July 15, 2025, Item #4DATE: TO: FROM: CONTACT: SUBJECT: Summary: AGENDA RE PQ RT City of Poway July 15, 2025 Honorable Mayor and Members of the City Council Julie Procopio, Director of Development Serviceso/' Miguel Solano, Assistant Engineer (858) 668-4653 or [email protected] CITY COUNCIL Rejection of Received Bids for the Fiber Optic Improvement Project, Bid No. 25-014, and Direction to Staff to Re-Scope, Consider Alternative Options and Potentially Re-Advertise the Project if Warranted A Notice Inviting Bids was duly advertised on May 2, 2025, for the Fiber Optic Improvement project. Two bids were received and opened on May 28, 2025, and exceeded the project budget. Per Municipal Code Section 3.28.070(E), at its sole discretion, the City Council may reject all bids presented and re-advertise for bids in accordance with California Public Contract Code Section 20166. Recommended Action: It is recommended the City Council reject the received bids and authorize staff to proceed with re-scoping, consider alternative options and potentially re-advertising the project if warranted. Discussion: This project was planned to establish a dedicated City-owned fiber optic network by installing approximately 15,965 linear feet of new fiber connections. The purpose of the project was to create direct links between City Hall, Fire Station 3 and other key facilities to improve internal communication, data transfer speeds and network reliability. The new fiber infrastructure was also intended to support future technologies such as security systems, digital services and high-speed connectivity between sites for City use only. Bids were opened on May 28, 2025. A total of two bids were received for the construction contract, ranging as follows: Company Total Bid Amount HP Communications, Inc. $626,631.25 DBX, Inc. $914,328.00 The apparent low bid of $626,631.25, submitted by HP Communications, Inc., has been determined 1 of 2
July 15, 2025, Item #4to be non-responsive due to the contractor's failure to acknowledge the required addendum. The contractor did not acknowledge the addenda which contained important project information necessary for a complete and compliant bid. The second bid, submitted by DBX, Inc., was for $914,328.00, approximately 142 percent over the engineer's estimate. The Engineer's estimate for the project is $377,275.00. This figure was calculated by analyzing recent bids from similar past projects and accounting for typical inflation in construction costs to reflect expected market conditions. However, the bids received were significantly higher than anticipated. The discrepancy appears to reflect cost factors that only became apparent during the bidding process, including continued increases in the cost of underground work and labor-intensive tasks such as cable pulling and fiber splicing. Current market conditions have continued to affect specialty contractor pricing, material availability, and labor resources, all of which have contributed to the elevated bid amounts. Since both bids exceed the available project budget and one was non-responsive, staff recommends City Council reject all bids. The project scope will be adjusted and staff will consider alternative approaches to achieving the project objectives. The project will potentially be rebid at a later date if warranted. Environmental Review: This action is not a "project" as defined under Section 15378(b)(5) of the California Environmental Quality Act (CEQA) State Guidelines; therefore, no environmental review is required. Fiscal Impact: None. Public Notification: None. Attachments: None. Reviewed/Approved By: We~ Kaserman Assistant City Manager 2 of 2 Reviewed By: Alan Fenstermacher City Attorney Approved By: Ch~ City Manager