REPORT TO THE CITY COUNCIL July 24, 2014 FROM: SCOTT L. MOZIER, PE, Director Public Works Department THROUGH: ROBERT N. ANDERSEN, PE, Assistant Director Public Works Department, Construction Management Division BY: PHILLIP TARVIN, Construction Manager Public Works Department, Construction Management Division SUBJECT ..Title Approve a substitution of listed subcontractor McCurley and Day Masonry, Inc., for the Universally Accessible Park - (Council District 1) ..Body RECOMMENDATION It is recommended that the City Council approve the request from Lewis C. Nelson and Sons, Inc. (LCN), to substitute McCurley and Day Masonry Inc., and utilize Williams Masonry for the Building Masonry work located at Universally Accessible Park located in Council District 1. EXECUTIVE SUMMARY LCN, the General Contractor for the referenced project, has requested to substitute McCurley and Day Masonry Inc., who is listed in the bid documents as the building masonry subcontractor. In accordance with the bid documents, LCN listed McCurley and Day Masonry, Inc., for the building masonry portion of the project because the work exceeds one-half of one percent of the total contract amount. LCN notified the City by letter dated May 13, 2014, that their building masonry, McCurley and Day Inc., was non-responsive and would not execute a contract. LCN is requesting Williams Masonry be allowed to perform the building masonry portion of the project. This action requires Council approval because Public Contract Code Section 4107 requires consent of the awarding authority to be requested by a prime contractor for a substitution of a subcontractor. BACKGROUND On April 10, 2014, a contract was issued in the amount of $7,819,000 to LCN for the construction of the Universally Accessible Park. In the original proposal, McCurley and Day Masonry of Fresno, California was listed as the subcontractor for the building masonry contract. On May 13, 2014, LCN provided the City a written request to substitute the listed subcontractor due to the listed subcontractor not executing a contract under Public Contract Code 4107 (a)(1). In accordance with Section 4107 of the Public Contracts Code, a Prime Contractor may substitute a listed subcontractor, with the consent of the awarding authority, when the listed subcontractor has refused to execute a written contract. The Subletting and Subcontracting Fair Practice Act requires the Prime Contractor to secure the permission of the awarding agency before substituting a non-listed subcontractor for a listed subcontractor in order to protect the public and subcontractors from bid shopping and bid peddling. (Southern California Acoustics Co., Inc., v. C.V. Holder, Inc. (1969), 71 Cal.2d 719,726. LNC has requested that they be allowed to utilize Williams Masonry to perform the building masonry work in place of McCurley and Day Masonry Inc., by letter dated May 13, 2014. Section 4107 of the Public Contract Code allows the prime contractor to substitute listed subcontractor with prior consent from the awarding authority. In accordance with provisions of the Public Contract Code, the City has notified McCurley and Day Masonry Inc., of the proposed substitution by certified mail delivered May 21, 2014. McCurley and Day Masonry, Inc., did not provide written objections within five working days of receipt of the notification ending a 5:00 P.M. on May 28, 2014, which constitutes the listed subcontractor's consent to the substitution. The City has not received a timely objection in accordance with Public Contract Code 4107. The City Attorney's Office finds the proposed substitution of subcontractor to be legal and proper if Council consents to the substitution. The replacement of the subcontractor for the building masonry portion of the contract will not increase the cost of the project. This project does not contain a Disadvantaged Business Enterprise (DBE) requirement and therefore will not affect the DBE status of the contract. ENVIRONMENTAL FINDINGS This is not a "Project" for the purposes of CEQA pursuant to CEQA Guidelines section 15378(b)(5), as it is an administrative action that will not result in direct or indirect physical changes to the environment. LOCAL PREFERENCE Local Preference was not considered because this action does not include a bid or an award of a City construction contract. FISCAL IMPACT There will be no impact to the General Fund or the project budget by this substitution.