TO: Members of the Governing Board
FROM: Christopher Silke, District Engineer
REPORT BY: Ross Murphy, Assistant Engineer
SUBJECT: Reject Bids for the Woodhaven Sewer Lift Station Replacement Project, NB 22-03
RECOMMENDATION
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District Engineer requests rejection of all bids pursuant to Section 20150.9 of the Public Contract Code for the “Woodhaven Sewer Lift Station Replacement Project”, NB 22-03.
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EXECUTIVE SUMMARY
Bids were received and opened for the Woodhaven Sewer Lift Station Replacement Project, NB 22-03 on August 10, 2023. The low bid exceeds the total funds allocated to the project. Staff is recommending rejection of all the bids pursuant to Section 20150.9 of the Public Contracting Code. District Staff are negotiating with agents representing the insurance underwriter to address the facility settlement value shortfall.
FISCAL & STRATEGIC PLAN IMPACT
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Is there a Fiscal Impact? |
Yes |
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Is it currently budgeted? |
Yes |
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Where is it budgeted? |
Napa Berryessa Resort Improvement District Capital Budget - Fund 5240, Org 5240500, Project 23032 |
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Is it Mandatory or Discretionary? |
Discretionary |
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Discretionary Justification: |
The District was allocated $175,000 for the Project received from Golden State Risk Management Authority insurance settlement. The low bid received for construction of the project was $446,818, which exceeds allocated project budget. The District does not have sufficient funding to award the construction contract within the insurance proceeds allocated for the Project at the low bid value and including construction administration and contingencies. |
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Is the general fund affected? |
No |
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Future fiscal impact: |
Unknown. There may be additional costs related to reducing scope and revising design plans. |
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Consequences if not approved: |
Additional District funding would be required to fund the project. |
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County Strategic Plan pillar addressed: |
Effective and Open Government |
ENVIRONMENTAL IMPACT
ENVIRONMENTAL DETERMINATION: Consideration and possible adoption of a Categorical Exemption Class 1: It has been determined that this type of project does not have a significant effect on the environment and is exempt from the California Environmental Quality Act. [See Class 1 (“Existing Facilities”) which may be found in the guidelines for the implementation of the California Environmental Quality Act at 14 CCR §15301; see also Napa County’s Local Procedures for Implementing the California Environmental Quality Act, Appendix B.].
BACKGROUND AND DISCUSSION
The Napa Berryessa Resort Improvement District ("District") is a special district of the State of California organized under the Resort Improvement District Law (Public Resources Code Section 13000 et seq.) for the provision of water and sewer service in an unincorporated portion of the County of Napa. The District provides water and sewer service to the Berryessa Highlands and Oakridge Estates communities.
On August 19, 2020, the LNU Lightning Fire Complex burned through the community, destroying many homes and damaging or destroying critical elements of infrastructure needed to operate the water and wastewater facilities, including the complete loss of Woodhaven Court Sewer Lift Station.
After extensive evaluation of damages followed by negotiations with Golden State Risk Management Authority (GSRMA) - the District’s insurance agency - an insurance settlement totaling $1,656,941 was issued to the District, $175,000 of which was the payout associated with the total loss of the Woodhaven Ct Lift Station. The District expended $822,982 of the insurance payout for the repairs of fire impacted facilities immediately following the fire, leaving $833,959 for other expenditures. District staff confirmed through discussions with the County’s Risk Manager that the use of the remaining insurance funds are not limited to fire-related projects. However, the replacement of the Woodhaven Ct Lift Station (the subject of today’s requested action) and the restoration of damaged irrigation system infrastructure that deliver and spray treated wastewater into permitted disposal sprayfields are the two remaining fire related projects that still need to be addressed, and staff believes that these two projects will consume the bulk of the insurance settlement monies.
On January 10, 2023 the Board approved a budget transfer of $100,000 from the District’s insurance settlement to the newly created Woodhaven Court Sewer Lift Station Replacement Project (Project) for the preparation of Design Plans and Specifications and demolition / site clean-up of the project site. Both of which are now complete with $69,141 remaining in project appropriations. Unobligated insurance settlement funds are presently $833,959.
On June 6, 2023 the Plans and Specifications we complete and the Board approved the project for public bidding. A pre-bid site walk was conducted on July 20, 2023 and sealed bids for the project were received and opened on August 10, 2023 with the following bid results:
Fort Bragg Electric - Fort Bragg, CA ($446,818.00)
Piazza Construction - Penngrove, CA ($452,500.00)
TNT Industrial Contractors - Sacramento, CA ($525,184.00)
The apparent low bid exceeds the insurance settlement proceeds that were originally earmarked for the replacement of the facility, or $175,000. As an additional fire-related project, replacement of treated wastewater disposal sprayfields piping, valves and spray system appurtenances is pending and will require a large portion of the unspent proceeds for its construction, it is in the District’s best interests to re-evaluate the project for cost-saving changes to the design and to engage in negotiations with the insurance underwriter to determine if additional proceeds may be available for the replacement of the sewer lift station with the goal of ensuring sufficient funding for the completion of both fire-related projects within the total insurance payout.
District staff therefore recommends that the Board reject all bids for the “Woodhaven Sewer Lift Station Replacement Project”, NB 22-03 for the reasons stated above until such time as the project can be scaled down to essential design elements for sewer collection service and a determination from the insurance agency is made on whether the replacement of the damaged facility is eligible for supplemental funds.