HomeMy WebLinkAbout2020-12-10; Agua Hedionda Lift Station Project Status Update (District 2); Gomez, PazTo the members of the:
Cl1Y COUNCIL
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Dec. 10,2020
Council Memorandum
To: Honorable Mayor Hall and Members of the City Council
From: Paz Gomez, Deputy City Manager, Publ_i,c orks
Via: Geoff Patnoe, Assistant City ManagerU __
Re: Agua Hedionda Lift Station Project Status Update {District 2)
{city of
Carlsbad
Memo ID# 2020261
This memorandum provides an update on the Agua Hedionda Lift Station Replacement Capital
Improvement Program {CIP) Project Nos. 3492, 3886 and 3949 {Project). Though the lift station
itself is in District 2, portions of the pipeline in the project also traversed Districts 1 and 3.
Background
The Agua Hedionda Lift Station is jointly owned by the cities of Carlsbad {30.9%) and Vista
{69.1%). It pumps wastewater flow from both cities to the Encina Water Pollution Control Facility
for treatment. As agreed upon by both cities, Carlsbad is the lead agency in executing the Project.
The Project, which is to replace the lift station and upgrade its capabilities, started in 2015 but
was delayed during construction in 2019 due to a contract dispute related to the performance of
the pumping system.
In October 2019, the City of Carlsbad {Carlsbad), with the concurrence of the City of Vista {Vista),
issued a unilateral deductive change order in the amount of $834,888 to remove the remaining,
non-disputed project work from the construction contractor's scope of work, and pursued an
alternative method of completing the remaining work. Specifically, the remaining work includes
final grading and paving, construction of a storm water detention basin and related storm drain
improvements, relocation of two temporary pumps that provide back-up pumping capacity for
the lift station, and demolition of the existing lift station.
Vista proposed to use the progressive design-build {PDB) delivery method because of their
familiarity with the process, the ability to provide owner input during the design phase of the
project, and a short procurement period. At that time, Vista estimated completing the remaining
work by summer 2020 at a cost of approximately $1.5 million total for both cities.
In April 2020, the City Council authorized approval of Amendment No. 4 to the Project
Agreement between Vista and Carlsbad. This amendment transferred the lead agency role from
Carlsbad to Vista for completion of the remaining work. Per the Project Agreement, Carlsbad's
share of the estimated cost of $1.5 million was 30.9% or $463,500, which was encumbered in the
Project budget and is available to partially cover Carlsbad's costs.
Public Works Branch
Utilities Department
5950 El Camino Real, Carlsbad CA 92008 I 760-438-2722
Council Memo -Agua Hedionda Lift Station Project Status Update (District 2)
Dec. 10,2020
Page 2
Discussion
During preparation ofthe Vista PDB request for proposals, Encina Wastewater Authority (EWA),
as operator of the facility, requested 50 additional system optimization and safety improvements
that would allow for the proper operation and maintenance of the facility. The agencies
understood this additional work would be included in the PDB contract if Vista and Carlsbad
mutually agreed and sufficient funding were available. Carlsbad, Vista and EWA agreed that this
additional work should be completed now or in the near future.
In October 2020, Vista received one proposal from TC Construction -Michael Baker, Inc.
(TC-MBI) as the design-build team, for a fee of $4.34 million, inclusive of the SO-item list of
improvements. Though Vista encouraged other contractors who attended the pre-bid meeting to
bid on the project, only one proposal was received. This is likely because of the current high
demand for construction contractors and the risk associated with relocating the two back-up
pumps.
In a PDB project, the risk is mostly held by the design-build team. Based on TC-MBl's proposed
construction schedule, pump relocation is scheduled to occur in August and September 2021,
prior to the rainy season and peak wet weather period. The temporary pumps will be used this
winter to handle peak sewer flows which cannot be pumped by the Agua Hedionda Lift Station in
its present condition. Staff will take extreme care to assure that the temporary pumps are in top
working order. By moving ahead with the project quickly, staff expects to have the station fully
operational before the 2022 rainy season.
Two iterations of negotiating a scope of service and fees with TC-MBI culminated in a final fee of
$4.29 million, which is nearly three times the original estimate of $1.5 million that was presented
and approved by the City Councils of both agencies in Am.endment No. 4. In addition to the PDB
fee increase, the costs for Vista's owner advisor services have increased to a total of $281,886 to
extend project management, design and environmental review services during development of
the Guaranteed Maximum Price (GMP), bringing the total estimated cost to $4,568,377. The final
GMP for construction of the completed project is developed upon completion of the 60% design,
so the fee is subject to revision until that time.
On Nov. 9, 2020, in consideration of the fee increase, Carlsbad staff contacted Vista staff to
discuss options to reduce the fee and whether Carlsbad could support the project completion at
this cost. Vista's recommended approach was to proceed with awarding the PDB contract in
December 2020 to complete the work in a timely manner. Vista's staff does not expect a
significantly lower bid to complete the remaining work in a timely manner using any other
project delivery method. Carlsbad staff expressed concern with the high fee and informed Vista
that Carlsbad did not have remaining project funds except for Carlsbad's percentage share of
. Vista's original estimate of $1.5 million, or $463,500. Carlsbad asked for time to analyze
alternatives.
Although Carlsbad has reserves that could be used to fund the remaining work, only a portion of
the reserves are available for this Project. However, staff can transfer $1.2 million from the
Council Memo -Agua Hedionda Lift Station Project Status Update (District 2)
Dec. 10,2020
Page 3
sewer connection fee fund to the sewer capacity fee fund to refund a previous transfer and free
up the funds needed to complete this Project. By utilizing the $463,S00 amount that is currently
encumbered for the remaining work and the transfer of $1.2 million of funds, sufficient funding is
available for the Carlsbad share of the Project, including the SO-item EWA list.
The cost of Vista's PDB contract includes the SO-item EWA list of improvements, but it does not
include any work that may be needed to address outstanding issues associated with the lift pump
performance. The potential solution to resolve the lift pump performance issues include
fabrication and installation of new impellers by the original contractor, which along with
subsequent testing and verification of their performance are anticipated to be completed by
early fall 2021. This scope is not included in Vista's PDB contract.
The timing of impeller replacement will need to be accommodated by the PDB team, and the
PDB schedule may still be delayed for other unforeseen reasons. If the new impellers do not
solve the lift pump performance issues, currently planned wastewater CIP projects will need to
be delayed for funding additional work at the Agua Hedionda Lift Station.
Options for Completion of the Remaining Work -Carlsbad Share
Carlsbad's share of costs for a~y option is 30.9% of the total cost. The description below and
Table 1 summarize the options. It should be noted that the $463,S00 that was previously
authorized in Amendment No.4 is available to partially cover Carlsbad's share of the total costs.
1. Proceed with the PDB approach for the total project, including the EWA SO-item list of
improvements.
a. Construction would commence in August 2021.
b. Carlsbad's share of the Project's total cost: $1,411,628.
2. Proceed with the PDB approach but delay the EWA SO-item list of improvements
a. Construction on the PDB would commence in August 2021.
b. Carlsbad's share of PDB: $1,1S9,071
c. Defer implementation of EWA's list of improvement items for another project at a
later date. During this postponement period, Carlsbad and Vista would continue to
pay EWA increased maintenance costs until completion of the SO-item list.
Additional staff resources would be required to develop a separate procurement
process for construction of these improvements. Carlsbad's share ofthe SO-item
list: $370,000, contingent on the bidding climate eight months from now.
d. Total Carlsbad share for PDB and. delayed SO-item improvements: $1,437,171
· 3. Transfer the lead agency responsibility back to Carlsbad. Have Carlsbad and the original
designer re-package and re-bid the project. Pursue a design-bid-build {DBB) approach
for the remaining work only. Exclude the EWA SO-item list of improvements. While staff
expects participation from other bidders, the number of bidders is _unknown. The new
price is uncertain and would be subject to the bidding climate at that time. Completion of
Council Memo -Agua Hedionda Lift Station Project Status Update {District 2)
Dec. 10,2020
Page 4
the Project would be delayed a minimum of eight months, requiring reliance on the
temporary pumps through the 2021-22 rainy season.
a. Carlsbad sunk cost in Vista's PDB effort: $139,920
b. Carlsbad estimated DBB share: $8S9,020.
c. Delay the SO-improvement portion of the project. During the time delay, Carlsbad
and Vista would continue to pay increased EWA maintenance cost until
completion of the SO-item list, and additional staff resources would be required.
Carlsbad's share: $278,100 contingent on the bidding climate eight months from
now
d. Total Carlsbad share for PDB and delayed SO-item improvements: $1,277,040
Table 1
Carlsbad's Cost Share 30.9%
Total Costs Option 1 Option 2 Option 3
(Vista and Vista PDB/Delay Repackage/Rebid
Carlsbad) Vista PDB SO EWA Items Delay EWA Items
PDB $3,469,1S2 $1,071,968 $1,071,968 $0
OA $281,886 $87,103 $87,103 $139,920
SO-item EWA List $817,339 $2S2,SS8 $0 $0
Rebid design-bid-build $2,780,000 $0 $0 $8S9,020
$1,411,628 $1,1S9,071 $8S9,020
SO-item EWA List in the
future $900,000 $0 $278,100 $278,100
GRAND TOTAL $1,411,628 $1,437,171 $1,277,040
Notes: Fastest approach Delays Delays entire
to complete full completion and project by
scope. Cost may adds uncertainty minimum of eight
change upon of cost associated months. Higher
GMP with the delayed maintenance
SO-item list. costs. Significant
additional staff
resources
required.
Lift Pump Issues
Carlsbad anticipates receiving two new impellers for the lift pumps in March 2021 and two
additional impellers in late summer 2021. The options described above do not include work that
· may be needed to address any lingering pump performance issues.
Council Memo -Agua Hedionda Lift Station Project Status Update (District 2)
Dec. 10,2020
. Page 5
Conclusions and Recommendation
The PDB project delivery method (Option 1) is the fastest approach to arrive at construction and
project completion and requires the least amount of staff resources. Although repackaging and
rebidding (Option 3) could save Carlsbad some funds, the longer period required to complete the
project, additional staff time needed and the uncertainty of the bidding climate eight months
from now makes this a less desirable option.
At the Jan. 26, 2021 City Council meeting, staff will recommend that funding for Option 1 be
confirmed with the intent of pursuing project completion via the PDB project delivery method at
the earliest possible time. This recommendation would be for Carlsbad's share ($1,411,628).
Next Steps
On Jan. 26, 2021, staff plans to present this item to the City Council with a recommendation to
proceed with Option 1 at a cost to Carlsbad of $1,411,628 and request authorization to transfer
$1.2 million from the sewer connection fee fund to the sewer capacity fee fund (as partial
repayment of a prior loan) to pay for completion of the remaining work and the SO-item EWA list.
On Jan. 26, 2021, Vista staff plans to present the same recommendation to the Vista City Council
for approval of their share. At that time, both City Councils will also be requested to approve
Amendment No. 5 to the Project Agreement.
cc: Scott Chadwick, City Manager
Celia Brewer, City Attorney
Laura Rocha, Deputy City Manager, Administrative Services
Cindie McMahon, Assistant City Attorney
Robby Contreras, Assistant City Attorney
Vicki Quiram, Utilities Director
Kevin Branca, Finance Director.
Ryan Green, Assistant Finance Director
Babaq Taj, Engineering Manager
Dave Padilla, Engineering Manager