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HomeMy WebLinkAbout2020-12-10; Agua Hedionda Lift Station Project Status Update (District 2); Gomez, PazTo the members of the: Cl1Y COUNCIL Date 0 -ho\~A ✓ cc ✓ CM -~_£ DCM (3) ✓ 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