REPORT TO THE CITY COUNCIL FROM: NICHOLAS D. MASCIA, PE, Assistant City Manager Interim Director-Capital Projects Department JENNIFER K. CLARK, Director Planning and Development Department BY: FRANCISCO V. MAGOS II, PE, Assistant Director Capital Projects Department, On-Site Project Management Division RICHARD L. MADRIGAL, Project Manager Capital Projects Department, On-Site Project Management Division SUBJECT ..Title Award a Construction Contract in the amount of $225,000.00 to CENCAL Services, Inc., of Fresno, California, for the Senior Housing Demolition Project (Bid File No. 12601755) (Council District 4) ..Body RECOMMENDATION Staff recommends that City Council award a Construction Contract to CENCAL Services, Inc. in the amount of $225,000.00, as the lowest responsive and responsible bidder for the demolition of existing building and parking lot at 4323-4333 North Blackstone Avenue to clear the parcel for construction of new senior affordable housing and authorize the Capital Projects Director or designee to sign the standardized construction contract on behalf of the City of Fresno. EXECUTIVE SUMMARY The Capital Projects Department (CPD) seeks to award a Construction Contract to CENCAL Services, Inc. following a competitive bidding process, which identified them as the lowest responsive and responsible bidder in the amount of $225,000.00. The project includes demolition of the existing building and parking lot to prepare the site for the development of future senior affordable housing. The Construction Contract will be funded utilizing Community Development Block Grant (CDBG) funds appropriated in Fiscal Year (FY) 2027. BACKGROUND On July 25, 2022, Council adopted the 2nd amendment of the Annual Appropriation Resolution No. 2022-154 appropriating CDBG funds for the acquisition of 4343 North Blackstone Avenue (APN 426-253-17) and 4323-4333 North Blackstone Avenue (APN 426-253-19) and approving the agreement for purchase and sale of the two parcels totaling 5.51 acres for the development of the new Senior Activity Center and Senior Affordable Housing projects. At the time of purchase, the two parcels each contained existing structures that required demolition for new development. The building on the Senior Activity Center parcel was vacant, but the building on the Senior Affordable Housing parcel was occupied by tenants. On September 8, 2023, Council awarded a construction contract to MAG Engineering, Inc., of Fresno, CA for the demolition of the existing building and parking lot at 4343 North Blackstone Avenue. The demolition of the building was completed on April 29, 2024. The existing structure at 4323-4333 North Blackstone was left undemolished until existing tenants could be relocated with the assistance of the City. The final tenants were relocated on March 31, 2025, leaving the building vacant and available for demolition. On April 24, 2025, Council adopted Substantial Amendment 2024-01 to the Fiscal Year 2024-2025 Annual Action Plan and authorized submission to the U.S. Department of Housing and Urban Development (HUD) to reprogram $1,214,423.49 in prior year project savings in CDBG and $135,57.41 in HOME Investment Partnership (HOME) funds. Of these funds, $580,300.00 was reprogrammed for the Senior Housing Demolition Project. On September 16, 2025, the City received the Authority to Use Grant Funding (AUGF) for $95,800.00 to be used for design and preliminary engineering requirements. On January 7, 2026, the City received the AUGF for $484,500.00 to be used for administering the construction requirements for demolition of the building and site. A Notice Inviting Bids was advertised and published on the City’s website, PlanetBids, and the Business Journal on May 29, 2026. The Project plans and specifications were distributed to twenty-five (25) prospective bidders and posted at two (2) building exchanges. Fifteen (15) sealed bid proposals were received and publicly opened July 14, 2026, with bid amounts ranging from $157,000.000 to $455,261.00. HD Matthews Demolition, the apparent low bidder, and Marco A. Gonzales Engineering Inc., the second lowest apparent bidder, were both deemed non-responsive following staff review. CENCAL Services, Inc., of Fresno, California, was determined to be the lowest responsive and responsible bidder in the amount of $225,000.00. The bids will expire on September 16, 2026. If the bids are rejected or expire, the Project must be rebid which will result in a delay to the Project.   The Community Workforce Agreement (PLA), adopted by Council in September 2021, does not apply to this contract because the engineer’s estimate for this Project was less than $1 million, pursuant to the terms of the PLA.   Staff recommends that Council award a construction contract in the amount of $225,000.00 to CENCAL Services, Inc., as the lowest responsive and responsible bidder for the Senior Housing Demolition Project, and authorize the Capital Projects Interim Director or designee to sign a standardized construction contract on behalf of the City of Fresno.   The City Attorney’s Office has reviewed and approved the standardized Construction Contract as to form. ENVIRONMENTAL FINDINGS For California Environmental Quality Act (CEQA) purposes, this Project is considered part of the Senior Activity Center Project. An environmental assessment Initial Study and Mitigated Negative Declaration (IS/MND) (SCH 2024101319, dated October 28, 2024) was previously adopted by City Council on December 5, 2024, as agenda item ID 24-1609. An analysis has been performed pursuant to CEQA Guidelines Section 15162 to determine whether a subsequent environmental review is required for this project. Based upon this analysis, the following findings are made to support the determination that no subsequent environmental review is required: No substantial changes are proposed in the project which will require major revisions to the IS/MND due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects because the project is being implemented as planned. Specifically, this item will implement the demolition of the buildings located at 4323-4333 North Blackstone Avenue. This demolition was contemplated and analyzed in the IS/MND adopted by Council. No substantial changes have occurred with respect to the circumstances under which the project is undertaken which will require major revisions to the IS/MND due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects. There is no new information of substantial importance, which was not known and could not have been known with the exercise of reasonable diligence at the time the previous IS/MND was adopted showing that: The project will have one or more significant effects not discussed in the previous IS/MND; Significant effects previously examined will be substantially more severe than shown in the previous IS/MND; Mitigation measures or alternatives previously found not to be feasible would in fact be feasible, and would substantially reduce one or more significant effects of the project; Mitigation measures or alternatives which are considerably different from those analyzed in the previous IS/MND would substantially reduce one or more significant effects on the environment. Based upon these findings, it has been determined that a subsequent environmental analysis is not required for this approval. LOCAL PREFERENCE CENCAL Services, Inc. is a local business, as defined by the Fresno Municipal Code. FISCAL IMPACT The Senior Housing Demolition Project is in Council District 4 and will have no impact to the General Fund. The Project will be funded utilizing CDBG funds appropriated in FY 2027. Attachments: Standardized Construction Contract Formal Procurement Evaluation Vicinity Map Location Map