REPORT TO THE CITY COUNCIL June 26, 2014 FROM: STEPHEN A. HOGG, Assistant Director Public Works Department Department of Public Utilities - Wastewater Management Division BY: KEVIN L. NORGAARD, Supervising Professional Engineer Department of Public Utilities - Wastewater Management Division SUBJECT ..Title Actions pertaining to the Fresno/Clovis Regional Wastewater Reclamation Facility Tertiary Treatment and Disinfection Facility (Bid File 3325) (Council District 3) 1. Adopt a finding of Mitigated Negative Declaration, pursuant to Sections 15178(b)(1) and (2), of the California Environmental Quality Act Guidelines for the construction of the Tertiary Treatment and Disinfection Facility and Associated Solar Energy Facility at the Fresno-Clovis Regional Wastewater Reclamation Facility 2. Award a construction contract in the amount of $28,674,500 to W.M. Lyles Co., of Fresno, California, for the construction 3. Award a Professional Services contract to Carollo Engineering, Inc., in the amount of $1,417,588 to provide construction management 4. Award a Professional Services contract to Moore Twining Associates, Inc. in the amount of $116,029 for materials testing and Special Inspection ..Body RECOMMENDATION Staff recommends that the City Council: 1. Adopt a finding of Mitigated Negative Declaration, pursuant to Section 15178(b)(1) and (2) of the California Environmental Quality Act (CEQA) Guidelines. 2. Award a construction contract in the amount of $28,674,500 to the W.M. Lyles Co. a California corporation of Fresno for the construction of the Tertiary Treatment and Disinfection Facility (TTDF) as the lowest responsive and responsible bidder. 3. Award a Professional Services contract to Carollo Engineering, Inc., a Delaware corporation of Walnut Creek, California, in the amount of $1,417,588 to provide construction management for the Tertiary Treatment and Disinfection Facility. 4. Award a Professional Services contract to Moore Twining Associates, Inc. a California Corporation of Fresno, in the amount of $116,029 for materials testing and Special Inspection for the Tertiary Treatment and Disinfection Facility. EXECUTIVE SUMMARY The Department of Public Utilities (DPU), Wastewater Management Division is seeking to award a $28,674,500 construction contract, a $1,417,588 construction management contract, a $116,029 special inspection services contract and adopt a finding of Mitigated Negative Declaration for the construction of the new TTDF to be located at the Regional Wastewater Reclamation Facility. The primary purpose of this construction project is to establish the first portion of the City of Fresno's recycled water treatment system. The project will produce 4,200 acre-feet annually of treated recycled water to offset potable water usage within the City. BACKGROUND The City has adopted the Urban Water Management Plan and a Recycled Water Master Plan. One key goal of these plans is to provide 25,000 acre-feet a year of potable water offsets by 2025. The usage of recycled water to offset potable water will conserve valuable drinking water resources. The Department of Public Utilities is also required by the Central Valley Regional Water Quality Board to adequately treat wastewater and manage the groundwater quality beneath the percolation ponds located at the Regional Wastewater Reclamation Facility (RWRF). The groundwater quality in the area around the RWRF is directly impacted by the quality and quantity of water being percolated into the ground through the surrounding percolation ponds. Advanced treatment and direct use of advanced treated water reduces the loading through the percolation ponds and reduces potential impacts to the quality of the groundwater. The current plant effluent is approved only for use to irrigate non-food chain crops while the advanced treated water would have no restrictions on what can be irrigated. The advanced treated water which will be produced by the TTDF is approved for use in landscape irrigation, groundwater recharge and industrial cooling applications. On August 26, 2010, the City Council approved a professional services contract for the design of the first phase of the Tertiary Treatment and Disinfection Facility. This treatment facility when fully built out will produce 25,000 acre-feet per year of potable water offsets. This construction contract is for the first phase of the TTDF which will provide more than 4,200 acre-feet per year toward the 25,000 goal. The TTDF design was completed on March 17, 2014 and the construction contract was advertised. Nineteen prospective bidders downloaded the bid documents consisting of electronic drawings and specifications. On May 6, 2014, four bids were received. W.M. Lyles was determined to be the lowest responsible and responsive bidder. Following Fresno Municipal Code Chapter 4 Article 1 and Administrative Order 6-19, a request for qualifications for construction management services for the TTDF was advertised through Planet Bids on the City's website. Six (6) Statements of Qualifications (SOQ) for construction management were received and all six candidates were interviewed by a panel consisting of City and design consultant staff members. Three (3) candidates were asked to submit proposals. The Department chose to proceed with Carollo Engineering, Inc., as the firm with the most beneficial qualifications, proposed scope and level of effort. An agreement was negotiated in the amount of $1,417,588. Following Fresno Municipal Code Chapter 4 Article 1 and Administrative Order 6-19 a request for proposals for material testing and special inspection services for the TTDF were also advertised through Planet Bids on the City's website. Five (5) proposals were received. The Department chose to proceed with Moore Twining Associates as the firm with the most beneficial qualifications, proposed scope and level of effort. An agreement was negotiated in the amount of $116,029. The City Attorney has reviewed and approved these three contracts as to form. Upon approval by the City Council, the agreements will be executed by the Director of Public Utilities or his designee, who has been delegated this authority by the City Manager. ENVIRONMENTAL FINDINGS The Tertiary Treatment and Disinfection Facility has been evaluated for compliance with the CEQA Guidelines. Based on the attached environmental assessment (EA No. C-12-113) and the list of identified mitigation measures, staff has determined that the project will not have a significant impact on the environment and that the filing of a mitigated negative declaration was appropriate in accordance with the provisions of CEQA Section 21157.5(a)(2) and CEQA Guidelines Section 15178(b)(1) and (2). A public notice of the attached mitigated negative declaration finding for Environmental Assessment Application No. C-12-113 (State Clearinghouse No. 2012061089) was published on February 14, 2014 in the Fresno Bee, posted with the County Clerk's office on that date, and was circulated through the State Clearinghouse for a 30-day review beginning on February 18, 2014. A Native American Tribal Consultation was also done. No comments were received. On March 24, 2014, the Development and Resource Management Department approved the environmental finding of Mitigated Negative Declaration in conjunction with approval of Conditional Use Permit No. C-12-113. The Department of Public Utilities, as applicant, has agreed to implement the Mitigation Monitoring Reporting Plan (MMRP), which is a standard condition of approval for projects. A copy of the environmental assessment and the Finding of Mitigated Negative Declaration is appended to this report. As part of the City Council's action on this matter, the Council is asked to adopt the Finding of Mitigated Negative Declaration for the awarding of construction contracts. LOCAL PREFERENCE Local preference does not apply to the award of the construction contract. The lowest responsive and responsible bidder is local. FISCAL IMPACT This project has no impact to the General Fund and is located in Council District 3. This project is identified in the five-year capital improvement plan. While this project is fully funded in the current fiscal year DPU is anticipating the approval of a State Revolving Fund low interest rate loan for this project. The loans currently being approved for recycled water projects are 30 year 1% terms. If this loan is secured staff will return to City Council for approval of the final financing agreement. If the loan is not secured the funding for this project will remain as is in the FY14 budget. Attachments: - Copy of Final Mitigated Negative Declaration - Bid Evaluation - Fiscal Impact Statement - Copy of Construction Management Agreement - Copy of Materials Testing Agreement - Vicinity map