CITY COUNCIL STAFF REPORT
Meeting Date: May 01, 2023
TO: THE HONORABLE MAYOR AND CITY COUNCILMEMBERS
SUBJECT: ADOPT RESOLUTION NO.___- 23 AUTHORIZING AN INCREASE OF THE BHM CONSTRUCTION, INC. PURCHASE ORDER IN THE
AMOUNT OF $743,616 (PREVIOUSLY APPROVED SCOPE) FOR THE
PLEASANT HILL LIBRARY PROJECT NO. 06-20
SYNOPSIS
The Pleasant Hill Library Project No. 06-20 provided for construction of a new Public Library and Site Improvements. The contractor, BHM Construction, Inc. (Contractor), has completed work to the City’s satisfaction. The purpose of this item is to authorize an increase to the BHM purchase order for previously identified additional scope of work in the amount of $743,616.
DISCUSSION
Background
The approved FY 2020-2025 Capital Improvement Plan (CIP) allocated funds for this Project (Project MK-4) for construction of the new Library and Site Improvements in the amount of $33,569,103. On August 3, 2020, the City Council adopted Resolution No. 71-20 and awarded the New Pleasant Hill Library Project No. 06-20 to BHM Construction, Inc., for $23,377,510 (including contingency).
On February 2, 2022, the Budget Committee reviewed and recommended that the City Council approve an additional scope of work totaling $1,336,788 to complete installation of low voltage systems, utilities, and other move-in-related work, as well as installation of a photovoltaic system.
On February 7, 2022, the City Council approved Resolution No. 13-22 authorizing the City Manager “to execute a contract…with Tesla, Inc. in an amount not to exceed $513,038 for the purchase of a solar power system for the new Pleasant Hill Library.” The remaining $823,750 was the anticipated cost for BHM Construction, Inc. to complete the remaining items. The City Council authorized the City Manager “to take all actions necessary to facilitate the Library move-in and installation and powering of utilities, and technology (low voltage systems).” Though the additional scope and associated cost for BHM to complete the work was recommended by the Budget Committee, and while the City Council authorized the City Manager to facilitate completion of that work, City Council Resolution No. 13-22 did not expressly increase BHM’s purchase order on February 7th.
Analysis
The project is now complete and the work conforms to the construction plans and specifications.
Construction began on August 25, 2020. The Contractor substantially completed the project on July 25, 2022, which was within the allotted contract time, accounting for unforeseen delays. The Library was opened to the public on July 30, 2022.
As the City winds down the project and closes out the contract with BHM, staff notes that the actual cost of BHM’s additional work was $743,616, which is approximately $80,000 less than the $823,750 cost anticipated and presented to the Budget Committee and City Council in February 2022. Staff is requesting City Council’s formal action to increase the purchase order by $743,616 for the additional work completed by BHM. In summary, BHM’s original contract plus the additional scope of work had an anticipated construction cost of $24,121,126. The actual total cost of construction for the library, however, including change orders, was $24,044,330, which is $76,796 below that anticipated cost.
The City has retained five percent of the total construction cost ($1,202,216.50) from BHM Construction, Inc. to ensure that the Contractor pays all their subcontractors and suppliers. The procedure for releasing these monies is the City Council’s formal acceptance of the work (approved March 20, 2023) with authorization to issue and record a Notice of Completion. The retention amount is scheduled to be paid to BHM Construction on May 2, 2023.
FISCAL IMPACT
Staff included the final cost of $743,616 for the additional work within the revised budget sheet that the City Council approved on March 20, 2023, as part of the Notice of Completion for the library project. Accordingly, formally increasing the purchase order, as requested, does not impact the final cost of the project, as previously presented in late March.
PUBLIC CONTACT
Public contact was made through posting of the City Council agenda on the City’s official notice bulletin board, at the Pleasant Hill Senior Center and at the Pleasant Hill Police Department. The agenda and staff report are posted on the City’s web page.
RECOMMENDED CITY COUNCIL ACTION
Adopt the Proposed Resolution authorizing the increase of the BHM Construction purchase order in the amount of $743,616.
ALTERNATIVES TO RECOMMENDED ACTION
None recommended.
ATTACHMENT(S):
Proposed Resolution
Prepared by: Ananthan Kanagasundaram, City Engineer
Reviewed by: Ethan Bindernagel, Community Development Director/Assistant City Manager Approved by: June Catalano, City Manager