BOARD AGENDA MEMORANDUM
Government Code § 84308 Applies: Yes ☐ No ☒
(If “YES” Complete Attachment A - Gov. Code § 84308)
SUBJECT:
Title
Approve a Budget Adjustment, Receive Report of Bids, Ratify Addenda, Approve the Contingency Fund and Award of Construction Contract to Swinerton Builders in the sum of $2,194,000.29 for the Security Upgrades and Enhancements Project, Project No. 60204022, Contract No. C0713 for Coyote Pumping Plant (Morgan Hill, District 1), Santa Teresa Water Treatment Plant (San Jose, District 7), Winfield Complex (San Jose, District 4), Headquarters Corporate Yard (San Jose, District 4), and Silicon Valley Advanced Water Purification Center (San Jose, District 3).
End
RECOMMENDATION:
Recommendation
A. Approve a Fiscal Year 2025 budget adjustment in the amount of $4,287,130 for the Security Upgrades and Enhancements Project (Project);
B. Ratify Addenda Nos. 1 and 2 to the contract documents for the Project;
C. Award the construction Contract to Swinerton Builders, located in Santa Clara, California, in the sum of $2,194,000.29, which includes Supplemental Work identified in Addenda No. 2; and
D. Approve a contingency sum of $329,100 and authorize Chief Executive Officer or designee to approve individual change orders up to the designated amount.
Body
SUMMARY:
Project Background
The Capital Improvement Program (CIP) Fiscal Year (FY) 2025-2029 Five-Year Plan identifies the Security Upgrades and Enhancements Project (Project) as a path to significantly enhance the overall security at Santa Clara Valley Water District (Valley Water) facilities. This Project's scope includes installing an updated security system, using modern technology capable of meeting today’s security threats of theft, trespass, and vandalism. The Project objective is to increase physical security for Valley Water properties, facilities, fleet, equipment, and staff through security upgrades and enhancements.
The Project is being delivered in three phases:
• Phase 1: Fencing Replacement
• Phase 2: Surveillance and Access Control Replacement
• Phase 3: Surveillance System Expansion
Phase 1 of the Project includes upgrades and enhancements to perimeter fencing and vehicular and pedestrian gate access at five Valley Water sites. The remaining scope, which includes installing an updated security system and using modern technology capable of meeting today’s security threats of theft, trespass, and vandalism, will be delivered in subsequent phases, subject to board approvals.
The five --Project sites for Phase 1 include:
Site 1: Coyote Pumping Plant, 1833 Peet Road, Morgan Hill, CA (District 1)
Replace 1,728 linear feet (LF) of existing 6-foot to 7-foot high fencing with a 9-foot high mini-mesh chain-link fence; replace one existing pedestrian gate; replace two existing 20-foot long manual vehicular gates; and replace one 25-foot long automatic vehicular security gate.
Site 2: Santa Teresa Water Treatment Plant, 7011 Graystone Lane, San Jose, CA (District 7)
Replace 2,725 linear feet (LF) of existing 6-foot to 8-foot high fencing with 9-foot high mini-mesh chain-link fence; install 880 linear feet (LF) of new fencing along other segments of Valley Water’s property line to include new fencing around the clear well; replace seven existing pedestrian gates; replace two existing 18-foot long manual vehicular gates; and replace two 29-foot long automatic vehicular security gates.
Site 3: Winfield Complex, 5905 Winfield Blvd, San Jose, CA (District 4)
Replace 1,003 linear feet (LF) of existing 6-foot to 9-foot high fencing with 9-foot high mini-mesh chain-link fence; install 200 linear feet (LF) of new fencing along other segments of the Valley Water’s property to extend the Gate A entrance and Gate B exit; replace one existing pedestrian gate; replace one existing 30-foot long manual vehicular gate; and replace one existing 28-foot long and one 30-foot long manual vehicular gates with new automatic vehicular security gate.
Site 4: Headquarters, Corporate Yard, 5770 Almaden Expressway, San Jose, CA (District 4)
Replace 1,546 linear feet (LF) of existing 6-foot to 8-foot high fencing with 9-foot high mini-mesh chain-link fence; install 300 linear feet (LF) of new fencing along other segments of the Valley Water’s property; replace two and install one new pedestrian gate; remove two 20-foot long and one 40-foot long manual vehicular gates and replace with 9-foot fencing; replace one 10-foot long manual vehicular gates; and replace three 20-foot long new automatic vehicular security gates with new automatic vehicular security gates.
Site 5: Silicon Valley Advanced Water Purification Center, San Jose, CA (District 3)
Replace 1,929 linear feet (LF) of existing 6-foot to 8-foot-high fencing with 9-foot high mini-mesh chain-link fence; replace two existing and install one new pedestrian gate for Visitor Center relocation; replace two12-foot and one 24-foot manual vehicular gates; and replace one 40-foot and one 50-foot automatic vehicular security gates.
Addenda Ratification
Two (2) addenda (Attachment 1) were issued during the bid period to clarify the Contract Documents, answer bidders’ questions, and incorporate a supplemental work site at Blossom Hill Annex, 1020 Blossom Hill Road, San Jose, CA (District 4). The supplemental work would consist of the replacement of 497 linear feet (LF) of existing 6-foot fencing with 9-foot high mini-mesh chain-link fence; install 178 linear feet (LF) of new fencing along other segments of Valley Water property to enclose a parking area; and install two new 25-foot manual vehicular gates around the parking enclosure. To formally incorporate the addenda into the Contract Documents, staff recommends that the Board ratify the addenda.
Contract Award
Table 1 summarizes the results of the C0713 bid received and opened on November 20, 2024. Swinerton Builders of Santa Clara, California, submitted the lowest responsive bid, approximately 38% lower than the Engineer’s Estimate of $3,540,938.
Two independent cost estimates were conducted to develop the Engineer’s Estimate. These estimates accounted for anticipated materials cost escalation and labor market constraints at the time of development. However, a review of the bids submitted indicates that the actual costs reflect current market conditions more accurately than the estimates, highlighting a few potential factors for the variance:
• Bid Spread Analysis: The average of the three bids received is $3,228,604, which is approximately 9% below the Engineer’s Estimate. This reinforces that the lowest bid is within a reasonable range and likely reflects cost efficiencies specific to the awarded contractor.
• Market Conditions: The bids suggest that material costs and labor market constraints may have stabilized or decreased since the Engineer’s Estimate was prepared, reducing construction costs for key components of the Project.
Staff reviewed the bid submittals and recommends that the Board award the Construction Contract to Swinerton Builders as the responsible bidder submitting the lowest responsive bid.
Table 1 - Bid Summary
|
Contractor, Location |
Bid Price |
Difference from Engineer Estimate (%) |
|
Swinerton Builders (Santa Clara, CA) |
$2,194,000.29 |
-38% |
|
Rodan Builders, Inc. (Hayward, CA) |
$3,317,000 |
-6% |
|
Golden Bay Fence Plus Iron Works, Inc. (Stockton, CA) |
$4,174,812 |
18% |
|
Engineer’s Estimate: $3,540,938 |
Contingency Funds
The Contract award sum for the Project is $2,194,000.29. To allow staff to quickly address unforeseen or changed site conditions and other unanticipated occurrences without causing unnecessary delays or consequential costs to the Project, staff recommends the Board approve encumbering a contingency amount of $329,100 (15% of the contract amount) for the subject Project.
The above-contingency amount was estimated due to known and unknown risks such as:
1. Unforeseen site conditions that result in changes that will need to be resolved during construction;
2. Differing site conditions;
3. Unanticipated variances in quantities and cost of various lump sum items estimated in the Bid;
4. Coordination issues and risks associated with weather conditions;
5. Coordination issues with operations and maintenance activities; and
6. Concealed conditions and/or field conditions that may be different from the baseline or as-built information used in the preparation of Project Contract Documents.
Approval of individual change orders for the Project will be subject to approval at the following designated amounts:
Facilities Unit Manager: $50,000
Deputy Administrative Officer: $100,000
Chief Operating Officer, Administrative Services: $200,000
Chief Executive Officer: Up to the Total Amount of
the Contingency
Previous Board Actions
On September 24, 2024, the Board adopted Resolution 24-46 setting the time and place of a public hearing on the Engineer’s Report and CEQA Exemption Determination for the Project.
On October 8, 2024, the Board conducted a public hearing and adopted Resolution 24-48 approving the Engineer’s Report and approving the Project.
On October 22, 2024, the Board adopted the plans and specifications and authorized advertisement for bids for the Project.
Outreach to Bidders
The Notice to Bidders was sent to the following recipients: approximately 26 plan rooms, 119 minority businesses, Chambers of Commerce and small business groups, certified small business contractors, and local and regional firms that have the appropriate license for this type of work, and the Santa Clara and San Benito Counties Building and Construction Trades Council, which maintains contacts with at least 1048 contractors and 70 union representatives, for distribution to their members.
Small Business Program
This project was advertised incorporating the Small Business Enterprise (SBE) Outreach Program, which establishes a small business subcontracting participation goal of at least 30 percent for non-SBE Bidders. The apparent low Bidder, Swinerton, is not a small business. However, its Bid subcontracts out the project scope of $1,101,591 to a California Department of General Services Certified Small Business (AAA Fence Company, Inc.), equivalent to 50.2% of the total Bid amount.
Rights of Way
This Project will be constructed within Valley Water’s existing rights-of-way.
Permits
Valley Water has obtained all necessary regulatory permits for Project construction.
As stated in the Contract Documents, the Contractor must obtain all necessary permits from the City of San Jose and the City of Morgan Hill to use their public right of way for hauling and traffic control.
Public Outreach
Valley Water utilizes various outreach strategies to inform the community of the Project’s progress and important milestones. During construction, outreach will be targeted to the surrounding neighborhoods and include pre- and post-construction notifications.
Next Steps
If the Board approves the recommendations, staff will proceed with Contract administration managed by Valley Water staff to facilitate the Project.
ENVIRONMENTAL JUSTICE AND EQUITY IMPACT:
There are no environmental justice and equity impacts associated with the Security Upgrades and Enhancements Project. This action is unlikely to or will not result in human health or environmental effects; and/or is not associated with an equity opportunity.
FINANCIAL IMPACT:
The Security Upgrades and Enhancements Project, Project No. 60204022, is included in the Capital Improvement Program (CIP) Fiscal Years (FY) 2025-29 Five-Year Plan and in the FY2024-25 Adopted Budget. The estimated Total Project Cost (TPC) to plan, design, and construct the Project (all phases) is $14.697 million (inflated). The total cost for Phase 1 of the project is estimated to be approximately $5,000,000 and includes the construction costs, contingency, and construction management. The total cost for the recommended construction contract, including the contingency sum of $329,100, is $2,523,100.33. The impact of awarding this construction contract does not change the overall TPC reflected in the CIP FY2025-29 Five-Year Plan.
A budget adjustment of $4,287,130 is recommended to increase the FY2025 budget for the Project to $5,000,000 to accommodate the increase to the FY2024-25 expenditures due to project advancement. The budget adjustment funding source will be funded via a $2,572,278 transfer from the Water Utility Enterprise Fund Operating and Capital Reserve (Fund 61, 60%), a $1,286,139 transfer from the Watershed & Stewardship Fund Operating and Capital Reserve (Fund 12, 30%), and $428,713 from the Safe, Clean Water Fund Operating and Capital Reserve (Fund 26, 10%).
The Project is funded by a combination of the Water Utility Enterprise Fund Operating and Capital Reserve (Fund 61, 60%), Watershed & Stewardship Fund Operating and Capital Reserve (Fund 12, 30%), and Safe, Clean Water Fund Operating and Capital Reserve (Fund 26, 10%). The portion of the Project cost that would be paid for by the Water Utility Enterprise (Fund 61) would be allocated 76.2% to North County Zone W-2, 18.3% to South County Zone W-5, 5.1% to South County Zone W-7, and 0.4% to South County Zone W-8.
CEQA:
Staff has determined that Phase 1 of the proposed Project is exempt from CEQA review because it qualifies for a Class 1 Categorical Exemption for Existing Facilities (CEQA Guidelines Section 15301) and Class 2 Categorical Exemption for Replacement and Reconstruction (CEQA Guidelines Section 15302). Phase 1 of the Project would not result in significant environmental impacts and the applicable exceptions in CEQA Guidelines Section 15300.2 do not exist. A Notice of Exemption has been filed with the County of Santa Clara Office of the Clerk/Recorder.
ATTACHMENTS:
Attachment 1: Addenda No. 1 and 2
Attachment 2: Project Delivery Process Chart
Attachment 3: Location Map
UNCLASSIFIED MANAGER:
Manager
Tony Ndah, 408-630-2208