Adopt Resolution #19-049 Accepting Bids and Awarding Contract for Riverdale Drive Trunk Utility Improvements, Improvement Project #18-14

Purpose:
The purpose of this case is to adopt Resolution #19-049 accepting bids and awarding a construction contract for Riverdale Drive Trunk Utility Improvements, Improvement Project #18-14.

Background:
This project proposes to extend 18-inch polyvinylchloride (PVC) trunk sanitary sewer and 12-inch ductile iron pipe (DIP) trunk watermain from existing utility stubs in the southwest corner of old Armstrong Boulevard and Riverdale Drive approximately 2,600 feet west along the south side of Riverdale Drive to roughly the intersection of Llama Street and Riverdale Drive.  Attached is a copy of the construction plans as bid.
 
The proposed improvements will initially serve the new Lazydays RV maintenance facility in the southeast quadrant of Riverdale Drive and Llama Street.  A condition of Plat approval was that the maintenance facility connect to City sewer and water since it is located within the City’s Metropolitan Urban Service Area (MUSA).  The maintenance facility is under construction and includes 20 service bays, a customer waiting area, parts warehouse, receiving dock, and office space. Approximately 30 staff will work in the maintenance facility, including service managers and technicians, warehouse staff, and customer service representatives. Area is reserved for future expansion.
 
Civil Site Group, Lazydays RV’s engineer, developed the plans used to bid the trunk utility improvements. Lazydays RV initially proposed to construct the trunk watermain and sanitary sewer with their development, with the City reimbursing them a pro-rata share of the costs.  Initially, trunk watermain was proposed to be constructed to the edge of their site from the existing stub at Armstrong Boulevard, and sanitary sewer was proposed as a trunk gravity system from the existing stub at Armstrong Boulevard to roughly halfway to their site, with the remaining sewer to be installed as forcemain with a lift station at their facility.
 
Concurrently, Staff was working with Bolton & Menk on a West Riverdale Drive roadway and utility extension analysis.  This analysis ultimately revealed that extending 18” trunk sanitary sewer west of Llama Street was feasible and would most cost-effectively serve all development south of Highway 10 and west of Armstrong Boulevard with sanitary sewer.
 
Staff then decided that trunk sanitary sewer and watermain would best be constructed as a City improvement project, and that Lazydays RV could then pay their portion of the costs through trunk fees, as is typically the case when utilities are available to serve a site.  City Staff immediately started working with Civil Site Group to complete their plans for bidding the trunk utility improvements as a winter construction project to meet Lazydays RV’s scheduled opening date of early May 2019.
 
The plans call for service lines to be stubbed to several properties along Riverdale Drive so the properties can be served with municipal utilities in the future. These properties include the Lazydays RV sales building north of Riverdale Drive and east of Llama Street, the old Quality RV property north of Riverdale Drive and west of Armstrong Boulevard which is owned by Anoka County and has a failed septic system that cannot be repaired, and several properties south of Riverdale Drive and west of old Armstrong Boulevard that are owned by Anoka County who is working to transfer the properties to the City.
 
Per City design standards, sanitary manholes are proposed to be constructed at 400-foot maximum intervals along the trunk sanitary sewer as needed for pipe deflections and cleaning purposes.  Fire hydrants and gate valves are also situated at standard locations along the trunk watermain to enhance public safety.
 
On December 11, 2018, the City Council approved plans and specifications and authorized advertising for bids for Improvement Project #18-14.  At the time, construction costs were estimated at $460,000 with $285,000 attributed to trunk sanitary sewer improvements and $175,000 attributed to trunk watermain improvements.  However, it was soon discovered that several cells of the cost estimate spreadsheet contained formula errors, which after corrections resulted in estimated construction costs being closer to $750,000.  This error was discussed with the Public Works Committee on December 18, 2018.
 
Advertisements for bids were published in the Anoka Union Herald and in Finance and Commerce on Friday, December 14, and again on Friday, December 21, 2018. Plans and specifications were also posted on-line on QuestCDN.
 
Bids were originally set to be received on January 15, 2019, and presented to the City Council for award on January 22, 2019.  However, in early January it was discovered that private utilities including CenterPoint Energy, CenturyLink, and Connexus Energy had already installed facilities in the same alignment as our proposed trunk utilities.  Since this project is proposed to be completed during winter, impacts to private utilities are especially problematic as the ground surrounding the private utilities will be frozen making them impossible to relocate without first thawing the ground around them, which would increase the construction schedule and construction costs.
 
Staff therefore issued an addendum moving the bid opening to February 5, 2019, allowing time to work with Civil Site Group to revise plans after realigning the trunk utilities south of the private utilities, avoiding impacts to private utilities as much as practical.  Though this added three weeks to the bid schedule, the revised design allows for quicker construction and provides significant cost savings by preventing the need to remove and replace hundreds of feet of 10-foot wide bituminous trail on the west end of the project along Lazydays RV’s maintenance facility site.
 
Relocating the trunk utilities to the south requires an additional 10-foot of permanent utility easement along Lazydays RV’s site to construct and maintain the trunk utilities.  The property owner has willingly agreed to dedicate this easement via a utility easement agreement.  The City Council was asked to accept this easement via a separate case on the consent agenda this evening.  Upon accepting this easement, the trunk utilities can be adequately constructed and maintained.  Attached is Exhibit B from the easement agreement depicting the easement area.
 
On February 5, 2019, a total of eleven bids were received, opened, checked for errors and omissions, and tabulated.  A summary of bids is below, including necessary adjustments as noted.  None of the adjustments was significant enough to affect the order of award.  All bids were found to comply with the advertisement for bids.
 

CONTRACTOR	TOTAL BID
Kuechle Underground, Inc.	$607,144.11
R.L. Larson Excavating	* $615,582.82
Metro Utilities, Inc.	$616,498.00
Dryden Excavating	* $647,902.79
S.R. Weidema, Inc.	$731,895.87
Dave Perkins Contracting, Inc.	$797,709.00
Douglas-Kerr Underground, LLC	$831,206.84
Veit & Company, Inc.	$855,316.61
Geislinger and Sons, Inc.	$879,761.81
Rachel Contracting, Inc.	$894,380.85
Northwest Asphalt, Inc.	$989,970.35
Engineer’s Estimate	$660,838.14

* Bid reflects corrected summation of unit prices bid multiplied by estimated quantities from Bid Form.


The bid of Kuechle Underground, Inc. of Kimball, Minnesota, in the amount of $607,144.11 for the total bid for construction of said improvements in accordance with the approved plans and specifications and advertisement for bids, is the lowest responsible bidder.

Advertisements for bids were published in the Anoka Union Herald and in Finance and Commerce on Friday, December 14, and again on Friday, December 21, 2018. Plans and specifications were also posted on-line on QuestCDN, which is where most contractors currently search for projects to bid on. This is standard bidding practice for City of Ramsey improvement projects.

Observations:
Though the bids received varied by over 60%, the five lowest bids were competitive and the low bid was more than 8% under the engineer’s estimate.

 

Alternatives:
Alternative #1 – Motion to adopt Resolution #19-049 accepting bids and awarding a construction Contract for Riverdale Drive Trunk Utility Improvements, Improvement Project #18-14.

Alternative #2 – Motion denying adoption of Resolution #19-049 at this time.

The low bid for construction of the proposed improvements as submitted by Kuechle Underground, Inc. amounts to $607,144.11. Adding indirect costs (23%) results in a total project cost of $746,787.26.

Staff is not able to provide construction staking for this project so proposals for these services were requested from two local engineering consulting firms; Bolton & Menk and Hakanson Anderson.  Based on the proposals received and attached, Staff recommends accepting the Bolton & Menk proposal in the amount of $6,685.
 
Staff will administer and inspect construction, and will update plans with as-constructed elevations, locations, pipe lengths, etc. upon completion of the improvements.
 
The proposed improvements will serve the City’s trunk sewer and water supply systems so project costs will be paid through sewer and water enterprise funds, which have respective balances of approximately $13,000,000 and $23,000,000.  Based on total project costs of $746,787.25 ($0.01 subtracted for Lazydays RV’s costs), an estimated $398,859.07 will be funded through the sewer fund, and $347,928.18 will be funded through the water fund.
 
The improvements will be constructed this winter to meet Lazydays RV’s opening date schedule, which typically results in higher construction costs due to ripping through frozen soils, increased idling of vehicles, reduced productivity, etc.  All costs related to winter construction were therefore intended to be Lazydays RV’s responsibility.  Such costs were intended to be captured under the lump sum bid item titled “Winter Conditions”.  Kuechle Underground bid a lump sum cost of $0.01 for this item.  Bids for this item ranged from $0.01 to $151,000 in the eleven bids received.  Staff reviewed the impacts of this bid item to the total bid costs and found that even if this bid item were removed from all eleven bids, the lowest responsible bidder would still be Kuechle Underground.  As such, Lazydays RV is only responsible for $0.01 of construction costs.

Staff recommends alternative #1 to support current development and prepare for future development in this area.

Motion to adopt Resolution #19-049 accepting bids and awarding a construction Contract for Riverdale Drive Trunk Utility Improvements, Improvement Project #18-14.