Fremont City Council Meeting: 12/02/25 07:00 PM
3300 Capitol Avenue Div/Dept: Landscape Architecture
Fremont, CA 94538 Category: Agreements and Contracts
SCHEDULED
Sponsors:
COUNCIL STAFF REPORT (ID # 5566) DOC ID: 5566 B
Updated: 11/21/2025 4:34 PM by Dina Lewis B Page 1
AWARD A CONSTRUCTION CONTRACT FOR PALM AVENUE DEMOLITION PROJECT (PWC8813A) - Approve Plans and Specifications, Accept the Bid and Award a Construction Contract for the Bid Amount of $316,998 to Resource Environmental, Inc. and Allocate a 20% Construction Contingency of $63,400 for a Total Contract Amount of $380,398 for the Palm Avenue Demolition Project (PWC8813A), Accept the bid withdrawal of Castle Construction LLC, deny the bid protest from Penkor Wrecking, and find that the project is exempt from review under the California Environmental Quality Act (CEQA) per CEQA Guidelines Sections 15301.
Contact Persons:
Name: Connie Chao Tara Bhuthimethee
Title: Landscape Designer II Parks Planning and Design
Manager
Div/Dept: Landscape Architecture Community Services
Phone: 510-494-4742 510-494-4738
E-Mail: [email protected] [email protected]
Executive Summary: This report recommends that the City Council approve the plans and specifications, accept the bid, and award a contract to Resource Environmental, Inc. for a total base bid amount of $316,998, and allocate a 20% construction contingency of $63,400 for a total contract amount of $380,398 for the Palm Avenue Demolition Project; and find that the project is exempt from review under the California Environmental Quality Act (CEQA) per CEQA Guidelines Section 15301.
BACKGROUND: On May 25, 1999, City Council approved the purchase of 19.8 acres at Palm Avenue for community park purposes. At the time of the purchase, the site was considered to be one of the City’s last opportunities to accommodate a Citywide Community sports park. On May 14, 2013, Council approved the sale of approximately seven acres of the site in a parkland land swap, after which approximately 12 acres remained.
Approximately one acre, immediately adjacent to the east property line, is owned by the San Francisco Public Utilities Commission (SFPUC). Pending approval from SFPUC, the land will be developed as part of the park.
The site is largely undeveloped except for four structures, including a bungalow building, ranch-style building, a metal shed and a wood barn. The bungalow at 42354 Palm Avenue was constructed between 1939 and 1946; the Ranch-style building at 42410 Palm Avenue was constructed around 1955; the metal shed was constructed between 1946 and 1957; and the barn was constructed before 1939, possibly as early as 1905, and was designed in the monitor style.
An historical evaluation conducted in 2024 determined that the site does not retain historic significance, is not eligible for listing on the California Register, and is not eligible for listing on the Fremont Register. For these reasons, the property and its structures are not designated as an historic resource.
Council Staff Report (ID # 5566) Meeting of December 2, 2025 Updated: 11/21/2025 4:34 PM by Dina Lewis B Page 2
In June 2025, the City began a community engagement process to involve residents, stakeholders, and local organizations in shaping the vision for the new park which identified community priorities, gathered feedback on desired amenities, and developed the character of the park.
DISCUSSION/ANALYSIS: This project is the first phase of a two-phased project. The first phase of the project includes demolition of the existing structures, with the exception of the wood barn, to prepare the site for Phase 2, which includes the development of the park. The barn is being retained for future consideration of use, pending funding and feasibility.
The structures to be demolished include the bungalow building, ranch-style building and metal shed, along with related utilities that service these structures. The Draft Master Plan for the park development will be brought before the Recreation Commission in early 2026 for recommendation to City Council for adoption. After plan adoption, the City will begin the environmental review, followed by the preparation of construction documents. The project is projected to start construction in 2027 with estimated completion and opening in 2028.
The scope of work for the demolition project consists of two parts. The first part will include the abatement and legal disposal of lead and asbestos from the structures. The second part will include the demolition of the structures; the removal of all concrete slab foundations, concrete and asphalt paving; and the removal of structural footings to subgrade. Utilities servicing the structures will be disconnected and demolished. Soils from undeveloped portions of site will be used to re-establish site elevations and import structural fill will be used to backfill the basement in the ranch-style house. Work will also include chain link fence demolition, tree removal, pruning of trees monitored by a certified arborist, and coordination with utility agencies.
Bid Results: The Palm Avenue Demolition Project was advertised for bid on October 7, 2025. On October 30, 2025, the City received eleven bids. The Bidders and their respective bid amounts are shown below.
Rank Contractor Bid Total
1 Castle Construction LLC $312,191.20 * **
2 Resource Environmental, Inc. $316,997.80*
3 Penkor Wrecking $333,550.00
4 D-Line Constructors, Inc. $413,000.00
5 W.C. Maloney LLC $522,732.50
6 Galeb Paving, Inc. $637,360.00
7 Bjork Construction Company, Inc. $684,805.16*
8 LVI Engineering, Inc. $762,360.00*
9 Belz Construction, Inc. $856,845.00*
10 S&H Construction, Inc. $898,600.00
Council Staff Report (ID # 5566) Meeting of December 2, 2025 Updated: 11/21/2025 4:34 PM by Dina Lewis B Page 3
11 NG Builder Company $900,605.90*
* Mathematically Corrected - Corrected for computation errors pursuant to Instructions to Bidders Part 6.1(A)
** Non-responsive - Pursuant to PCC § 5103
The low bidder was determined by evaluation of the base bid as stated in the Instruction s to Bidders of the Contract Documents. Castle Construction LLC (“Castle”) was the lowest bidder after their Bid Schedule was mathematically corrected. Upon analysis, it was found that Castle’s unit cost was filled out incorrectly as their unit cost for lump sum items was not “inclusive of all costs, whether direct or indirect, including profit and overhead.” At bid opening, Castle was ranked as the 5th apparent lowest bidder with a Total Base Bid of $627,150. After mathematical corrections were made, their actual Total Base Bid was $312,191.20.
Furthermore, the license and registration requirements in the Notice Inviting Bids state that the successful bidder and/or subcontractor must possess a C-22 license, HAZ certification and ASB certification to perform the portion of the work that entails hazardous materials abatement, and C -61/D49 for tree pruning and tree removal. Upon review, Castle did not possess any of these required licenses and did not provide subcontractors knowledgeable in those trades in the Subcontractor List. Therefore, Castle’s bid was deemed non-responsive due to an error found in their Bid Schedule and for providing no proof of C - 22 license, HAZ certification, ASB certification and C-61/D49 license. Pursuant to PCC § 5103, a mistake was made in the bid proposal and staff recommends that the City Council accept the withdrawal of Castle Construction LLC’s bid.
The second low bid was submitted by Resource Environmental, Inc. for a mathematically corrected base bid amount of $316,997.80. The contractor is a responsible bidder experienced in this type of work. Their bid is responsive and all bid documents are in order.
The lowest responsive bidder’s price is 69% below the Engineer’s Estimate of $1,042,855.
Bid Protest: A Notice of Intent to Award was issued on November 3, 2025 to the responsive low bidder Resource Environmental, Inc. (“Resource Environmental”). On November 5, 2025, Penkor Wrecking (“Penkor”) submitted a bid protest in accordance with City procedures, alleging that Resource Environmental failed to list a licensed C -13 fencing subcontractor on its Subcontractor List. Penkor contends that fencing represents a significant (5.6%) portion of the project, deeming it non-incidental and that the omission constitutes a material irregularity affecting the fairness of the bidding process. Penkor requested that Resource Environmental be deemed nonresponsive and that the project be awarded to Penkor as the lowest responsive bidder.
Under Public Contract Code Section 20162, contracts must be awarded to the lowest responsive bidder. A bid is responsive if it conforms to all material terms; immaterial defects that do not give a bidder an unfair advantage may be waived. (Ghilotti Construction Co. v. City of Richmond (1996) 45 Cal.App.4th 897).
City staff, in consultation with the City Attorney’s Office, reviewed the protest and determined that Resource Environmental’s omission of a fencing subcontractor does not render the bid nonresponsive. Under the CSLB’s definition of incidental and supplemental work (California Code of Regulations, Title 16, § 831), a licensed contractor may perform work that is necessary to complete the project in connection with the contractor’s primary Council Staff Report (ID # 5566) Meeting of December 2, 2025 Updated: 11/21/2025 4:34 PM by Dina Lewis B Page 4
trade or classification. Pursuant to Business and Professions Code Section 7059, work in other classifications is deemed “incidental and supplemental” when it is essential to completing the licensed trade and may be performed either by subcontractors or by the contractor’s own employees. Resource Environmental confirmed in its response that it will self-perform the fencing work as incidental to the demolition.
Here, the project requires that the general contractor hold a valid Class A, Class B, or C-21 license. Resource Environmental holds valid licenses in all three classifications. Temporary fencing and tree protection fencing work is considered incidental and supplemental to the overall scope of work because it is a minor part of a larger project, which is the demolition of structures and utilities. As fencing is considered incidental and supplemental to the demolition scope of work, this work may be self-performed by licensed general contractor.
Based on this review, staff finds Resource Environmental’s bid to be responsive and recommends that the City Council deny Penkor’s bid protest.
FISCAL IMPACT: The Palm Avenue Demolition Project was funded in the FY 2015/16- 2019/20 Capital Improvement Plan with additional funds added to the project in the FY 2017/18-2021/22, 2019/20-2023/24, 2021/22-2025/26 and 2023/24-2027/28 Capital Improvement Plans.
1. Total Project Funds Appropriated to the Project:
▪ Fund 540 Park Facility Impact Fee (PWC8813) $19,100,000 o 2015/16 - 2019/20: $1,700,000
o 2017/18 - 2021/22: $1,500,000
o 2019/20 - 2023/24: $4,350,000
o 2021/23 - 2025/26: $8,350,000
o 2023/24 - 2027/28: $3,200,000
Total Funds Available: $19,100,000
2. Project Expenses to Date:
▪ Project Management, Design, Consultants*, Utility Coordination, Administration:
$538,341
*Historic evaluation, Phase 1 Environmental Site Assessment, Pre-renovation lead and asbestos survey, design consultants, tree survey, geotechnical investigation, barn structural evaluation
3. Estimated Construction (Demolition) Expenditures:
Demolition Project: $316,998
20% Construction Contingency 63,400
Project and Construction Management: 60,864
Construction Subtotal: $441,262
Funds Remaining at Demolition Completion: $18,120,397
Based on the contract amount and project cost estimates, there are sufficient funds budgeted for this project.
ENVIRONMENTAL REVIEW: Pursuant to the California Environmental Quality Act (CEQA), the proposed project would be categorically exempt pursuant to CEQA Guidelines Section Council Staff Report (ID # 5566) Meeting of December 2, 2025 Updated: 11/21/2025 4:34 PM by Dina Lewis B Page 5
15301—Existing Facilities, as the proposed demolition of two single-family homes, one accessory shed, their supporting utilities, and the remnant foundations of former structures that inhabited the site would be consistent with Section 15301(l), which exempts demolition projects in urbanized areas involving three or fewer single-family residences and the demolition of accessory/appurtenant structures. A January 2024 Historic Resource Evaluation conducted by Architectural Resources Group found that none of the structures proposed for demolition retained historic integrity or were eligible for placement on the California Register of Historic Resources or the City of Fremont Register of Historic Resources. Therefore, they do not qualify as a historic resource under CEQA and their demolition would not have a significant impact on the environment.
ATTACHMENTS: None.
LINKS: https://www.fremont.gov/government/departments/parks-planning-design/design- projects/palm-avenue-demolition
RECOMMENDATIONS:
1. Approve the plans and specifications for the Palm Avenue Demolition Project (PWC8813A).
2. Accept the bid withdrawal of Castle Construction LLC, deny the bid protest from Penkor Wrecking, and accept the bid and award a contract to Resource Environmental, Inc., for a total base bid amount of $316,988, and allocate a 20% construction contingency of $63,400 for a total contract amount of $380,397.
3. Find that the project is exempt from review under the California Environmental Quality Act (CEQA), each as a separate and independent basis, per Section 15301, as the demolition of two single-family homes, one accessory shed, their supporting utilities, and the remnant foundations of former structures that inhabited the site would be consistent with Section 15301(l).