Adopt Resolution #19-114 Accepting Bids and Awarding Contract for Improvement Project #19-03, Wood Pond Hills & Chestnut Ridge Street Reconstructions

Purpose:
The purpose of this case is to adopt Resolution #19-113 accepting bids and awarding a contract for construction for Improvement Project #19-03, Wood Pond Hills and Chestnut Ridge Street Reconstructions.

Background:
Attached is a copy of the plans prepared by City staff for Improvement Project #19-03, Wood Pond Hills and Chestnut Ridge Street Reconstructions, which proposes to reconstruct streets within the Wood Pond Hills and Chestnut Ridge neighborhoods including 146th Avenue, Helium Street, and Krypton Street.  Maps attached to this case show the general location and scope of the proposed improvements.
 
Existing Conditions
The streets within these developments were constructed between 1992 and 1994 as urban sections using bituminous pavement, surmountable concrete curb and gutter, and concrete storm sewer. These streets were constructed to a width of 30-feet from face-of-curb to face-of-curb, are generally centered within 60-foot wide right-of-ways, and measure approximately 3,310 linear feet (0.63 miles) in length.  Attached is a street segments summary that includes other existing conditions such as PASER ratings, maintenance histories, and pavement section information obtained from ground penetrating radar.
 
The existing bituminous pavement section ranges between 1.6 and 5.0 inches thick, with a median thickness of 2.5 inches.  The existing aggregate base section ranges between 1.3 and 8.4 inches thick, with a median thickness of 4.1 inches.  Section thicknesses were obtained using Ground Penetrating Radar (GPR) analysis performed by Braun Intertec in 2017.  The pavement section was built on generally poorly graded sand with silt subgrade material generally considered suitable for pavement support with proper conditioning.
 
The City annually evaluates and rates the condition of pavement on all City streets using the Pavement Surface Evaluation and Rating (PASER) system. In the summer of 2018, the pavement sections of the above referenced street segments had a PASER rating of 2, except the south half of Krypton Street, which was rated at 4.  PASER ratings of 3 or less indicate the street requires reconstruction.  Staff recommends reconstructing all streets, including the south half of Krypton Street.  This will keep all pavement sections on the same maintenance schedule moving forward, and it would likely cost more to overlay the south half of Krypton Street due to additional contractors and mobilizations.
 
The existing storm sewer system consists of concrete catch basins that collect stormwater runoff from the curb and gutter, and concrete storm sewer pipes that route the runoff to stormwater ponding areas where the runoff is stored and treated.  The storm sewer system was also inspected was generally found to be in good operating condition so only minor maintenance work is proposed including re-grouting some structures and resetting castings.  One sewer pipe has a small hole near the top of the pipe, potentially caused by a boring machine while installing a private utility.  This hole will be inspected during construction to see if the hole requires a patch.
 
Municipal utilities (sanitary sewer and watermain) exist under each of the streets.  These utilities were inspected and were found to be in good operating condition so no improvements are proposed at this time.
 
Proposed Improvements
All damaged concrete curb and gutter sections are proposed to be removed and replaced.
 
The existing bituminous pavement section will be reconstructed using the Full Depth Reclamation (FDR) process, which involves reclaiming the existing bituminous pavement section, along with a portion of the underlying aggregate base. The reclaim material generated by this process is then spread over the reshaped and compacted existing aggregate base between the curb and gutter.  Excess reclaim material is then removed and hauled off site to allow 3½-inches of new bituminous pavement to be placed over the remaining compacted reclaim material.  This results in a 7-ton pavement design, which is the City standard for residential streets.
 
Bids
On May 1, 2019, four (4) sealed bids were received and were publicly opened.  The bids were competitive and complied with the advertisement for bids. A summary of bids is below and in the attached resolution.
 

CONTRACTOR	TOTAL BID
Omann Contracting Companies, Inc.	$304,916.53
Asphalt Surface Technologies, Corp.	$328,141.00
North Valley, Inc.	$336,586.72
Northwest	$361,974.76
Engineer’s Estimate	$267,156.35

 
Omann Contracting Companies Inc. of Albertville, Minnesota, submitted the lowest responsible total bid of $304,916.53 for constructing the proposed improvements in accordance with the approved plans and specifications and advertisement for bids.  This bid is $37,760.18 (14.1%) more than the engineer’s estimate of $267,156.35.
 
Following award of Contract, a Notice of Award will be issued to Omann Contracting Companies, Inc. to initiate execution of a contract and issuance of the required bonds and insurance. The City Attorney will verify that the contract, bonds, and insurance are in proper legal form prior to execution of the contract. Once the Contract is executed, staff will issue a Notice to Proceed so construction can begin.  At this time, it is anticipated that construction will begin in June or early July, depending on the Contractor’s availability.

A preconstruction meeting will be held before construction begins. Staff will then mail letters to abutting property owners to provide updates on the proposed construction schedule and operations based on the Contractor’s input at the preconstruction meeting.  The letter will also contain a link to the City’s web site where up-to-date information can be found during construction, as well as contact information in case property owners wish to contact the Contractor or City project inspector for any reason.

Project schedule:
May 14 – Accept Bids / Award Contract
June / early July – Begin construction
August 16 – Substantial completion (open to traffic)
September 10 – Order Assessment Hearing
October 8 – Conduct Assessment Hearing

Public Comments
Staff conducted a public information meeting on Wednesday, November 7, 2018.  The purpose of the meeting was to present the proposed improvements, estimated costs, funding program, and preliminary project schedule to benefiting property owners, and to receive public input on the project.  Property owners from 3 of the 59 identified benefiting properties attended and none of the property owners generally objected to the project, and most of the questions pertained to special assessments, particularly payment options.  Since then, no additional public comment has been received.

Advertisements for bids were published in the Anoka Union Herald and in Finance & Commerce on March 29 and April 5, 2019, as required by State Statutes.

The engineer’s estimate based on final plans was $37,760.18 (14.1%) less than the lowest bid.  When preparing engineer’s estimates, Staff applies unit bid prices from projects recently bid, typically within the last year or two, and adjusts unit prices based on any new information available.  The intent is for the engineer’s estimate to fall within the middle of all bids received.  In recent years, this has generally been the norm.  However, this year all bids received for both proposed 2019 street reconstruction projects were more than the engineer’s estimate.  This is primarily due to higher unit bid prices for bituminous pavement ($25,587) and concrete work ($11,535).
 
Other cities are also experiencing higher bid prices in these areas.  As such, Staff does not recommend re-bidding with hopes of receiving better bids.

The proposed improvements are anticipated to have a serviceable life of 60 years, assuming proactive maintenance operations are performed on a regular basis over the life of the improvements.
 
Some properties may have private irrigation systems that could be impacted during construction.  Staff will notify property owners in writing of the pending construction as far in advance of construction as possible to allow as much time as possible to relocate irrigation system components out of the construction area.  Once the project is complete, property owners will be allowed to relocate irrigation system components to their previous locations, if desired.  All costs required to relocate private irrigation system components will be the responsibility of the property owners, but if private irrigation systems are damaged due to negligence on the part of the City’s contractor, the contractor will be responsible to repair the damage.
 
This is the final year of the 2015 - 2019 Street Reconstruction and Overlay Program (SROP).  If this project is not completed in 2019, it could be added to the next 5-year SROP to allow reconstruction between 2020 and 2024 instead, though this would reduce the overall scope of pavement maintenance work that will be completed in 2019 since no new streets can be added to the current 5-year SROP.
 
This project, along with Improvement Project #19-01, were the first projects to be bid electronically through QuestCDN.  Using electronic bids helps streamline the bidding process for both the City and the bidders.  The new electronic bidding process went very smoothly and reduced the amount of time Staff normally spent opening and reading sealed paper bids aloud, and Staff did not field a single call from bidders inquiring about the bid results afterwards.

Alternatives:
Alternative #1 – Motion to adopt Resolution #19-114 accepting bids and awarding a contract for construction for Improvement Project #19-03, Wood Pond Hills and Chestnut Ridge Street Reconstructions, to Omann Contracting Companies Inc. in the amount of $304,916.53.

Alternative #2 – Motion to deny adoption of Resolution #19-114 at this time.

Project Costs
Construction and total project costs based on the lowest responsible bid received from Omann Contracting Companies Inc. of Albertville, Minnesota, are as follows.
 

	Total Bid
Construction Costs	$304,916.53
Project Costs	$375,047.33

 
Project costs include 23% indirect costs for administrative (6%), engineering (15%), finance (1%), and legal (1%) costs.
 
Attached is a proposal from Bolton & Menk for construction staking services using 2019 hourly rates.  Staff does not anticipate need much in the way of construction staking for this project given that most of the existing curb and gutter will remain in place, which will determine most of the elevations and locations.  With the recent retirement of the senior engineering technician, Staff no longer has the ability to stake construction so consultants will need to provide this service on all future public improvement projects.  This cost is included under indirect costs for engineering.


Project Funding
This project is proposed to be funded using a combination of the following funds;

• Unexpended street reconstruction funds = $284,729.08*
• Special assessments = $86,228.50
• Storm sewer funds = $4,089.75

            * After collecting assessments (bonds initially cover assessments).
 
Approximately $900,000 in unexpended Street Reconstruction Program funds are available to fund both street reconstruction projects.  Bonding is therefore not required to pay for the 2019 street reconstruction projects.
 
Fifty-nine (59) benefiting properties will receive special benefit from the improvements and are proposed to be assessed up to 25-percent of eligible project costs.  Eligible project costs include all costs except those related to subgrade corrections and public utility improvements. Assessments are proposed to be applied equally across the 8 assessable properties using the “per lot” assessment method as allowed by the adopted Special Assessments Policy.
 
A preliminary assessment amount of $1,303.70 per benefiting property was adopted by Council on November 13, 2018.  Based on low bid project costs, assessments for benefiting parcels would increase to $1,461.50, an increase of $157.80.
 
Final assessments will be adopted following the Assessment Hearing on October 8, 2019, after construction is complete and actual construction costs are known.  Over the last four years, a special benefit consultation report has been prepared for all projects and the results of the report were used to help guide final assessment amounts.  However, this project is so similar to the River’s Bend street reconstruction project completed last year that Staff recommends not completing a special benefit consultation report for this project, which would cost around $6,500, and instead use these funds to offset increases in assessments.
 
The City will fund all non-assessed project costs, including the costs required to expand the cul-de-sac per the alternate bid.

Staff recommends Alternative #1.  This will allow the project to be constructed in 2019, and will allow for the use of special assessments to pay up to 25% of eligible project costs per the applicable provisions of Chapter 8 of the City Charter, the City’s Special Assessments Policy, and Minnesota Statute Chapter 429.

Motion to adopt Resolution #19-114 accepting bids and awarding a contract for construction for Improvement Project #19-03, Wood Pond Hills and Chestnut Ridge Street Reconstructions, to Omann Contracting Companies Inc. in the amount of $304,916.53.