03-25-2013 EXECUTIVE SESSION - Laserfiche WebLink

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Item No: 7C _ Meeting Date: March 25, 2013 MOM T rE—W Type of Business: Council Business J v LAY AdministratorReview: City of Mounds View Staff Report To: Honorable Mayor and City Council From: Nick DeBar, Public Works Director Item Title/Subject: Resolution 8080, Awarding a Construction Contract to Northwest Asphalt, Inc. for 2013 Street and Utility Improvement Project—Area F Background: Detailed background information for the Street and Utility Program and the Area F project is included as a reference at the end of this report. Much of this information was presented to the Council in previous staff reports associated with prior approvals for the project. Discussion: The City Council approved bidding documents (plans/specs) and authorized advertisement for bids for Area F of the Street and Utility Improvement Program on February 25, 2013 (Res. 8067). The advertisement was published in the February 28 and March 7 editions of the Sun - Focus and Finance & Commerce (regional trade publication). Six bid proposals were received and publicly read aloud on March 21, 2013. The bids have been tabulated, checked for mathematical errors, and corrected in accordance with the contract requirements by the City's consulting engineer Stantec. Bid amounts ranged from $3,122,034.01 to $3,465,514.40 for the 3.0 mile project. The low bid was submitted by Northwest Asphalt, Inc. of Shakopee, Minnesota — the same general contractor that has performed construction for the last four areas (B/C, D, and E) over the past three years. The bidding environment continues to be excellent for this type of work. There was only $7,874.26 difference between the two lowest bids, or 0.25%, and only 0.8% between the three lowest bids. The overall difference between the low and high was only 11%. Attached to this report is a recommendation letter from Stantec summarizing the bids. Given the satisfactory performance on the past three construction projects, Public Works and Stantec highly recommend awarding the construction contract to Northwest Asphalt for $3,122,034.01. This amount is an estimated construction cost and actual construction costs will vary due to variations in quantities of the 131 individual unit price bid items in the contract. Although most work will fit into one of these 131 bid items, there is always a possibility of addition costs related to unknown conditions that might not fit into a bid item. For this reason, a construction contingency of 2.5%, or $78,000, is recommended to deal with these unknowns in a timely manner without delaying construction operations. Stantec has provided a fee estimate to provide engineering services for the construction phase of the project, which includes administration, engineering, inspection, surveying, and closeout for the project. Compensation will be actual hours worked plus reimbursable expenses for a maximum estimated fee of $270,000. This is the same compensation structure with Stantec during the design phase of the project. Stantec's total billing for the design phase (through March 1, 2013) is $159,193, which is higher than their estimated fee of $120,000. Although this initial estimate was very optimistic at the time, the main reason for the increase is related to unforeseen items encountered and scope creep involving two added parking lots, increased time spent evaluating sewer conditions, MSA street amenities, changes in Mn/DOT hydrology/hydraulic requirements, and Rice Creek Watershed District mandates related to judicial ditch crosses. For these reasons, staff is recommending adjusting the maximum estimated fee for the design phase to $165,000.