans,
specifications and contract documents to reflect changes in the scope of work for the Bressi
Sewer Manhole Rehabilitation Project, and are now requesting the City Council adopt the
revised plans, specifications and contract documents.
Staff recommend accepting the bids and awarding a contract to Palm Engineering Construction
Company, Inc., in an amount not to exceed $3,527,704.
The contract award amount exceeds $220,000, so the City Council’s approval to award the
contract is required under Carlsbad Municipal Code Section 3.28.080(I).
Feb. 24, 2026 Item #1 Page 1 of 10
Docusign Envelope ID: DE56A114-5BC1-444C-9D36-CAD1A264C0D5
Explanation & Analysis
The City Council adopted the project’s plans, specifications and contract documents on Nov. 18,
2025, authorizing the City Clerk to advertise for bids with Resolution No. 2025-248. The
contract documents consist of two separate sewer Capital Improvement Program projects that
have been bundled together for efficiency and cost savings due to their proximity to each other.
• The Poinsettia Lane Sewer Improvements Project, Project No. 5548-D, includes
replacement of 2,560 feet of existing 12-inch diameter sewer pipe with 15-inch and 18-
inch diameter pipe and rehabilitation of 10 sewer manhole structures along Poinsettia
Lane between Alicante Road and El Fuerte Street.
• The Bressi Sewer Manhole Rehabilitation Project, Project No. 5503-26, will rehabilitate
sewer manhole structures in the Bressi Ranch area.
When the City Council authorized the project for bidding, 25 structures were slated for
rehabilitation. Since then, a developer has been required to rehabilitate three of those
structures as part of the development’s public improvements. As a result, those structures were
removed from the city’s bid, freeing up funds to address other nearby structures. Two
additional structures previously identified as being in poor condition were added to the revised
bid, resulting in a net reduction of one structure compared with the original schedule.
The approximate project area is shown in Exhibit 2. The estimated engineer’s estimate for both
projects, including contingency, was $3,840,000.1 Seven bids were received on Jan. 9, 2026, in
response to the bid advertisement with the lowest bid submitted by Palm Engineering in an
amount not to exceed $3,527,704. Palm Engineering’s bid of approximately $3.5 million came
in under the engineer’s estimate of approximately $3.8 million. Staff have determined that
Palm Engineering’s bid was responsive to the city’s bid request and that Palm Engineering is a
responsible bidder because it has completed similar projects. Several schools are in the vicinity
of both projects, and the contract requires most work activities along the immediate school
frontages to be completed during the summer months. Staff are coordinating with school
representatives to inform them of the construction schedule and prepare outreach materials.
Staff recommend that the City Council adopt the revised plans, specifications and contract
documents, accept the bids and award a construction contract to Palm Engineering in an
amount not to exceed $3,527,704.
1 This cost is based on an engineer’s estimate, an opinion of a project’s probable construction cost given by an
experienced and qualified professional engineer generally familiar with the construction industry. Staff use them
to obtain an estimate that will be as close to the actual costs as possible.
Feb. 24, 2026 Item #1 Page 2 of 10
Docusign Envelope ID: DE56A114-5BC1-444C-9D36-CAD1A264C0D5
Fiscal Analysis
The total estimated construction cost including contingency, construction management,
inspection, public outreach and engineering and administration is $4,940,544. Both projects are
funded by the sewer replacement fund and have sufficient funding to complete construction.
Each project’s available funding and estimated contribution to the total construction cost are
itemized below.
Poinsettia Lane Sewer Improvements Project
The Poinsettia Lane Sewer Improvements Project is a component of the Sewer Line Capacity
Improvements Program, CIP Program Project No. 5548, which is funded by the Sewer
Replacement Fund. The total cost of the Poinsettia Lane Sewer Improvements Project is
$4,251,104, which includes the construction contract, contingency, construction management
and inspection, material testing and public outreach. The available funds and estimated
construction costs are shown in the table below:
Sewer Line Capacity Improvement Program
Capital Improvement Program Project No. 5548
Total appropriation to date $5,690,045
Total expenditures and encumbrances to date -$925,788
Total available balance $4,764,257
Poinsettia Lane Sewer Improvements Project
Capital Improvement Program Project No. 5548-D
Construction contract – Palm Engineering Construction Company, Inc. -$3,036,504
Construction contingency -$607,300
Construction management, inspection and testing, public outreach,
engineering and administration (estimated) -$607,300
Total estimated costs -$4,251,104
Remaining balance $513,153
Sufficient funding is available in the Sewer Replacement Fund for the Poinsettia Lane Sewer
Improvements Project, Project No. 5548-D.
The Poinsettia Lane Sewer Improvements Project is eligible for funding from the city’s Sewer
Benefit Area H, which includes the project site. The funding program collects fees from
developers for sewer capacity improvements not funded by the city’s sewer connection fee
program. Sewer Benefit Area H will contribute 15% of the project costs in accordance with the
engineer’s report approved by the City Council on Oct. 28, 2025.
Staff will return to the City Council to request the Sewer Benefit Area H fund to reimburse the
Sewer Replacement Fund once the final construction costs have been accrued and Sewer
Benefit Area H fee revenues have been collected to contribute to the reimbursement.
Feb. 24, 2026 Item #1 Page 3 of 10
Docusign Envelope ID: DE56A114-5BC1-444C-9D36-CAD1A264C0D5
Bressi Sewer Manhole Rehabilitation Project
The Bressi Sewer Manhole Rehabilitation Project, Project No. 5503-26, is a component of the
Sewer System Rehabilitation and Replacement Program, Project No. 5503, which is funded by
the Sewer Replacement Fund. The total cost of the Bressi Ranch Sewer Manhole Rehabilitation
Project is $687,600, which includes the construction contract, contingency, construction
management and inspection, material testing and public outreach. The available funds and
estimated construction costs are shown in the table below:
Sewer System Rehabilitation and Replacement Program
Capital Improvement Program Project No. 5503
Total appropriation to date $14,426,475
Total expenditures and encumbrances to date -$8,190,605
Total available balance $6,235,870
Bressi Sewer Manhole Rehabilitation Project
Capital Improvement Program Project No. 5503-26
Construction contract – Palm Engineering Construction Company, Inc. -$491,200
Construction contingency -$98,200
Construction management, inspection and testing, public outreach,
engineering and administration (estimated) -$98,200
Total estimated construction costs -$687,600
Remaining balance $5,548,270
Sufficient funding is available in the Sewer Replacement Fund for the Bressi Sewer Manhole
Rehabilitation Project, Project No. 5503-26.
Carlsbad Municipal Code Section 3.28.040(C)(5) authorizes the City Manager or designee to
approve change orders in an amount equal to the contingency set at the time of contract
award. The contingency amount for the Poinsettia Sewer Improvements project is $607,300
and for the Bressi Sewer Manhole Rehabilitation project is $98,200, for a total contingency
amount of $705,500 for both projects.
Next Steps
Once the City Council adopts the revised plans, specifications and contract documents, accepts
the bids and awards a construction contract to Palm Engineering, staff will issue a purchase
order, schedule a pre-construction meeting with the contractor and issue a notice to proceed to
construct the project.
The duration of the construction contract is nine months, not including rainy days and delays
from change orders that may extend the contract duration. The project is expected to be
completed by late 2026, and a notice of completion to release bonds issued for the project will
be recorded at that time.
Staff will coordinate with the school representatives to inform them of the construction
schedule and prepare outreach materials.
Feb. 24, 2026 Item #1 Page 4 of 10
Docusign Envelope ID: DE56A114-5BC1-444C-9D36-CAD1A264C0D5
Environmental Evaluation
Poinsettia Lane Sewer Improvements Project
In accordance with the California Environmental Quality Act, or CEQA, procedures and CEQA
Guidelines sections 15080 through 15097, a Program Environmental Impact Report (PEIR), State
Clearinghouse No. 2012021006 (City Planning Case No. EIR 12-01), was certified as complete on
Nov. 13, 2012, by the City Council for the Sewer Master Plan and Carlsbad Municipal Water
District Water Master Plan and Recycled Water Master Plan Updates. A first addendum to the
Final EIR 12-01 was prepared for the 2019 Master Plan Update and adopted on Sept. 17, 2019.
Pursuant to CEQA Guidelines section 15168, the request to approve a change in the scope of
work for Capital Improvement Program Project No. 5548-D is within the scope of the Project
covered by a previously certified PEIR, and no new environmental document is required. There
is no public review period required. The effects of the Project were examined in the PEIR and
Addendum and all feasible mitigation measures and alternatives developed in the PEIR are
incorporated into the resolution approving the change in the scope of work for Capital
Improvement Program Project No. 5548-D. Further, since no changes to the PEIR or Addendum
are necessary to support the Project, the city is not required to prepare an Addendum or
Supplemental EIR to the PEIR per State CEQA Guidelines section 15164. Therefore, the prior
PEIR is sufficient to support the proposed action. No further analysis or environmental
documentation is required
Bressi Sewer Manhole Rehabilitation Project
The proposed action of rehabilitation of existing Bressi sewer manhole structures is
categorically exempt from environmental review under CEQA Guidelines Section 15301
because it involves the maintenance, repair or minor alteration of existing facilities with
negligible or no expansion of the existing or former use. No exceptions to the categorical
exemption as set forth in CEQA Guidelines Section 15300.2 or Carlsbad Municipal Code Section
19.04.070(C) apply.
Exhibits
1.City Council resolution
2.Location maps
Feb. 24, 2026 Item #1 Page 5 of 10
Docusign Envelope ID: DE56A114-5BC1-444C-9D36-CAD1A264C0D5
Exhibit 1 RESOLUTION NO. 2026-041 .
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD,
CALIFORNIA, ADOPTING THE REVISED PLANS, SPECIFICATIONS AND
CONTRACT DOCUMENTS, ACCEPTING THE BIDS AND AWARDING A
CONTRACT TO PALM ENGINEERING CONSTRUCTION COMPANY, INC. FOR
THE CONSTRUCTION OF THE POINSETTIA LANE SEWER IMPROVEMENTS
AND BRESSI SEWER MANHOLE REHABILITATION PROJECTS IN AN AMOUNT
NOT TO EXCEEED $3,527,704
WHEREAS, the City Council of the City of Carlsbad, California has determined it is necessary,
desirable and in the public interest to construct the Poinsettia Lane Sewer Improvements Project,
Capital Improvement Program, or CIP, Project No. 5548-D, and the Bressi Sewer Manhole Rehabilitation
Project, CIP Project No. 5503-26, collectively the Project; and
WHEREAS, on Nov. 18, 2025, the City Council adopted Resolution No. 2025-248, approving the
plans, specifications and contract documents and authorizing the City Clerk to advertise for bids to
construct the Project; and
WHEREAS, the plans, specifications and contract documents were revised to reflect changes to
the Bressi Sewer Manhole Rehabilitation Project’s bid quantity; and
WHEREAS, on Jan. 9, 2026, staff received seven bids in response to the bid advertisement; and
WHEREAS, staff found the lowest bid submitted by Palm Engineering Construction Company,
Inc. in an amount not to exceed $3,527,704 to be responsive; and
WHEREAS, staff determined that Palm Engineering Construction Company, Inc. is a responsible
bidder in that it has successfully performed similar projects for other agencies; and
WHEREAS, Carlsbad Municipal Code Section 3.28.040(C)(5) authorizes the City Manager or
designee to approve change orders in an amount equal to the contingency set at the time of contract
award, which is $607,300 for CIP Project No. 5548-D and $98,200 for CIP Project No. 5503-26 for a total
contingency amount of $705,500; and
WHEREAS, sufficient sewer replacement funds are available to complete the Project; and
WHEREAS, the Poinsettia Lane Sewer Improvements Project, CIP Project No. 5548-D, is eligible
for funding from the city’s Sewer Benefit Area H; and
WHEREAS, staff will return to the City Council to request the Sewer Benefit Area H fund to
reimburse the Sewer Replacement Fund for the Poinsettia Lane Sewer Improvements Project, CIP
Feb. 24, 2026 Item #1 Page 6 of 10
Docusign Envelope ID: DE56A114-5BC1-444C-9D36-CAD1A264C0D5
Project No. 5548-D, once the final construction costs have been accrued and Sewer Benefit Area H fee
revenues have been collected to contribute to the reimbursement.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California, as
follows:
1.That the above recitations are true and correct.
2.That the City Council has determined that in accordance with the California
Environmental Quality Act, or CEQA, procedures and CEQA Guidelines sections 15080
through 15097, a Program Environmental Impact Report (PEIR), State Clearinghouse No.
2012021006 (City Planning Case No. EIR 12-01), was certified as complete on Nov. 13,
2012, by the City Council for the Sewer Master Plan and Carlsbad Municipal Water
District Water Master Plan and Recycled Water Master Plan Updates. A first addendum
to the Final EIR 12-01 was prepared for the 2019 Master Plan Update and adopted on
Sept. 17, 2019. Pursuant to CEQA Guidelines section 15168, the request to approve a
change in the scope of work for Capital Improvement Program Project No. 5548-D is
within the scope of the Project covered by a previously certified PEIR, and no new
environmental document is required. There is no public review period required. The
effects of the Project were examined in the PEIR and Addendum and all feasible
mitigation measures and alternatives developed in the PEIR are incorporated into the
resolution approving the change in the scope of work for Capital Improvement Program
Project No. 5548-D. Further, since no changes to the PEIR or Addendum are necessary
to support the Project, the city is not required to prepare an Addendum or Supplemental
EIR to the PEIR per State CEQA Guidelines section 15164. Therefore, the prior PEIR is
sufficient to support the proposed action. No further analysis or environmental
documentation is required.
3.That the City Council has determined that the proposed action of rehabilitation of
existing Bressi sewer manhole structures is categorically exempt from environmental
review under CEQA Guidelines Section 15301 because it involves the maintenance,
repair or minor alteration of existing facilities with negligible or no expansion of the
existing or former use. No exceptions to the categorical exemption as set forth in CEQA
Guidelines Section 15300.2 or CMC Section 19.04.070(C) apply.
Feb. 24, 2026 Item #1 Page 7 of 10
Docusign Envelope ID: DE56A114-5BC1-444C-9D36-CAD1A264C0D5
4.That the City Council adopts the revised plans, specifications and contract documents
for the Poinsettia Lane Sewer Improvements Project, CIP Project No. 5548-D, and the
Bressi Sewer Manhole Rehabilitation Project, CIP Project No. 5503-26.
5.That the bid in an amount not to exceed $3,527,704 submitted by Palm Engineering
Construction Company, Inc., is accepted, and the Mayor is hereby authorized to execute
a contract.
6.That the City Manager or designee is hereby authorized to approve construction change
orders up to $607,300 for CIP Project No. 5548-D and $98,200 for CIP Project No. 5503-
26 for a total contingency amount of $705,500.
7.That the City Manager or designee is authorized to sign all other documents necessary
for regulatory compliance, to extend funding opportunities, or to otherwise implement
and finalize the project, all of which are subject to review and approval as to form by
the City Attorney’s office.
8.That the award of this contract is contingent upon Palm Engineering Construction
Company, Inc. executing the required contract and submitting the required bonds and
insurance policies, as described in the contract, within 20 calendar days after adoption
of this Resolution. The City Manager may grant reasonable extensions of time to execute
the contract and assemble the required bonds and insurance policies.
PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council of the City
of Carlsbad on the 24th day of February, 2026, by the following vote, to wit:
AYES: Blackburn, Bhat-Patel, Acosta, Burkholder, Shin.
NAYS: None.
ABSTAIN: None.
ABSENT: None.
______________________________________
KEITH BLACKBURN, Mayor
______________________________________
SHERRY FREISINGER, City Clerk
(SEAL)
Feb. 24, 2026 Item #1 Page 8 of 10
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ESTRELLADEMARRDQUAIL PLQUAIL PL
LOCATION MAP
EXHIBIT
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Exhibit 2
Feb. 24, 2026 Item #1 Page 9 of 10
5548-D
POINSETTIA LANE SEWER
IMPROVEMENTS
Docusign Envelope ID: DE56A114-5BC1-444C-9D36-CAD1A264C0D5
ESTRELLADEMARRDQUAIL PLQUAIL PL
LOCATION MAP
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Feb. 24, 2026 Item #1 Page 10 of 10
PROJECT SITE
5503-26
BRESSI SEWER MANHOLE
REHABILITATION
Docusign Envelope ID: DE56A114-5BC1-444C-9D36-CAD1A264C0D5