TO:Andrew P. Powers, City Manager
FROM:Clifford G. Finley, Public Works Director
DATE:February 27, 2024
SUBJECT: Hill Canyon Treatment Plant Digester Backup Boiler Upgrade Project (CI 5615)
RECOMMENDATION:
1. Approve the project design, plans, specifications, and Addenda Nos. 1 and 2 for construction of the Hill Canyon Treatment Plant (HCTP) Backup Boiler Upgrade Project (CI 5615).
2. Award construction contract to Mesa Energy Systems, Inc. (Irvine, CA), in the amount of $1,275,451 plus a contingency of $127,545.
3. Approve budget appropriation in the amount of $1,303,656 from A/C #624-0000- 341-9900 (Wastewater Fund, Net Position) to A/C #624-8250-682-8300 (HCTP Digester Backup Boiler Upgrade Project CI 5615).
4. Approve Fourth Amendment to Professional Services Agreement No. 13132- 2022 with AEPC Group, LLC (AEPC) (Santa Clarita, CA) for construction phase support services and material testing for the HCTP Digester Backup Boiler Upgrade Project (CI 5615) in the amount of $65,320, for a revised not-to-exceed amount of $150,145, plus extra services of $6,530.
5. Authorize expenditure in the amount of $1,474,846 ($1,275,451 construction contract, $127,545 construction contract contingency, $65,320 for construction phase support services and materials testing, and $6,530 for extra services) from A/C #624-8250-682-8300 (CI 5615, HCTP Digester Backup Boiler Upgrade Project).
6. Delegate authority to the City Engineer to approve changes in the design, plans, specifications, and working details of the project on work directives and change orders up to the project-approved contingency amount.
7. Find that the Project is categorically exempt from the California Environmental Quality Act (CEQA) pursuant to 14 CCR 15302.
HCTP Digester Backup Boiler Upgrade Project (CI 5615)
February 27, 2024
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3 FINANCIAL IMPACT:
$1,303,656 Increase to Adopted FY 2023-24 Wastewater Fund Capital Budget. A $1,303,656 budget increase is requested for the HCTP Digester Backup Boiler Upgrade Project (CI 5615). $300,000 is included in the Adopted FY 2023-24 Wastewater Capital Fund Budget with an additional budget carryover of $125,000 for a total budget of $425,000. Estimated total project cost is $1,806,656.
BACKGROUND:
The City’s HCTP is located at 9600 Santa Rosa Road and sits at the confluence of the north and south Arroyo Conejo Creeks. The facility has three anaerobic digesters that process the organic waste from the treatment plant, as well as the digestate of fats, oils, and grease (FOG) that is brought to the facility for processing. The FOG facility is being completely redesigned as a separate project, with construction expected to be complete by Summer 2024.
To maintain the required high temperatures within the digesters, HCTP has a boiler system used in conjunction with the anaerobic digesters. After the installation of the boiler system in the mid-1990s, the system struggled to operate consistently on the combustible gas produced by the digesters. The existing system is dual fuel, which allows for a natural gas supply in times when the digester gas is insufficient to operate the boiler. For several decades, the boiler was fueled by digester gas augmented by natural gas. The City installed a proprietary/privately- owned cogeneration system that worked in conjunction with the boiler system to consume and process excess digester gas.
The City recently purchased the cogeneration system and it currently operates as the primary source of heat for the digesters. The boiler is operated when the cogeneration system is offline. As of late, the boiler system has been experiencing more issues with the digester gas consumption, resulting in the system operating almost exclusively on the more costly natural gas.
Due to the age of the boiler system equipment and the increase in maintenance expenses, the 2020 HCTP Master Plan included a recommendation to upgrade the digester boiler system (which includes appurtenances/valves). This project includes the construction of a new replacement dual fuel (natural and digester gas) backup boiler for the three existing wastewater digesters, replacement of existing piping, heat exchanger valves, miscellaneous concrete, electrical and associated appurtenances (Attachment #1).
HCTP Digester Backup Boiler Upgrade Project (CI 5615)
February 27, 2024
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3 On October 11, 2022, City Council approved an agreement with AEPC of Santa Clarita, CA, to perform the engineering design services and preparation of construction contract documents for the Digester Backup Boiler Upgrade Project.
On January 16, 2024, City Council authorized staff to prepurchase the boiler unit in the amount of $190,000, to help offset the extended manufacturing time, and to better align with the construction timeline.
DISCUSSION/ANALYSIS:
City Council authorized bidding of this project on November 7, 2023, and the Notice Inviting Bids was publicly advertised in the Thousand Oaks Acorn newspaper and posted on the City’s procurement website on November 10, 2023, per the Public Contract Code Section 22037 and Thousand Oaks Municipal Code 3-10.306. Four bids were received and publicly opened on January 10, 2024. The bid results are as follows:
Bidder Bid
1. Mesa Energy Systems, Irvine, CA $1,275,451
2. GSE Construction, Livermore, CA $1,483,025
3. Desert Mechanical, Sylmar, CA $1,814,887
4. Metro Builders, Newport Beach, CA $2,562,813
The lowest bid received is from Mesa Energy Systems. Inc. for $1,275,451. The engineer’s estimate is $880,000. The discrepancy between the engineer’s estimate and the construction bid amount is reflective of the current construction bidding environment as the California construction cost index has increased 35 percent since 2021, and construction bids are regularly being submitted 30-50 percent higher than the design estimate.
The bid package submitted by Mesa Energy Systems has been reviewed and found to be in order. A bid protest was filed with the City on January 16, 2024; however, after review by staff, the protest was rejected on January 24, 2024, after the low bid was determined to be responsive. Staff therefore recommends the award of the construction contract to Mesa Energy Systems.
Design Support Services During Construction
Engineering and design support services are required by the project engineer of record AEPC during the construction phase of the project. Their scope of work will include reviewing and responding to requests for information, reviewing material submittals, preparation of final project punch list, and preparing record drawings upon completion of construction. Their services will also include material testing HCTP Digester Backup Boiler Upgrade Project (CI 5615)
February 27, 2024
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3 and inspection throughout the construction period. Staff recommends approval of the Fourth Amendment to Contract No. 13132-2022 with AEPC for $65,320, plus extra services of $6,530 (Attachment #2).
The estimated project cost breakdown is as follows:
Design & Engineering (prev. approved, inc. extra services) $ 91,810 Boiler Equipment (previously approved) $ 190,000
Project Management Support Services (prev. approved) $ 50,000 Boiler Replacement Contract (this action) $1,275,451
Boiler Replacement Contingency (this action) $ 127,545 Construction Phase Support Services (this action) $ 65,320 Const. Phase Support Services Contingency (this action) $ 6,530 Total Estimated Cost $1,806,656
This construction phase is anticipated to start by March 2024 and be fully completed by Fall 2024. The project design, specifications and Addenda Nos. 1 and 2 are available for review by request to the Public Works Department by e- mail at [email protected] or by phone at (805) 449-2400.
This project is categorically exempt from CEQA per Section 15302 (replacement/reconstruction of an existing facility).
This project meets City Council’s Top Ten Priorities #6, “Public Works + Infrastructure Investments.”
Community Outreach: This project will be limited to work at the City’s HCTP and is not expected to impact any neighboring residences. The work will be at the north end of the plant and will have a limited impact on plant operation. Construction-related impacts to hiking trail users will be minimal.
CIP PROJECT PRIORITY (as outlined in FY 2023-24 and FY 2024-25 CIP Program Budget)
Priority One – Addresses health and safety, legal and regulatory requirements, or a top City Council Priority.
HCTP Digester Backup Boiler Upgrade Project (CI 5615)
February 27, 2024
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3 COUNCIL GOAL COMPLIANCE:
Meets the following City Council goal:
F. Provide and enhance essential infrastructure to ensure that the goals and policies of the Thousand Oaks General Plan are carried out and the City retains its role and reputation as a leader in protecting the environment and preserving limited natural resources.
PREPARED BY: Paul Weinstein, Associate Analyst
Attachments:
Attachment #1 – Vicinity and Location Maps
Attachment #2 – Fourth Amendment to Agreement for AEPC Group, LLC Documents Provided Under Separate Cover:
#1 – Project Plans and Specifications
DPW: 850-20\cg\pw\ev\Council\2024\022724\CI 5615\ HCTP Digester Backup Boiler Upgrade staff report.docx