This project is part of the ongoing Street Preventative Maintenance Program supported by the City Council since 1985. Annually, staff identifies streets proposed for preventative maintenance and bids this work in three contracts: chip seal resurfacing, overlay resurfacing and crack sealing.  Chip sealing is an economical surface treatment designed to protect and prolong the life of the pavement.  This contract will provide a chip seal on approximately 20 miles of streets throughout the City. An attached map shows the locations of the proposed work. Staff opened bids on February 24, 2015, for the Work Order 15-03, City Chip Seal. The contract was advertised on February 12 and 19 in the Billings Times and on the City's website. Knife River submitted the lowest responsible bid.

The Council may:

• Award W.O. 15-03, City Chip Seal to Knife River in the amount of $1,211,559.35; or
• Do not award a contract and reject all bids.  If this project is not awarded, the deferred maintenance of City streets will increase.   

The following bid was received and evaluated:

Contractor	Bid Amount
Knife River	$1,211,559.35
Pavement Maintenance Solutions, Inc.	$1,215,265.33
Intermountain Slurry Seal, Inc.	$1,395,500.00

The funding for the project was budgeted in FY15 and the source is gas tax and arterial funds.  The previously encumbered funds represent  the construction contract already approved by City Council for the overlay project and Change Order 2 for W.O. 13-03 City Crack Seal.

Project Budget	$2,585,000.00
Previously Encumbered	$1,088,012.90
This Contract	$1,211,559.35
Budget Remaining	$285,427.75

Staff recommends the City Council award a contract for W.O. 15-03, City Chip Seal to Knife River in the amount of $1,211,559.35.