HomeMy WebLinkAbout06-10-2014 B1 LOVR Interchange Project Update
FROM: Daryl R. Grigsby, Public Works Director
Prepared By: Tim Bochum, Deputy Public Works Director
Kyle Rowland, Engineering Inspector
SUBJECT: LOS OSOS VALLEY ROAD/US 101 INTERCHANGE IMPROVEMENTS
PROJECT UPDATE, SPECIFICATION NO. 99821
RECOMMENDATIONS
1. Approve the project plans and specifications, and the revised project budget for the Los Osos
Valley Road/US 101 Interchange Improvements Project, Specification No. 99821.
2. Authorize the advertisement of the project pending issuance of the Federal authorization form
E-76.
3. Approve a contract amendment with Dokken Engineering (Encumbrance No. 40908) in the
amount of $228,860 to perform construction engineering (design support services) during the
construction phase of the Los Osos Valley Road/101 interchange project, Specification No.
99821.
4. Direct staff to return by October in order to:
a. Award of contract with the lowest responsible bidder following a selection process
conforming to the Caltrans Local Assistance Procedures Manual.
b. Provide debt financing recommendations up to $7.5 million (estimated) in project
funding to pay the City’s remaining portion of the Los Osos Valley Road/US 101
Interchange Improvements Project costs, Specification No. 99821.
c. Apprise Council of any necessary impact fee program modifications that may be
needed to fund project costs.
5. Receive and file information about a proposal for reimbursements from available Traffic Impact
Fee cash balances to the General Fund equal to the full debt service cost in 2014-15 but no less
than one-half of the annual debt service expense for future years which is proposed as part of the
2013-15 Financial Plan Supplement.
REPORT-IN-BRIEF
This item presents information and recommendations to move the US 101/ Los Osos Valley Road
(LOVR) Interchange project to construction. It recommends Council approval of the bid package
for the project and to solicit bids for the project once State requirements for grant funding award
have been obtained. The report discusses project funding and budget issues and sets the stage to
return to Council by October 2014 for consideration of any final bid award, final debt financing
approval and recommendations for revisions to the City’s impact fee programs, if necessary to
address funding for the project. Lastly, the report foreshadows recommendations that will come
June 10, 2014
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forward in the 2013-15 Financial Plan Supplement regarding repayment for debt service costs that
will be secured by the General Fund but reimbursed by the Traffic Impact Fee accounts.
DISCUSSION
Background
The City of San Luis Obispo has reached a major milestone in the completion of the US 101/LOVR
Interchange project – the Plans and Specifications (PS&E) for the project are now complete and
have been approved by Caltrans. This PS&E package has now been forwarded to the California
Transportation Commission (CTC) for approval at its June 25th meeting. At that meeting, the CTC
will appropriate the $16,000,000 State Transportation Improvement Program (STIP) grant
previously approved by SLOCOG for this project. This authorization to proceed sets the start date
for reimbursable work on the project.
In addition, the City’s bid package for the project is complete and ready to advertise. The City can
proceed with advertising after CTC approval on June 25th, and issuance of the Federal E-76 Form,
(Authorization to Proceed). The E-76 is generally issued 1-2 weeks following CTC approval.
The City and Caltrans have been working to design and construct the Los Osos Valley Road / US
101 interchange project for many years . It is a very complex project due to its location next to the
confluence of San Luis Obispo (SLO) and Prefumo Creeks, and due to the geometrically unique
intersection of the freeway and LOVR.
Project Highlights
The project will correct operational deficiencies and improve safety at the southern entry to the City
at LOVR by widening LOVR to four lanes between the recently constructed Calle Joaquin
intersection and South Higuera Street. To accomplish this, a new two-lane bridge structure will be
constructed south of, and adjacent to, the existing overcrossing. The existing bridge will carry the
westbound traffic and the new bridge will carry eastbound traffic. An adjacent bridge crossing of
San Luis Obispo Creek will be widened to accommodate the four travel lanes. The project will also
include minimum 6-foot wide sidewalks over the freeway, 6.5-foot wide bike lanes, and will
improve the on and off-ramps. Sidewalks across the SLO Creek Bridge will be widened to allow
additional area for pedestrians and bicyclists accessing the Bob Jones Trail and future integration
with the Trail segment south of LOVR.
The City is the project sponsor, with the California Department of Transportation (Caltrans) serving
in an oversight role since they are stewards of the State Highway System . All necessary property
acquisitions have been secured.
Project Management Services
In January 2014, the City entered into an agreement for Project Manager (PM) services with
Southstar Engineering. The PM has assisted the City with final plans and specifications review, and
project permitting. The PM also assisted with the development of the Request for Proposals (RFP)
for the Construction Management service discussed below. In addition, they will have a key role in
processing the project through advertising and awarding phases. During the construction phase, the
PM is responsible for keeping the City appraised of all activities on site, identifying potential
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problems and solutions, and providing direct oversight of the construction inspection staff. They
will also maintain public outreach and information.
Construction Management Services
Due to the size and complexity of the project, Council authorized the advertisement for
Construction Management (CM) services at their April 1, 2014 meeting. The CM role in the project
will be the day-to-day inspection, materials testing, coordination with Caltrans and contractor staff,
and completion of required paperwork for the project. More specifically, some of these required
services will include: utility coordination, structure inspection, surveying, public outreach,
environmental monitoring, and material inspection and testing.
The City, in coordination with Caltrans, is currently evaluating submitted proposals for these
services and expects to enter into contract with a qualified firm in July in order to be ready for
construction to begin later this year.
Project Outreach
The project will impact local and regional traffic circulation in this busy area of the city.
Consequently, staff has been working with the PM and Caltrans to develop a significant public
outreach effort as part of the project. A website for the project has been developed
(www.LOVR101.org) for status updates and project information so that the public can get real time
information on the project including road closures.
In addition, a notification database has been created so that individuals and businesses can subscribe
to notices that will be sent out by the CM firm and contractor. The PM along with Staff are
currently analyzing the use of social media such as Facebook and Twitter for better public access to
project information and noticing. The PM firm will be taking lead on most public contact during the
project including complaints and project inquiries.
Construction Engineering– Dokken Contract Amendment
As part of project construction, the design engineering firm – Dokken Engineering – will continue
with additional construction engineering services. In that capacity, Dokken will assist the CM and
PM firms with interpretation of the plan set, resolve construction inconsistencies, respond to
contractor requests for information or change order requests, project redesigns (if necessary) and
As-built submittals. These services are not part of the design services contract with Dokken. Staff
has worked with Dokken to prepare a scope of work and cost estimate for these services through the
end of construction in an amount not to exceed $229,000. Staff recommends Council authorize
amending these costs into the Dokken contract. Expenditures for these services will not occur until
construction commences later this year, and will only be used on an as needed basis.
Project Plans and Specifications
The project plans, specifications, and estimates (PS&E) were developed by the City’s consultant
design firm Dokken Engineering. This 100% PS&E package was submitted to Caltrans in May
2014 with anticipated approval by headquarters in June 2014. The CTC is expected to vote on the
$16,000,000 in grant funding at their June 25, 2014 meeting. Approval of this funding request will
release the E-76 - Authorization to Proceed from the Federal Highway Administration.
Construction advertisement can begin after issuance of the E-76.
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FISCAL IMPACT
Improvements to the US 101/LOVR interchange have been in the planning and developmental
stages for at least twenty years. Phased improvements have been constructed with City oversight by
prior development. The first two phases of this three-phase project included the Calle Joaquin
relocation done by Costco, miscellaneous improvements done by the Irish Hills Development, and
prior sidewalk and bridge work.
This third phase of improvements has been delayed while the City obtained full State funding equal
to $16,000,000 to help deliver the required interchange improvements. With completion of the
plans, specification and permit process the City now has a fully refined engineer’s estimate on costs
necessary to complete the project.
This refined engineer’s estimate notes the project will cost $24,124,300 from this point to
completion. Highlights of this amount include:
a) $17,986,302 for the interchange construction work, landscaping and environmental
mitigation
b) $1,840,000 in contingency
c) $250,000 bond origination fee (this fee may ultimately be included in the bond repayment
amount – yet to be determined).
d) $4,048,500 for PM, CM and construction engineering services of which $859,500 has
already been allocated by previous Council.
As noted above, the total construction project cost from this point forward is $24,124,300. Based
upon prior Council actions, the total amount needed to move forward for FY 2014-15 is
$23,338,808. This includes $74,000 of reimbursement to the General Fund for prior Right of Way
assistance.
To date, approximately $4,135,660 has been spent on Phase III of the project. This amount, in
addition to the $74,000, brings the total cost of this final phase of the Interchange to $28,334,000 as
shown in Table 1.
A summary of the totals referred to above and noted below:
a) $23,338,808 is the amount needed in FY 14-15 to fund all anticipated construction related
costs not currently funded,
b) $24,124,283 is the total amount required to complete all work moving forward from the date
of this report – this includes some CM and PM services already funded,
c) $28,333,943 represents the total amount of the third and final phase (US 101/LOVR
Interchange), and,
d) $36,513,717 is the total project cost including the prior phases; some completed several
years ago.
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To Date 2013-142014-15
Alrerady Incurred Costs:
Study (PSR)189,000$ 189,000$
Environmental & Studies 954,300$ 954,300$
Value Engineering 40,000$ 40,000$
Land Acquisition 250,000$ 250,000$
Design (PS&E)2,676,120$ -$ 2,676,120$
Legal 26,240$ 26,240$
Subtotal:4,135,660$ 4,135,660$
Misc.
GF Reimbursement for ROW 74,000$ 74,000$
Construction:
RE Services/Pre-Construction 100,000$ 100,000$
City Contingency Amount 1,839,481$ 1,839,481$
Loan/bond Origionation Fee 250,000$ 250,000$
Construction (includes Env. Mit)17,986,302$ 17,986,302$
Construction Management 759,475$ -$ 3,189,025$ 3,948,500$
759,475$ 100,000$ 23,264,808$ 24,124,283$
Total All Project Costs:4,895,135$ 100,000$ 23,338,808$ 28,333,943$
Project Components
Table 1 – Project Costs
This total Phase III amount of $28,333,943 is $549,293 (1.9%) higher than anticipated in the FY
2013-15 Financial Plan.
The above chart indicates the total “physical” construction cost of $17,986,302 and contingency of
$1,839,481 million is 70% of the total Phase III project costs of $28,338,808. The remaining 30% is
for Right of Way acquisition, design, coordination with Caltrans, permits, construction engineering
and construction management. While this amount is higher than the typical 20-25% in ‘soft costs’
for construction projects, it is consistent with similar projects involving state facilities, high traffic
locations, and projects intersecting streams and creeks.
Debt Financing Needs
Based upon these new estimates and the final grant amount, the local “borrowing” necessary to
complete the project will be about $7,500,000. This amount is determined by subtracting the
$16,000,000 from the FY 14-15 expenses of $23,338,808 and rounding up.
Total Costs- FY 2014-15: $23,338,808
Grant Amount: $16,000,000
Subtotal: $7,338,808
Rounded: $7,500,000
The Finance Department has worked with its Financial Advisor to obtain estimated debt service
costs for a borrowing this size. Interest rates are forecast to continue rising and the annual debt
service payments are estimated to be $482,000 over 30 years. This is approximately $57,000 more
than the amount anticipated when the 2013-15 Financial Plan was adopted. The General Fund will
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be obligated to pay this amount annually and will be reimbursed when payments from the Citywide
TIF and LOVR Sub Area Impact Fee are collected. The project will return to Council with the
financing documents at the same time that the recommended bid award is brought back for
approval, which is anticipated to be October 2014.
Funding
The funding strategy for the interchange project was initially established as follows:
• An ultimate 50/50 split between local funds from the City and outside funding sources
(transportation grants)
• The local fund component would be:
o The Citywide TIF account
o The special LOVR Sub Area Impact fee established to better collect monies from
development in close proximity to the project
o And, when necessary, the General Fund or other source to help keep the project on
track.
Including all three phases of the project, total project costs are:
Status
Calle Joaquin Relocation (Phase I)7,945,775$ Complete
Misc. Sidewalk and Bridge Widening (Phase II)234,000$ Complete
Phase III - US 101/LOVR Interchange 28,333,942$ In Progress
Total Costs for All Phases 36,513,717$ Table 2 – Total Project Costs, All Phases
Impact Fees
Impact fees intended to be dedicated to this project are anticipated to fall short of the total project
cost of $36,513,717 by $1.4 million. It was anticipated the TIF and LOVR Subarea Fee would be
adjusted to compensate for any shortfall. It is premature to assume those fees need to be amended at
this point as several variables remain in motion including project costs, actual bids, the intensity of
development (potential LUCE changes), and other variables. Staff will return to council with
recommendations for fee amendments once these variables are clarified. Staff will assess the
appropriate timing of this work effort.
General Fund Reimbursement
The financing of the amount needed to complete the project construction will be an obligation of the
General Fund due to the fact that the credit markets do not find enough security in impact fee
programs because of the fluctuations that occur in the volume of annual fee collections. As a result,
TIF should be considered as a back-stop to the General Fund by providing a minimum amount of
support for the debt service expense when sufficient cash balances exist. Staff is recommending
that the 2013-15 Financial Plan Supplement show the TIF fund contribute an amount equal to the
full debt service payment for 2014-15. Staff also recommends at least one-half of the future debt
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service payments are made by impact fees in future years. The FY 14-15 amount is estimated at
$250,000.
Project Schedule
May 29th, 2014 Conduct Construction Management firm interviews
July 8 th , 2014 Award/execute Construction Management contract
June 25th, 2014 California Transportation Commission to vote on $16,000,000 grant
July, 2014 Federal authorization to proceed issued from FHWA - Form E-76
July-August, 2014 Construction advertisement period
October, 2014 Council authorization to proceed with necessary debt financing
October, 2014 Award construction contract
November, 2014 Start construction
Spring, 2016 End construction
The dates listed above are project based on the current project status and may change as the project
progresses.
ATTACHMENTS
1. Amendment to Agreement with Dokken Engineering
Council Reading File: Project #99821; Plans, Specification & estimates Bid Package
t:\council agenda reports\2014\2014-06-10\lovr interchange project update (grigsby-bochum)\99821 car lovr-101 project update.docx
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Attachment 1
AMENDMENT TO AGREEMENT
THIS AMENDMENT TO AGREEMENT is made and entered in the City of San Luis Obispo on Monday,
June 9, 2014, by and between the CITY OF SAN LUIS OBISPO, a municipal corporation, herein after referred to
as City, and Dokken Engineering, hereinafter referred to as Contractor.
WITNESSETH:
WHEREAS, on April 20, 2004 the City entered into an Agreement with Contractor to prepare Phase I
PA&ED services for the U.S. 101/Los Osos Valley Road Interchange Improvements project, Specification No.
99821; and
WHEREAS, the City desires to amend the scope of services to include design support to the City of San
Luis Obispo and the Resident Engineer throughout construction. This work generally includes responding to
requests for information (RFI’s), reviewing shop drawings and submittals, and preparing as-built plans. The
Contractor has submitted a proposal for this purpose that is acceptable to the City.
NOW THEREFORE, in consideration of their mutual promises, obligations and covenants hereinafter
contained, the parties hereto agree as follows:
1. The scope of services and related compensation is hereby amended as set forth in Exhibit A -
Amendment 2 attached hereto.
2. All other terms and conditions of the Agreement remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed the day and year
first written above.
ATTEST: CITY OF SAN LUIS OBISPO
____________________________________ By: ____________________________________
City Clerk City Administrative Officer
APPROVED AS TO FORM: CONTRACTOR
_____________________________________ By: ____________________________________
City Attorney
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