Agenda packet — Seal Beach City Council, June 22, 2026 (part 7 of 7)

BACKGROUND AND ANALYSIS:

The City’s Sewer Mainline Improvement Project (Project) was budgeted in the FY 2025-26 Capital Improvement Program (CIP) to improve the sanitary sewer infrastructure within the City. The work will generally include cured-in-place pipe (CIPP) lining of identified sewer mainline to extend its serviceable life. Pursuant to the 2023 Sewer Repair Work Plan (Plan), various sanitary sewer mainlines were subject to closed circuit television (CCTV) inspection of which identified pipes in need of lining.

On April 2, 2026, the City issued a solicitation for bids for the Project, and on May 6, 2026, the City Clerk’s office received three (3) bids with the following bid results:

Rank Contractor Total Bid
Low
Estate Design and Construction
(Estate Design)
$699,510.00
2 Performance Pipeline Technologies, Inc.
(Performance Pipeline)
$718,850.00
3 Vortex Services, LLC dba Sancon
Technologies
$839,650.00
A. Staff Analysis and Bid Protest
The City’s project team reviewed the bid submitted by Estate Design, the apparent low bidder, and the other bids submitted. Several defects were identified with respect to Estate Design’s bid, with respect to non-responsiveness and nonresponsibility, including:

1. Failure to submit bid bond meeting minimum 10% requirement. The submitted bid bond was in the amount of $69,800 (nonresponsiveness).

2. Failure to provide documentation of certification or license to perform CIPP lining (non-responsiveness).

3. Failure to provide relevant subcontractor(s) to execute the Scope of Project including a subcontractor to perform CIPP lining (nonresponsiveness).

4. Failure to meet mandatory experience requirements including minimum ten (10) years’ installation experience and minimum of 5,000 lineal feet (LF) of CIPP liner using bidder’s own work force (non-responsibility).

Following the opening of the bids, the second low bidder, Performance Pipeline, submitted a bid protest on the grounds that the apparent low bidder is nonresponsive and non-responsible, on the following grounds:

1. Failure to demonstrate mandatory technical ability and experience (non-responsibility).

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2. Failure to meet minimum requirements including minimum of ten (10) years of CIPP installation experience or 5,000 LF of CIPP using the bidder’s own workforce; or certification and licensure to perform the CIPP lining (non-responsibility).

Staff provided Estate Design with a copy of the protest and requested that the apparent low bidder provide a response. Estate Design did not submit a response to the bid protest and or the City’s letter within the allotted time allocation.

B. Staff’s Recommendation
After reviewing all submitted bids, the bid protest submitted by Performance Pipeline, and Estate Design’s lack of response, it was determined that the bid of the apparent low bidder, Estate Design, was non-responsive to the Project specifications. Estate Design submitted a bid bond that was not 10% of their bid, a material deviation that renders their bid non-responsive. In addition, Estate Design’s bid is also non-responsive because they failed to provide documentation reflecting that they possess the required certification or license to perform the CIPP lining work and failed to list a subcontractor to perform the CIPP lining work while listing subcontractors for work that is not part of the Project. These defects in their bid are material and cannot be waived. Staff therefore recommends that the City Council find that Estate Design’s bid is non-responsive for these reasons. A determination by the City Council that the Estate Design bid is non-responsive would be sufficient to reject their bid, and would negate the need for any further review of the Estate Design’s bid related to the question of responsibility.

Therefore, based upon these material, non-waivable defects in Estate Design’s bid, staff recommends that the City Council sustain the bid protest and reject the apparent low bidder’s bid as non-responsive, deem the second lowest bidder, Performance Pipeline as the lowest responsive and responsible bidder at the bid price of $718,850, award the Project to Performance Pipeline, and reject all other bids. The Project plans are available in the City Engineer’s office.

Staff further recommend authorizing the City Manager, or designee, to approve additional work requests by Performance Pipeline up to $110,000, authorizing the City Manager, or designee, to approve the performance of construction support/inspection services up to $80,000, by the City’s on-call professional inspection services contractor, NV5, Inc., in the cumulative not-to-exceed amount of $190,000.

Construction is estimated to start in fall 2026 in FY 2026-27 and is projected to be completed within 70 working days following the issuance of the Notice to Proceed.

This Project is to be conducted in various ongoing phases for sewer mainline improvement throughout the City based on the lining priority. This first phase of the

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Project entails work conducted within Districts 1 and 3, comprising within the residential areas of the Hill, Bridgeport, the Cove, and Old Town areas, respectively.

The work and schedule will be coordinated with nearby residences and businesses prior to the start of construction.

ENVIRONMENTAL IMPACT:

This project complies with all requirements of the California Environmental Quality Act (CEQA) and is categorically exempt under section 15301 Class 1, Subsection (c) of the CEQA Guidelines.

LEGAL ANALYSIS:

The City Attorney has reviewed the agreement and approved the resolution as to form.

FINANCIAL IMPACT:

Sufficient funding has been allocated in the FY 2026-27 CIP budget for the Sewer Mainline Improvement Program (2026). No budget amendments are recommended. The table below presents the estimated breakdown of the Project construction cost:

Description Amount
Performance Pipeline Technologies - Total Bid $ 718,850 Additional Work/Contingency $ 110,000
Construction Support/Inspection $ 80,000
Total $ 898,850
Any unspent funds will be returned to the original funding source.

RECOMMENDATION:

That the City Council adopt Resolution 7800:

1. Approving the plans, specifications, and contract documents for the Sewer Mainline Improvement Project, CIP O-SS-2; and,

2. Sustaining the bid protest of Performance Pipeline Technologies, Inc. and rejecting the bid of the apparent low bidder, Estate Design and Construction, Inc., as non-responsive on the basis of the non-responsive defects identified in the bid protest and by staff; and,

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3. Awarding a Public Works Agreement to Performance Pipeline Technologies, Inc. in the amount of $718,850.00, and rejecting all other bids; and,

4. Authorizing the City Manager to execute a Public Works Agreement with Performance Pipeline Technologies, Inc. for the Project; and,

5. Authorizing the City Manager to approve additional work requests by Performance Pipeline up to $110,000; and,

6. Authorizing the City Manager to approve construction support/inspection services up to the not-to-exceed amount of $80,000, in connection with the Project, to be performed by the City’s on-call professional inspection services contractor.

SUBMITTED BY: NOTED AND APPROVED:

Iris Lee Patrick Gallegos
Iris Lee, Director of Public Works Patrick Gallegos, City Manager Prepared by: Sean Low, Deputy Director of Public Works – Maint./Util.

ATTACHMENTS:

A. Resolution 7800
B. Public Works Agreement with Performance Pipeline Technologies, Inc.

C. Performance Pipeline Technologies, Inc. Bid Protest dated May 13, 2026 D. City’s Protest Notice to Estate Design and Construction, Inc., dated May 28, 2026
RESOLUTION 7800

A RESOLUTION OF THE SEAL BEACH CITY COUNCIL

AWARDING AND AUTHORIZING THE CITY MANAGER TO

EXECUTE A PUBLIC WORKS AGREEMENT WITH
PERFORMANCE PIPELINE TECHNOLOGIES, INC. FOR THE
SEWER MAINLINE IMPROVEMENT PROJECT, CIP O-SS-2
WHEREAS, on April 2, 2026, the City issued a solicitation for bids for the Sewer Mainline Improvement Project, CIP O-SS-2 (Project), and received three (3) bids in response to the solicitation; and,
WHEREAS, based on the bids opened on May 6, 2026, the apparent low bidder was Estate Design and Construction, Inc. (Estate Design) in the amount of $699,510.00; the second low bidder was Performance Pipeline Technologies, Inc. (Performance Pipeline) in the amount of $718,850.00; and the third low bidder was Vortex Services, LLC dba Sancon Technologies in the amount of $839,650.00; and,
WHEREAS, upon reviewing the Notice Inviting Bids and Instructions to Bidders, the bids submitted for the work to be performed pursuant to the Agreement and the plans and specifications, staff found the following defects in the Estate Design bid:

1. Failure to submit bid bond meeting minimum 10% requirement – the submitted bid bond was in the amount of $69,800 (non-responsiveness); and,

2. Failure to provide documentation of certification or license to perform Cured-In-Place Pipe (CIPP) lining (non-responsiveness); and,

3. Failure to provide relevant subcontractor(s) to execute the Scope of Project including a subcontractor to perform CIPP lining (non-responsiveness); and,

4. Failure to meet mandatory experience requirements including minimum 10 years’ installation experience and minimum of 5,000 lineal feet (LF) of CIPP liner using bidder’s own work force (non-responsibility); and, WHEREAS, on May 13, 2026, the second low bidder, Performance Pipeline, submitted a bid protest to the City alleging that Estate Design is a non-responsive and non-responsible bidder on the following grounds:

1. Failure to demonstrate mandatory technical ability and experience (nonresponsibility); and,

3. Failure to comply with Subletting and Subcontracting Fair Practices Act, due to failure to list a CIPP subcontractor while lacking the minimum ten (10) years’ experience or CIPP certifications required to self-perform the work (non-responsiveness); and,
WHEREAS, upon reviewing the Notice Inviting Bids and Instructions to Bidders, bids submitted for the work to be performed pursuant to the Agreement, plans and specifications, and the staff report and oral comments, the City Council finds that Estate Design’s bid is non-responsive for the following reasons:

1. Failure to submit a bid bond in the minimum amount of 10% of its bid; and,

2. Failure to provide documentation of certification or license to perform CIPP lining; and,

3. Failure to list relevant subcontractor(s) to execute the Scope of Project including a subcontractor to perform the CIPP lining; and, WHEREAS, the City Council further finds that the non-responsive defects identified by Staff and Performance Pipeline in Estate Design’s bid are material and nonwaivable, and that Estate Design’s bid should therefore be rejected because it is non-responsive; and,
WHEREAS, a finding that Estate Design’s bid is rejected due to nonresponsiveness, negates the necessity for further review of Estate Design’s bid pertaining to non-responsibility; and,
WHEREAS, based upon its review of the record, the City Council finds that Performance Pipeline is the next low responsive and responsible bidder and a qualified firm to perform the Project.

NOW, THEREFORE, the Seal Beach City Council does resolve, declare, determine and order as follows:

Section 1. The City Council finds that all Recitals set forth above are true and correct, and incorporates them herein by this reference.

Section 2. The City Council hereby approves the plans and specifications for the Project.

Section 3. Based on the City Council’s review of the record and the recitals set forth above, the City Council hereby sustains the bid protest filed by Performance Pipeline against the bid of Estate Design and further finds the Estate Design bid to be non-responsive based on the nonresponsive defects identified in the protest letter and identified by staff, and rejects the Estate Design bid.

Section 4. Based on the City Council’s review of the record and the recitals set forth above, the City Council hereby awards a Public Works Agreement to Performance Pipeline for the Project in the not-toexceed amount of $718,850.00, and rejects all other bids.

Section 5. The City Council hereby authorizes and directs the City Manager to execute the Public Works Agreement with Performance Pipeline on behalf of the City.

Section 6. The City Council hereby authorizes the City Manager to approve payments for additional work requests by Performance Pipeline up to $110,000; and
Section 7. The City Council hereby authorizes payments for construction support/inspection services up to the not-to-exceed amount of $80,000, in connection with the Project, to be performed by the City’s on-call professional inspection services contractor.

PASSED, APPROVED AND ADOPTED by the Seal Beach City Council at a regular meeting held on the 22nd day of June 2026 by the following vote:

AYES: Council Members
NOES: Council Members
ABSENT: Council Members
ABSTAIN: Council Members

Lisa Landau, Mayor
ATTEST:

Gloria D. Harper, City Clerk
STATE OF CALIFORNIA }
COUNTY OF ORANGE } SS
CITY OF SEAL BEACH }
I, Gloria D. Harper, City Clerk of the City of Seal Beach, do hereby certify that the foregoing resolution is the original copy of Resolution 7800 on file in the office of the City Clerk, passed, approved, and adopted by the City Council at a regular meeting held on the 22nd day of June 2026.

Gloria D. Harper, City Clerk

PUBLIC WORKS AGREEMENT

SEWER MAINLINE IMPROVEMENT PROJECT
CIP O-SS-2
between
City of Seal Beach
211 - 8th Street
Seal Beach, CA 90740
&
Performance Pipeline Technologies, Inc.
5292 System Drive
Huntington Beach, CA 92649
(714) 536-7386
THIS CONTRACT (“Contract”) is made as of June 30, 2026, by and between the City of Seal Beach, a California charter city (“City”), and Performance Pipeline Technologies Inc., a California Corporation (“Contractor”) (collectively, “the parties” and individually, a “party”).

RECITALS
A. WHEREAS, the City Council of the City of Seal Beach (“City”) approved the plans and specifications for the SEWER MAINLINE IMPROVEMENT PROJECT (“Project”) with respect to design criteria, and based thereon the City issued a Notice Inviting Bids dated April 2nd, 2026; and,
B. WHEREAS, Contractor submitted a Bid to City for the Project dated May 6, 2026 in the amount of $718,850.00 (“Bid” hereinafter) in response to the Notice Inviting Bids; and,
C. WHEREAS, Contractor is a California licensed Class C-42, State Contractor’s License #825824, and DIR #1000561121; and,
D. WHEREAS, pursuant to the authority provided by its City Charter and Seal Beach Municipal Code, City desires to engage Contractor to carry out the Project in the manner set forth herein and more fully described in Section 1.0.

NOW, THEREFORE, in consideration of performance by the parties of the mutual promises, covenants, and conditions herein contained, the parties hereto agree as follows:

CONTRACT

1. Contractor’s Services.

1.1 Scope and Level of Services. For and in consideration of the mutual promises set forth herein, and subject to the terms and conditions set forth in this Contract, Contractor shall perform and complete in good and workmanlike manner all work (“Work”) for the Project identified as Sewer Mainline Improvement Project CIP O-SS-2 (“Project”) as described in this Contract and in the Contract Documents listed in Subsection 1.2.

1.2 Contract Documents. The Contract Documents consist of this Contract and all the following: Notice Inviting Bids, Instructions to Bidders, Accepted Bid Proposal and Bid Sheets, Notification of Award, Noncollusion Declaration, Designation of Subcontractors, Contractor’s Industrial Safety Record, Contractor’s Technical Ability and Experience References, Resumes, Bidder Questionnaire, Bid Bond, Faithful Performance Bond, Payment Bond (Labor and Materials), permits from regulatory agencies with jurisdiction, Special Provisions, Specifications, General Provisions, Plans, Standard Plans, Reference Documents, and any other documents referenced therein, all Addenda as prepared prior to the date of Bid opening setting forth any modifications or interpretations of any of said documents, Change Orders, and any and all supplemental agreements executed amending or extending the Work contemplated and that may be required to complete the Work in a substantial and acceptable manner; and all Exhibits attached to this Contract. The Exhibits attached to this Contract include the Performance Bond (Exhibit A), Payment Bond (Labor and Materials) (Exhibit B), Workers’ Compensation Insurance Certificate (Exhibit C), Insurance Endorsements (Exhibit D), Acknowledgment of Penal and Civil Penalties Concerning Contractor Licensing Laws (Exhibit E), Acknowledgment of Labor Law Requirements (Exhibit F), Standard Specifications and Reference Documents (Exhibit G), Non-Collusion Declaration (Exhibit H), Contractor’s Industrial Safety Record (Exhibit I), Declaration of Subcontractors (Exhibit J), and Accepted Bid Proposal with Bid Sheets (Exhibit K), and Project Plans (Appendix A). All Contract Documents are hereby incorporated into this Contract.

1.3 The Work shall be performed in accordance with the Plans, Specifications and other Contract Documents. Contractor shall furnish at its own expense all labor, materials, equipment and services necessary therefor, except such labor, materials, equipment and services as are specified in the Contract Documents to be furnished by City.

1.4 In the event of any material discrepancy between the express provisions of this Contract and the provisions of the other Contract Documents, the provisions of this Contract shall prevail.

2. Effective Date. This Contract is effective as of June 30, 2026 (the “Effective Date”), and shall remain in full force and effect until Contractor has rendered the services required by this Contract and a Notice of Completion has been filed with the Orange County Recorder, unless sooner terminated or extended pursuant to this Contract.

3. Contractor’s Compensation.

3.1 Payment. For performing and completing the Work in accordance with the Contract Documents, City shall pay Contractor, in accordance with the Bid Proposal as full compensation therefor, but in no event will City pay more than the total base bid amount of $718,850.00 (Seven Hundred Eighteen Thousand Eight Hundred and Fifty dollars), subject to any additions and deletions pursuant to the terms of the Contract Documents. Said sum shall constitute payment in full for all Work performed hereunder, including, without limitation, all labor, materials, equipment, tools and services used or incorporated in the Work, supervision, administration, overhead, expenses and any and all other things required, furnished or incurred for completion of the Work as specified in the Contract Documents. City shall make payments to Contractor on account of the Contract sum at the time, in the manner, and upon the conditions specified in the Contract Documents.

3.2 Additional Work. The City Manager is authorized to approve extra work requests to fund unforeseen conditions up to the amount approved at the time of award by the City Council. Payment for additional work in excess of this amount requires prior City Council authorization.

4. Contractor’s Personnel.

4.1 All Work shall be performed by Contractor or under Contractor’s direct supervision, and all personnel shall possess the qualifications, permits, and licenses required by the Seal Beach Municipal Code and other state and local laws and by the Notice Inviting Bids/Instructions to Bidders to perform such Services, including, without limitation, a City of Seal Beach business license as required by the Seal Beach Municipal Code.

4.2 Contractor shall be responsible for payment of all employees’ wages and benefits, and shall comply with all requirements pertaining to employer’s liability, workers’ compensation, unemployment insurance, and Social Security.

Contractor shall fully comply with the workers’ compensation law regarding Contractor and Contractor’s employees.

4.3 Contractor shall indemnify and hold harmless City and its elected officials, officers, employees, servants, volunteers, and those City agents serving as independent contractors in the role of City officials, from any and all liabilities, damages, claims, costs and expenses of any nature to the extent arising from Contractor’s alleged violations of personnel practices.

4.4 Contractor is, and shall at all times remain as to City, a wholly independent contractor. Contractor shall have no power to incur any debt, obligation, or liability on behalf of City or otherwise act as an agent of City. Neither City nor any of its agents shall have control over the conduct of Contractor or any of Contractor’s employees, except as set forth in this Contract. Contractor shall not, at any time, or in any manner, represent that it or any of its officers, agents, or employees are in any manner employees of City. Contractor shall pay all required taxes on amounts paid to Contractor under this Contract, and indemnify and hold City harmless from any and all taxes, assessments, penalties, and interest asserted against City by reason of the Work performed pursuant to this Contract.

4.5 City shall have the right to offset against the amount of any fees due to Contractor under this Contract any amount due to City from Contractor as a result of Contractor’s failure to promptly pay to City any reimbursement or indemnification arising under this Section 4.

5. Indemnification.

5.1 Contractor’s Duty. To the fullest extent permitted by law, Contractor shall, at its sole cost and expense, defend, indemnify, and hold the City and its elected and appointed officials, officers, attorneys, agents, employees, volunteers, successors, assigns, and those City agents serving as independent contractors in the role of City officials (collectively “Indemnitees”) from and against any and all damages, costs, expenses, liabilities, claims, demands, causes of action, proceedings, expenses, judgments, penalties, stop notices, liens, liabilities and losses of any nature whatsoever, including fees of accountants, attorneys or other professionals and all costs associated therewith and the payment of all consequential damages (collectively, “Liabilities”), in law or in equity, whether actual, alleged or threatened, which arise out of, are claimed to arise out of, pertain to, or relate to, the acts or omissions of Contractor, its officers, agents, attorneys, servants, employees, Subcontractors, materialmen, contractors, or their officers, agents, servants or employees (or any entity or individual for whom the Contractor bears legal liability)in the performance of the Contract, including the Indemnitees’ active or passive negligence, except for Liabilities arising from the sole negligence or willful misconduct of the Indemnitees, as determined by court decision or by the agreement of the Parties. Contractor shall defend the Indemnitees in any action or actions filed in connection with any Liabilities with counsel of the Indemnitees’ choice, and shall pay all costs and expenses, including all attorneys’ fees and experts’ costs actually incurred in connection with such defense. Contractor shall reimburse the Indemnitees for any and all legal expenses and costs incurred by Indemnitees in connection therewith. The City shall not be liable for any accident, loss, or damage to the Work prior to completion, except as otherwise specified in Section 6-5 of the Specifications.

5.2 Taxes and Workers’ Compensation. Contractor shall pay all required taxes on amounts paid to the Contractor under the Contract, and indemnify and hold the City harmless from any and all taxes, assessments, penalties, and interest asserted against the City by reason of the independent contractor relationship created by the Contract. Contractor shall fully comply with the Workers’ Compensation law regarding Contractor and Contractor’s employees. Contractor shall indemnify and hold the City harmless from any failure of Contractor to comply with applicable Workers’ Compensation laws. City may offset against the amount of any fees due to Contractor under the Contract any amount due to City from Contractor as a result of Contractor’s failure to promptly pay to the City any reimbursement or indemnification arising under this Subsection 5.2.

5.3 Bid Protests. In addition to all other obligations set forth in this Section 5, Contractor shall reimburse the City for all attorneys’ fees and costs incurred by City in connection with, arising out of or incident to any Bid protest.

5.4 Civil Code Exception. Nothing in this Section 5 shall be construed to encompass Indemnitees’ sole negligence or willful misconduct to the limited extent that the underlying Contract is subject to Civil Code Section 2782(a) or the City’s active negligence to the limited extent that the underlying Contract Documents are subject to Civil Code Section 2782(b), provided such sole negligence, willful misconduct or active negligence is determined by agreement between the parties or by the findings of a court of competent jurisdiction.

5.5 Workers’ Compensation Acts not Limiting. Contractor’s indemnifications and obligations under this Section 5, or any other provision of the Contract, shall not be limited by the provisions of any Workers’ Compensation act or similar act. Contractor expressly waives its statutory immunity under such statutes or laws as to City, its officers, agents, employees and volunteers.

5.6 Insurance Requirements not Limiting. City does not, and shall not, waive any rights that it may possess against Contractor because of the acceptance by City, or the deposit with City, of any insurance policy or certificate required pursuant to the Contract. The indemnities in this Section 5 shall apply regardless of whether or not any insurance policies are determined to be applicable to the Liabilities, tax, assessment, penalty or interest asserted against City.

5.7 Nonwaiver of Rights. Indemnitees do not, and shall not, waive any rights that they may possess against Contractor because of the acceptance by City, or the deposit with City, of any insurance policy or certificate required pursuant to this Contract.

5.8 Subcontractor Indemnity Agreements. Contractor shall obtain executed indemnity agreements with provisions identical to those in this Section 5 from each and every Subcontractor or any other person or entity involved by, for, with or on behalf of Contractor in the performance of the Contract. If Contractor fails to obtain such indemnity obligations, Contractor shall be fully responsible and indemnify, hold harmless and defend the Indemnitees from and against any and all Liabilities at law or in equity, whether actual, alleged or threatened, which arise out of, are claimed to arise out of, pertain to, or relate to the acts or omissions of Contractor’s Subcontractor, its officers, agents, servants, employees, Subcontractors, materialmen, contractors or their officers, agents, servants or employees (or any entity or individual for whom Contractor’s Subcontractor bears legal liability) in the performance of the Contract, including the Indemnitees’ active or passive negligence, except for Liabilities arising from the sole negligence or willful misconduct of the Indemnitees, as determined by final court decision or by the agreement of the Parties.

5.9 Survival. The provisions of this Section 5 shall survive the expiration or termination of the Contract, are intended to be as broad and inclusive as is permitted by the law of the State, and are in addition to any other rights or remedies that Indemnitees may have under the law. Payment is not required as a condition precedent to an Indemnitee’s right to recover under this indemnity provision, and an entry of judgment against a Contractor shall be conclusive in favor of the Indemnitee’s right to recover under this indemnity provision.

6. Insurance.

6.1 Liability Insurance. Contractor shall at all times during the term of this Contract carry, maintain and keep in full force and effect the insurance referenced in this Section 6. The policy limits set forth below do not act as a limitation upon the amount of indemnification to be provided by Contractor. Contractor shall complete and execute the following documents attached as Exhibits hereto and incorporated herein by this reference:

6.1.1 Exhibit D-1: Additional Insured Endorsement -
Commercial General Liability.

6.1.2 Exhibit D-2: Additional Insured Endorsement -
Automobile Liability.

6.2 Minimum Scope of Insurance. Unless otherwise approved by City, coverage shall be at least as broad as:

6.2.1 Insurance Services Office Commercial General Liability coverage (occurrence form CG 0001).

6.2.2 Insurance Services Office form number CA 0001 (Ed. 1/87) covering Automobile Liability, code 1 (any auto).

6.2.3 Insurance Services Office form number CG 20 10 11 85 (Ed. 11/85) covering Additional Insured—Owners, Lessees or Contactors (Form B).

6.2.4 Workers’ Compensation insurance as required by the State of California and Employer’s Liability Insurance.

6.3 Minimum Limits of Insurance. Contractor shall maintain limits no less than:

6.3.1 General Liability: $2,000,000 per occurrence and in the aggregate for bodily injury, personal injury and property damage. Commercial General Liability Insurance or other form with a general aggregate limit shall apply separately to this Contract or the general limit shall be twice the required occurrence limit.

6.3.2 Automobile Liability: $2,000,000 per occurrence for bodily injury and property damage.

6.3.3 Employer’s Liability: $1,000,000 per occurrence and in the aggregate for bodily injury or disease; and Workers’ Compensation Insurance in the amount required by law.

6.4 Additional Insureds. City, its elected and appointed officials, officers, employees, attorneys, agents, volunteers, and independent contractors in the role of City officials, shall be the insured or named as additional insureds covering the Work, regardless of any inconsistent statement in the policy or any subsequent endorsement, whether liability is attributable to Contractor or City.

6.5 Replacement Insurance. Contractor agrees that it will not cancel, reduce or otherwise modify the insurance coverage required by the Contract during the term of the Contract. Contractor agrees that if it does not keep the required insurance in full force and effect, and such insurance is available at a reasonable cost, City may take out the necessary insurance and pay the premium thereon, and the repayment thereof shall be deemed an obligation of Contractor and the cost of such insurance may be deducted, at the option of City, from payments due Contractor. This shall be in addition to all other legal options available to City to enforce the insurance requirements.

6.6 Certificates of Insurance with Original Endorsements. Contractor shall submit to City certificates of insurance with the original endorsements, both of which reference the same policy number, for each of the insurance policies that meet the insurance requirements, not less than one (1) day before beginning of performance under the Contract. The endorsements are to be signed by a person authorized by that insurer to bind coverage on its behalf. Endorsements must be executed on City’s forms titled “Additional Insured Endorsement,” copies of which are attached as exhibits to this Contract, or on any other form that contains substantially the same terms and is approved by City’s Risk Manager. The endorsements must specifically name the City of Seal Beach and its elected and appointed officials, officers, employees, attorneys, agents, volunteers, and independent contractors in the role of City officials as insureds or additional insureds. Current insurance certificates and endorsements shall be kept on file with City at all times during the term of this Contract. City reserves the right to require complete, certified copies of all required insurance policies at any time.

6.7 Deductibles and Self-Insured Retentions. Contractor shall inform City of any deductibles or self-insured retentions except with respect to any professional liability insurance.

6.8 Other Insurance Provisions. The general liability and automobile liability policies are to contain, or be endorsed to contain, the following provisions:

6.8.1 For any claims related to this Contract, Contractor’s insurance coverage shall be primary insurance as respects City, its officers, officials, employees, volunteers and those City agents serving as independent contractors in the role of City officials. Any insurance or self-insurance maintained by City, their officers, officials, employees, volunteers or those City agents serving as independent contractors in the role of City officials shall be excess of Contractor’s insurance and shall not contribute with it.

6.8.2 Contractor’s insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer’s liability.

6.8.3 Each insurance policy required by this Section 6 shall be endorsed to state that coverage shall not be canceled or materially modified except after 30 calendar days prior written notice by first class mail has been given to City.

6.8.4 Each insurance policy required by this Section 6 shall expressly waive the insurer’s right of subrogation against City and its elected officials, officers, employees, servants, attorneys, volunteers, and those City agents serving as independent contractors in the role of City or agency officials. By executing this Agreement, Contractor waives all rights of subrogation against City and its elected and appointed officials, officers, employees, agents, volunteers and those City agents serving as independent contractors in the role of City officials.

6.9 Acceptability of Insurers. Insurance is to be placed with insurers with a current A.M. Best’s rating of no less than A:VIIl unless waived in writing by City’s Risk Manager.

6.10 No Limitation on Indemnity. The insurance provisions shall not be construed to limit Contractor’s indemnity obligations contained in this Contract or any other Contract Documents.

6.11 Insurance Requirements not Limiting. If Contractor maintains broader coverage and/or higher limits than the minimums required in this Section 6, City requires and shall be entitled to the broader coverage and/or the higher limits maintained by Contractor. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to City. No representation is made that the minimum insurance requirements of this Contract are sufficient to cover the obligations of Contractor under this Contract.

6.12 Subcontractors. Contractor shall require each of its Subcontractors, if applicable, that perform services under the Contract to maintain insurance coverage that meets all of the requirements of the Contract including this Section 6.

7. Liquidated Damages. Should the Contractor fail to complete the Project, or any part thereof, in the time agreed upon in the Contract, the Contractor shall reimburse the City for the additional expense and damage for each calendar day that the Contract remains uncompleted after the Contract completion date. It is agreed that the amount of such additional expense and damage incurred by reason of failure to complete the Contract is the per diem rate of $1,500.00 per calendar day. Such amount is hereby agreed upon as liquidated damages for the loss to the City resulting from the failure of the Contractor to complete the Project within the allotted time and to the value of the operation of the works dependent thereon. It is expressly understood and agreed that this amount is a reasonable amount and is established in lieu of damages that are incapable of calculation at the inception hereof; and this amount is not to be considered in the nature of a penalty. The City shall have the right to deduct such damages from any amount due, or that may become due to the Contractor, or the amount of such damages shall be due and collectible from the Contractor or the Contractor’s Surety.

Progress payments made after the scheduled completion date shall not constitute a waiver of liquidated damages.

8. Suspension. City may, in writing, order Contractor to suspend all or any part of the Contractor’s Services for the convenience of City or for work stoppages beyond the control of City or Contractor. A suspension of the Services does not void this Contract.

9. Notices. Any notices, bills, invoices, or reports authorized or required by this Contract shall be in writing and shall be deemed received on (a) the day of delivery if delivered by hand or overnight courier service during Contractor’s and City’s regular business hours or by facsimile before or during Contractor’s regular business hours; or (b) on the third business day following deposit in the United States mail, postage prepaid, to the addresses heretofore set forth in the Contract, or to such other addresses as the parties may, from time to time, designate in writing pursuant to the provisions of this Section. All notices shall be addressed as follows:

If to City: City Clerk
City of Seal Beach
211-8th Street
Seal Beach, California 90740
Telephone: (562) 431-2527
Fax: (562) 493-9857
With a copy to:

Public Works Director
City of Seal Beach
211-8th Street
Seal Beach, California 90740
If to Contractor: Performance Pipeline Technologies, Inc. 5292 System Drive
Huntington Beach, CA 92649
Telephone: 714-536-7386
Attn: Gene Glassburner

10. Non-Assignability; Subcontracting. Contractor shall not assign, transfer, or subcontract any interest in this Contract or the performance of any of Contractor’s obligations hereunder. Any attempt by Contractor to so assign, transfer, or subcontract any rights, duties, or obligations arising hereunder shall be null, void and of no effect.

11. Compliance with Laws. Contractor shall comply with all applicable federal, state and local laws, ordinances, codes and regulations in force at the time Contractor performs the Services.

12. Non-Waiver of Terms, Rights and Remedies. Waiver by either party of any one or more of the conditions of performance under this Contract shall not be a waiver of any other condition of performance under this Contract. In no event shall the making by City of any payment to Contractor constitute or be construed as a waiver by City of any breach of covenant, or any default which may then exist on the part of Contractor, and the making of any such payment by City shall in no way impair or prejudice any right or remedy available to City with regard to such breach or default.

13. Attorneys’ Fees. In the event that either party to this Contract shall commence any legal action or proceeding to enforce or interpret the provisions of this Contract, each party shall be responsible for their own attorneys’ fees.

14. Construction. The validity, interpretation, and performance of this Contract shall be controlled by and construed under the laws of the State of California, with venue in Orange County, California. In the event of any asserted ambiguity in, or dispute regarding the interpretation of any matter herein, the interpretation of this Contract shall not be resolved by any rules of interpretation providing for interpretation against the party who causes the uncertainty to exist or against the party who drafted the Contract or who drafted that portion of the Contract.

15. Workers’ Compensation. Labor Code Sections 1860 and 3700 provide that every contractor will be required to secure the payment of compensation to its employees. In accordance with the provisions of Labor Code Section 1861, by signing this Contract, the Contractor certifies as follows:
“I am aware of the provisions of Section 3700 of the Labor Code which require every employer to be insured against liability for workers’ compensation or to undertake self-insurance in accordance with the provisions of that Code, and I will comply with such provisions before commencing the performance of the Work of this Contract.”

16. Prevailing Wages. The City and the Contractor acknowledge that the Project is a public work to which prevailing wages apply, and Contractor shall comply in all respects with all applicable provisions of the California Labor Code, including but not limited to those set forth in Exhibits E and F, attached hereto.

17. Claim Dispute Resolution.

17.1 In the event of any dispute or controversy with the City over any matter whatsoever, the Contractor shall not cause any delay or cessation in or of Work, but shall proceed with the performance of the Work in dispute. Contractor shall retain any and all rights provided that pertain to the resolution of disputes and protests between the parties. The Disputed Work will be characterized as an “unresolved dispute” and payment, if any, shall be as later determined by mutual agreement or a court of law. Contractor shall keep accurate, detailed records of all Disputed Work, claims and other disputed matters.

17.2 All claims arising out of or related to the Contract Documents or this Project, and the consideration and payment of such claims, are subject to the Government Claims Act (Government Code Section 810 et seq.) with regard to filing claims. All such claims are also subject to Public Contract Code Section 9204 and Public Contract Code Section 20104 et seq. (Article 1.5), where applicable. This Contract hereby incorporates those provisions as though fully set forth herein. Thus, Contractor or any Subcontractor must file a claim in accordance with the Government Claims Act as a prerequisite to filing a construction claim in compliance with Section 9204 and Article 1.5 (if applicable), and must then adhere to Article 1.5 and Section 9204, as applicable, pursuant to the definition of “claim” as individually defined therein.

18. Antitrust Claims. In entering into this Contract, Contractor offers and agrees to assign to City all rights, title, and interest in and to all causes of action it may have under Section 4 of the Clayton Act (15 U.S.C. Sec. § 15) or under the Cartwright Act (Business and Professions Code Section 16700 et seq.) arising from purchases of goods, services, or materials pursuant to the Agreement. This assignment shall be made and become effective at the time City tenders final payment to Contractor without further acknowledgment by the parties.

19. Prohibited Interests; Conflict of Interest

19.1. Contractor covenants that it presently has no interest and shall not acquire any interest, direct or indirect, which may be affected by the Work, or which would conflict in any manner with the performance of the Work under this Agreement.

Contractor further covenants that, in performance of this Agreement, no person having any such interest shall be employed by it. Furthermore, Contractor shall avoid the appearance of having any interest, which would conflict in any manner with the performance of the Work. Contractor shall not accept any employment or representation during the term of this Agreement which is or may likely make Contractor “financially interested” (as provided in California Government Code §§ 1090 and 87100) in any decision made by City on any matter in connection with which Contractor has been retained.

19.2. Contractor further warrants and maintains that it has not employed or retained any person or entity, other than a bona fide employee working exclusively for Contractor, to solicit or obtain this Agreement. Nor has Contractor paid or agreed to pay any person or entity, other than a bona fide employee working exclusively for Contractor, any fee, commission, gift, percentage, or any other consideration contingent upon the execution of this Agreement. Upon any breach or violation of this warranty, City shall have the right, at its sole and absolute discretion, to terminate this Agreement without further liability, or to deduct from any sums payable to Contractor hereunder the full amount or value of any such fee, commission, percentage or gift.

19.3. Contractor warrants and maintains that it has no knowledge that any officer or employee of City has any interest, whether contractual, non-contractual, financial, proprietary, or otherwise, in this transaction or in the business of Contractor, and that if any such interest comes to the knowledge of Contractor at any time during the term of this Agreement, Contractor shall immediately make a complete, written disclosure of such interest to City, even if such interest would not be deemed a prohibited “conflict of interest” under applicable laws as described in this subsection.

20. Entire Agreement. This Contract, including any other documents incorporated herein by specific reference, represents the entire and integrated agreement between Contractor and City. This Contract supersedes all prior oral or written negotiations, representations, or agreements. This Contract may not be amended, nor any provision or breach hereof waived, except in a writing signed by the parties which expressly refers to this Contract.

21. Severability. The invalidity in whole or in part of any provisions of this Contract shall not void or affect the validity of the other provisions of this Contract.

22. Titles and Headings. The titles and headings used in this Contract are for convenience only and shall in no way define, limit or describe the scope or intent of this Contract or any part of it.

23. Authority. Any person executing this Contract on behalf of Contractor warrants and represents that he or she has the authority to execute this Contract on behalf of Contractor and has the authority to bind Contractor to the performance of its obligations hereunder.

24. Counterparts. This Contract may be executed in counterpart originals, duplicate originals, or both, each of which is deemed to be an original for all purposes.

5292 System Drive
Huntington Beach, CA. 92649
Phone (714) 536-7386
Performance Pipeline Technologies
DIR # 1000561121
License # 825824

Performance Pipeline Technologies, Inc.
5292 System Drive
Huntington Beach, CA. 92649
Phone (714) 536-7386
May 13, 2026

VIA EMAIL
Gloria Harper, City Clerk
City of Seal Beach
211 8th Street
Seal Beach, CA 90740
Email: [email protected]
Iris Lee, Public Works Director
City of Seal Beach
211 8th Street
Seal Beach, CA 90740
Email: [email protected]
SUBJECT: FORMAL BID PROTEST – Sewer Mainline Improvement Project (CIP O-SS-2) APPARENT LOW BIDDER: Estate Design and Construction

Dear Ms. Harper and Ms. Lee:

Performance Pipeline Technologies, Inc. (PPT) hereby submits this formal protest regarding the bid submitted by Estate Design and Construction (“Estate Design”) for the Sewer Mainline Improvement Project (CIP O-SS-2).

Our protest is based on the fact that the apparent low bidder is non-responsible and their bid is materially non-responsive. Estate Design lacks the specialized experience and technical qualifications specifically mandated by the Contract Documents to perform Cured-In-Place Pipe (CIPP) rehabilitation.

I. Failure to Demonstrate Mandatory Technical Ability and Experience The City’s "Bidder’s Technical Ability and Experience References" form (Page 17 of the Bid Proposal) requires bidders to demonstrate their competency in the specific type of work being tendered. For this project, that work is almost exclusively 8” and 12” UV CIPP lining and chemical grouting.

A review of Estate Design’s submitted references reveals a total absence of CIPP or trenchless rehabilitation experience. Their listed projects consist of:
 General plumbing and restroom remodeling.
 Solar energy and roofing installations.
 Street light trenching and open-cut drainage.

None of these references involve the specialized equipment, technical ability, or bypass pumping protocols inherent to CIPP. In contrast, PPT’s technical submission confirms our specialized focus on this scope, including the mandatory 5,000 lineal feet of CIPP installation required for this project. Under California public contracting law, a bidder must be "responsible," meaning they possess the fitness and capacity to perform the specific work. Estate Design has effectively admitted in their own bid that they have zero experience in the project's primary scope.

II. Non-Responsiveness to Special Provisions Section 5-9 Section 5-9 of the Special Provisions (SP-24) establishes strict threshold requirements for this contract, specifically:
 A minimum of ten (10) years of CIPP installation experience.  Installation of a minimum of 5,000 lineal feet of CIPP using the Contractor’s own workforce.  Current certification and licensure to perform the CIPP lining process. 5292 System Drive
Huntington Beach, CA. 92649
Phone (714) 536-7386
Performance Pipeline Technologies
DIR # 1000561121
License # 825824
While the City may choose to waive the physical attachment of certification letters at the time of bid as a minor informality, it cannot waive the underlying requirement that the bidder actually possesses this experience. Estate Design’s own Bidder Questionnaire (Page 25) states the firm has only five (5) years of experience as a contractor, and their references confirm none of that time was spent performing CIPP. Therefore, they cannot meet the mandatory 10-year requirement, rendering them a non-responsible bidder.

III. Subcontractor Listing and Self-Performance Requirements Under the Subletting and Subcontracting Fair Practices Act, Estate Design is required to self-perform any work for which a subcontractor was not listed. Estate Design failed to list a CIPP subcontractor, meaning they are legally obligated to perform the CIPP lining themselves.

As their bid proves they do not have the 10 years of experience or the specific CIPP certifications required by Section 5-9, they are incapable of legally or technically self-performing the work. This creates a material defect in their bid that cannot be cured after the fact.

Conclusion
The City of Seal Beach established these experience requirements to protect the integrity of its sewer infrastructure and to ensure the work is performed by qualified specialists. Awarding a high-risk trenchless project to a general building and remodeling contractor with no CIPP history creates significant risk for the City.

Performance Pipeline Technologies, Inc. respectfully requests that the City find the bid of Estate Design and Construction non-responsive and award the contract to the lowest responsible bidder that meets the technical requirements of the project.

Sincerely,
Gene Glassburner
General Manager
Performance Pipeline Technologies, Inc.

SEWER MAINLINE

IMPROVEMENT PROGRAM
(2026)– CIP O-SS-2

CITY OF SEAL BEACH
June 22, 2026

WHAT TO EXPECT
• Project Overview
• Timeline
• Bid Summary & City Findings
• Project Budget and Funding
• Council Action Recommendations

PROJECT OVERVIEW
• Furnish and install cured-in-place pipe (CIPP) lining for 8” and 12” pre-designated lines • Conduct as-needed point repairs on sewer lateral connections • Project phase of work (Phase 1) will be conducted in Districts 1 and 3 (The Hill, Bridgeport, Cove, Old Town areas)

TIMELINE
April 2, 2026
Notice of Inviting Bids Issued
May 6, 2026
Bid Opening
May 2026 – June 2026
Bid Review
Bid Protest Management
June 22, 2026
Council Award
July 2026-August 2026
Contract Execution
Notice to Proceed Issued
Fall 2026
Mobilization
70 Working Days

BID SUMMARY
• Formal bid process (April 2, 2026 – May 6, 2026):
• Three (3) bids received
Rank Contractor Total Bid
Low Estate Design and Construction, Inc. $699,510
2 Performance Pipeline Technologies, Inc. $718,850
3 Vortex LLC dba Sancon Technologies $839,650
Terms: RESPONSIVE VS. RESPONSIBLE
• Responsive bid:
• Considered “responsive” if it promises to do what the bidding instructions demand and follows all relevant submission instructions • Responsiveness concerns only the bid itself, not the bidder’s qualifications or ability to execute the project
• Responsible bidder:
• Indicates a bidder “has demonstrated the attribute of trustworthiness, as well as quality, fitness, capacity and experience to satisfactorily perform the public works contract.”
City Findings and Bid Protest Summary
• City discovered several defects in low bidder’s (Estate Design) bid:
• Non-Responsive:
• Failure to meet minimum bid bond of 10%
• Failure to submit the required documentation of license or certification to execute scope • Failure to submit relevant subcontractors
• Performance Pipeline Technologies submitted a Bid Protest on May 13, 2026, citing:
• Non-Responsible:
• Failure to demonstrate min. mandatory technical ability and experience (10 years or 5,000 LF of CIPP using own workforce)
• Non-Responsive:
• Failure to list relevant subcontractors/lacking minimum experience and certifications required • City Informed Apparent Low Bidder of City findings/Bid Protest, no response from Estate Design within time allotted

PROJECT BUDGET & FUNDING
Description Amount
Performance Pipeline Technologies - Total Bid $ 718,850 Unforeseen Work/Construction Contingency $ 110,000
Construction Support/Inspection $ 80,000
Total $ 898,850
• Budgeted in FY 2026-27 CIP budget for the Sewer Mainline Improvement Program (2026) • O-SS-2 is a listed project within the Sewer Rate Study • No budget amendments are necessary
• Rate Funded. No external funding is being contemplated RECOMMENDATIONS:
• Approving the plans, specifications, and contract documents for the Sewer Mainline Improvement Project, CIP O-SS-2; and,
• Sustaining the bid protest of Performance Pipeline Technologies, Inc. and rejecting the bid of the apparent low bidder, Estate Design and Construction, Inc., as non-responsive on the basis of the non-responsive defects identified in the bid protest and by staff; and, • Awarding a Public Works Agreement to Performance Pipeline Technologies, Inc. in the amount of $718,850, and rejecting all other bids; and,
• Authorizing the City Manager to execute a Public Works Agreement with Performance Pipeline Technologies, Inc. for the Project; and,
• Authorizing the City Manager to approve unforeseen work requests up to $110,000 and construction support/inspection services up to $80,000, in connection with the Project, in the cumulative not-to-exceed amount of $190,000
THANK YOU!
Agenda Item P

AGENDA STAFF REPORT
DATE: June 22, 2026
TO: Honorable Mayor and City Council
THRU: Patrick Gallegos, City Manager
FROM: Iris Lee, Director of Public Works
SUBJECT: Awarding and Authorizing Execution of a Public Works Agreement with T.E. Roberts, Inc. for the LCWA Watermain Lining – Trenchless Technology Improvements, CIP
WT2103
________________________________________________________________ SUMMARY OF REQUEST:

That the City Council adopt Resolution 7801:

1. Approving the plans, specifications, and contract documents for the LCWA Watermain Lining – Trenchless Technology Improvements, CIP WT2103; and,

2. Awarding a Public Works Agreement to T.E. Roberts, Inc. for the Project in the not-to-exceed amount of $3,209,485; finding bids submitted by Minako America Corporation dba Minco Construction and Vortex Services, LLC as non-responsive; and rejecting all other bids; and,

3. Authorizing the City Manager to execute the Public Works Agreement with T.E. Roberts, Inc. for the Project; and authorizing the City Manager to approve additional work requests up to $320,950 (approximately 10%), in connection with the Project; and,

4. Authorizing the City Manager to approve construction support services in the amount of $234,976 in connection with the Project, including engineering and environmental support, construction management, and inspection services, to be performed by the City’s on-call professional services contractors.

BACKGROUND AND ANALYSIS:

The 18” diameter LCWA Watermain serves as one of the City's primary transmission facilities and provides critical redundancy for conveying potable water to Old Town and other portions of the service area. Failure of this pipeline could significantly impact the City's ability to maintain reliable water service, fire flow

Page 2 ends

capacity, and operational flexibility during emergency conditions. Given the age and condition of the pipeline, proactive rehabilitation is more cost-effective than continued emergency repairs and reduces the risk of service disruptions.

The Project corridor is located within a wetlands area that is currently undergoing restoration by the Los Cerritos Wetlands Authority (LCWA). Completing the rehabilitation work prior to the full implementation of restoration improvements will minimize future habitat disturbance, avoid additional permitting complexities, and reduce the likelihood that future maintenance activities would impact restored wetland resources.

Given the condition of the watermain infrastructure and the frequency of main breaks within this area, the LCWA Watermain Lining – Trenchless Technology Improvements, CIP WT2103 (Project), was programmed into the Capital Improvement Program (CIP) to extend the pipeline’s serviceable life. Relining of the existing watermain was evaluated as the most cost-effective approach for extending the useful life of the facility while minimizing environmental impacts, construction duration, and overall project costs compared to full replacement.

On March 18, 2026, the City solicited public bids for the Project and subsequently issued four (4) official addenda. The original Notice Inviting Bids, Instructions to Bidders, Bid Specifications, and addenda (collectively “Bid Documents”) may be reviewed in the Public Works Department and are not included with this staff report due to their length.

On May 21, 2026, the City Clerk’s office received three (3) bids with the following base bid results:

Rank Contractor Total Base Bid
Low T.E. Roberts, Inc. $3,209,485
2 Minako America Corporation dba
Minco Construction
$3,475,000
3 Vortex Services, LLC $3,863,605
A. Independent Bid Analysis
An independent analysis of the apparent low bidder’s bid package finds T.E.

Roberts, Inc. (T.E. Roberts) to be responsive and responsible.

As a condition of receiving Drinking Water State Revolving Fund (DWSRF) financing, bidders were required to submit specific DWSRF compliance documentation with their bids. Minako America Corporation dba Minco Construction (Minco) and Vortex Services, LLC (Vortex) failed to provide the required bid documentation and are therefore deemed non-responsive.

The apparent low bid submitted by T.E. Roberts was approximately 8% lower than the second-lowest bid and approximately 17% lower than the highest bid received.

Page 3 ends

The relatively narrow spread among the bids provides confidence that the pricing reflects current market conditions and that the bid is fair and reasonable.

B. Drinking Water State Revolving Fund Loan
The State Water Resources Control Board’s (Water Board) DWSRF program was created to finance infrastructure improvements to support drinking water systems and maintain compliance with Safe Drinking Water Act requirements. Interest rates associated with DWSRF are generally favorable to emphasize the importance of investing into each agency’s water system. The 2026 DWSRF interest rate is 2.1%.

The standard loan term is the lesser of 30 years or the useful life of the financed facility.

In parallel with project construction efforts, the City and Water Board are finalizing the DWSRF financing agreement. The financing agreement has undergone review by the Water Board, City Attorney's Office, Finance Department, and Public Works Department, and is nearing completion. Staff anticipates presenting the agreement to the City Council for consideration in the near future.

The Water Board has confirmed that execution of the financing agreement is not required prior to construction contract award or contractor mobilization. The City has been advised that proceeding with Project award while finalizing financing documents is a customary practice under the DWSRF program and helps avoid unnecessary project delays.

C. Staff’s Recommendation
The Water and Sewer Rate Study adopted in 2025 assumed a construction cost of approximately $2.5 million for the Project. Subsequent design refinement, updated cost estimating, and current market conditions resulted in an engineer's estimate of approximately $2.68 million, exclusive of construction support and contingency. The low bid received was $3.21 million.

Although construction costs exceed original planning assumptions, staff recommends proceeding with the Project due to the critical nature of the facility, the increasing risk of pipeline failure, the favorable financing available through the DWSRF program, and the unique opportunity to complete the work prior to implementation of planned wetlands restoration activities.

ENVIRONMENTAL IMPACT:

This project complies with all requirements of the California Environmental Quality Act (CEQA) and is categorically exempt under section 15301 Class 1, Subsection (b) of the CEQA Guidelines because this project is an alteration of a publicly owned utility facility involving negligible expansion of existing use.

Page 4 ends

LEGAL ANALYSIS:

The City Attorney has reviewed and approved the Agreement and Resolution as to form.

FINANCIAL IMPACT:

The DWSRF program operates on a reimbursement basis, requiring the City to initially fund eligible project expenditures and subsequently seek reimbursement through the State. As such, construction funding has been appropriated in the FY 2026-27 budget to support project implementation pending reimbursement through the DWSRF program.

The table below presents the estimated breakdown of the Project cost:

Description Amount

RATE FUNDED
Design (completed): $ 294,072

SRF LOAN FUNDED
Construction Support
Engineering & Environmental Support $ 115,196
Construction Management $ 69,780
Inspection $ 50,000
Construction Support Cost: $ 234,976
Construction
T.E. Roberts $ 3,209,485
Contingency (approx. 10%) $ 320,950
Construction Cost: $ 3,530,435
RECOMMENDATION:

That the City Council adopt Resolution 7801:

1. Approving the plans, specifications, and contract documents for the LCWA Watermain Lining – Trenchless Technology Improvements, CIP WT2103; and,

Page 5 ends

SUBMITTED BY: NOTED AND APPROVED:

Iris Lee Patrick Gallegos
Iris Lee, Director of Public Works Patrick Gallegos, City Manager ATTACHMENTS:

A. Resolution 7801
B. Public Works Agreement with T.E. Roberts, Inc.

RESOLUTION 7801

A RESOLUTION OF THE SEAL BEACH CITY COUNCIL

AWARDING AND AUTHORIZING THE CITY MANAGER TO
EXECUTE A PUBLIC WORKS AGREEMENT WITH T.E.

ROBERTS, INC. FOR THE LCWA WATERMAIN LINING –
TRENCHLESS TECHNOLOGY IMPROVEMENTS, CIP WT2103
WHEREAS, on March 18, 2026, the City issued a solicitation for bids for the LCWA Watermain Lining – Trenchless Technology Improvements, CIP WT2103 (Project); and,
WHEREAS, on May 21, 2026, the City Clerk’s office received three (3) bids in response to the solicitation for bids, and T.E. Roberts, Inc. (T.E. Roberts) submitted the lowest responsive bid in the amount of $3,209,485; and, WHEREAS, upon review of T.E. Robert’s Bid Proposal and the Bid Documents, the City Council further finds that T.E. Roberts is a responsive and responsible bidder and a qualified firm to perform the Project; and, WHEREAS, upon review of Minako America Corporation dba Minco Construction (Minco) and Vortex Services, LLC (Vortex) bid proposals, the City Council finds that Minco and Vortex failed to provide the required bid documentation and are therefore deemed non-responsive; and,
WHEREAS, the City has submitted a State Revolving Fund loan application to the State Water Resources Control Board (Water Board) to finance the Project at a favorable interest rate; and,
WHEREAS, the Water Board has authorized the City to proceed with implementation of the Project, and the City is currently finalizing a State Revolving Fund financing agreement that will be presented to the City Council under a separate action.

NOW, THEREFORE, the Seal Beach City Council does resolve, declare, determine and order as follows:

Section 1. The City Council finds that all Recitals set forth above are true and correct, and incorporates them herein by this reference.

Section 2. The City Council hereby approves the plans and specifications for the Project.

Section 3. Based on the record and recitals set forth above, the City Council hereby awards a Public Works Agreement to T.E. Roberts for the Project in the not-to-exceed amount of $3,209,485; finds bids submitted by Minako America Corporation dba Minco Construction and Vortex Services, LLC as non-responsive; and rejects all other bids.

Section 4. The City Council hereby authorizes and directs the City Manager to execute the Public Works Agreement with T.E. Roberts on behalf of the City.

Section 5. The City Council hereby authorizes the City Manager, or designee, to approve additional work requests by T.E. Roberts up to $320,950 (approximately 10%), in connection with the Project.

Section 6. The City Council hereby authorizes the City Manager to approve construction support services in the amount of $234,976, in connection with the Project, including engineering and environmental support, construction management, and inspection services, to be performed by the City’s on-call professional services contractors.

PASSED, APPROVED AND ADOPTED by the Seal Beach City Council at a regular meeting held on the 22nd day of June 2026 by the following vote:

AYES: Council Members
NOES: Council Members
ABSENT: Council Members
ABSTAIN: Council Members

Lisa Landau, Mayor
ATTEST:

Gloria D. Harper, City Clerk
STATE OF CALIFORNIA }
COUNTY OF ORANGE } SS
CITY OF SEAL BEACH }
I, Gloria D. Harper, City Clerk of the City of Seal Beach, do hereby certify that the foregoing resolution is the original copy of Resolution 7801 on file in the office of the City Clerk, passed, approved, and adopted by the City Council at a regular meeting held on the 22nd day of June 2026.

Gloria D. Harper, City Clerk

PUBLIC WORKS AGREEMENT

LCWA WATERMAIN LINING - TRENCHLESS TECHNOLOGY IMPROVEMENTS PROJECT CIP WT2103
between
City of Seal Beach
211 - 8th Street
Seal Beach, CA 90740
&
T.E. Roberts, Inc.
17771 Mitchell North
Irvine, CA 92614
(714) 669-0072
(714) 200-0241 - FAX
THIS CONTRACT (“Contract”) is made as of June 22, 2026, by and between the City of Seal Beach, a California charter city (“City”), and T.E. Roberts, Inc., a California corporation (“Contractor”) (collectively, “the parties” and individually, a “party”).

Docusign Envelope ID: 2519BB05-D37A-87DF-8242-31903634D49C Docusign Envelope ID: 80748343-6005-8DC1-82A5-6A8CDC83ABEE

RECITALS
A. WHEREAS, the City Council of the City of Seal Beach (“City”) approved the plans and specifications for the LCWA WATERMAIN LINING - TRENCHLESS TECHNOLOGY IMPROVEMENTS, CIP WT2103 (“Project”) with respect to design criteria, and based thereon the City issued a Notice Inviting Bids dated March 18, 2026; and
B. WHEREAS, Contractor submitted a Bid to City for the Project dated May 21, 2026 in the amount of $3,209,485 (“Bid” hereinafter) in response to the Notice Inviting Bids; and
C. WHEREAS, Contractor is a California licensed A and C-34 Contractor (State Contractor's license number (License #603008, DIR #1000000280); and D. WHEREAS, pursuant to the authority provided by its City Charter and Seal Beach Municipal Code, City desires to engage Contractor to carry out the Project in the manner set forth herein and more fully described in Section 1.0.

NOW, THEREFORE, in consideration of performance by the parties of the mutual promises, covenants, and conditions herein contained, the parties hereto agree as follows:

CONTRACT

1. Contractor’s Services.

1.1 Scope and Level of Services. For and in consideration of the mutual promises set forth herein, and subject to the terms and conditions set forth in this Contract, Contractor shall perform and complete in good and workmanlike manner all work (“Work”) for the Project identified as LCWA WATERMAIN LINING CIP - TRENCHLESS TECHNOLOGY IMPROVEMENTS, CIP WT2103 (“Project”) as described in this Contract and in the Contract Documents listed in Subsection 1.2.

1.2 Contract Documents. The Contract Documents consist of this Contract and all the following: Notice Inviting Bids, Instructions to Bidders, Accepted Bid Proposal and Bid Sheets, Notification of Award, Noncollusion Declaration, Designation of Subcontractors, Contractor’s Industrial Safety Record, Contractor’s Technical Ability and Experience References, Resumes, Bidder Questionnaire, Bid Bond, Faithful Performance Bond, Payment Bond (Labor and Materials), permits from regulatory agencies with jurisdiction, Special Provisions, Specifications, General Provisions, Plans, Standard Plans, Reference Documents, and any other documents referenced therein, all Addenda as prepared prior to the date of Bid opening setting forth any modifications or interpretations of any of said documents, Change Orders, and any and all supplemental agreements executed amending or extending the Work contemplated and that may be required to complete the Work in a substantial and Docusign Envelope ID: 2519BB05-D37A-87DF-8242-31903634D49C Docusign Envelope ID: 80748343-6005-8DC1-82A5-6A8CDC83ABEE acceptable manner; and all Exhibits attached to this Contract. The Exhibits attached to this Contract include the Performance Bond (Exhibit A), Payment Bond (Labor and Materials) (Exhibit B), Workers’ Compensation Insurance Certificate (Exhibit C), Insurance Endorsements (Exhibit D), Acknowledgment of Penal and Civil Penalties Concerning Contractor Licensing Laws (Exhibit E), Acknowledgment of Labor Law Requirements (Exhibit F), Accepted Bid Proposal with Bid Sheets (Exhibit G), Required Federal Forms (Appendix H), and Project Plans (Appendix A). All Contract Documents are hereby incorporated into this Contract.

1.4 In the event of any material discrepancy between the express provisions of this Contract and the provisions of the other Contract Documents, the provisions of this Contract shall prevail.

2. Effective Date. This Contract is effective as of June 22, 2026 (the “Effective Date”), and shall remain in full force and effect until Contractor has rendered the services required by this Contract and a Notice of Completion has been filed with the Orange County Recorder, unless sooner terminated or extended pursuant to this Contract.

3. Contractor’s Compensation.

3.1 Payment. For performing and completing the Work in accordance with the Contract Documents, City shall pay Contractor, in accordance with the Bid Proposal as full compensation therefor, but in no event will City pay more than the total not-to-exceed amount of $3,209,485.00 (Three million two hundred nine thousand four hundred eight five dollars and 00/100), subject to any additions and deletions pursuant to the terms of the Contract Documents. Said sum shall constitute payment in full for all Work performed hereunder, including, without limitation, all labor, materials, equipment, tools and services used or incorporated in the Work, supervision, administration, overhead, expenses and any and all other things required, furnished or incurred for completion of the Work as specified in the Contract Documents. City shall make payments to Contractor on account of the Contract sum at the time, in the manner, and upon the conditions specified in the Contract Documents.

3.2 Additional Work. The City Manager may authorize extra work to fund unforeseen conditions up to the amount approved at the time of award by the City Council, subject to the not-to-exceed amount set forth in Section 3.1. Payment for additional work in excess of this amount requires prior City Council authorization.

4. Contractor’s Personnel.

4.1 All Work shall be performed by Contractor or under Contractor’s direct supervision, and all personnel shall possess the qualifications, permits, and Docusign Envelope ID: 2519BB05-D37A-87DF-8242-31903634D49C Docusign Envelope ID: 80748343-6005-8DC1-82A5-6A8CDC83ABEE licenses required by the Seal Beach Municipal Code and other state and local laws and by the Notice Inviting Bids/Instructions to Bidders to perform such Services, including, without limitation, a City of Seal Beach business license as required by the Seal Beach Municipal Code.

Contractor shall fully comply with the workers’ compensation law regarding Contractor and Contractor’s employees.

5. Indemnification.

5.1 Contractor’s Duty. To the fullest extent permitted by law, Contractor shall, at its sole cost and expense, defend, indemnify, and hold the City and its elected and appointed officials, officers, attorneys, agents, employees, volunteers, successors, assigns, and those City agents serving as independent contractors in the role of City officials (collectively “Indemnitees”) from and against any and all damages, costs, expenses, liabilities, claims, demands, causes of action, proceedings, expenses, judgments, penalties, stop notices, liens, liabilities and losses of any nature whatsoever, including fees of accountants, attorneys or other professionals and all costs associated therewith and the payment of all consequential damages (collectively, “Liabilities”), in law or in equity, whether actual, alleged or threatened, which arise out of, are claimed to arise out of, pertain to, or relate to, the acts or omissions of Contractor, its officers, agents, attorneys, servants, employees, Subcontractors, materialmen, contractors, or their officers, agents, servants or employees (or any entity or individual for whom the Contractor bears legal liability)in the performance of the Contract, including the Docusign Envelope ID: 2519BB05-D37A-87DF-8242-31903634D49C Docusign Envelope ID: 80748343-6005-8DC1-82A5-6A8CDC83ABEE Indemnitees’ active or passive negligence, except for Liabilities arising from the sole negligence or willful misconduct of the Indemnitees, as determined by court decision or by the agreement of the Parties. Contractor shall defend the Indemnitees in any action or actions filed in connection with any Liabilities with counsel of the Indemnitees’ choice, and shall pay all costs and expenses, including all attorneys’ fees and experts’ costs actually incurred in connection with such defense. Contractor shall reimburse the Indemnitees for any and all legal expenses and costs incurred by Indemnitees in connection therewith. The City shall not be liable for any accident, loss, or damage to the Work prior to completion, except as otherwise specified in Section 6-5 of the Specifications.