Agenda Item: 8
CITY OF SANTA CLARITA
AGENDA REPORT
CONSENT CALENDAR
CITY MANAGER APPROVAL:
DATE: September 13, 2022
SUBJECT: CENTRAL PARK BUILDOUT, PROJECT P4019 - TRIPARTITE
TENDER AGREEMENT
DEPARTMENT: Public Works
PRESENTER: Shannon Pickett
RECOMMENDED ACTION
City Council:
1. Authorize the City Manager or designee to finalize and execute all necessary documents, including a tripartite tender agreement, subject to City Attorney approval, which includes a completion offer (contract) to Urban Habitat in an approximate amount of $10,002,385, and authorize a contingency in the amount of $1,000,238, for a total contract amount not to exceed $11,002,623, as well as authorize the City Manager to approve the finalized reimbursement amount to the City for additional costs incurred to ensure the City is not financially disadvantaged by the prior contractor’s default.
2. Appropriate funds in the amount of $2,100,000 from Facilities Fund (Fund 723) to expenditure account P4019723-516101, increase Facilities Fund revenue account 723- 462101 by $2,100,000, and increase General Fund Miscellaneous revenue account 100- 462101 by approximately $400,000.
3. Extend the current contract and authorize an increased expenditure authority for civil engineering services, surveying services, and construction support with Psomas in the amount of $14,480 and authorize a contingency in the amount of $1,448, for a total additional contract amount not to exceed $15,928.
BACKGROUND
The Central Park Buildout project is being constructed at the southwest corner of Central Park near the intersection of Bouquet Canyon Road and Alamogordo Road, as indicated on the attached vicinity map. The scope of work includes the addition of four full-sized multipurpose fields, the installation of sport field lighting, landscaping and irrigation, various site furnishings,
a restroom building, upgrades to the adjacent dog park, including a lighted accessible walkway from the new parking lot to the dog park, 268 additional parking spaces, exercise stairs, and the construction of an emergency access road from the existing parking lot to an adjacent street. This project supports the Building and Creating Community theme of the City of Santa Clarita’s (City) five-year strategic plan, Santa Clarita 2025.
On September 28, 2021, the City Council awarded a construction contract to Spectrum Construction Group, Inc. (Spectrum), the lowest responsible bidder, to construct the Central Park Buildout project. Their bid was reviewed for accuracy and conformance to the contract documents and found to be complete. Construction began on January 10, 2022, and proceeded until April 29, 2022, when City staff terminated Spectrum’s right to proceed for default. Staff coordinated with the City Attorney’s office to work with Spectrum’s surety company, Great American Insurance Company (GAIC), to find an acceptable contractor to complete the project.
On May 23, 2022, GAIC administered a Solicitation for Offers (SFO) requesting offers from two construction companies, AMG & Associates and Urban Habitat, to complete this project. AMG & Associates previously submitted a bid as a general contractor and Urban Habitat previously submitted bids as a subcontractor. Urban Habitat was the offeror GAIC selected to present to the City for completion of the project.
Urban Habitat possesses a valid Class A state contractor’s license and is in good standing with the Contractors State License Board. City staff reviewed the contractor’s bid for accuracy and conformance to the contract documents and found it to be complete.
A tripartite tender agreement between GAIC, Urban Habitat, and the City has been prepared and details all responsibilities of each party with respect to the construction of this project. The City Attorney’s office has reviewed this agreement to ensure it includes the entire scope necessary to complete the project and obligates GAIC to cover all costs and losses the City may encounter above the remaining budget amount, as well as any losses resulting from Spectrum’s work on the project. Staff recommends entering into the tripartite tender agreement with GAIC and Urban Habitat.
The original contract amount with Spectrum was $9,770,716.42. Due to one additive change order in the amount of $34,081.64 dated March 7, 2022, and two deductive change orders in the amounts of $632,500 and $673,618.86 dated August 3, 2022 and August 31, 2022, respectively, the total contract amount was $8,498,679.20. Three payments were made to Spectrum totaling $785,236.93. In addition, the City tendered $360,788.64 to the Los Angeles County Superior Court as part of an interpleader action, which was authorized by the City Council on June 14, 2022, to compensate subcontractors and other claimants not paid by Spectrum. Therefore, the remaining contract balance is $7,352,653.63.
Urban Habitat has offered to complete the contract for approximately $10,002,385.49. GAIC is responsible for the difference of approximately $2,649,731.86 to cover the costs to complete the project. The final negotiations for the contract amount are pending the completion and acceptance of one change order. The overall contract amount is expected to decrease as a result of this change order.
In addition, the City expended money resulting from Spectrum’s default, including but not limited to, increased staff and consultant time, which was required to work through the contractor replacement process with the City Attorney and the attorneys for GAIC, attorney fees, surveying required to locate lighting and ensure the sewer installation was performed properly, and preparing new plans for best management practices related to the Stormwater Pollution Prevention Program. The increased expenditure authority for civil engineering services, surveying services, and construction support is necessary due to these additional expenses resulting from Spectrum’s default and GAIC is responsible for these direct costs.
The park amenities being constructed will not be available as early as originally expected because of delays associated with Spectrum’s default. This will result in projected revenue losses for rentals of the facilities and corresponding impacts to associated travel and tourism revenue.
GAIC is responsible for these indirect costs associated with Spectrum’s default.
The tripartite tender agreement obligates GAIC to pay the City approximately $2,500,000 to compensate the City for all costs to complete and warrant the project, together with all direct and indirect costs associated with Spectrum’s default. This also includes compensation to exonerate GAIC’s bonds.
The contract amount to complete the project covers the base bid and additive alternate items, which include the addition of pavers, trees, and irrigation in the parking lot area. The contingency will cover unanticipated project costs due to unforeseen conditions and changes in the scope of work, requested by the City. The remaining project budget will provide for public art components, construction support costs for labor compliance services, staff oversight, construction engineering, inspection, and project management.
ALTERNATIVE ACTION
Other action as determined by the City Council.
FISCAL IMPACT
Upon approval of the recommended actions, and receipt of compensation from GAIC, adequate funds from Facilities Fund expenditure account P4019723-516101 and American Rescue Plan Act Fund expenditure account P4019228-516101 will be available to support the recommended construction and construction support contracts, as well as all anticipated project costs.
ATTACHMENTS
Vicinity Map
Urban Habitat Offer to Complete Construction (available in the City Clerk's Reading File) Psomas Construction Support Proposal (available in the City Clerk's Reading File)