Item Number: 16
City Council / Board of Directors
WRITTEN COMMUNICATION(s)
Meeting of: May 7, 2024
Submitted By:
Fredy Bonilla, City Engineer
Subject:
Bear Valley Road Overhead at BNSF Railroad Project Closeout Recommendation:
That the Honorable City Council take the following actions related to the Bear Valley Road Overhead at BNSF Railroad Project (BVOH):
(1) Adopt Resolution No. 24-032 to amend the Fiscal Year 2023/24 budget to reflect an additional appropriation of $828,722.24 from Fund 352 and additional expenses in the amount of $828,722.24 from Fund 352;
(2) Approve Contract Change Order Nos. 2, 3, & 4 to Riverside Construction Company, Inc. in the amount not to exceed of $678,722.24; and
(3) Approve Amendment No. 2 to the Consultant / Professional Services Provider Agreement for construction management services with Parsons Transportation Group, Inc., in an amount not to exceed $150,000.00.
Fiscal Impact:
The recommended actions require an additional appropriation of $828,722.24 from Fund 352, Road Development Impact Fees (DIF), and will result in an expense of the same amount from account 3524500-55315-60014. Resolution No. 24-032 (Attachment A) has been prepared to amend the FY 2023/2024 budget accordingly. The estimated available cash balance in Fund 352 is shown in Table 1 below.
Table 1
Account Fund Available Cash
Balance
352 $6,218,198
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Strategic Plan Goal:
This project aligns with “Goal E Invest in Infrastructure” in the City of Victorville Strategic Plan 2023-2026 by increasing the level of service to motorists and pedestrians crossing the BNSF railroad that use the Bear Valley Road Bridge.
Background:
The Bear Valley Road Overhead at BNSF Railroad project widened both sides of the bridge on Bear Valley Road over the BNSF Railroad to provide standard lane widths and shoulders, and to accommodate a double east-bound left turn lane from Bear Valley Road to Ridgecrest Road. A right turn lane from westbound Bear Valley Road to Ridgecrest Road has also been constructed. The road approaches to the bridge have also been widened from Industrial Boulevard to east of Ridgecrest Road. The traffic signal poles at both intersections have been replaced to accommodate the widened road. The project also included sidewalk and adequate width for future bike lanes to cross over the bridge.
Please refer to Attachment B, a map and aerial view of the Project.
On November 7, 2017, the City Council approved an Overpass Agreement with BNSF Railway Co. (BNSF). Through this agreement, BNSF permitted the construction to widen the bridge and granted easements to the City. The agreement requires that the City compensate for any tasks performed by BNSF related to construction in the BNSF right of way or affecting the railroad traffic.
On June 18, 2019, the City Council approved a Project Funding Agreement with the San Bernardino County Transportation Authority (SBCTA). On July 24, 2020, Federal Highway Bridge Program (HBP) grant funds were authorized by Caltrans Local Assistance and the Federal Highway Administration (FHWA) for construction in the amount of $5,540,111.68.
On December 15, 2020, the City Council amended a Consultant / Professional Services Provider Agreement with Dokken Engineering for design support during construction for a total amount not to exceed of $246,875. Furthermore, the City Council approved a budget amendment per Resolution 20-110 to appropriate and expense $139,448 of Road DIF funds for this service.
On May 18, 2021, the City Council approved Amendment No. 1 to the Project Funding Agreement with SBCTA, which increased both the City and SBCTA funding commitments to the project based on a higher construction cost estimate.
Also, on May 18, 2021, the City Council approved a Consultant / Professional Services Agreement with Parsons Transportation Group, Inc., for the Bear Valley Road Overhead at BNSF Railroad Project construction management in an amount not to exceed of $1,613,726.04.
On June 15, 2021, the City Council approved Fiscal Year (FY) 2021/22 Budget including the appropriation and expenditure of $5,540,112 of Federal Highway Improvement 3 6
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Program (HIP) grant fund, $2,284,803 Federal HPB funds, and $1,500,000 of Road DIF funds for the project.
On September 7, 2021, the City Council awarded a construction contract to Riverside Construction Company (Riverside) in the amount not to exceed of $9,818,512.60.
Construction for this project was expected to be completed in August of 2023, barring unforeseen delays.
On June 21, 2022, the City Council approved FY 2022/23 Budget including the appropriation and expenditure of $2,408,173 of Road DIF funds for the project.
On June 27, 2022, the Federal Highway Improvement Program (HIP) grant funds were authorized by Caltrans Local Assistance and FHWA in the amount of $2,117,110.08.
These funds were programmed in accordance with the agreement between the City and SBCTA.
On June 20, 2023, a budget amendment including the revenue and expense of $1,768,829 of Federal Bridge NHPP grant funds authorized by Caltrans Local Assistance was approved by the City Council. Additionally, Contract Change Order No. 1 authorizing payment to the contractor in the amount of $1,501,900 for project overruns caused by BNSF monitoring, inspection and delays was approved.
On October 17, 2023, Amendment No. 1 to the Consultant / Professional Services Provider Agreement with Parsons Transportation Group (Parsons) in the amount of $260,000 was approved by the City Council due to project construction overruns and delays.
Discussion:
The BVOH Project was substantially completed in January 2024, after all construction related activities were finalized. Subsequently, Riverside submitted a Time Impact Analysis with a request for additional compensation to the consultant construction management firm representing the City, Parsons. The total compensation requested was in the amount of $1,340,000 to close out the project. Parsons reviewed the request and concluded what reasonable costs incurred by the contractor were compensable and fair to both parties. Riverside Construction agreed to a final payment of $778,621.72. The amount of $99,899.48 remains available from the previous contract change order that was authorized by the City Council on June 20, 2023, therefore, the total amount required to close the project is $687,722.24. The attached Change Orders prepared by the consultant construction manager and reviewed by Engineering staff are referenced in Attachment C to address the following items.
During the course of construction for every project it is typical to experience variations in the actual quantity of work performed in comparison to the bid item quantities listed in the contract bid schedule. Quantity overruns, work deleted, or less quantity installed than the quantity listed in the bid as a result to changes authorized or directed during construction are paid or deducted at contract unit prices. The net cost for quantity adjustments 3 6
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including increases, reductions, and eliminated quantities totaled $207,065.25, as indicated in Contract Change Oder No. 2, please refer to Attachment C. There is no negotiation of work paid at contract unit prices; therefore, the contractor will receive full compensation for this work.
The City issued a change order to the contractor for deductions of costs incurred by the City during the course of work. City staff from Public Works and Traffic Engineering responded to several issues that came up during construction after normal construction working hours or the weekends that the contractor was responsible for addressing but could not respond to in a sufficient time to mitigate the issues. As a result, the City will deduct $8,221.76, as indicated in Contract Change Order No. 3, from the amount due to the contractor (please refer to Attachment C).
The contractor submitted an extension of time request due to delayed work outside of their control. These delays were principally driven by the BNSF submittal review process.
BNSF required, reviewed, and approved all the contractor’s work plans for every stage of construction within their right-of-way, resulting in weeks of standby time. Everything associated with the widening of the bridge was within their right-of-way; therefore, all the work could not proceed without their approval and oversight. The project specifications allowed the contractor to submit a request for home and field office overhead costs when forced to delay work due to items outside of their control. The contractor submitted a request for $959,874.93 in home and office overhead costs. After a careful review of the request, the amount was reduced to $479,878.75 as indicated in Contract Change Order No. 3 and considered fair compensation for the additional four months the contractor has had to work on the project due to delays caused by BNSF (please refer to Attachment C).
Table 2 represents the current funding plan for the project which includes the federal grant funds, the proposed construction contract change orders in the amount of $687,722.24, and construction management agreement amendment in the amount of $150,000.
Table 2
Funding Plan
Total
Construction
Cost
Federal HBP
2754500
Federal HIP
257502N
Federal
Bridge NHPP
2754500
City Road DIF
3524500
Construction
Contract $11,320,412.60 $4,875,298.28 $1,604,190.90 $1,547,479.27 $3,293,444.15 Change Order $687,722.24 $0.00 $0.00 $0.00 $687,722.24
Construction
Management $1,918,408.18 $664,813.40 $512,919.18 $221,349.73 $259,325.87 Con. Mang.
Amendment $150,000.00 $0.00 $0.00 $0.00 $150,000.00
Construction
Support $246,875.00 $0.00 $0.00 $0.00 $246,875.00
Construction
Total $14,323,418.02 $5,540,111.68 $2,117,110.08 $1,768,829.00 $4,897,367.26 3 6
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The total federal funding for the construction of this project is $9,426,050.76, which is about 66% of the total construction cost. The federal funds have a minimum match requirement of 11.47% and the minimum match is $1,221,244.80. Only part of the project was eligible for federal funding. The Federal HBP and Bridge NHPP funded the bridge and road approaches to approximately 500-feet from the ends of the bridge. The road approach construction extends approximately 1,000 feet east and west from the ends of the bridge. The remainder of the project costs are funded by the Federal HIP and City Road DIF, Fund No. 352. The total Road DIF contribution to the project is estimated to be $4,897,367.26.
Engineering staff submitted a HBP cost change request to Caltrans for additional grant funding. This submission was due in part to the project delays that resulted in the home and office overhead cost change order request from the contractor. HBP funding is limited and there is no guarantee additional funds will be made available to the City. Furthermore, the matching requirement would still be applicable. The City may receive up to $733,667 of additional grant funding based upon the matching requirement for both construction and construction management services.
The probability of receiving additional grant funding for construction costs is better than construction management costs. The grant programs include a maximum percentage of 15% for this service based upon the construction cost. The cost of construction with the approval of the change orders will be $11,999,135; 15% of this cost is $1,799,870. The Parsons agreement amendment will increase the total management cost paid to them alone to $2,068,408. This will be more than 15% maximum, approximately 17%.
Therefore, the receipt of additional construction management grant funds may not occur at all.
If additional funds are allocated to one of the grants, a budget amendment will be presented to City Council to appropriate and expense the funds for the project. The funds received will be reimbursed to Road DIF, the funds proposed herein to pay the construction contract change order and construction management agreement amendment. If no additional grant funds are received, no additional action will be required.
Staff recommends that the City Council adopt Resolution No. 24-032 to amend the Fiscal Year 2023/2024 budget to reflect an additional appropriation of $828,722.24 from Road DIF, Fund 352, an additional expense of $828,722.24 and approve Contract Change Order Nos. 2, 3, & 4 in an amount not to exceed $687,722.24 for the BVOH Project for Riverside Construction Co., and approve an agreement amendment in the amount not to exceed of $150,000 to Parsons Transportation Group for construction management services associated with the Project.
Staff remains available for any questions the Council may have.
Attachments: A. Resolution No. 24-032
B. Project Map and Aerial View
C. Construction Contract Change Orders
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D. Parsons Transportation Group Agreement Amendment No. 2