Item Number: 17
City Council / Board of Directors
Written Communications
Meeting of: October 21, 2025
Submitted By:
James Murawski, Airport Director
Subject:
Building 701 Demolition, Standard Construction Agreement Amendment One, Project #CC25-134
Recommendation:
That the Southern California Logistics Airport Authority Board of Directors approve Amendment One to the Standard Construction Agreement with Vertex Civil, LLC., for Building 701 Demolition, Project #CC25-134, increasing the total not to exceed compensation amount by $207,850, from $355,360 to $563,210, and increasing the total number of days to complete the project by thirty (30) days.
Fiscal Impact:
This Amendment will result in an expenditure of $207,850 but will not require an additional budget appropriation. Existing unencumbered funds in Building 701 Demolition account 4501130A-52415 are sufficient to cover a portion of the additional expense. Staff budgeted $450,000 for the project, of which $355,360 was encumbered when the contract was awarded, leaving $94,175.90 unencumbered and available to utilize.
Additional unencumbered funds were identified and transferred from other expense accounts to accommodate the proposed Amendment cost increase. $75,000 in rent credit expenses from Building 756 Rent Credit expense account 4501160A-52411 that will not be realized in fiscal year 2026 were transferred to Building 701 Demolition account 4501130A-52415. Additionally, $38,674.10 from Building 718 Demolition account 4501135A-52415 was transferred to Building 701 Demolition account 4501130A-52415 to fill the remaining budget shortfall. Preparation work to prepare Building 718 for demolition will consist of hazardous materials testing and a site plan study to determine the future potential highest and best use of the site. This work is expected to occur in Spring of 2026, giving staff ample time to evaluate the budget and transfer funds if needed.
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The budget transfers made to accommodate the proposed change order and the remaining budget amounts are summarized below:
Building 701 Demolition Budget History
Account 4501130A-52415 Amount
Original Building 701 Demolition Budget $450,000.00
Solicitation Advertisement Expense ($464.10)
Construction Contract ($355,360.00)
Remaining Budget $94,175.90
Proposed Change Order #1 Expense ($207,850.00)
Available Budget Prior to Transfers $94,175.90
Budget Shortfall from Change Order #1 ($113,674.10)
Budget Transfers
Building 756 Rent Credits 4501160A-52411 $75,000.00
Building 718 Demolition 4501135A-52415 $38,674.10
Total Budget Transfers $113,674.10
Budget Shortfall after Transfers $0
Budget Amount After Transfers
Account Name Account Number Amount
Building 701 Demolition 4501130A-52415 $563,210.00
Building 756 Rent Credits 4501160A-52411 $0
Building 718 Demolition 4501135A-52415 $61,325.90
Strategic Plan Goal:
Goal E. Invest in Infrastructure: Project #CC25-134 invests in infrastructure by removing a dilapidated building that will prepare the site for future development. The Amendment is necessary to complete the demolition of Building 701.
Background:
A Standard Construction Agreement by and between the Southern California Logistics Airport Authority (“SCLAA”) and Vertex Civil, LLC., (“Vertex”) for the demolition of Building 701 was approved by the SCLAA Board of Directors on July 15, 2025. The demolition commenced on September 08, 2025, with regulatory compliant abatement of Asbestos Containing Material (“ACM”) taking place prior to full-scale demolition.
During the abatement of ACM in Building 701 by Vertex, it was brought to the attention of staff that significantly more ACM was present than what was included in the original Construction Agreement bid values. Vertex discovered that a previously undetected raised subfloor existed and was built over approximately 4,000 square feet of tile with mastic that contains asbestos. This same tile and mastic is located in other areas of the building and tested positive for ACM. In addition, Vertex discovered approximately 28,000 square feet of additional ACM drywall located throughout the building that is 4 3
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covered with newer pieces of asbestos free drywall. In addition, a water tank system discovered below the subfloor was also found to be coated with ACM insulation.
Discussion:
The discovery of significantly more ACM in Building 701 is unfortunate and was completely unknown to staff prior to the demolition work commencing in Building 701.
Given the large amount of known and previously unknown ACM in this building and the potential for it to be released into the environment, staff sought a solution from Vertex.
The abatement of the additional asbestos discovered in Building 701 is an urgent matter in that the remaining demolition work cannot occur until the newly discovered ACM is abated, and the building cannot be left in its present state with ACM potentially exposed and Vertex’s tools and equipment on site, in addition to the potential for the demolition permits to expire. To procure additional ACM abatement services, staff requested a proposal from Vertex, in accordance with City of Victorville Municipal Code §2.28.180, which provides governance for construction contract change orders. City of Victorville Municipal Code §2.28.180 stipulates that change order work to be performed should relate to the original project and should be necessary to achieve its original scope.
Staff received and reviewed the attached proposal from Vertex to abate the additional 32,000 square feet of ACM in the amount of $207,850 and found that the proposed asbestos abatement price per square foot is higher than the original price of $5.34 per square foot. The nature of the location of the additional ACM is such that significantly more work needs to be done by hand instead of machine. The original work plan called for abatement of the ACM to be done by hand and then machines would be used for the remaining interior demolition. The location of the newfound ACM will prevent machines from being used as extensively as planned, thus increasing the labor hours and number of employees needed on the project, which consequently raises the cost per square foot.
Vertex has proposed a price of $5.8125 per square foot to abate the newfound ACM. Staff reviewed the original bid submissions of all bidders on this project and calculated the aggregate bid amount average for ACM abatement at $6.16 per square foot. When compared to the average bid price of the original submission and the additional work that must be done by hand, staff consider Vertex’s price to be fair.
Approval of Amendment One to the existing Construction Contract with Vertex will allow Vertex to abate the newly discovered ACM and continue with the demolition of Building 701, which will remove a potential health hazard from the community and open valuable Airport property for development. To halt the project for a lengthy period of time while a separate procurement for further ACM abatement is conducted seems unreasonable given that Vertex is already on site, their proposed price is lower than the average abatement price from the solicitation that was conducted just a few months ago, the proposed work is necessary to continue the project, and the proposed work is identical in nature to the work that they are already performing on Building 701.
Therefore, staff requests and recommends that the SCLAA Board of Directors approve Amendment One to the Construction Contract by and between the SCLAA and Vertex Civil, LLC., increasing the total not to exceed compensation by $207,850 from $355,360 4 3
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to $563,210, for Building 701 Demolition, Project #CC25-134.
Staff remains available for any questions or comments you may have.
Prepared By:
Samuel Evans, Airport Business Analyst
Jose Gutierrez, Airport Business Technician
Sisco Elekana, Airport Project Technician
Attachments: A. Site Map
B. Amendment One to the Construction Agreement
C. Vertex Proposal
D. City Municipal Code 2.28.180