City Council Memorandum
TO: HONORABLE MAYOR AND CITY COUNCIL DATE: SEPTEMBER 1, 2026 FROM: HOUSING AND HUMAN SERVICES WARD: 2
DEPARTMENT
SUBJECT: CONTINGENCY INCREASE FOR THE DESIGN-BUILD AGREEMENT FROM REQUEST FOR PROPOSALS NO. 2381 WITH CAL-CITY CONSTRUCTION, INC., OF CERRITOS, CALIFORNIA, FOR THE RIVERSIDE ACCESS CENTER RENOVATION PROJECT LOCATED AT 2880 HULEN PLACE IN THE AMOUNT OF $35,000, FOR A TOTAL REVISED CONTINGENCY AMOUNT OF $235,850 AND A REVISED TOTAL AGREEMENT AMOUNT NOT TO EXCEED $1,574,850 ISSUE:
Consider approving an increase in authorized contingency for the Design-Build Agreement from Request for Proposals No. 2381 with Cal-City Construction, Inc., of Cerritos, California, for the Riverside Access Center Renovation Project in the amount of $35,000, for a revised contingency amount of $235,850 and a revised total agreement amount not to exceed $1,574,850.
RECOMMENDATIONS:
That the City Council:
Approve an increase in contingency in the amount of $35,000 for the Design-Build Agreement with Cal-City Construction, Inc., of Cerritos, California, for the Riverside Access Center Renovation Project, for a revised contingency amount of $235,850 and a revised total agreement amount not to exceed $1,574,850; and Authorize the Interim City Manager, or designee, to execute amendments to the Design-Build Agreement, Change Orders, adjustments to the Contract Time and Project Schedule, and all related documents necessary to implement this action, within the approved project budget and revised authorized Change Order contingency, including making minor and non-substantive revisions.
BACKGROUND:
On January 14, 2025, the City Council approved a Design-Build Agreement with Cal-City Construction, Inc., of Cerritos, California, pursuant to Request for Proposals (RFP) No. 2381 for the Riverside Access Center Renovation Project, located at 2880 Hulen Place. The agreement was approved in the amount of $1,339,000 with a 15% construction contingency of $200,850, for a total agreement amount not to exceed $1,539,850.
The Design-Build Agreement was subsequently executed, and Amendment No. 1 was later executed to incorporate federally required Community Development Block Grant (CDBG) provisions with no modifications to the project scope or contract compensation.
Construction is being completed under a phased implementation approach to allow portions of the facility to become operational while work continues within the remaining areas of the building.
DISCUSSION:
The Riverside Access Center Renovation Project is progressing through a phased construction approach and is nearing completion of Phase 1. Approximately 30% to 35% of the project remains, including completion of Phase 2 construction, commissioning of building systems, final inspections, punch list activities, project closeout documentation, warranty turnover, and final owner occupancy.
As construction has progressed, several owner-requested improvements have been identified that are in the City's best interest to complete prior to final project closeout. Staff also evaluated the remaining project scope, pending Change Orders, anticipated closeout activities, and available contingency authority. To date, $176,463 has been utilized, representing 13.2% of the currently approved 15% contingency, leaving the remaining 1.8% available for unforeseen conditions during the final phase of construction. Based on that evaluation, staff determined that an additional $35,000 in Change Order contingency provides sufficient authority to complete the remaining work while maintaining a reasonable contingency reserve for unforeseen conditions during the final phase of construction.
As construction has progressed and the project has transitioned into the final phase of implementation, staff have identified several remaining improvements that are recommended to enhance the completed facility, support long-term operations, and minimize future disruption. These improvements are summarized below and are included as Exhibits A through D for reference.
Exterior Building Painting (Exhibit A)
Exterior building painting was identified during construction as work necessary to complete the exterior appearance of the facility but was not included in the original procurement documents. Completion of this work will provide a finished exterior appearance consistent with the overall renovation and prepare the facility for the planned Housing and Human Services grand opening following project completion.
Future Exterior Sign Power (Exhibit B)
Housing and Human Services intends to procure exterior building signage under a separate contract. This item provides the electrical infrastructure and power source necessary to support that future installation. Completing this work during the current construction project will eliminate the need for future demolition, minimize disruption to facility operations, and avoid additional construction costs after occupancy.
Interior Door Painting (Exhibit C)
The desired factory-applied door finish was not available to match the existing architectural finish throughout the facility. As a result, paint-grade doors were selected, and this Change Order provides the preparation and field painting necessary to achieve a consistent architectural appearance throughout the renovated building.
Door Finish Reconciliation (Exhibit D)
This item reconciles pricing associated with a change from factory-finished doors to paint-grade doors, to maintain a uniform door finish throughout the facility.
Purchasing Overview
The original agreement was approved by City Council in accordance with Purchasing Resolution 24101, Section 508 Awards states, “Contracts procured through Formal Procurement shall be awarded by the Awarding Entity to the Lowest Responsive and Responsible, except that… (c) Contracts procured through Formal Procurement for Services or Professional Services, where a Request for Proposals or Request for Qualifications was used to solicit Bids, shall be awarded by the Awarding Entity in accordance with the evaluation criteria set forth in the Request for Proposals or Request for Qualifications.” This recommendation is pursuant to Purchasing Resolution 24101, Section 1104 “Change Orders”, which states: “Modification to a Purchase Order shall be made only by Change Order. Subject to the availability of funds, Change Orders may be utilized for purposes of…(3) modifying scope of work/services being provided, where the modification is reasonably related to the original scope of work/services. Unless otherwise specifically authorized by the Awarding Entity, Change Orders which cumulatively exceed the following will require Awarding Entity approval…(c) 10% of the original contract price for Contracts and/or Purchase Orders previously approved by the Awarding Entity and the total Change Order amount will not exceed $150,000.
The Purchasing Manager concurs that the recommended action is compliant with Purchasing Resolution 24101.
FISCAL IMPACT:
The total fiscal impact is an increase in authorized contingency in the amount of $35,000, resulting in a revised contingency amount of $235,850 and a revised total agreement amount not to exceed $1,574,850.
Sufficient funding in the amount of $35,000 is budgeted and available in the Grants and Restricted Programs Fund, Hulen Place Campus Maintenance Account No. 2545100-424130.
Any unused Change Order contingency remaining upon project completion will remain available within the project budget and be administered in accordance with the City's budget procedures.
Prepared by: Kurtis Sharp, Project Manager
Approved by: Michelle Davis, Housing and Human Services Director Certified as to
availability of funds: Julie Nemes, Finance Director
Approved by: Kris Martinez, Assistant City Manager
Approved as to form: James Johnson, City Attorney
Attachments:
Exhibit A – Exterior Building Painting
Exhibit B – Future Exterior Sign Power
Exhibit C – Interior Door Painting
Exhibit D – Door Finish Reconciliation
Exhibit E – Concrete Floor Polishing
Increase in Contingency for Access Center Renovation Project ● Page 2