City Council
Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Public Works
Meeting Date: May 18, 2026
Report #:2604-6220
TITLE
Approval of Construction Contract No. C26197180 with Casey Construction, Inc. in the Not-to-Exceed Amount of $544,556 and Authorization for the City Manager or Their Designee to Negotiate and Execute Change Orders for Related Additional but Unforeseen Work that May Develop During the Project Up to a Not-to-Exceed Amount of $54,456 for the Storm Drainage System Replacement and Rehabilitation Project (SD-06101); CEQA status – Exempt under CEQA Guidelines Section 15301(c)
RECOMMENDATION
Staff recommends that the City Council:
1. Approve and authorize the City Manager or their designee to execute Construction Contract No.
C26197180 with Casey Construction, Inc. in the amount of $544,556 for the Storm Drainage System Replacement and Rehabilitation Project (SD-06101); and
2. Authorize the City Manager or their designee to negotiate and execute one or more change orders to the above construction contract with Casey Construction, Inc. for related, additional but unforeseen work which may develop during the project, the total value of which shall not exceed $54,456.
BACKGROUND
The Storm Drainage System Replacement and Rehabilitation Project (SD-06101) proposes to increase the existing 12-inch storm drain line to a 36-inch line on Alester Avenue from Hamilton Avenue to Dana Avenue to convey rain water and provide additional storage capacity, and to repair a broken storm drain lateral on Lambert Avenue and Birch Street. Increasing the pipe along Alester Avenue would help to mitigate flooding along Duveneck Elementary School in an event similar to the December 31, 2022 storm and creek overflow.
This scope was solicited as an add-alternate bid item on the Hamilton Avenue Capacity Upgrades
Project.1 Precision Engineering, Inc.’s bid for the add-alternate work was 257% over the original engineer’s estimate of $402,188 and this scope of work was not included in Contract No. C25195264.2
ANALYSIS
Project Description
The project locations are on Alester Avenue from Hamilton Avenue to Dana Avenue, and at Lambert Avenue and Birch Street, depicted on the attached Location Map (Attachment A). Staff recommends approval of Contract No. C26197180 for the Storm Drainage System Replacement and Rehabilitation Project. 3 The scope of work includes the replacement of 283 linear feet of 12-inch concrete pipe with 36-inch high density polyethylene pipe (HDPE) on Alester Avenue, replacement of 117 linear feet of 12- inch HDPE, replacement of 3 catch basins, and installation of 1 storm drain junction box. Concrete work includes removal and replacement of 3 curb ramps, curb and gutter, and sidewalk. Pipe replacement in the streets may require additional work such as pavement restoration and striping due to the location of the work. Although the project has been designed to avoid utilities conflicts, the contract includes an allowance for the cost of potential utility service relocations in locations where the existing utilities services (water, gas, cable, electric, and sanitary sewer) may conflict with the installation of the new storm drain pipes. Prior to bidding, staff updated the engineer’s estimate to reflect the most recent bid prices received as part of the Hamilton Avenue Capacity Upgrades Project Solicitation Process
On March 10, 2026, an Invitation for Bids (IFB) for the Storm Drainage Replacement and Rehabilitation Project at Various Locations was posted on OpenGov, the City’s eProcurement platform. The bidding period was 23 days. Bids were received from eight qualified contractors on April 2, 2026, as listed on the attached Bid Summary (Attachment B).
Table 1: Summary of Invitation of Bids
Project Bid Name/Number Storm Drainage System Replacement and Rehabilitation Project at Various Locations and IFB #197180
Proposed Length of Project 60 days
# of Bid Packages Downloaded by Contractors 49
Total Days to Respond to Bid 23 days
Number of Bids Received 8
Base Bid Price Range $544,556 to $1,712,025
Public Link to Solicitation https://procurement.opengov.com/portal/palo-alto- ca/projects/244946
1 City Council, October 6, 2025; Agenda Item #5, Report #2507-5009, https://recordsportal.paloalto.gov/WebLink/DocView.aspx?id=83624&dbid=0&repo=PaloAlto&searchid=ac4bc027-cb44-4220- 9222-105b0b4e5fd5
2 Precision Engineering, Inc. Hamilton Avenue Capacity Upgrades Project Contract No. C25195264; https://www.paloalto.gov/files/assets/public/v/1/public-works/staff-reports-all/2025/precision-engineering-hamilton-ave- capacity-upgrades-c26195264.pdf
3 Casey Construction, Inc. Storm Drainage System Replacement and Rehabilitation Project Contract No. C26197180 https://www.paloalto.gov/files/assets/public/v/1/public-works/engineering-services/cip-contracts/engineering-forms-and- downloads/c26197180-casey-construction-final.pdf
Bids ranged from $544,556 to $1,712,025 and from 28% below to 127% above the engineer’s estimate of $755,102. Staff reviewed the bids submitted and recommends acceptance of the bid submitted by Casey Construction, Inc. in the amount of $544,556 and that Casey Construction, Inc. be declared the lowest responsible bidder. The contingency amount of $54,456, which equals 10% of the contract value, is requested for related, additional but unforeseen work which may develop during the project, implemented via City-approved Change Order.
Staff confirmed with the Contractor's State License Board that the contractor has an active license on file. Staff also contacted the listed references for Casey Construction, Inc. and found that they performed satisfactorily on past construction projects for other clients.
FISCAL/RESOURCE IMPACT
Funding for the project is available in the Fiscal Year 2026 Stormwater Management Fund Capital Budget for the Storm Drainage System Replacement and Rehabilitation Project (SD-06101).
STAKEHOLDER ENGAGEMENT
Staff presented to the Storm Water Management Oversight Committee (SWMOC) on the progress of the Storm Drain Rehabilitation and Replacement Project. Once the construction contract is awarded, staff will continue to notify and update the SWMOC during construction. Extensive public outreach will be conducted before and during the construction phase to keep the community informed throughout the process, including flyers sent to adjacent residences, schools, and businesses, and notices posted online on Nextdoor and the City’s website.
ENVIRONMENTAL REVIEW
This project is categorically exempt from the provisions of the California Environmental Quality Act (CEQA) under Section 15301 (d) (repair, maintenance and/or minor alteration of existing facilities and 15302 (c) (replacement of existing structures) of the CEQA Guidelines and no further environmental review is necessary.
ATTACHMENTS
Attachment A: Location Map
Attachment B: Bid Summary
APPROVED BY:
Brad Eggleston, Director Public Works/City Engineer