Q SEW Pp�T
CITY OF
z NEWPORT BEACH
c�<,FORN'P City Council Staff Report
November 28, 2023
Agenda Item No. 14
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: David A. Webb, Public Works Director - 949-644-3311, [email protected]
PREPARED BY: Michael Sinacori, Assistant City Engineer
[email protected], 949-644-3342
TITLE: Alley Reconstruction (Assessment District 111, Underground Utility District 22 Phase 2 and Assessment District 124 Phase 0 Areas) — Award of Contract No. 8820-2 (23R07)
ABSTRACT:
Staff has received construction bids for the alley reconstruction work related to Assessment District 111 (AD-111), Utility Undergrounding District 22 - Phase 2 (UUD22- 2), and Assessment District 124 Phase 0 areas on Balboa Peninsula and Balboa Island.
Staff requests the City Council's approval to award the construction contract to Grigolla & Sons Const. Co. Inc. and a budget amendment from prior project savings to complete the funding needed for the project. The project consists of removing and reconstructing with concrete, the existing asphalt or concrete streets/alleys, alley approaches, sidewalks, curb and gutter, driveways, and adjusting utility boxes to grade that were installed as part of all the recent utility work.
RECOMMENDATIONS:
a) Find this project exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15301 (repair and maintenance of existing highways and streets, sidewalks, and gutters involving no expansion of use) of the CEQA Guidelines, because this project has no potential to have a significant effect on the environment; b) Approve the project plans and specifications;
c) Approve Budget Amendment No. 24-034 transferring project savings from General Fund CIP and Neighborhood Enhancement unappropriated fund balance and appropriating $52,972.29 in increased expenditures in Account No. 01201927- 980000-23R07 and $200,496.14 in increased expenditures in Account No. 53601- 980000-23R07;
d) Award Contract No. 8820-2 to Grigolla & Sons Const. Co. Inc. for the total bid price of $3,481,384, and authorize the Mayor and City Clerk to execute the contract; and e) Establish and encumber a contingency of $175,000 (approximately 5% of the bid) to cover the cost of unforeseen work not included in the original contract. 14-1
Alley Reconstruction (Assessment District 111, Underground Utility District 22 Phase 2 and Assessment District 124 Phase 0 Areas — Award of Contract No. 8820-2 (23R07) November 28, 2023
DISCUSSION:
The reconstruction of concrete alleys within AD-111 is the final step in the utility undergrounding process after power pole removal and associated water main replacement efforts in this area. In addition, a small portion of the alley in West Newport, between Prospect and Cedar Streets and adjacent to West Coast Highway, will be completed as part of the AD-111 efforts. The North Bayfront AD 124 Phase 0 area undergrounding is also being included in this effort since even though full alley reconstruction of AD 124 on Balboa Island is several years away, the underground construction will be completed shortly in that North Bayfront alley. Staff is not including the additive bid items of UUD-22 Phase 2 alley restoration in this award and will address those in a separate contract.
At 10 a.m. on October 3, 2023, the City Clerk opened and read the following bids for this project:
BIDDER TOTAL BID AMOUNT
Low Grigolla & Sons Const. Co. Inc. $ 3,481,384
2nd Gentry General Engineering, Inc. $ 4,159,308
The apparent low bidder for this project, Grigolla & Sons Const. Co. Inc., submitted a bid approximately 34 percent more than the Engineer's Estimate of $2,600,000 (which included UUD 22 Phase 2). The Engineer's Estimate may have been on the low side based on previous low bid alley projects the last few years. However, several bid items had significant cost increases this past year, such as cost of concrete, mobilization, traffic control, construction surveying and storm water protection associated with recent and on -going inflation pressure compounded with high contractor demand. Grigolla submitted all the necessary forms and possesses a Classification "A" License as required by the project specifications. A check of the contractor's references indicates satisfactory completion of similar projects for other public agencies.
Staff received a protest from Gentry General Engineering noting that Grigolla did not attend the mandatory pre -bid meeting required for this project. Contractors could be deemed non -responsive for not attending, as noted in the protest. However, a Grigolla representative contacted City staff after the meeting and explained that due to a medical emergency, they were not able to attend. They made a special request to be allowed to bid and Grigolla was given the same information that was provided to the other contractors at the mandatory pre -bid meeting. Staff approved the contractor's request to bid the project as Grigolla is well experienced and has done many other projects successfully for the city.
Work necessary to complete this contract consists of removing existing asphalt and concrete pavements and constructing new concrete alleys, adjusting utility boxes to grade, conducting traffic control, installing new traffic striping, and other incidentals items.
Grigolla will have 125 consecutive working days to complete the project once given the notice to proceed. Initial work is expected to begin in March 2024 due to work that Grigolla is already contracted to provide for the City.
14-2
Alley Reconstruction (Assessment District 111, Underground Utility District 22 Phase 2 and Assessment District 124 Phase 0 Areas — Award of Contract No. 8820-2 (23R07) November 28, 2023
Project plans and specifications will be available for review at the November 28, 2023 City Council meeting or upon request.
FISCAL IMPACT:
The construction bid, along with other costs listed below, put the overall cost approximately $250,000 over the various CIP Budgets earmarked for this Alley Reconstruction project. As previously discussed, there were many factors that led to a higher than estimated bid. The funding from AD 111 was determined and set in 2016 when the project was approved by City Council. Since initial approval of the underground district, the project has experienced unplanned delays associated with the Covid 19 Pandemic, as well as supply shortages and material and labor cost escalation.
Specifically, the cost for concrete has increased from $8 per square foot in 2016 to more than $25 per square foot today. This increase is unprecedented and could not have been foreseen. This has put added financial pressure during this final phase of alley reconstruction and requiring approximately $250,000 in additional funding to complete the project. Staff proposes to utilize unappropriated fund balance in the General Fund CIP and Neighborhood Enhancement Funds that are the result of savings following the completion and close out of various projects.
Therefore, a combination of Assessment District, Water enterprise and City General Funds are being used for reconstruction of the alley pavement within and adjacent to the completed underground utility work. With the approval of the attached budget amendment of $253,468, sufficient funding for this project will be available from the Capital Improvement Program (CIP) budgets in the accounts shown below.
Account Description
Water Enterprise Capital Fund
AD124 Funding
Contributions (Utility Companies)
Neighborhood Enhancement
AD111 Funding
Neighborhood Enhancement
General Fund — CIP
Account Number
Amount
70201931-980000-24R07
$
1,330,984
67502-941032
$
838,093
13501-980000-21A11
$
513,703
53601-980000-23R07
$
319,389
66002-941032
$
307,872
53601-980000-22R11
$
231,951
01201927-980000-23R07
$
133,392
Total: $ 3,675,384.
AD funding is through property owner contributions and bond financing secured by property assessments. The Water Enterprise Fund generates revenue primarily through water rates collected by service users. The utility company contributions are administration fees assessed to various utility companies for work completed on behalf of the utility company within the Underground Utilities District (UUD) No. 22 — Phases 2 and 3 project (21A11). The Neighborhood Enhancement Fund is used for projects that enhance neighborhood aesthetics and functionality and is funded via surplus general funds.
14-3
Alley Reconstruction (Assessment District 111, Underground Utility District 22 Phase 2 and Assessment District 124 Phase 0 Areas — Award of Contract No. 8820-2 (23R07) November 28, 2023
Proposed fund uses are as follows:
Vendor
Purpose
Amount
Grigolla & Sons Const. Co. Inc.
Construction Contract
$
3,481,384
Grigolla & Sons Const. Co. Inc.
Contingency
$
175,000
Geotechnical
Geotechnical
$
18,000
Various
Incidentals, Printing
$
1,000
Total: $
3,675,384
Staff recommends establishing $175,000 (approximately 5 percent of total bid) for contingency purposes and unforeseen conditions associated with construction.
ENVIRONMENTAL REVIEW:
Staff recommends the City Council find this project exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15301 (repair and maintenance of existing highways and streets, sidewalks, and gutters involving no expansion of use) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential to have a significant effect on the environment.
NOTICING:
The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item).
ATTACHMENTS:
Attachment A — Location Map
Attachment B — Budget Amendment No. 24-034
14-4
Attachment
Ci
3ti 5
�P
BALBOA PENINSULA
BAY FRONT ALLEY N
NTA BAY FR�
�Z
J
O
U
}
m
Of¢
Z
o
d
Q
cn
J
0 O
U
Z
J
O
Q
Co
=
W
Q
x
z
O
BALBOA
AVENUE
w
'Z
w
Q
w
Z
w
Q
>
w
Q
>H
w
Q
z
Q
z
w
Q
v
Z:D
w
Q
w
z
Q
AVENUE
cn
z
J
O
�
m
cc
Flop
z
g
p
El
w
=
a
U
O
Q
w
Q
}
Ha.
Q
X
O
N
Hi
BALBOA ISLAND
UUD 22 PHASE 2 BOUNDARY `
AD-111 AREA BOUNDARY
AD 124 PHASE 0 BOUNDARY ��J<
ALLEY RECONSTRUCTION (AD-1 11 AREA, UUD 22 PHASE 2 AND AD 124 PHASE 0) CITY OF NEWPORT BEACH
PUBLIC WORKS DEPARTMENT
LOCATION MAP C-8820-2 7 10/24/23
14-5
ATTACHMENT B
City of Newport Beach
"Wr BUDGET AMENDMENT
2023-24 BA#: 24-034
Department: Public Works
ONE TIME: 0 Yes ❑ No
Requestor: Theresa Schweitzer
Approvals
❑ CITY MANAGER'S APPROVAL ONLY
Finance Director: Date 1119123
COUNCIL APPROVAL REQUIRED City Clerk: Date
EXPLANATION FOR REQUEST:
To appropriate funds from the General Fund and Neighborhood Enhancement Fund for the Alley Reconstruction J from existing budget appropriations work related to Assessment District 111, Underground Utility District 22, and Assessment District 124. ❑ from additional estimated revenues from unappropriated fund balance
REVENUES
Fund #
Org
Object
Project
Description
Increase or {Decrease} 5
Subtotal[
EXPENDITURES
Fund #
Org
Object
Project
Description
Increase or (Decrease) $
012
01201927
980000
231307
STREET- CIP EXPENDITURES FOR GL
52,972.29
536
53601
980000
231107
NEIGHBORHOOD ENHANCEMENT -CIP EXPENDITURES FOR GL 200,496,14 Subtotal) $ 253,468.43
FUND BALANCE
Fund tt
Object
Description
Increase or (Decrease) $
012
300000
GENERAL FUND CAPITAL PROJECTS - FUND BALANCE CONTROL
(52,972.29)
536
300000
NEIGHBORHOOD ENHANCEMENT- FUND BALANCE CONTROL
(200,496.14)
Subtotal $ (253,468.43)
Fund Balance Change Required
14-6