For City Council Meeting August 13, 2024
TO: Honorable Mayor and City Council
APPROVAL: G. Michael Milhiser, Interim City Manager
FROM: Tim Sullivan, Director of Public Works
Title
Request City Council to 1) Adopt Resolution No. 8283 Amending its Budget for the 2024-2025 Fiscal Year to Authorize a Transfer of $3,250,000 to the Capital Projects Fund and an Appropriation of $3,250,000 for the Public Works Administration Building Restoration Project; 2) Award a Construction Contract to Marcon Engineering, Inc. in the Amount of $3,179,019.25 for the Public Works Administration Building Restoration Project, City Project No. 220201; 3) Authorize a Contract Change Order Request in the amount of $446,366 with Fountainhead Corporation pursuant to the City’s “On-Call” Agreement for Construction Management, Inspection, and Materials Testing Services for the Public Works Administration Building Restoration Project, City Project No. 220201; and 4) Authorize the City Manager or their Designee to Execute all Related Documents.
(ACTION)
Body
RECOMMENDATION
Staff requests that the City Council:
1) Adopt Resolution No. 8283 Amending its Budget for the 2024-2025 Fiscal Year to Authorize a Transfer of $3,250,000 to the Capital Projects Fund and an Appropriation of $3,250,000 for the Public Works Administration Building Restoration Project.
2) Award a Construction Contract to Marcon Engineering, Inc. in the amount of $3,179,019.25 for the Public Works Administration Building Restoration Project, City Project No. 220201.
3) Authorize a Contract Change Order Request in the amount of $446,366 with Fountainhead Corporation pursuant to the City’s “On-Call” Agreement for Construction Management, Inspection, and Materials Testing Services for Public Works Administration Building Restoration Project, City Project No. 220201.
4) Authorize the City Manager or their Designee to Execute all Related Documents.
BACKGROUND
In August 2021, a fire damaged the Public Works building located at 335 W. Rialto Avenue, necessitating evacuation and causing extensive structural, water, and smoke damage. City services were relocated to ensure continuity. The building has been boarded and secured since.
On September 14, 2021, the City Manager was granted authority to approve remediation services up to the initial claim of $250,000.
Constant communication was maintained with the City’s Insurance Adjuster, McLarens, to discuss actions required to remediate the damages to the building and to obtain a modular building to provide temporary office space for the Maintenance & Facilities and Engineering staff during the repair and reconstruction work.
On November 8, 2021, the City Council approved a professional services agreement with Miller Architectural Corporation in the amount of $134,250 to provide Architectural and Engineering Services for the Public Works Administration Building Restoration Project.
On December 14, 2021, the City Council Adopted Resolution No. 7818 amending its budget for the 2021-2022 Fiscal Year budget authorizing an appropriation to the General Fund Liability Fund in the amount of $1,150,000 for anticipated settlements and expenses related to the fire at the Public Works Administration Building. Subsequently, on January 11, 2022, the City Council Adopted Resolution No. 7826 Amending Resolution No. 7818 to fully appropriate an additional $2,100,000 for expenditures related to anticipated litigation and related costs, for a total of $3,250,000 appropriated to the project. Copies of the resolutions are included as Attachment 6 & 7. Additionally, staff requested $2,000,000 in the Fiscal Year 2024/2025 budget in the Capital Projects Fund.
On June 16, 2022, staff was relocated to a modular building at 335 W. Rialto Avenue (west parking lot) to continue City services.
On March 12, 2024, the City Council authorized the release of bids for the Public Works Administration Building Restoration Project.
ANALYSIS/DISCUSSION
Miller Architecture has provided plans for reconstructing the damaged building, including structural repairs, interior refurbishments, and required building code improvements. Restoration of the building will include new interior non-bearing metal stud partitions, ceilings, electrical receptacles, data networking, lighting, replacement of roofing and roof-mounted HVAC units and ductwork, plumbing, finishes, replacement of doors, hardware, casework windows, and signage. There will also be a new electrical service and fire sprinkler system. The exterior improvements include an accessible path of travel from the public right of way, accessible parking, and infrastructure for electric vehicle charging stations. The roof-mounted solar panel system will be removed and stored during construction and then reinstalled upon completion of the renovations.
On April 22, 2024, the City released RFB No. 24-003 for the Public Works Administration Building Restoration Project, City Project No. 220201, and published the Notice Inviting Bids on the PlanetBids.com website. On June 4, 2024, the City received eight (8) bids as follows:
A complete bid summary is included as Attachment 1. The engineer’s estimate was $2.70 to $3.15 million. The lowest responsible and responsive bid was $3,179,019.25 submitted by Marcon Engineering, Inc. The bid received by One Silver Serve was found to be non-responsive to the contract documents. Staff reviewed the second lowest bid and found Marcon Engineering, Inc. to be properly licensed and qualified. Marcon Engineering Inc.’s Disclosure Statement, Contractor’s License, and DIR verification documents are included as Attachment 2. Staff recommends that the City Council accept the bid received from Marcon Engineering, Inc. as the lowest responsible and responsive bid. A construction contract with Marcon Engineering, Inc. for the project is included as Attachment 3.
Construction Management, Inspection, and Materials Testing Services
On April 12, 2022, the City Council approved an on-call agreement with Fountainhead Corporation for on-call construction management, inspection, and materials testing services for an initial 3-year term, with two 1-year optional extensions.
Staff has reviewed and recommends approval of the proposal provided by Fountainhead Corporation based on their prior constructability review of the Project plans and their experience overseeing projects of this magnitude similar in scope to the Project. A copy of their proposal is included as Attachment 4. Fountainhead has provided a fee proposal of $446,366 to provide the required construction phase services through the duration of the project. A copy of Fountainhead’s Disclosure Statement is included in Attachment 5.
The recommended award of the construction contract and the approval of the contract change order for the Public Works Administration Building Restoration Project, City Project No. 220201 will be funded from previous appropriations designated for this project and will not request additional funds from the general fund.
ENVIRONMENTAL IMPACT
The repair of the fire-damaged Public Works Department administrative building is considered statutorily exempt from the provisions of the California Environmental Quality Act (CEQA) pursuant to Section 15269 Emergency Projects, (b) defined as “Emergency repairs to publicly or privately owned service facilities necessary to maintain service essential to the public health, safety, and welfare.
GENERAL PLAN CONSISTENCY
This action is consistent with Guiding Principle 3A in the General Plan:
Our City government will lead by example, and will operate in an open, transparent, and responsive manner that meets the needs of the citizens and is a good place to do business.
Approval of this action also complies with the following City of Rialto General Plan Goals and Policies:
Goal 3-6: Require that all developed areas within Rialto are adequately served with essential public services and infrastructure.
LEGAL REVIEW
The City Attorney’s Office has reviewed the agreement and approved it as to form.
FINANCIAL IMPACT
Operating Budget Impact
The proposed action will not affect the Operating Budget.
Capital Improvement Budget Impact
The project currently has funding of $5,250,000. This includes $3,250,000 allocated from Fiscal Year 2021/2022 through resolutions 7818 and 7826 in the General Fund Liability Fund, Account No. 67302148-52011 and $2,000,000 as approved in the Fiscal Year 2024/2025 budget, in the Capital Projects Fund, Account No. 33007302-53001.
A budget resolution is needed to transfer the $3,250,000 available in the General Liability Fund balance to the Capital Projects Fund. This transfer does not request additional general fund funds, but it will move funds from the General Liability Fund to the Capital Projects Fund for the construction and construction management related costs.
After adoption of the requested Budget Resolution, funds to appropriate for the award of the construction contract with Marcon Engineering, Inc will be budgeted and available in the Capital Projects Fund, Account No. 33007302-53001-220201-22 in the amount of $3,179,019.25 and Account No. 33007302-53001-220201-15 for the Contract Change Order with Fountainhead Corporation in the amount of $446,366.
Licensing
A Business License Tax at the Professional Services rate in the amount of $3,254 based on the construction amount of $3,179,019.25 will be assessed to Marcon Engineering, Inc. and $504 based on the $446,366 Construction Management & Inspection contract will be assessed to Fountainhead Corporation.