CITY OF SAN MATEO
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CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 9 Section Name: {{section.name}} Account Number: 10-4662 File ID: {{item.tracking_number}} TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Public Works Department
MEETING DATE: April 07, 2025
SUBJECT:
On-Site Fueling Station Replacement and Canopy Addition – Purchase and Construction Contracts RECOMMENDATION:
Adopt a Resolution approving an alternative purchasing procedure for a purchase contract with Petroleum Marketing Equipment for fueling equipment and a tank for the On-Site Fueling Station Replacement and Canopy Addition Project in the amount of $125,606.39, and establish a contingency reserve of $13,000 for the purchase contract; approve a construction contract with Armer Norman & Associates, Inc. in the amount of $978,988.00, and establish a contingency reserve in the amount of $150,000.00; and authorize the Public Works Director to execute the purchase contract and construction contract in substantially the forms presented and issue change orders as allowed by the contract documents and within the contingency reserves.
BACKGROUND:
There are two 10,000-gallon underground storage tanks (USTs) located at the City’s Corporation Yard (1949 Pacific Blvd.) that store and distribute unleaded gasoline to 168 City vehicles and 10 pieces of equipment. The USTs are single-walled and were installed in 1967. The State Water Resources Control Board requires that these types of tanks be taken out of operation by December 31, 2025, to reduce the chances of soil contamination as a result of not having secondary containment. The On-Site Fueling Station Replacement and Canopy Addition Project (Project) proposes to install one 10,000-gallon aboveground storage tank (AST) and associated fueling appurtenances, including dispensers, fuel management system, bollards, canopy, and monitoring systems, then to remove and dispose two existing 10,000-gallon USTs and associated fueling system and appurtenances. The cavity will be backfilled with clean fill and the surface will be restored.
In 2023, the City awarded the professional design services for the Project to Robertson Engineering, Inc. (Robertson).
Robertson subsequently prepared a bid package for the Project. The engineer’s estimates were $150,000 and $825,000 for the tank/fueling equipment purchase and construction, respectively.
Purchase Contract with Petroleum Marketing Equipment
Originally, the procurement of the AST and fueling equipment was anticipated to be a part of the construction contract.
Due to the urgency of this Project and the anticipated several-month lead times of the AST and fueling equipment, staff recommends purchasing the equipment separately. If the contractor procures the materials, it will add several months to the Project schedule potentially pushing the completion date past the state UST closure deadline of December 31, 2025.
This would cause the City extreme hardship in fueling gas-powered vehicles and equipment as the existing USTs would be red-tagged and not allowed to be operated.
Pursuant to San Mateo Municipal Code Section 3.60.070(h)(3), the City may use any purchasing procedure approved by the City Council if the City Council makes a finding concurrent with the award of the contract that the procedures are in
CITY OF SAN MATEO
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the best interest of the City. Here, the solicitation of direct quotes, rather than a formal bid process, is in the best interest of the City because it significantly reduces the lead time needed prior to constructing the project and putting the new AST fueling station into service so that the City can meet the December 31, 2025 UST closure deadline.
On January 28, 2025, the City solicited quotes to procure the AST and fueling equipment from three vendors: Northwest Pump, Shields Harper & Co., and Petroleum Marketing Equipment. Quotes were due on February 20, 2025, and a total of two (2) quotes were received. The quotes received are listed below in order of increasing amounts.
Contractor Total Bid Amount
Petroleum Marketing Equipment $125,606.39
Shields Harper & Co. $145,609.17
After review of quotes, staff recommends purchasing equipment from Petroleum Marketing Equipment, Inc.
Agreement with Armer Norman & Associates, Inc.
The project was advertised on January 30, 2025, and a total of four (4) bids were received and opened on February 27, 2025. The bids received are listed below in order of increasing bid amount.
Contractor Total Bid Amount
Armer Norman & Associates, Inc. $978,988
GEMS Environmental Services, Inc. $1,100,089
CIC $1,153,086
Savidge Construction, Inc. $1,462,120
After review of bid documents, staff determined that Armer Norman & Associates, Inc. is the lowest responsive, responsible bidder. Therefore, staff recommends Armer Norman & Associates, Inc. be awarded this construction contract.
Based on the above, staff recommends for the City Council to adopt a Resolution approving an alternative purchasing procedure for a purchase contract with Petroleum Marketing Equipment in the amount of $125,606.39, and establish a contingency reserve of $13,000, and to approve a construction contract with Armer Norman & Associates, Inc. in the amount of $978,988.00, and establish a contingency reserve in the amount of $150,000.00.
BUDGET IMPACT:
There are sufficient funds in the Corp Yard Underground Tank Replacement project (Project No. 46f013) to fund these agreements with Armer Norman & Associates, Inc. and Petroleum Marketing Equipment in the amounts of $978,988.00 and $125,606.39, respectively, and to establish contingency reserves of $150,000 and $13,000, respectively, for a total of $1,267,594.39.
ENVIRONMENTAL DETERMINATION:
This project is categorically exempt from CEQA, because it consists of the replacement or reconstruction of existing structures and facilities where the new structure will be located on the same site as the structure replaced and will have substantially the same purpose and capacity as the structure replaced and involves no expansion of capacity. (CEQA Guidelines Section 15302.)
NOTICE PROVIDED
All meeting noticing requirements were met.
ATTACHMENTS
Att 1 – Proposed Resolution
Att 2 – Purchase Contract (Petroleum Marketing Equipment)
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Att 3 – Construction Contract (Armer Norman & Associates, Inc.)
STAFF CONTACT
Sydney Chow, Associate Engineer
[email protected]
(650) 522-7331
Stephanie Piñon, Senior Engineer
[email protected]
(650) 522-7315