COMMITTEE AGENDA MEMORANDUM
Capital Improvement Program Committee
Government Code § 84308 Applies: Yes ☒ No ☐
(If “YES” Complete Attachment A - Gov. Code § 84308)
SUBJECT: title
Receive Information on Change Orders to Anderson Dam Tunnel Project Construction Contract.
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RECOMMENDATION: Recommendation
Receive information on change orders to Anderson Dam Tunnel Project Construction Contract.
Body
SUMMARY:
During the May 17, 2021, Capital Improvement Program (CIP) Committee meeting, staff provided an update on the Anderson Dam Tunnel Project (ADTP) No. 91864006. The Committee requested staff provide monthly change order status updates after construction of the ADTP commences on July 7, 2021.
Project Background
Santa Clara Valley Water District (Valley Water) is undertaking the Anderson Dam Federal Energy Regulatory Commission Order Compliance Project (FOCP) as a result of the February 20, 2020, directive from the Federal Energy Regulatory Commission (FERC) to implement interim risk reduction measures at Anderson Dam. One of those measures is the ADTP.
On April 27, 2021, Valley Water’s Board of Directors awarded the construction contract for the ADTP to the top-ranked, best-value proposer, Flatiron Dragados West, Inc. (FDW), in the sum of $161,140,321 and approved a contingency amount of $40,000,000 (25% of the contract price). The Board directed staff to discuss delegating authority for contingency expenditures with the CIP Committee. On January 28, 2025, the Board of Directors approved an increase of $40,000,000 to the construction contract contingency sum, bringing the total construction contract contingency to $80,000,000.
By unanimous roll call vote at its May 17, 2021, meeting, the Committee approved recommending to the full Board that it consider delegating authority to staff to approve change orders for the ADTP at the amounts stated below and that the CIP Committee receive regular monthly reports with information regarding approved change orders, pending change orders, and the cumulative amounts. Valley Water’s Board of Directors accepted the CIP Committee recommendations at its regular meeting on May 25, 2021.
Delegated Approval Authority
Unit Manager: Up to $100,000
Assistant Operating Officer: Up to $250,000
Deputy Operating Officer: Up to $500,000
Assistant Chief Executive Officer: Up to $2.5 million
Chief Executive Officer: Up to $5 million
Board of Directors: $5 million and above
Construction Contract Change Orders Status
There is one new Contract Change Order (CCO No. 64) to present to the CIP Committee. The amount of CCO No. 64 is estimated at $1,200,000.00. Two attachments providing information on construction contract change orders (Attachment 1) and construction contract financials (Attachment 2) are included for reference.
Contract Change Order No. 64
1. Diversion Tunnel Steel Liner and Concrete Backfill - Additional Scope and Escalation.
This change addresses additional scope and cost escalation associated with completion of the Diversion Tunnel final lining work. Due to cumulative schedule impacts from regulatory agency-driven design changes and unforeseen field conditions, the construction completion date was extended from March 4, 2024 to December 4, 2026, as documented in Time Impact Analyses (TIA) 1 through 6.
The Diversion Tunnel scope includes installation of a 13-foot diameter steel final lining along the approximately 350-foot long tunnel, placement of low-density cellular concrete (light weight concrete), and associated welding, coating, and inspection activities.
As a result of these schedule extensions, Diversion Tunnel final lining work originally planned for 2023 is now being performed in 2026, requiring adjustment for market escalation. This change includes compensation for increased costs in labor, materials, equipment, and subcontractor work, reflecting market conditions at the time of execution.
The change also incorporates field modifications required at start of the Diversion Tunnel liner to accommodate a more complex configuration connecting to a 13-foot pipe extension at the Transition Zone. These modifications required additional joints, butt straps, welding, and temporary support measures to ensure proper alignment and maintain required tolerances during installation.
This change order is estimated to be valued at $1,200,000.00.
Other Changes from Previous Month Contract Change Order Status
1. CCO No. 61 includes two items (Overhead Conduit to Control Room Building No 1; and Stop Log Expedited Delivery) estimated to be valued at $6,900 and $22,600, respectively. These two items were originally included in CCO No. 59, which was presented at the December 2025 CIP Committee meeting. Subsequently the two items were moved from CCO No. 59 to a new CCO No. 61. The total amount of CCO No. 61 was estimated at $29,500. CCO No. 61 has been revised to remove the Overhead Conduit to Control Room Building No. 1, as this work will be performed in the near future on a Time-and-Materials basis and the actual cost will be finalized at that time. The Stop Log Expedited Delivery cost has been updated and reduced from $22,600 to $22,391. CCO No. 61 now also includes Ultrasonic Testing of Microtunneling Pipe Welds, presented at the March 2026 CIP Committee meeting as part of Change Order 62 for $39,803, bringing the revised total for CCO No. 61 up to $62,194.00,
2. CCO No. 62 was presented at the March 2026 CIP Committee meeting for two items (Installation of Large Diameter Pipe Outside of the Tunnel; and Ultrasonic Testing of Microtunneling Pipe Welds) estimated to be valued at $39,803 and $4,500,000 respectively. The total amount of the change order was estimated at $4,539,803. The Ultrasonic Testing of Microtunneling Pipe Welds, valued at $39,803, has been removed from CCO No. 62 and added to CCO No. 61. Therefore, CCO No. 62 has been updated to only include Installation of Large Diameter Pipe Outside of the Tunnel, which is estimated to be valued at $4,500,000.00.
ENVIRONMENTAL JUSTICE IMPACT:
There are no environmental justice impacts associated with this item.
ATTACHMENTS:
Attachment A: Gov. Code § 84308: Flatiron Dragados West
Attachment 1: Construction Contract Change Orders Status
Attachment 2: Construction Contract Financial Status
UNCLASSIFIED MANAGER:
Manager
Ryan McCarter, 408-630-2983