For Utilities Commission Meeting [October 20, 2020]
TO: Honorable Chairperson and Commission
APPROVAL: Thomas J. Crowley, P.E., Utilities Manager
Title
Recommend the City Council/Rialto Utility Authority: Approve the First Amendment to the Four-Party Implementation Agreement for the Construction and Operation/Maintenance of the Liquid Chlorinator, Approve the Cost-Share in the Amount of $217,663, and Direct Emhart/AECOM to proceed with construction contract award to ICS, the apparent lowest responsible bidder for the Liquid Chlorinator project.
(ACTION)
Body
BACKGROUND:
On August 12, 2015, the City of Rialto (Rialto) entered in to a Four-Party Implementation Agreement with Emhart Industries (Emhart), County of San Bernardino (County) and the City of Colton (Colton), to implement the interim remedial action plan as required by the Consent Decree entered into on July 2, 2013. The remedial action required by the Work Consent Decree was selected and approved and overseen by the US Environmental Protection Agency (EPA).
The County and Emhart agreed that the EPA Remedy would be combined with an existing groundwater extraction and treatment remedy that was designed and constructed by the County to capture and remove perchlorate and TCE in the Basin and required by the Santa Ana Regional Water Quality Control Board (Regional Board). This project is referred to as the “Combined Remedy” project.
The Combined Remedy project includes:
1. Installing a new extraction well (EW-1), located at the northwest corner of Jerry Eaves Park,
2. Expanding the existing County groundwater treatment system installed at Rialto 3 to treat extracted water from EW-1 and Miro 3 wells,
3. Upgrading the chlorination station at the Combined Remedy site,
4. Constructing an inter-tie between Rialto and Colton to deliver Colton’s water rights produced out of EW-1, and
5. Complete system improvements to the Colton’s drinking water distribution system.
ANALYSIS/DISCUSSION
Emhart and their consultant AECOM were tasked with designing and constructing an expansion of the existing chlorination station. It was determined early in the permit review process that the State Water Resources Control Board (SWRCB) Division of Drink Water (DDW) would “highly recommend” that the old tab-based chlorination system be replaced with a liquid based chlorination system that would better meet the treatment system needs. Finally, this new chlorinator system will provide for a more reliable disinfection process assuring that the water treated is safe a reliable to drink.
In addition to satisfying DDW’s requirements, an advantage to converting to a liquid chlorinator system is the savings in operation and maintenance (O&M) costs. Per the Four-Party Agreement, Rialto is responsible for the O&M costs for water being treated from the county’s portion of the treatment plant. Rialto has been paying this cost from the beginning of the project. Colton is responsible for the O&M costs for the water being treated from the Emhart portion of the treatment plant.
As shown on tables below, the annual O&M cost for the tablet system option is estimated at $160,796, while the liquid chlorinator system is $44,039, resulting in an overall savings of $116,757 to be shared between Rialto and Colton annually. With the savings of nearly $117,000 per year, Rialto and Colton would recover their investment in four (4) years. Also, selecting the liquid chlorination option would result in a savings to Rialto of $95,851 for the first four (4) years, including construction and installation costs.
Emhart/AECOM worked with Rialto staff to design a new chlorination system that would be acceptable to DDW. The new chlorination station will include:
• Modulization and demolition of existing tab chlorination system,
• Chlorine storage tank and containment pad,
• Canopy for the storage tank,
• Piping and conduit installation,
• Chlorine system installation in the existing build located on site,
• Electrical installations,
• System testing and start-up, and
• Security fencing.
Emhart/AECOM prepared a final bid package and requested bids from qualified contractors in May 2020. Six contractors participated in the job walk in May 2020. Four of the six contractors submitted bids on the project. Below are the results of the bids in descending order:
1. AIS $497,390
2. ICS $499,000
3. Matrix $516,160
4. CMAC $541,286
The difference between the low and high bidders is less than 10%, so staff believes these bids are an accurate representation of the cost and level of effort required to build a liquid chlorinator in accordance with the approved design. All the bids included costs based on prevailing wages and have essentially the same working schedule of seventy (70) days.
AIS is the apparent low bidder at $497,390; however, AECOM has recent experience with the company on other projects and have reported the company is having issues meeting established project deadlines. The next lowest apparent bidder is ICS at $499,000, which is only $1,610 more in cost. Parties to the Four-Party Implementation Agreement are recommending the construction contract be awarded to ICS.
In addition to the construction contract costs, the total project costs include some long lead items that were procured by AECOM earlier to avoid delaying the overall project schedule. These items consisted of chlorine pumps and controllers, chlorine analyzer, static mixer and injection quill, and isolation valves. The total amount for these items is $78,258. Finally, the total cost to design and gain approval from the DDW for the chlorination project is $50,730.
To proceed with the project, Rialto needs to execute the First Amendment to the Four-Party Implementation Agreement. A draft copy of the proposed First Amendment to the Four-Party Implementation Agreement (Regarding Costs of Construction, Operation, and Maintenance of Liquid Chlorinator) is included as Attachment 1.
FINANCIAL IMPACT:
The total project cost is:
1. Construction (ICS) $499,000
2. Contingency (5%) $25,000
3. Long Lead Items $78,258
4. Design and Approval $50,730
Total Project Cost $652,988
The total project cost is to be shared between Emhart, Rialto, and Colton equally. Each agency would pay $217,663. Rialto will reimburse Emhart over the next four years.
RECOMMENDATION:
Staff requests the Utility Commission recommend the City Council/Rialto Utility Authority:
• Approve the First Amendment to the Four-Party Implementation Agreement for the Construction and Operation/Maintenance of the Liquid Chlorinator.
• Approve the cost-share plan described above in the amount of $217,663, and
• Direct Emhart/AECOM to proceed with construction contract award to ICS, the apparent lowest responsible bidder for the Liquid Chlorinator project.