TO: HONORABLE MAYOR FROM: John Ristow
AND CITY COUNCIL Matt Loesch
SUBJECT: SEE BELOW DATE: March 13, 2023
Approved Date
3/21/22
SUBJECT: REPORT ON BIDS AND AWARD OF CONTRACT FOR THE 10254 - 2023
MAJOR STREETS SEALING PROJECT
RECOMMENDATION
Report on bids and award a construction contract for the 10254 – 2023 Major Streets Sealing Project, to the lowest responsive, responsible bidder, Graham Contractors, Inc., in the amount of $5,105,023 and approve a 10 percent contingency in the amount of $510,000.
SUMMARY AND OUTCOME
Approval of this construction contract award to Graham Contractors, Inc. enables the surface- sealing of approximately 41 miles of streets along the Major Street Network. Approval of the 10% contingency provides funding for any unanticipated work necessary for the proper completion or construction of the project.
BACKGROUND
The Major Street Network consists of 944 miles of the City’s most heavily traveled streets, which collectively carry over 85% of the traffic in the City. A total of 75 miles of Major Streets is planned for maintenance in 2023. Approximately 41 miles will be surface-sealed, while the remaining 34 miles will be resurfaced. Sealing is a preventative maintenance measure that extends the useful life of a street and reduces long-term maintenance cost to the City.
Resurfacing treatment is reserved for streets that are in poor condition and require more extensive repairs.
The process used for sealing is called “micro-surfacing” and involves the application of a thin layer of asphalt emulsion blended with rock approximately 3/8 of an inch in depth to the pavement. This is typically performed in two separate phases: preparation and a final surface sealing application. The preparation phase includes the installation or retrofit of Americans with COUNCIL AGENDA: 4/4/23
FILE: 23-463
ITEM: 5.1
HONORABLE MAYOR AND CITY COUNCIL
March 13, 2023
Subject: Report on Bids and Award of Contract for the 10254 - 2023 Major Streets Sealing Project
Disabilities Act curb ramps, and the removal and replacement of any structurally failed sections of the pavement. The final surface treatment is applied to the entire street after preparation phase is complete. To maximize the number of pavement miles sealed in one construction season, the preparation phase is executed under separate contracts, and mobilized concurrently on different streets.
The Department of Transportation utilizes a Pavement Management System to collect and store roadway condition data that is used to generate a candidate list of streets to be considered for the annual pavement maintenance program. The candidate list is then thoroughly analyzed by staff using the following criteria to create the final list of streets:
• Funding availability and funding use restrictions
• Streets on the Major Street Network
• Streets not affected by current or future street related projects • Maintenance history and prescribed treatment schedules • Streets associated with planned safety, bikeway, or other “complete streets” projects • Community and City Council office feedback regarding roadway conditions and priority street segments
• Relative location of street segments to create multiple, continuous segments, consistency within neighborhoods, and project efficiency
• Multi-year geographic spread across the City and street network
As part of the Department of Transportation’s equity analysis in the development of the 2023 Major Streets paving program, staff cross-referenced the selected streets relative to census tracts designated by the Metropolitan Transportation Commission as “Equity Priority Communities”.
Based on this analysis, 20 miles of the streets within this contract are in Equity Priority Communities and represents 26% of the 75 miles of Major Streets selected for maintenance. The attachment to this memorandum contains the list of streets to be sealed. The list may change if unforeseen circumstances arise or new information regarding other projects becomes available.
ANALYSIS
Bids were opened on February 16, 2023, with the following results:
Contractor City Bid Amount Variance
Amount
Over/(Under)
Percent
Engineer's Estimate -- $4,904,719.55 -- --
Graham Contractors, Inc. San José $5,105,022.78 $200,303.23 4.08 Pavement Coatings Company Sacramento $5,797,989.10 $893,269.55 18.21
HONORABLE MAYOR AND CITY COUNCIL
March 13, 2023
Subject: Report on Bids and Award of Contract for the 10254 - 2023 Major Streets Sealing Project
The Engineer’s Estimate for this project is $4,904,719.55 and was based on bids received from similar past projects and current estimated construction prices. The low bid submitted by Graham Contractors, Inc. is $5,105,022.78 and is 4.08% above the Engineer’s Estimate. The bid is considered acceptable for the work involved in the project.
The bids are higher than the Engineer’s Estimate due to the larger than anticipated increase in materials and labor costs for the removal and installation of roadway striping and markings, particularly the removal of pavement markings and the installation of 12” thermoplastic striping.
Collectively, the removal and installation of roadway striping and markings were 26% over the Engineer’s Estimate, while bid items directly related to sealing the streets with new asphalt were 8% under the Engineer’s Estimate. The primary reason for the increased bid prices on these items is a high demand for striping services across the region with high expectation by contracting agencies for timely application of roadway striping, in conjunction with a limited supply of striping contractors that can perform the work required. Both bidders used the same striping subcontractor and submitted similar bids for all striping related line items. Additionally, the striping contractors that have worked on similar pavement maintenance projects in the past may be anticipating striping work that requires more extensive traffic control and time and materials to safely perform to work, thus adding to the bid prices.
Despite the higher than anticipated bids, staff recommends awarding the contract for the following reasons:
• Given the current bidding environment – high demand for paving contractors, very low supply of striping contractors, and time of year when bids traditionally increase as contractors are starting to or already have secured projects – it is improbable that rebidding the project to receive more favorable bids would be successful. • Rebidding the project would also delay implementation of the project and may require a portion of the streets to be placed on winter suspension for completion in spring of 2024. • The Pavement Maintenance Program has sufficient funding to deliver the project as specified without impacting other planned projects.
Contingency
San José Municipal Code Section 7.04.050 provides for a standard contingency of 10 percent on all public works contracts except those involving the renovation of building or buildings. The standard contingency is appropriate for this project.
Project Labor Agreement Applicability
The Project Labor Agreement is applicable to this project because the Engineer’s Estimate is over $1.2 million.
HONORABLE MAYOR AND CITY COUNCIL
March 13, 2023
Subject: Report on Bids and Award of Contract for the 10254 - 2023 Major Streets Sealing Project
Local and Small Business Outreach
Public Works procurement staff used Biddingo to outreach to local and small business enterprises. Chapter 4.12 of the San José Municipal Code defines a “local business enterprise” as one with a legitimate business presence in Santa Clara County and “small business enterprise” as a local business enterprise with 35 or fewer employees. Procurement staff sent bid invitations to 8,154 vendors, and documents were downloaded by 18 vendors, two of which were located within Santa Clara County. The recommended contractor is a local and a small business enterprise. No local or small business enterprises were listed as subcontractors on the project.
EVALUATION AND FOLLOW-UP
The Department of Transportation provides an ongoing evaluation of the City’s pavement conditions and provides periodic reports on this topic to the Transportation and Environment Council Committee. In addition to the projects discussed in this memorandum, two additional major street projects consisting of 34 miles, and six additional local and neighborhood street pavement maintenance projects totaling 161 miles are tentatively scheduled for City Council action this spring.
COST SUMMARY/IMPLICATIONS
This project supports the Transportation and Aviation Services City Service Area goal to Preserve and Improve Transportation Assets and Facilities. By performing pavement maintenance with this project, the extension of the useful life of the project streets will defer more costly reconstruction. The source of funding for this project is through the 480 – State Gas Tax Pavement Maintenance Fund. This project will have no net operating and maintenance costs to the General Fund.
1. TOTAL COST OF PROJECT:
Programmatic Project Delivery Estimate $510,500.00 Construction Contract $5,105,022.78
Contingency $510,500.00
TOTAL PROJECT COSTS: $6,126,022.78
HONORABLE MAYOR AND CITY COUNCIL
March 13, 2023
Subject: Report on Bids and Award of Contract for the 10254 - 2023 Major Streets Sealing Project
BUDGET REFERENCE
The table below identifies the fund and appropriation being used to fund the contract recommended in this memorandum.
COORDINATION
This memorandum has been coordinated with the Department of Planning, Building and Code Enforcement, the City Attorney’s Office, and the City Manager’s Budget Office.
PUBLIC OUTREACH
This memorandum will be posted on the City’s Council Agenda website for the April 4, 2023 City Council meeting.
To solicit contractors, this project was listed on an online bid solicitation website, Biddingo, where bid packages were made available to download for contractor organizations and builders’ exchange. When the project commences, the contractor will provide advance notification regarding working hours, duration of project, and any appropriate schedule and lane closures to affected businesses and residents, as stated in the specifications. To inform traveling motorists of upcoming construction activities and potential traffic delays, changeable message signs may be used on selected streets stating the scheduled date and time for work to occur on the street.
COMMISSION RECOMMENDATION AND INPUT
No commission recommendation or input is associated with this action.
Fund
#
Appn
#
Appn Name
Total
Appn
Amt. for
Contract
2022-23
Adopted
Capital
Budget Page
Last
Budget
Action
(Date,
Ord. No.)
Source of New Funding
480 406C
Pavement
Maintenance-SB1
Road Repair &
Accountability Act
2017
$39,274,833 $5,105,022.78 1081 10/18/22,
30833
Total Current Funding Available $39,274.833 $5,105,022.78
HONORABLE MAYOR AND CITY COUNCIL
March 13, 2023
Subject: Report on Bids and Award of Contract for the 10254 - 2023 Major Streets Sealing Project
CEQA
Environmental status granted by the Planning, Building and Code Enforcement Department.
Exempt, File No. ER23-009, CEQA Guidelines Section 15301(c), Existing Facilities.
PUBLIC SUBSIDY REPORTING
This item does not include a public subsidy as defined in section 53083 or 53083.1 of the California Government Code or the City’s Open Government Resolution
/s/ /s/
MATT LOESCH JOHN RISTOW
Acting Director of Public Works Director of Transportation
For questions, please contact Frank Farshidi, Transportation Division Manager, at (408) 794- 1945 or Mathew Nguyen, Deputy Director, Department of Public Works at (408) 535-8300.
Attachment: 2023 Major Streets Sealing Project
ATTACHMENT
Subject: 2023 Major Streets Sealing Project
List of Streets
Street Name Street From Street To
Council
District
1ST ST LIBERTY ST SOUTHBAY DR/HOLGER
WY
4 4TH ST ST. JAMES ST SANTA CLARA ST 3
ABORN RD RUBY AV GURDWARA
AV/MURILLO AV
8 BERRYESSA RD MABURY RD LUNDY AV 3, 4
CARLTON AV NATIONAL AV 130’ W/O WINTON AV 9
CLASSICO AV FOWLER RD EVERGREEN VILLAGE SQ 8
COTTLE AV PINE AV KOCH LN 6, 9
EVERGREEN VILLAGE SQ RUBY AV CLASSICO AV 8
FOWLER RD SAN FELIPE RD BIANCO WY 8
HOLGER WY 1ST ST ZANKER RD 4
JULIAN ST E 6TH ST 21ST ST 3
KIRK AV CITY LIMIT W MADELINE DR 5
LEIGH AV SOUTHWEST EXPY HAMILTON AV 6
LOS GATOS ALMADEN RD TAFT DR LEIGH AV 9
MABURY RD BERRYESSA RD OAKLAND RD 3
MARKET ST SANTA CLARA ST REED ST 3
MERIDIAN AV PARK AV FRUITDALE AV 6
MT. PLEASANT RD CLAYTON RD KOHLER AV 5
RUBY AV ABORN RD EVERGREEN VILLAGE SQ 8
SAN ANTONIO ST SUNSET AV SCHARFF AV 5
STORY RD CAPITOL EXPY CLAYTON RD 5
TULLY RD ALVIN AV CAPITOL EXPY 5, 7, 8