REPORT TO THE CITY COUNCIL January 28, 2016 FROM: THOMAS C. ESQUEDA, Director Department of Public Utilities BY: MICHAEL CARBAJAL, Division Manager Department of Public Utilities - Water Division SUBJECT ..Title Award a construction contract in the amount of $15,157,862.00 to Mountain Cascade, Inc. for the City of Fresno Friant-Kern Canal Pipeline Project- Bid File 3372-2 (District 6, County). - MAY BE PULLED ..Body RECOMMENDATIONS Staff recommends that City Council: 1. Award a construction contract in the amount of $15,157,862.00 to Mountain Cascade, Inc. for the City of Fresno Friant-Kern Canal Pipeline project. 2. Authorize the Director of Public Utilities, or designee, to sign the contract on behalf of the City of Fresno. EXECUTIVE SUMMARY Subsequent to evaluation of submitted bid proposals by eight (8) pre-qualified contractors, Mountain Cascade, Inc. was found to be the lowest responsive and responsible bidder for construction of the City of Fresno's (City's) Friant-Kern Canal Pipeline (FKCP) in the amount of $15,157,862. Council approval of this contract to Mountain Cascade, Inc. is necessary for construction of the FKCP which will convey water to the City's Northeast Surface Water Treatment Facility (NESWTF) and aid in meeting the City's long-term conjunctive water use goals, achieve a balanced water portfolio, and alleviate groundwater overdraft problems by the year 2025. This contract award will be funded through a Safe Drinking Water State Revolving Fund (SDWSRF) low interest loan from the State Water Resources Control Board (SWRCB), accepted by the City Council on January 7, 2016, for the FKCP construction project in the amount of $26,520,000, as determined by the SWRCB. BACKGROUND In accordance with the Construction Management Act, the Department of Public Utilities (DPU) solicited statements of qualifications for pre-qualification for general contractor services. Announcements requesting Pre-Qualification for General Contractor Services for the construction of the FKCP project were published on July 6, 2015 in the Fresno Business Journal and posted to the City's PlanetBids Online site. The City received nineteen (19) pre-qualification submittals. Pre-qualification submittals were opened on August 4, 2015. The submittals were evaluated by the Water Division's selection committee utilizing the criteria outlined in the pre-qualification package. A total of thirteen (13) general contractors met the pre-qualification requirements. On October 15, 2015 completed project plans and specifications were advertised in the Business Journal. On October 20, 2015, a mandatory project pre-bid meeting was held at the Department of Public Utilities- Water Division, Program Management and Engineering Office, located at the City's Municipal Services Center. Ten (10) of the thirteen (13) pre-qualified firms attended the mandatory pre-bid meeting, resulting in ten (10) pre-qualified firms bidding for FKCP construction contract. Seven (7) sealed bid proposals were received and publicly opened on November 17, 2015. Mountain Cascade, Inc. submitted a bid price in the amount of $15,157,862 and is considered to be the lowest responsive and responsible bidder. The Staff Determination of Award was posted on the City's website on November 24, 2015. The price is 17% below the Engineer's Estimate of $18,182,754. The remaining six (6) bids ranged in price from $15,499,270 to $17,780,508. On January 7, 2016 the City Council approved acceptance of a $26,520,000 SRF Low Interest Loan through the SWRCB for construction of the Friant-Kern Canal Pipeline. The construction contract will be fully funded through this loan. The City Attorney has reviewed and approved as to form the contract documents. ENVIRONMENTAL FINDINGS An initial study and Mitigated Negative Declaration was prepared and adopted on June 14, 2012 for this project. A Notice of Determination was subsequently filed with the Fresno County Clerk's Office on June 19, 2012. The City of Fresno Raw Water Pipeline Project Initial Study was prepared in August of 2011, providing an analysis of the proposed alignments and the alternative pipeline alignments. An analysis has been performed pursuant to California Environmental Quality Act ("CEQA") Guidelines �15162 to determine whether subsequent environmental review is required for the Project. Based upon this analysis the following findings are made to support the determination that no subsequent environmental review is required: 1. No substantial changes are proposed in the Project which will require major revisions of the previous Negative Declaration due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects. In this case there are no changes to the Project. 2. No substantial changes occur with respect to the circumstances under which the Project is undertaken which will require major revisions of the previous Mitigated Negative Declaration due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects. In this case, the proposed pipeline alignment has not changed. 3. There is no new information, which was not known and could not have been known at the time of the previous Mitigated Negative Declaration that the Project will have significant effect not discussed in the Mitigated Negative Declaration. Based upon these findings, it has been determined that no further environmental documentation is required for this Project. Additionally, the City has been working with several Federal agencies to meet the requirements of the National Environmental Policy Act ("NEPA"). The USFWS and the Army Corp of Engineers approved the Biological Opinion in November, 2015 identifying the mitigations for the effect this Project has on endangered plants and wildlife. Following the USFWS's approval of the BO and endangered species mitigations, the BO was submitted to the USBR for their review and acceptance. Once accepted, the USBR will issue a Finding of No Significant Impact ("FONSI") and give authorization for the City to begin construction of the Friant-Kern Raw Water Pipeline Project. LOCAL PREFERENCE Local preference was not implemented because the project is funded by federal funds. FISCAL IMPACT There is no impact to the General Fund. The award of this construction contract will be funded by the State Revolving Fund Low Interest Loan through the State Water Resources Control Board as part of the construction of the Friant-Kern Canal Pipeline project. Appropriations are included in Water Division's FY2016 Capital Improvement Program adopted budget within the State Low Interest Loan FKCP Fund (40184). The loan repayments for the low interest loan were included in the water rate model used to create the five-year utility rate plan that was adopted by the City Council on February 26, 2015. Attachment: Bid Evaluation Information