ITEM # 12
CITY OF MONTEBELLO
CITY COUNCIL AGENDA STAFF REPORT
TO: H
onorable Mayor and City Council Members
FR
OM: René Bobadilla, P.E., City Manager
BY: J
ames Enriquez, P.E., Director of Public Works / City Engineer SUBJ
ECT: Approval of a Change Order to the Construction Contract with Gentry Brothers, Inc. – Beach Street Pavement and Storm Drain Rehabilitation Project - Phase 1 (From Vail Avenue to 5th Street), CP No. 883 DAT
E: April 13, 2022
RECOMMENDATIONS:
It
is recommended that the City Council:
1) Fi
nd that the requested “Changes in Work” for the project (Attachment A) have no significant effect on the environment and approve the changes in the aggregate amount of $534,370. The final contract amount with Gentry Brothers , Inc. is increased to $1,460,397; and
2) Tak
e such additional, related, action that may be desirable.
FISCAL IMPACT
The Fi
scal Year 2021-22 Capital Improvement Program (CIP) Budget approved by the City Council at the June 23, 2021 meeting includes a total amount of $2,200,000 for the Beach Street Pavement and Storm Drain Rehabilitation Project, including Phase 1 and Phase 2.
The Project is funded entirely from the Road Maintenance and Rehabil itation Act (SB1) (Fund 201).
The t
otal project cost is estimated at $1,998,045, including the recommended change orders and contingency, and is fully funded at this time, No additional appropriations are recommended.
CITY COUNCIL MEETING AGENDA HANDOUT - ITEM NO. 12, REVISED STAFF REPORT & ATTACHMENTS CITY COUNCIL AGENDA REPORT – MEETING OF APRIL 13, 2022
Approval of a Change Order to the Construction Contract with Gentry Brothers, Inc. – Beach Street Pavement and Storm Drain Rehabilitation Project - Phase 1 (From Vail Avenue to 5th Street), CP No. 883
BACKGROUND
O
n December 8, 2021 , the City Council awarded a construction contract to the lowest responsive and responsible bidder, Gentry Brothers, Inc., in an amount not -to-exceed $926,027 for Phase 1 of the project from Vail Avenue to 5th Street.
P
hase 2 of the project from 5th Street to Bluff Road had been delayed because it included the replacement of a storm drain that required a permit from Los Angeles County Department of Public Works . In January 2022, the City Council authorized the replacement of the storm drain under an emergency declaration following storm damage that occurred in December 2021. The storm drain replacement was completed in March 2022, allowing the road reconstruction of this segment to move forward. Staff recommends adding this work to the Phase 1 contract at the extended unit prices bid.
The total cost for adding this segment of road work is $446,770 . Construction of this segment under a separate contract would add additional administrative costs for preparing a separate bid package and for managing the bid and construction of an additional project. It would also delay the repair of this segment of Beach Street by several months.
A
dditionally, the contractor submitted a request for additional compensation for increased asphalt material costs that are beyond their control (Attachment B). The price increase is related to the recent sharp increase in the price of petroleum, a key ingredient in asphalt.
The material supplier has indicated that the cost of the asphalt has increased by $15 per ton since the original bid was submitted. This increase applied over the tonnage of the entire project results in a total project cost increase of $87,600. Payment of this added cost will ensure the asphalt is available without delaying the project construction schedule, which could expose the project to even further material price increases due to the current volatility of oil prices.
ANALYSIS
An u
pdated summary of total projected costs for the subject project is as follows:
$ 247,700 Engineering Design Services
(West & Associates awarded on 8/12/2020 & 11/10/2021)
$ 92,126 Construction Management/Inspection
(AIM Consulting Services awarded on 1/12/2022)
$ 926,849 Original Authorized construction contract (Gentry Brothers, Inc. awarded on 12/8/2021)
$ 534,370 Change Orders (Recommended)
$
197,000 Contingency (10%)
$ 1,998,045 Total Project Cost
CITY COUNCIL AGENDA REPORT – MEETING OF APRIL 13, 2022
Approval of a Change Order to the Construction Contract with Gentry Brothers, Inc. – Beach Street Pavement and Storm Drain Rehabilitation Project - Phase 1 (From Vail Avenue to 5th Street), CP No. 883
SUMMARY
T
he City Council will consider approving a change order, in the amount not -to-exceed $534,370 to the construction contract with Gentry Brothers, Inc. (GBI) for C.P. No. 883 – Beach Street Pavement and Storm Drain Rehabilitation Project. Upon the approval by the City Council of the recommended actions , staff will direct the contractor to proceed with the proposed additional work.
ATTACHMENTS:
A. A
ttachment A – Changes in Work Summary
B. Attachment B – Contractor Request for Additional Compensation
ATTACHMENT A
CHANGES IN WORK SUMMARY
April 13, 2022
BEACH STREET PAVEMENT AND STORM DRAIN REHABILITATION PROJECT (FROM VAIL AVENUE TO BLUFF ROAD)
CP NO. 883
P
roject Description:
The project consists of roadway resurfacing/reconstruction of Beach Street from Vail Avenue to Bluff Road. Work includes repair of damaged concrete sidewalk, cub, gutter, cross gutters and ADA ramps. The existing asphalt with be removed or cold-milled and resurfaced with new asphalt.
Changes in Work:
(1) Extended project limits adding from 5th St to Bluff Rd $ 446,770 (2) Increased cost of Asphalt $ 87,600
Total Changes in Work $ 534,370
Description of Changes:
(1) The project had been split into two phases. Phase 1 was from Vail Ave to 5th St.
Phase 2 was from 5th St to Bluff Rd. The phasing was due to the replacement of the storm drain from 5 th St to Bluff Rd. Since the storm drain replacement was delayed by permits required by LA County Department of Public Works, Phase 1 was bid for construction to accelerate the completion of the majority of the project. The storm drain was recently replaced in an emergency contract following storm damage in December 2021. Now that the storm drain work is completed, the road resurfacing work can be completed. The recommended added cost of $446,770 extends the contract unit prices in the original bid, with the exception of an additional cost of $209,900 for overexcavation to remediate oversaturated soil likely resulting from years of flooding and the leaking storm drain in this area, placement of crushed aggregate base material under the new pavement, and the increased cost of asphalt due to current market conditions. (2) The contractor has requested compensation for increased asphalt material cost that is beyond their control. The contractor submitted invoicing from the asphalt supplier demonstrating that the cost of asphalt material has increased since the original bid due to the sharp increase in the cost of petroleum. The increase is $15 per ton (from $60.41 to $75.41 per ton). The total increase for the project is $87,600.
ATTACHMENT A
Revised Contract Amount:
Original contract amount $ 926,027
Changes in work to be authorized $ 534,370
Revised contract amount $ 1,460,397
Percent total change to original contract amount 57.7%
384 E. LIVE OAK AVENUE, IRIWINDALE, CA 91706 | 626-357-9631 | FAX 626-357-6322 March 23, 2022
James Enriquez
City of Montebello
1600 W. Beverly Blvd.
Montebello, CA 90640
RE: Beach Street Pavement Rehabilitation Project - Asphalt Price Increase Project # CP No. 882
Mr. James Enriquez:
As you are able to see from the attached letters from Holliday Rock and Kelterite, the COVID-19 pandemic, coupled with political instability in Europe, has caused a significant increase in the price of materials. Specifically, our asphalt suppliers have had to substantially increase the cost of asphalt delivery on account of increased oil and natural gas prices. Previous binder pricing is not being honored, resulting in weekly price increases.
This increase is in addition to previous price increases. For example, the original quote we received put the price per ton at $60.41. This was material cost only. We recently received a revised Materials Quote, dated March 22, 2022, which indicated that the new price per ton would be $75.41. This represents a total increase in material price of $15.00 per ton. Given the fact that the California Crude Oil Price index had oil at $298.80 a year ago and now it is $507.20, this is not surprising.
The price increases are indicative of a critical supply shortage within the meaning of our contract. We are faced with "exorbitant prices entirely inconsistent with current and standard rates taking into account the quantities involved and the usual industry practices in obtaining such quantities." This has made performance of the contract essentially impossible at the current material pricing rates and ultimately requires a change order increasing the price of the contract that will allow us to perform.
We are hereby requesting that City of Montebello execute a Change Order reflecting an increase in the total price for the project.
Respecfully,
Wayne Gentry
Gentry Brothers, Inc.
KELTERITE CORPORATION
Contractors State License #944160 A/B
12231 Pangborn Ave
Downey, CA 90241
Phone: (562) 401-0011 Fax: (562) 401 -1012
DISPATCH Phone: (562) 401-0039
SALES Phone: (562) 760-0350 or [email protected]
ASPHALT and BASE MATERIALS ASPHALT and CONCRETE DUMP 2/28/2022
Customers:
Costs of goods such as oil, fuel, etc. have reached an all time high and are changing rapidly. Kelterite has tried to absorb increases and changes as fast as possible, however the recent escalations are so high we cannot continue to do so. Kelterite recommends that bidders put increases in their bids ahead of time because we will be quoting asphalt material with a good through date that will not be extended.
Oil prices for March 2022 jumped over $100.00 from some major suppliers and accordingly Kelterite has raised our prices for all asphalt materials $5.00 per ton on any future quotes and our FOB pricing.
Trucking and fuel prices are expe cted to increase dramatically in the coming weeks. Please be prepared for those costs when bidding your projects as adjustments will be made as needed in order to ensure trucking can be provided to our projects.
Kelterite appreciates your business and welcomes any suggestions you may have in order to help deal with these unprecedented times.
QUOTATION
Estimated Quantity Unit Description Unit Price
3,000.00 Ton . B 3/4" PG 64-10 60.41
1,900.00 Ton . C2 1/2" PG 64-10 60.41
Quote No. 87092
Sales Representative
GBI Gentry Brothers Inc.
384 E. Live Oak Blvd.
Irwindale, CA 91706
Quote Expiration Date
2/28/22
Customer Account No.
Shipping Method
70520
Kelterite Corporation
SALES TAX INCLUDED IN ASPHALT MATERIAL PRICE
$200.00 per hour Saturday Premium Plant Charge - $200.00 per hour Night Premium Plant Charge - $300.00 per hour Sunday Premium Plant Charge Date Quote Issued
Ship to Job Address:
_____________________
DATE
____________________________________________________________
SIGNATURE
____________________________________________________________ PRINT NAME and TITLE
Truck
Unit price applies
Total
Beach St. pavement Rehab. Phase 1,
Montebello, CA
8D
12231 Pangborn Ave
Downey, CA 90241
Phone: (562) 401-0011 Fax: (562) 401-1012
Dispatch: (562) 401-0039
Contractors State License #944160 A/B
ASPHALT and BASE MATERIALS ASPHALT and CONCRETE DUMP
PURCHASE ORDER REQUIRED WITHIN 30 DAYS OF QUOTE OR QUOTE WILL EXPIRE UNLESS EXTENDED IN WRITING 10/12/21
Jason/Joe
Beach & Bluff
Page: 1
PLEASE CONFIRM BY SIGNING AND RETURNING THE ENCLOSED COPY TO KELTERITE CORPORATION, PROVIDE A PURCHASE ORDER, OR PROVIDE A SIGNED ORDER CONFIRMATION.
[email protected]
When asphalt arrives cold or unacceptable at job, you must notify the Control House within 1/2 hour of its arrival and it must be returned for testing. Any disputes regarding dump fee charges and/or material must be brought to our attention within 21 days of delivery or dump.
Ref #:
1. Additional Charges apply for: (1) Plant Standby Time and (2) Special Opening (nights and weekends).
2. Above prices are based upon U.S. Tonnages delivered in Proc/Super Ten trucks unless otherwise specified. Subject to availability/scheduling. Excludes: Q.C.Q.A. and/or testing of any kind, ALL asphalt products may include rap.
3. Minimum 17 tons per load for delivery, all quotes are based on Monday through Friday deliveries unless otherwise specified.
4. Payment Terms are Net 30 from date of delivery. If purchaser fails to make payment on the due date, an interest charge at the rate of 1.5% per month will accrue until su chtime as full payment plus interest charge is made by the Purchaser.
5. All Sales quotes are based upon Cash/Credit Card Purchases, unless approved credit is in place and current.
6. Prices include delivery if applicable. Delivery includes 30 minutes of unloading time. Delay in exce ssof 30 minutes will be charged at he applicable hourly rate of $108 per hour on weekdays, $129 per hour on Saturdays and $142 per hour on Sundays. Shipments are subject to availability. Materials are subjet to availabilty. Customer (Buyer) will alway pay the correct sales tax owed based on the actual invoice.
7. This quote and its conditions will be a part of any purchase order and order confirmation received.
8. Additional 4% surcharge will be added to credit card payments over $1,000.00.
9. Additional Terms and Conditions apply per the credit agreement.
10. Additional $8.00 per load will be added to the unit price above for environmental fees.
11. Current dump fees are published on our website. If quoted dump fees are reduced, then the reduced dump fees apply only when all asphalt and/or base material is purchased at quoted price. Dumps are subject to availability.
12. Should any proceeding whether legal, equitable or otherwise, be commenced between the parties to this agreement, concerning this agreement and the rights and duties of the parties in relation thereto, the party prevailing in such proceeding shall be entitled to its reasonable attorney's fees and costs in addition to other such relief as may be granted
QUOTATION
Estimated Quantity Unit Description Unit Price
3,000.00 Ton . B 3/4" PG 64-10 75.41
1,900.00 Ton . C2 1/2" PG 64-10 75.41
Quote No. 87092R2
Sales Representative
GBI Gentry Brothers Inc.
384 E. Live Oak Blvd.
Irwindale, CA 91706
Quote Expiration Date
5/23/22
Customer Account No.
Shipping Method
70520
Kelterite Corporation
SALES TAX INCLUDED IN ASPHALT MATERIAL PRICE
$200.00 per hour Saturday Premium Plant Charge - $200.00 per hour Night Premium Plant Charge - $300.00 per hour Sunday Premium Plant Charge Date Quote Issued
Ship to Job Address:
_____________________
DATE
____________________________________________________________
SIGNATURE
____________________________________________________________ PRINT NAME and TITLE
Truck
Unit price applies
Total
Beach St. pavement Rehab. Phase 1,
Montebello, CA
8D
12231 Pangborn Ave
Downey, CA 90241
Phone: (562) 401-0011 Fax: (562) 401-1012
Dispatch: (562) 401-0039
Contractors State License #944160 A/B
ASPHALT and BASE MATERIALS ASPHALT and CONCRETE DUMP
PURCHASE ORDER OR SIGNED QUOTE ARE REQUIRED WITHIN 15 DAYS OR QUOTE WILL BE SUBJECT TO REVISED PRICING 3/22/22
Jason/Joe
Beach & Bluff
Page: 1
PLEASE CONFIRM BY SIGNING AND RETURNING THE ENCLOSED COPY TO KELTERITE CORPORATION, PROVIDE A PURCHASE ORDER, OR PROVIDE A SIGNED ORDER CONFIRMATION.
[email protected]
Ref #:
When asphalt arrives cold or unacceptable at job, you must notify the Control House within 1/2 hour of its arrival and it must be returned for testing. Any disputes regarding charges and/or material must be brought to our attention within 21 days of delivery or dump. Material is in compliance wil all testing except stability.
2. Above prices are based upon U.S. Tonnages delivered in Proc/Super Ten trucks unless otherwise specified. Subject to availability/scheduling.
1. Additional Charges apply for: (1) Plant Standby Time and (2) Special Opening (nights and weekends).
3. Minimum 17 tons per load for delivery, all quotes are based on Monday through Friday deliveries unless otherwise specified.
4. Payment Terms are Net 30 from date of delivery. If purchaser fails to make payment on the due date, an interest charge at the rate of 1.5% per month
5. All Sales quotes are based upon Cash/Credit Card Purchases, unless approved credit is in place and current.
6. Prices include delivery if applicable. Delivery includes 30 minutes of unloading time. Delay in excess of 30 minutes will be charged at the applicable hourly
7. This quote and its conditions will be a part of any purchase order and order confirmation received.
8. Additional 4% surcharge will be added to credit card payments over $1,000.00.
9. Additional Terms and Conditions apply per the credit agreement.10. Additional $8.00 per load will be added to the unit price above for environmental fees.
11. Current dump fees are published on our website. If quoted dump fees are reduced, then the reduced dump fees apply only when all asphalt and/or
12. Should any proceeding whether legal, equitable or otherwise, be commenced between the parties to this agreement, concerning this agreement and Excludes: Q.C.Q.A. and/or testing of any kind, ALL asphalt products may include rap. will accrue until such time as full payment plus interest charge is made by the Purchaser. rate of $116 per hour on weekdays, $137 per hour on Saturdays and $149 per hour on Sundays and will not be negotiated.Shipments are subject to availability. Materials are subject to availability. Customer (Buyer) will always pay the correct sales tax based on the actual invoice. base material is purchased at quoted price. Dumps are subject to availability. the rights and duties of the parties in relation thereto, the party prevailing in such proceeding shall be entitled to its reasonable attorney's fees and costs in addition to other such relief as may be granted.