Adopt Resolution #23-305 Accepting Bids and Awarding Contract for Improvement Project #21-08, Water Treatment Plant Trunk Watermain Improvements

Purpose:
The purpose of this case is to adopt Resolution #23-305 accepting bids and awarding a construction contract for Improvement Project #21-08, Water Treatment Plant Trunk Watermain Improvements. 
 
Background:
On October 8, 2019, the Ramsey City Council adopted Resolution #19-248 accepting five (5) proposals and awarding a professional services contract to SEH, Inc. for the purpose of analyzing the City’s municipal water supply system source water, developing a water system model, and preparing a preliminary design report for a centralized water treatment plant to ensure that the City’s municipal water supply system will continue to provide adequate quantities of safe drinking water into the foreseeable future.
 
On March 9, 2021, the Ramsey City Council adopted Resolution #21-061 awarding a contract to SEH Inc. to prepare plans and specifications for Improvement Project #21-08, Water Treatment Plant Trunk Watermain Improvements.
 
On October 26, 2021, the Ramsey City Council adopted Resolution #21-303 approving final plans and specifications and authorizing advertisements for bids using a base bid and an alternate bid as follows;

• Base bid – The base bid specified a combination of construction techniques whereby open trenching of watermain is specified along the south side of Bunker Lake Boulevard and the north side of 143^rd Avenue, while directional drilling of watermain is specified at intersections, through Cottonwood Park, under Sunwood Drive, and under the stormwater pond between Hoya and Anderson Dahlen north of 143^rd Avenue.

• Alternate bid – The alternate bid specified directional drilling of watermain across as much of the project area as feasible.

 
On January 25, 2022, the Ramsey City Council adopted Resolution #22-003 rejecting all bids and authorizing staff to work with SEH, Inc. to revise the approved plans to reduce project costs and to monitor the bidding environment to identify the most favorable time to bid the project again.  Attached is a copy of the City Council case with all attachments for reference.
 
On July 25, 2023, the Ramsey City Council adopted Resolution #23-168 executing a new Professional Services Agreement with SEH, Inc. to revise the previously approved plans and to re-bid said improvements for 2024 construction in advance of the Water Treatment Plant commissioning in the Spring of 2025.
 
The plan revisions from the 2021 bid set are the result of staff approved additions to the water system and contractor feedback from the previous bids. These changes consist of the following elements:
 

1. Adding an underground meter vault near well #8 on the existing water main in the park, including associated instrumentation for operational ease.

 

2. Adding a new water main between Bunker Lake Boulevard and 147th Terrace to complete the loop. The water main is anticipated to be installed on City owned property where Well No. 3 is located. Also, a new 1-inch service line is proposed to be installed off this line to the existing well house for priming the Well No. 3 pumps.

 

3. Re-design the water main in Town Center Drive south of Bunker Lake Boulevard and remove the water main in the open space easement to open this parcel up for future development.

 

4. Install a new 1-inch service line off Town Center Drive to the wellhouse building at Well No. 5 for pump priming purposes.

 

5. Modify the plans for the 24-inch raw water main on the trail north of Sunwood Drive to use open cut installation rather than Horizontal Directional Drilling (HDD), with the exception of under Sunwood Drive, which will still be HDD to avoid impacting the recently reconstructed street.

 

6. Include trenchless installation of the water main crossing Bunker Lake Boulevard at 143rd Avenue to avoid impacts to the recent improvements to Bunker Lake Boulevard.

 

7. The trunk water main under 143rd Avenue will now be fully installed via open cut trench installation followed up with full depth bituminous pavement replacement due to the age and condition of the existing pavement, and to avoid reconstructing one side of the street and overlaying the other, putting the two sides of the street on different maintenance schedules.  To accommodate the construction traffic using 143^rd Avenue for the WTP construction and to maintain access to adjacent commercial/industrial properties, phased pavement removal is anticipated to maintain a hard driving surface to the greatest extent possible during construction.

 
On September 26, 2023, the Ramsey City Council adopted Resolution #23-237 approving revised final plans and specifications as prepared by SEH, Inc. and authorizing advertisements for bids including a base bid and an alternate bid utilizing prevailing wage rates.
 
Final construction plans and specifications as bid are attached for reference.  

Bids were advertised in Finance and Commerce and in the Anoka Union Herald on Friday, September 29, and on Friday, October 6, 2023.  Bids were also advertised and managed online on QuestCDN.  

Observations:
A total of seven (7) bids were received, opened and tabulated by SEH, Inc. on November 1, 2023, and the following bids were found to comply with the approved plans and specifications and advertisements for bids.
 

CONTRACTOR	TOTAL BASE BID	TOTAL ALTERNATE BID
Northdale Construction Co., Inc.	$6,671,413.99	$6,671,414.00
Park Construction Company	$7,106,594.45	$7,106,594.46
Geislinger & Sons	$7,230,597.00	$7,264,597.00
S.M. Hentges & Sons, Inc.	$7,357,844.80	$7,357,845.80
RL Larson Excavating, Inc.	$7,613,079.74	$7,613,079.75
Meyer Contracting Inc.	$7,929,324.30	$7,929,324.31
Minger Construction Co., Inc.	$8,768,848.98	$8,768,848.98
Engineer’s Estimate	$7,519,839.00	$7,519,839.00

 
Northdale Construction Co., Inc. submitted the lowest responsible bid for both the base and the alternate bid for construction of said improvements in accordance with the approved plans and specifications and advertisements for bids.
 
Material shortages have eased recently but the awarded contractor will use the Winter months to order their materials so the materials are available when the contractor is ready to start work in the Spring of 2024. 
 
Alternatives:
Alternative #1 – Motion to adopt Resolution #23-305 accepting bids and awarding a contract for Improvement Project #21-08, Water Treatment Plant Trunk Watermain Improvements, to Northdale Construction Company for the alternate bid in the amount of $6,671,414.
 
Alternative #2 – Motion of other.    

The engineer’s construction cost estimate for the base and alternate bids is $7,519,839.00.  A 10% contingency was added to estimated unit prices to address changes that may result during construction.
 
The alternate bid allows for the use of prevailing wages by the primary contractor and their subcontractors in the event State grant funding can be utilized for construction of this project.
 
The majority of funding for this project is proposed to come from water enterprise funds.  For almost two decades, municipal water users have been contributing to a future water treatment plant, which includes off-site trunk watermain improvements required to provide the plant with raw water, and to transport treated (finished) water out to the distribution mains. 
 
Additional funding for this project could potentially come from State bonding, as well as from a sales and use tax exemption for all project related materials.  In 2023, legislative requests were drafted and presented as House File 1177 and Senate File 1197 requesting $10 million in State Bonding, and requesting a sales and use tax exemption for the Water Treatment Plant project. This year the City received $3.2 million in State Bond Funding and the sales and use tax exemption was approved.  Unfortunately, the legislative request language was specific to the Water Treatment Plant and did not encompass the entirety of the project, which includes the necessary trunk watermain improvements.  The City has since been notified that utilizing the awarded bond funding would require all work to be completed using prevailing wages. Staff have therefore been working with Magney Construction, the WTP contractor, to determine construction cost impacts related to utilizing prevailing wages for the WTP project.  Staff are of the understanding that the prevailing wage cost impact on the WTP project will be significantly less than the awarded $3.2 million, but this will be verified before awarded bond funds are utilized.
 
Staff plans to submit a 2024 legislative request for the remaining $6.8 million from our 2023 $10 million request, which the City previously received a verbal commitment on.  The City also plans to submit a request to amend the language to allow both the Bond proceeds and the sales and use tax exemption to apply to the trunk watermain improvements project also. 

Staff recommends approving alternative #1 to make sure that the new Water Treatment Plant can be served by the six municipal wells in The COR when the plant is ready to be commissioned in the Spring of 2025.
 
Attached is a bid award recommendation memo from SEH, Inc. recommending awarding the construction contract to Northdale Construction Company.
 
On Tuesday, November 21st, the Public Works Committee unanimously recommended City Council approval of alternative #1.  

Adopt Resolution #23-305 accepting bids and awarding a contract for Improvement Project #21-08, Water Treatment Plant Trunk Watermain Improvements, to Northdale Construction Company for the alternate bid in the amount of $6,671,414.