HomeMy WebLinkAbout04/05/1994, C-5 - AMENDMENT NO. 1 TO CONTRACT WITH BLACK AND VEATCH FOR CONSTRUCTION SUPPORT SERVICES FOR THE WATER TREATMENT PLANT MODIFICATION PROJECT. l„„�I�IIIn,IIIIIn�I�I�II� WJ MEETING DATE:
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san � Is oBIspo Ail 1994
COUNCIL AGENDA REPORT ITEM NUMBER: G�
FROM: John Moss Prepared By: Gary W..Henderson__-
Utilities D ector Water Division Manager
SUBJECT: Amendment No. 1 to Contract with Black and Veatch for Construction Support
Services for the Water Treatment Plant Modification Project.
CAO RECOMMENDATION:
By Motion, 1) approve Amendment No. 1 to the Contract for construction support services for
the Water Treatment Plant Modification Project increasing the maximum compensation by
$135,000, 2) authorize the CAO to approve use of project contingency funds for additional
construction support services should the project completion extend past completion date of July
1994 and 3) authorize a deductive change order of $154,380 for deletion of the coating of the
existing 4.0 million gallon storage tank from the contract with R.P. Richards.
DISCUSSION:
The City's water treatment plant has been undergoing a major renovation necessitated by the
1986 amendments to the Safe Drinking Water Act. The construction bids for the project were
received on November 18, 1992 with bids ranging from $7,675,000 to $9,526,000. The
apparent low bidder requested that their bid be withdrawn due to an error made in preparing the
bid. In January 1993, the City Council approved the withdrawal of the low bidder and
authorized the award of the contract to the second low bidder, R.P. Richards in the amount of
$8,510,000. R.P. Richards bid was approximately $600,000 less than the next lowest bidder
and the engineers estimate.
A project of this magnitude requires significant construction management expertise to insure a
high quality project and to minimize construction problems that can lead to change orders.
Black and Veatch was retained to provide the construction management for the project with a
maximum compensation of $750,000. The estimated compensation was based on Black and
Veatch's past experience on similar projects of this type.
Amendment No. I
Black and Veatch have requested an amendment to their contract in an amount of $135,000.
The basis for the additional compensation is outlined in Attachment A. Black and Veatch has
been required to expend significant effort beyond their estimated work scope and contractual
requirements in the area of submittal review. This project has required significantly more
submittal reviews than anticipated. The construction contractor's submittals have fallen well
shortof expectations and have resulted in considerable additional work for Black and Veatch.
The project specifications allow the City to backcharge the contractor for submittals that require
3 or more reviews. The City intends to enforce this issue but the backcharges will fall short in
covering the total amount of effort necessary to keep the project on track. The backcharges will
recoup only a portion of the recommended $135,000 amendment to Black and Veatch's contract.
pcity of san LUis osIspo
i COUNCIL AGENDA REPORT
Black and. Veatch Amendment No. 1
Page 2
Another area of the project which has experienced additional impacts involves meetings between
Black and Veatch and subcontractors to R.P. Richards. As noted in Attachment A, it is rare that
Black and Veatch would be required to call and attend meetings between a Contractor and his
named subcontractor in order to mediate their dispute over contract requirements. Numerous
calls, meetings, and letters have resulted over issues regarding R.P. Richards' subcontractors
or suppliers responsibility. While this additional work was necessary to keep the project on
schedule, it was not anticipated at the time Black and Veatch's contract with 'the City was
negotiated. As stated earlier, the total additional compensation to cover unanticipated submittal
review and contractor/subcontractor mediation is estimated to be $135,000 for construction
management through July 1994.
Additional Compensation
The project completion date currently is July 1994. City staff and Black and Veatch have
reservations concerning the ability of the contractor to meet this completion date. The project
schedule has been compressed from the original schedule provided by the contractor at the start
of the project. Many area of the project are on the critical path and any impacts in these areas
may result in the extension of time necessary to complete the project. The project specifications
provide for liquidated damages to be assessed for failure to meet the project completion date
($250 per day) as well as the substantial completion date ($500 per day). These damages may
offset additional costs necessary to provide for the construction management to project
completion. If the project completion extends to October 1994, it is estimated that the additional
costs would be approximately $60,000 for onsite inspection 'services and $60,000 for contract
administration support from Black and Veatch's office.
Deductive Change Order
The existing 4.0 million gallon treated water storage tank is required to be painted as part of the
project. The coating on the interior was to be removed and a new coating applied. This would
necessitate the draining of the tank and removing the tank from service for approximately 3
months. This storage tank represents approximately 20% of the City's total storage capacity.
Due to construction schedule impacts noted previously, a number of processes at the water
treatment plant will be out of service at the same time that the storage tank is proposed to be
recoated. Staff is concerned that any construction problems during this time may result in the
inability to meet the City's water demands. Staff has requested a cost proposal from R.P.
Richards to delete the tank coating from the project. R.P. Richards' cost proposal for deletion
of this work is $154,380.
G"Jr'
MY Of San Luis OBISPO
j COUNCIL AGENDA REPORT
Black and Veatch Amendment No. 1
Page 3
FISCAL E%4PACT
In the January 5, 1993 Council Agenda Report in which staff recommended contract award to
R.P. Richards, the following was shown as the total project construction budget.
A. Contract Amount $89510,000
B. Construction Management 750,000
C. Contingencies 595.700
TOTAL $9,855,700
This was almost $1 million less than the engineers estimate.
Approval of the recommendations in this report would not change the total project budget but
would approve moving funding as follows:
A. Original Contract Amount $8,510,000
Approved Additive Change Orders 180,000
Deductive Change Order < 154,380>
TOTAL CONTRACT
AS OF THIS DATE $89535,620
B. Construction Management 750,000
Amendment No. 1 135.000
TOTAL CONSTRUCTION
MANAGENIENT 8859000
C. Contingencies 595,700
Less Approved Change Orders < 180,000>
V Add Deductive Change Order 154,380
V Less Amendment No. 1 < 135.000>
TOTAL REMAINING
CONTINGENCIES 435,080
TOTAL APPROVED BUDGET $998559700
Specific Actions recommended in this report.
'�� m►►�NIIIII�P ��UIU city of san Us 0BIspo _ _
UNCIL AGENDA �EPOPIT
Black and Veatch Amendment No. 1
Page 4. Amendment
Attachments: A. Letter from Black and Veatch
B. Amendment No. 1 to Contract with Black and Veatch
I
Attachment A
BLACK &VEATCH
2300 Clayton Rood,Suite 1200,Concord,Colilornio 94520-2100,(510)246-8000,Fox:(510)674-9458
City of San Luis Obispo, California B&V Project 23192.400
Water Treatment Plant Modifications B&V File G. 1.11
February 15, 1994
Mr. Gary Henderson
Water Division Manager
City of San Luis Obispo 7
955 Morro Street
San Luis Obispo, CA 93401
Dear Gary: -
This letter provides additional support data you have requested, itemizing
specific reasons why we are experiencing budget problems and are entitled
to a contract amendment in the amount of $135,000.
We have gone back and broken Task 3A into seven main categories to compare
budgeted versus actual expenditures. A brief description of each task
follows, and a summary matrix is attached as Table 1 .
Following this breakdown, a brief summary of proposed work for the duration
of the project, including charges which would be incurred if R.P. Richards
does not complete the project by the end of July 1994.
Task 1 - Preaward Services
This task began in the fall of 1992, and included assisting the City with
the bid opening, conducting a prebid conference, preparing addenda,
attending the bid opening, evaluating bids, preparing bid tabulations, and
making recommendations for award to the City.
Status Complete.
Budget 132% of budget used.
Discussion Due to the limited experience of the Contractor, the
bid evaluation phase was extended a full 60 days.
Additional expenses for letters, phone calls, and
meeting with the low bidder were required to complete
the task.
Task 2 - Contract Administration
This task includes all day-to-day aspects of the office phase services for
this project. Included in this task are project management, contract
interpretation, change order review, RFI review/support, and construction
submittals. The majority of the budget is for submittal review. This task
started when a letter recommending award of contract was sent to the City.
ER-Umnl
Page 2
Mr. Gary Henderson B&V Project 23192.400
February 15, 1994
Status 65% complete (approximate) .
Budget 119% of budget used.
Discussion The attached Figure 1 compares the submittal effort by
R.P. Richards to that by the Contractor for the MID
Water Plant. Both projects were designed by the same
B&V design team and submittals are being reviewed by
the same personnel , so the numbers are directly
applicable. The submittal effort at MID is
approximately 81 percent complete (309 initial
submittals have been received out of 380 total ) . The
effort by the Contractor at MID is not perfect, but is
more typical of a normal Contractor' s effort.
Substantial completion for the MID plant is October
1994. Through February 7, 1994, by our records, R.P.
Richards is only approximately 55 percent complete (158
initial submittals have been received out of 285
total ). The effort by R.P. Richards was late starting
and the level of completeness of their initial
submittals has shown only minimal improvement. The
requirements for the submittals are clearly outlined in
the specifications. Most contractors learn very
quickly what is required and make a good faith effort
to comply with the specified submittal requirements.
The effort by R.P. Richards on submittals falls well
short of expectations and results in considerable
additional work on our part. The Contract between the
City and R.P. Richards allows for backcharging the
Contractor for submittals beyond the first resubmittal .
This provision, while seldom used, will help the City
recoup some of the costs for our additional efforts.
The backcharges will fall short in covering the total
amount of effort we have expended to keep the project
on track.
Aside for submittal review, contract administration has
been impacted by R.P.Richards' operations. It is rare
that we are forced to call and attend meetings between
a Contractor and his named subcontractor in order to
mediate their dispute over Contract requirements.
Numerous calls, meetings, and letters have resulted
over issues regarding R.P. Richards' supplier
responsibility. Some specific examples are the plant
control system, ozone system supplier, cribwall , and
painting of existing tanks. Our involvement in these
issues results in increased costs for office phase
budget.
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Page 3
Mr. Gary Henderson B&V Project 23192.400
February 15, 1994
Task 3 - Monthly Site Visits
This task includes monthly construction progress meeting attendance by B&V
Concord office staff. Additional meetings with the City and/or R.P.
Richards that are required to facilitate the work are also included.
Status 60% complete (based on July completion).
Budget 58% of budget used.
Discussion Currently within budget.
Task 4 - Computer Configuration
This task provides for configuration services for the plant computer
control system.
Status 30% complete.
Budget 26% of budget used.
Discussion In spite of late start due to Contractor' s inability to
negotiate supply contract with supplier, this task is
now on schedule and is within budget.
Task 5 - Performance Testing/Startup
This task calls for B&V assistance in plant startup of the entire plant, as
well as performance testing of the ozone system. It covers one trip with
two staff members to assist City staff achieve this significant project
milestone.
Status/Budget Scheduled for later 1994.
Discussion None.
Task 6 - Substantial Completion Inspection and Operator Training
This task calls for B&V site inspection trip for substantial completion,
along with one day of onsite operator training for the new facility. The
one-day session is to advise plant personnel on the project basis of design
and intended plant operations.
Status/Budget Scheduled for later 1994.
Discussion None.
ER-U=3
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Page 4
Mr. Gary Henderson B&V Project 23192.400
February 15, 1994
Task 7 - Final Completion and Record Drawings
This task calls for a final inspection trip, as well as preparation of as-
built drawings. As-built drawing effort consists of transferring Engineer
and Contractor as-built drawing notes into a final record drawings set.
Status/Budget Scheduled for later 1994.
Discussion None.
As mentioned in our previous letter dated December 10, 1993, we would
propose that the contract amendment be tracked separately under Phase 4,
Supplemental Services. Phase 4 could be split into two phases each, based
on. our original cost times multiplier contract. We would propose the
following breakdown:
Phase Compensation Through Upper Limit
4A End of July 1994 $135,000
*4B End of October 1994 $ 60,000
*Compensation based on average expenditure of $20,000 per month.
A Contract amendment will also be required to maintain our onsite
inspection services beyond July 1994. Compensation for Vince would be
based on his current salary times multiplier amount. We would propose the
following breakdown:
Phase Compensation Through Upper Limit
3B End of October 1994 $60,000
We hope this letter helps clarify our current situation.
If you have any questions or comments, do not hesitate to contact me.
Very truly yours,
BLACK & VEATCH
L
Ronald E. Henderson, P.E. G
Project Manager
er
Enclosure
cc: Ken Earing, SLO
Vince Miller, B&V Field
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42-S-9
Table 1
TASK 3A
COMPARISON OF BUDGET TO ACTUAL
THROUGH JANUARY 14, 1994
Actual
Task Budgct Completion'
No. Task Budget Actual (%) (%)
1 Preaward Services 32,797 43,435 132 100
2 Contract Administration 205,208 246,980 119 65
3 Monthly Site Visits 44,790 75,906 58 60
4 Computer 110,825 29,513 26 30
Configuration
5 Performance Testing/ 6,996 0 0 0
Startup
6 Substantial Completion 7,418 0 0 0
and Operator Training
7 Final Completion and 6,966 0 0 0
As-built Drawings
TOTALS 415,000
'Completion percentages based on contract completion by end of July 1994.
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AMENDMENT NO. 1 Attachment B
CONSULTANT SERVICE CONTRACT
BETWEEN CITY OF SAN LUIS OBISPO
AND BLACK AND VEATCH CONSULTANTS
THIS AMENDMENT NO. 1, made in duplicate and entered into this day of
April, 1994, by and between the City of San Luis Obispo (herein referred to as City) and Black
and Veatch (herein referred to as Consultant), provides for changes to the Consultant Service
Contract dated September 22, 1992, as follows:
WITNESSETH:
WHEREAS, Consultant was hired by the City to provide construction management
services associated with the "Water Treatment Plant Expansion Project;
WHEREAS, Consultant has the expertise to insure compliance with the plans and
specifications for the project construction work;
WHEREAS, Consultant has offered to provide the required services necessary to assure
adequate construction management and inspection of the construction project;
NOW, THEREFORE, in consideration of their mutual covenants the parties hereto agree
as follows:
1. Description of Project. The basic description of the Project, as provided in
Exhibit A to the Agreement remains unchanged.
2. Compensation. The cost estimate in the AGREEMENT shall be changed to
increase the maximum compensation by $135,000 to $885,000.
3. All other terms and conditions of the consultant service contract dated September
22, 1992 remain unchjanged and in full force and effect.
IN WITNESS WHEREOF, the parties hereto have executed this AMENDMENT on the
year and date first written above.
CITY OF SAN LUIS OBISPO BLACK AND VEATCH CONSULTANTS
By:
Mayor
ATTEST: oved As to Form:
City Clerk ty �6Wey
1 C_s-ii