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HomeMy WebLinkAbout05-07-2013 c7 trench repair & minor concrete job order contract spec 91196counctl âqenòa pepont MætiuD¡c 517l2ol3 iEmNümhr C7 CITY OF SAN LUIS OBISPO FROM:DarylR. Grigsby, Director of Public'Works Prepared By: Kyle Rowland, Engineering lnspector SUBJECT: TRENCH REPAIR AND MINOR CONCRETE, JOB ORDER CONTRACT -2013, SPECIFICATTON NO. 91196 RECOMMENDATIONS 1. Approve plans and specifications for the Trench Repair and Minor Concrete, Job Order Contract - 2013,Specification No. 91196. 2. Authorize staff to advertise for bids and authorize the City Manager to award the contract to the lowest responsible bidder. DISCUSSION Background Throughout the course of the year, small street repairs need to be completed due to repair on underground pipelines, or street areas that have settled significantly. 'When awater or sewer pipe is repaired, Utility Department staff complete the work to the pipeline and then temporarily patch the roadway. Engineering Division staff collects the location information after the repair is made and issues a construction contract periodically to replace the temporary patch with a stronger and more permanent asphalt patch. This is currently performed on an as-needed basis using Utility Trench Repair-Job Order Contract-20l 1, entered into in March of 2012 for one year. In order to streamline this activity and allow these permanent repairs to be completed more rapidly, while still retaining the benefits of low bids, staff is proposing re-establishing a Job Order Contract (JOC) for trench repair work for the upcoming year. JOC is an alternative bidding procedure that was approved by the voters and added to the City's Charter onNovember 5,2002 (See Attachment 1). Simplyput, it is an on-call service contract. The JOC provisions allow the City to perform maintenance related construction projects for repair, remodeling or other repetitive work under a unit price contract. The City first implemented a JOC program shortly after the Charter amendment was approved by the voters. The Gordian Group was retained to develop the JOC program in which 160,000 pre-priced construction tasks were developed and the contractors bid a percentage mark-up. The Gordian Group developed the specifications and a contract was awarded in August 2003. The City used this contract for about 2years. Multiple projects were completed using the JOC and the success of the program evaluated. The 160,000 pre-priced construction tasks covered every imaginable type of work and broke it down into very small elements, such as traffic control where the City paid per cone costs. This minute breakdown required staff to spend a great deal of time unraveling a cost proposal to see if it made c7 -1 sense for the work proposed to be completed or if there were unnecessary elements in the proposal. The additional staff time needed for review made controlling City costs more challenging. Engineering staff revisited the JOC concept in 201I and created a contract serving as a "focused program." lnstead of bidding a JOC program which covers every imaginable type of work and essentially pays the contractor for each worker and each piece of equipment that is used to complete the work, staff has developed a program that bids the finished product. The current Utility Trench Repair JOC has been developed to pay the contractor for each square foot of roadway repaired, regardless of number of pieces of equipment or the number of staff the contractor plans to use. This methodology is consistent with other types of projects the City completes and has made it simpler for the contractors to prepare and submit proposals, and streamlined delivery of work. Last year, the City generated 14 Task Orders, totaling $345,000 and proving to be an effective approach of handling roadway repairs. The proposed Trench Repair and Minor Concrete JOC - 2013 is modeled after the successful Utility Trench Repair JOC, but has been expanded to include other, easily identified work items and extends the contract time to 24 months. The new contract items are various types of minor concrete work construction, including sidewalk repairs and ramps. These changes will expedite delivery of routine, ongoing, small City funded construction projects. V/hile this contract will be available for City funded work, other Utilities such as the Gas Company, PG&E and Charter Communications would be required to create their own contract with their own contractor if they want a similar system for those projects. How JOC Contracts Work When Engineering staff is notified of the specific sites needing repair by maintenance staff in both the Utilities and Public 'Works departments, and from members of the public, locations are entered into a GIS database for tracking and documentation. Engineering compiles the work in a Task Order with a manageable number of locations marked for repair. With this information the contractor will calculate the cost of the repairs based on the contract prices established through the JOC contract. Once staff has verified the contractor's calculation is correct, a purchase order will be issued for the work, authorized by the City Engineer for projects of $25,000 or less, and by the City Manager for all other projects within approved budget. Task Orders in excess of approved budget will retum to Council for approval. This process follows the City Purchasing Policy and the authorization limits have been set by the Council in Resolution 9444 as part of the JOC program (See Attachment2). Once the work is authorized at the appropriate level and budget transfer completed, a work order is issued to complete the repair and work can commence. Payment and close out of the individual task orders will generally follow existing practices, with the exception that a final report is not completed on individual task orders. The program will be assessed to determine its effectiveness. If the program works well, other focused JOC projects will be recommended for release to handle the more routine project work. c7-2 Routine repairs can, and sometimes are, completed by staff. This is a very effective approach when immediate response is needed, or funding is not readily available for contract services. This delivery method is not routinely used due to the very high volume of repair requests and the need for street maintenance support work to be completed in advance of microsurfacing projects to streamline delivery of those projects. By operating this JOC project, the maintenance staff remains focused on delivering Measure Y priority paving work, while still providing a rapid response for utility trench repairs and minor concrete work as needed. Contract preparation costs are kept to a minimum as well, by using this on-call service concept. CONCURRENCES This project is exempt from environmental review since it is a maintenance and replacement project and a Notice of Exemption has been filed through the Community Development Department. FISCAL IMPACT This contract does not obligate any funds for construction. Once the contract has been executed, staff will begin scoping work and issuing work orders. Funding will be transferred into this project account from previously approved and funded Capital Improvement Plan projects, not-to- exceed the funding authorized by Council or authorization limits as approved by Council Resolution Number 9444 (2003 Series). Transfers of existing appropriations between projects will be completed in accordance with Council adopted financial policies. The funding sources for this work include the Street Reconstruction and Resurfacing (R&R) Master Account,'Water Distribution System Improvement - Trench Repair Master Account, Collection System Improvement Master Account, and the Sidewalk Repair Master Account. ALTERNATIVE Deny øuthorizøtion to ødvertise. The City Council could choose not to authorize the advertisement of the project. This is not recommended because the JOC program is a cost- effective way in which to get necessary maintenance work complete in a short timeframe. ATTACHMENTS 1. Council Agenda Report. Authorizins JOC 2. Resolution 9444 (2003 Series) AVAILABLE FOR REVIEW IN THE COUNCIL OFFICE Trench Repair and Minor Concrete - JOC - 2013 Specihcations T:\Council Agenda Reports\2O13\2013-05-07\2013 Trench Repair & Minor Concrete JOC 91196 (Grigsby-Rowland)\g1196 CAR Advertise,doc c7-3 I councrL Aq€nòâ pepopt CITY OF SAN TUIS OBISPO FROM Michael D. McCluskey, Public Bill Statler, Director of Finance Jay D. Walter, City Engineer SUBJECT: JOB ORDER CONTRACTING AND ALTERNATIVE BIDDING PROCEDURES CAO RECOMMENDATION Introduce an ordinance amending Chapter 3.24 of the Municipal Code to provide for the use of Job Order Contracting and Alternative Bidding Procedures for construction projects. DISCUSSION Background The City's Mission Statement and the Council's budget and fiscal policies both strongly encourage enhancements in productivity, íncluding changing cumbersome procedures. In December 2001, the Directol of Public Works authorized staff to research additional methods to accomplish construction projects. After a review of the existing Public Contract Code and inquiring of several cities and counties, we found two alternative methods that are in broad use throughout the state: Job Order Contracts (JOC) and the Uniform Public Construction Cost Accounting Act (Alternative Bidding Procedures), which offer added methods for cities to accomplish construction projects. They are particularly beneficial when focusing on smaller, repetitive-type projects that can be accomplished quickly without the need for the same formal plans and specifications that larger, more complex projects require. Based on the experience of other agencies (including Cal Poly and the County), these added methods could significantly enhance the Engineering Division's ability to deliver construction projects for the City faster and at a lower cost. Charter Amendments, On May 7, 2002, the Council conceptually implementing the two alternative methods for construction project contracting; and on June 18, 2OO2, formally authorized placing a measure on the November 5,2002 ballot to amend the City Charter to allow their use. The voters overwhelmingly approved MeasurcL-}2by 777o. Current PolÍcíes and Procedures, The City's current purchasing policies and procedures governing construction projects are set forth in a number of documents, including the California Public Contract Code, City Charter, Municipal Code, Purchasing Resolution and Financial Management Manual, In addition to amending the Charter, the City now needs to amend the Municipal Code regarding formal bidding procedures (Article III of Chapter 3.24) in order to implement JOC and alternative bidding procedures. The City's Purchasing Resolution will also need to be amended and this is the subject of a companion agenda item. cteff -l Attachment 1 Job Order Contractlng and Alternative Bidding Procedures Paee2 Municipal Code Amendments Only Article III of the City's purchasing ordinance (Chapter 3.24 of the Municipal Code), which addresses the City's formal bidding procedures, needs to be amended to implement JOC and alternative bidding procedures: all other provisions of the City's purchasing ordinance remain the same. The proposed revisions to Article III are highlighted in Exhibit A of the attached ordinance (the new text is shaded and the deleted text is seue*+*e*gh). The following summarizes the changes. Job Order Contrøctíng. As previously discussed with the Council, JOC allows the use of a fixed unit-price contract for indefinite quantity contracts for maintenance-type construction contracts. In preparing the specifications for this master contract, a detailed and comprehensive "Construction Task Catalog" with general specifications and a "baseline" cost is prepared for each specific task that is allowed to be performed under the master contract. The City then invites formal bids from general contractors, who will bid using a percentage adjustment factor (up or down) to be applied against the "baseline" unit prices in the bid document. The JOC award is then made to the contractor with the lowest adjustment factor. Work is subsequently performed under the JOC by the use of individual Task Orders, which are specific proposals agreed to by the City and the contractor on a project-by-project basis using the fixed unit-prices specified in the master contract. The authority to applove Task Orders is set forth in the City's Purchasing Resolution. As discussed in the companion agenda item, we recommend that the City Engineer be authorized to approve JOC Task Orders up to $25,000; and that CAO approval be required for all Task Orders in excess of this amount, Regardless of the amounq all Task Orders will be subject to the requirement that the amount be equal to or less than the budget amount specifically approved by the Council for each project. This will be verified through the rigorous "CAO Report" and purchase order process already in place for all purchases. On December 17, 2002, the Council approved contracting with The Gordian Group to develop the extensive catalog and specifications needed to implement the JOC system, We plan to return to the Council for approval of these documents in June 2003. Once these are approved by the Council, with the addition of Section 3.24.145 in the attached Municipal Code amendment, we will be then be able to implement the JOC program in accordance with Charter requirements. Alterna,tive Bidding Procedures. Until the Charter amendment approved by the voters in November 2002, all City construction contracts were governed by a Charter provision adopted in 1955, which in turn referenced a State Public Contract Code dating to the 1930's. The affect of this was to limit the ability for City employees to do minor construction work ($5,000 or less, including staff time, materials and equipment use), and to require formal bids for all construction work in excess of $5,000, While these dollar limits made sense seventy years ago, they don't any longer. The framers of the 1955 Charter ried to account for the passage of time by linking dollar limits to a specific section of the State Public Contract Code, rather than specifying a dollar amount in the Charter itself, under the reasonable assumption that over time, the State would amend the dollar amounts in the referenced code section. Unfortunately, the State never has. Instead, in 1985 it adopted "alternative bidding procedures" in a separate section of the Public Contract Code than the ê/c4u Job Order and Alternative Blddlng Procedures Attachment I Pase 3 one specified in the Charter. These "alternative bidding procedures" created the updated limits envisioned by the 1955 Charter framers by: 1. Allowing the use of "force account" (City staff and materials) for projects of $25,000 or less. Z. .,Open market" soliciting of bids by phone, fax or letter for projects of $25'000 or less. 3. Direct solicitaúon of formal bids from qualified contactors (with notice to construction trade journals) for projects of $25,000 to $100'000. In exchange for easing the requirements for lower-välue projects, the alterative procedures increase rhem for projects .oiing more than $100,000: publishád notice 14 days before bids are due is required lversus the cunJnt lO-day requirement); and mailed notice to trade journals 30 days before the bids arc due is required (which isnit currently required at all). With approval of the Charter amendment, the City can now use these "alternative bidding procedures." The changes and additions to Sections 3.24,150, 180, 185 and 187 of the proposed amendment are to imple-ment the alternative procedures in accordance with Charter requirements. Proposed Purchasing Guidelines Update A companion staff report titled "Purchasing Guidelines Update" gives an overview of the City's .urtrni purchasing system and outlines the proposed resolution changes also needed to implement JOC and ihe alternative bidding procedures, and integrate these changes into the City's overall purchasing sYstem. CONCURRENCES In addition to the Council's action to authorize a ballot measure to amend the Charter, the SLO County Builders Exchange supported the City's adoption of both alternative methods' FISCAL IMPACT There are no direct fiscal impacts in adopting the proposed update to the City's Municipal Code' However, there will be indirect cost savings 0hlough improved organizational effectiveness and productivity by implementing these procedures. ALTERNATTVES Take No Action, Without these changes to the Municipal Code, the City cannot take advantage of the productivity improvements now envisioned in the City Charter. ATTACHMENT Ordinance amending Article III of Chapter 3.24 of the Municipal Code. c7-¿!ñ - b Gr Finoncc/Manuols/Fiuo¡cial Mnnugement Manuul/200-Purchusing/Proposed UpdateV/Council Agendo Rcport-JOC/ABP Attachment bfr ORDINANCE NO. (2003 Series) AN ORDINANCE OF THE COUNCIL OF THE CITY OF SAN LUIS OBISFIO AMENDING CHAPTER3.24, ARTICLE III OF THE MUNICIPAL CODE TO PROVIDE FOR THE USE OF JOB ORDER CONTRACTING AND ALTERNATIVE BIDDING PROCEDI]RES FOR PUBLIC CONSTRUCTION PROJECTS WffiREAS, the citizens of San Luis Obispo approved Measure L-02 on November 5, 2002, which amended the City Charter to authorize the use of job order confracting for maintenance-related projects as provided under Section 201285 of the Public Contract Code and alternative bidding procedures as provided under Section 22000 of the Public Contract Code ("Uniform Public Construction Cost Accounting Acf') for public construction projects; and \ryHEREAS, Section 901 (E) and (F) of the City Charter states that the Council shall establish by ordinance guidelines for the use of such contracts and procedures. NOW, THEREFORE, BE IT ORDAINED by the Council of the City of San Luis Obispo as follows: SECTION 1. Article III of Chapter 3.24 of the Municipal Code of the Ciry of San Luis Obispo is hereby amended as set forth in Exhibit A. SECTION 2. A summary of this ordinance, approved by the City Attorney, together with the names of the Council members voting for and against it, shall be published at least five days prior to its final passage, in The Tribune, a nelwspaper published and circulated in this City. This ordinance will go into on effect at the expiration of thirty (30) days after its f,rnal passage. INTRODUCED on April 15, 2003 AND FINALLY ADOPTED by the Council of the City of San Luis obispo on .,2003 on the following roll call vote: AYES: NOES: ABSENT: David F. Romero, Mayor ATTEST: Lee Price, City Clerk APPROVED AS TO FORM: -l- A.Attorney cr-7fuâ - Lf 6AAttachment I Exhibit A AMENDMENT TO FOBMAL CONTRACT PROCEDURES Chapter 3.24 of the Municipal Code ARTICLE NI. FORMAL CONTRACT PROCEDURE 3,24,140 Requirements for purchase. Except as otherwise provided in this chapter, purchases and contracts for supplies, services, equipment and construetionprojeçts , which are equal to or in excess of the bid requirement amount specified by council resolution, shall be by written contract with the lowest responsible bidder pursuant to the procedures prescribed in this article. set forth in:this Article: resolution. 3,24.150 Bids - Notice of invitation and submission. A. Notices inviting bids shall include, but not be limited to, the following: 1. A general description of the item(s) or service(s) to be purchased, or the public work to be constructed or improved; 2.The location where bid blanks and specifications may be secured; 3. The time and place assigned for the opening of sealed bids; 4. The type and character of bidder's security required, if any; and 5. The location and deadline for submission of bids. B. Notices inviting bids shall be p*blished at least once in the official newspaper of the city, with the first publication occurring at least ten çalendq days before the date of opening the bids. 6rl-f'2- c7-8 ôrtAttachment 1 ExhÍbit A AMENDMENT TO FORMAL CONTRACT PROCEDURES contfactors. C, Sealed bids shall be identified as bids on the envelopes and shall be submitted to the purchasing authority. 324J60 Bids - Security requirement. Bidder's security may be required when deemed necessary by the purchasing authority. Bidders shall he entitled to return of bid security. However, a successful bidder shall forfeit his bid security upon refusal or failure to execute a contract within fifteen days after notice of award of that contract, unless the city is responsible for the delay. The contract may be awarded to the next lowest responsible bidder upon the refusal or failure of the successful bidder to execute the contract within the time herein prescribed. 3.24.170 Bids - Opening and retention. Sealed bids shall be opened in public at the time and place stated in the notice inviting bids. A tabulation of all bids received shall be made available for public inspection until the award of a contract. All bids shall be retained on file for a period of not less than two years. 3.24.180 Bids - Rejection. The purchasing authority may reject: A. Any bid that fails to meet the bidding requirements in any respect; or B. All bids, for any reason whatsoever, and may readvertise for new bids purchase. 6/Þ ¿ c7-9-3- AMENDMENT TO FORMAL CONTRACT PROCEDURES blr Attachment 1 Exhibit A C. In the case o the city anl! f.nali. hpye [hg pr.gject done by fo, rce aceount. 3,24,190 Contract award. Subject to the prior approval of the city administrative officer, contracts shall be awarded by the purchasing authority to the lowest responsible bidder, except as follows: A. If, at the time of bid opening, two or more bids received are for the same total amount or unit price, quality and service being equal, and if in the discretion of the purchasing authority the public interest will not permit the delay ôf readvertising for bids, then the purchasing authority may accept the one she or he chooses or the lowest bid obtained through subsequent negotiation with the tie bidders. B. Sellers, vendors, suppliers and contractors who maintain places of business located within the limit of the city shall be given preference if quality, price, service and all other factors are equal. 3.24.200 Requiring bond of successful bidder. The purchasing authority may require as a condition to executing a contract on behalf of the city, a performance bond or a labor and material bond, or both, in such amounts as the purchasing authority shall determine appropriate to protect the best interests of the city, The form and amounts of such bond(s) shall be described in the notice inviting bids. 3,24,210 Determination of lowest responsible bidder. In addition to the bid or quotation price, criteria for determining the lowest responsible bid or quotation, for the purposes of the Charter and this chapter, shall include, but not be limited to, the following: A. The character, integrity, reputation, judgment, experience and efficiency of the bidder (this may include an analysis of previous work performed for the city); 6r+ '7 c7 -10-4- AMENDMENT TO FOBMAL CONTRACT PROCEDURES lprt Attachment 1 Exhibit A B. The ability of the bidder to perform the contract, or provide the supplies, equipment or services required, within the time specified, without delay or interference; C. The ability of the bidder to provide future maintenance, repair parts and replacement of purchased equipment or supplies; D, Compliance by the bidder with federal acts, executive orders and state statutes governing nondiscrimination in employment; and E. The results of any evaluation relating performance and price, such as testing, life-cycle costing, and analysis of service, maintenance and technical <lata. á,r-8 -5-c7-11 o o Attachment 2 RESOLUTION NO.9444 (2003 Series) A RESOLUTION OF THE COUNCIL OF THD CITY OF SAN LT]IS OBISPO UPDATING PTTRCIIASING GTJIDELINES \ryHEREAS, in the course of conducting City operations it is necessary to purchase a broad range of goods and services; and WHERDAS, the Council has adopted purchasing policies and procedures as set forth in Chapter 3.24 of the Municipal Code that require the Council to speciff by resolution the dollar amount of purchases and contracts requiring the use of either open market or formal bidding procedures, and the level of authority required to authorize invitations for bids (or requests for proposals), award contracts or approve Job Order Contract Task Orders; and \ryHEREAS, the Council desires to update existing guidelines to reflect cunent conditions and implement improved procedures, including electing to become subject to the uniform construction cost accounting procedures set forth in the Public Conhact Code, commencing with Section 22010, as required by the State in order to use tho alternative bidding procedures fo¡ construction projects set forth in Section 22032 of rhe Public Contract Code. NOW, THEREFORE, BE IT RESOLYED by the Council of the City of San Luis Obispo that: SECTION 1. Resolution No. 8239 (1993 Series) is hereby rescinded and the updated purchasing guidelines set forth in Exhibit A are hereby adopted. SECTION 2. The construction change order policy set forth in Exhibit B is hereby amended. SECTION 3. The City hereby elects to become subject to the uniform construction cost accounting procedures set forth in the Public Contract Code. On motion of Council Member Settle, seconded by Council Member Ewan, and on the following roll call vote: AYES: Council Members Ewan, Settle and Schwartz, Vice Mayor Mulholland, and Mayor Romero NOES: None ABSENT: None the foregoing resolution was adopted on April 15,2003. Mayor David F, Romero Lee Price, C.M.C. City Clerk TOFORM: Gilbert A.Acting Attomey A F.9444 c1-1,2 PURCHASING GUIDELINES o o No..9tltA D. Qffïò.er: CONST]LTANT SERVICES Contracts for consultant services will be awarded pursuant to the following guidelines. -1- Attachment 2 Exhibít A In accordance with the policy framework set forth in Chapter 3.'24 of the municipal code, City purchases and contracts (including those for rentals and leases, but excluding ihos" for reaiproperty) will be made pursuant to these guidelines. Applicable competitive bidding categories, authorization limits or contract award procedures will be based on unit cost, total purchase costfor consolidated bid items or fiscal year aggregates in the case of blanket purchase orders orsimilar ongoing purchasing ar:rangements. Staging of purchases in order to avoid these competitive bidding procedures or authorization limits is pr.ohibited. GENERAL PURCHASES Purchases and contracts for supplies, equipment, operating and maintenance services, and construction projects will be made pursuant to the following guidelines. A. Over-the'Counter. Purchases of less than $5,000 may be authorized by the DepartmentHead. Although no specific purchasing requirements are established for this level of purchase, competitive bidding should be used whenever practical. B. Open Market. Purchases between $5,000 and $25.000 $+5p0O may be authorized by the Director of Finance (or designee) pursuant to the open market bidding procedures established in Chapter 3.24 (Arricle tr) of the municipal code. c' tr'ormal Bids or Proposals. Purchases in excess of $25.000 $+spoo will be made pursuant to the formal bidding requirements established in Chapter 3,24 (Aúicle ìn) of the mìnicipalcode. Authority to approve specifications, invite bids or request proposals and award contracts will be as follows: 1. For purchases with an approved budget and a cost estimate of $IOOOOO $SOS00 or less, the City Administrative Officer is authotized to invite bids or.{,r".t p-porals, approve specifications and award the contract. 2. Fot purchases in excess of $ibO;SQ $5oi00o, Council approval of the specifications and authorization to invite bids or request proposals is required, The Council may authorize the City Administrative Officer to awa¡d the contract if the selected bid or proposal is less than or equal to the Council-approved cost estimate and there a¡e no substantive changes to the specifications. otherwise, council award of the contract is required. C7 -I3 Attachment 2 Exhibit A A. Contracts for consultant seryices estimated to cost less than $5,000 may be awarded by the Department Head. Although no specific purchasing requirements are established for this level of contract, proposals should be solicited whenever practical. B. Contracts for consulting services estimated to cost between $5,000 an¿ $25:00q $fSPSS may be awarded by the City Administrative Officer. Proposals from at least three firms should be solicited whenever practical. C. Contracts for consultant services estimated to cost more thun $21000 $+SSgg will generally be awarded pursuant to the following guidelines; however, it is recognized that the City's need for consultant services will vary from situation to situation, and accordingly, flexibility will be provided in determining the appropriate evaluation and selection process to be used in each specific circumstance. 1. The Council should generally approve request for proposal (RFP) documents before they are issued. The Council may authorize the City Administrative Off,rcer to award the contract if it is less than or equal to the Council-approved cost estimate and there are no substantive changes to the approved workscope. Otherwise, Council award of the contract is required. 2. In the event that the timely evaluation and selection of a consultant precludes Council approval of the RFP before it is issued, the RFP may be approved and disttibuted by the City Administrative Officer; however, award of the contract will be made by the Council. 3. Cost will not be the sole criterion in selecting the successful bidder. Consultant proposals will be evaluated based on a combination of factors that result in the best value to the City, including but not limited to: a. Understanding of the work required by the City b. Quality and responsiveness of the proposal c, Demonstrated competence and professional qualifications necessary for satisfactory performance of the work required by the City d. Recent experience in successfully performing similar services e, Proposed methodology for completing the work f. References g. Background and related experience of the specific individuals to be assigned to the project h. Proposedcompensation 4. If it is determined that it is in the best interest of the City for services to be provided by a specific consultant-with contract terms, workscope and compensation to be determined based on direct negotiations----contract awa¡d will be made by the Council. -2- c7 -J.4 oo CONSTRUCTION CONTRACT CHANG E ORDERS o o Attachment 2 Exhíbít B 9444 OVERVIEW When the City awards a construction contract, the need for contract change orders (CCO's) is notunusual. CCo's are required whenever the scope of work changes from that in the originalcontract or an unknown condition of the site requires a change in the scope of work. Usrraìly ucontingency amount is established when the project budget is finalized upon contract award toaccommodate limited CCO's. The purpose of this policy is to establish iimits of authority for approving construction project CCO,s. GOALS l. Ensure appropriate authority and accountabilityin the approval ofchange orders. 2' Minimize the time needed to approve a cco in order to avoid project delays, 3' Establish a system under which the organizational level at which approval is given iscommensurate \ryith the size of CCO and size of project. 4' Eliminate the potential for approval of a CCO when contingency funds are insufficient. POLICIES Conditions for Approval of CCO's by Staff 1. Sufficient contingency funds are budgeted and available in order for the public WorksDirector or city Administrative off,rcer (or cAo-approved designees) to approvo a cco. 2. The nature of work in the CCO is not significantly different from that in the contract. 3, Authorization limits are based on an individual CCO amount, not the aggregate amount of allCCO's. 4. Atthonzation limits apply to cco's for increases in contract amounts only. 5' When the aggregate amount of CCO's reaches 75Vo of the contingency, the awardingauthority shall be informed of the status of the project and rhe suffiðiency of funding tã complete tbe project. 6. work will not be broken up into multiple cco,s in order to circumvent this policy. 7' All CCo's must be in writing and approved by the appropriate contract parties consistent with the authorized limits established in this policy. c7-15 CONSTRUCTION CONTRACT CHANGE ORDERS Attachment 2 Exhlblt B Resolution No.9444 8. A copy of each approved CCO will be transmitted promptly to the Finance Department. 9. The CAO may grant approval of CCO's in excess of i}ltiXtX)O $5eS0O under the following circumstances (all three factors must be present): a. Immediate approval of the CCO is necessary to avoid delay. b. The CCO is an integral and mandatory component of the project. c. The costs associated with delay of the project would be excessive. The Project Manager is responsible for carrying out this policy. 10. Cont¡act Task Orders. Authorization Limits 1. Public Works Director/Approved Designee Not to exceed $25,000 2. City Administrative Officcr Not to exceed $too.OOq $seBee 3. City Council Greater than contract or $iOO.OOO* $s€peo * See circunßtances above where the CAO my approve CCO's in excess of $100,000. Orígínally Approveil by lhe Council ott August 3, 1993; Revísed by the Council on April 15, 2003 C7 -16 oo 2