REPORT TO THE CITY COUNCIL October 8, 2015 FROM: SCOTT L. MOZIER, PE, Director Public Works Department THROUGH: ROBERT N. ANDERSEN, PE, Assistant Director Public Works Department, Construction Management Division PHILLIP TARVIN, Construction Manager Public Works Department, Construction Management Division BY: BILL HERR, Assistant Construction Manager Public Works Department, Construction Management Division SUBJECT ..Title Approve the Substitution of a listed Subcontractor, Dansa Construction, for emergency generator upgrade at City Hall - Project ID SC00003 - Council District 3 ..Body RECOMMENDATION It is recommended that the City Council approve the request from R&H Industries dba Best Electric (Best Electric) to substitute Dansa Construction and self-perform the concrete and ceiling tile work for the Emergency Generator Upgrade at City Hall. EXECUTIVE SUMMARY Best Electric, the General Contractor who was awarded the referenced project, has requested to substitute Dansa Construction, who is listed in the bid documents as the concrete and ceiling tile subcontractor. In accordance with the bid documents, Best Electric listed Dansa Construction for the concrete and ceiling tile portion of the project because the work exceeds one-half of one percent of the total contract amount. Best Electric notified the City by letter dated August 11, 2015, that their concrete and ceiling tile subcontractor Dansa Construction fails or refuses to execute a written contract. Best Electric is requesting to be allowed to self-perform the concrete and ceiling tile 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 February 5, 2015, a contract was issued in the amount of $692,300 to Best Electric for the construction of the Emergency Generator Upgrade at Fresno City Hall; the Notice to Proceed was issued April 20, 2015. In the original proposal, Dansa Construction of Fontana, CA was listed as the subcontractor for the concrete and ceiling tile work with the contract. On August 11, 2015, Best Electric provided the City a written request to substitute the listed subcontractor and self-perform the work, since the listed subcontractor would not execute 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 Best Electric has requested that they be allowed to self-perform the concrete and ceiling tile work in place of Dansa Construction, by letter dated August 11, 2015. 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 Dansa Construction of the proposed substitution by USPS certified mail which was delivered on August 19, 2015. Dansa Construction, did not timely provide written objections to the City within five working days of receipt of the notification ending at 5:00 pm on August 26, 2015. In accordance with Public Contract Code 4107 the failure to provide timely written objections this constitutes the listed subcontractor's consent to the substitution. 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 concrete and ceiling portion of the contract will not increase the cost of the project. This project does contain an Underutilized Disadvantaged Business Enterprise (UDBE) requirement however this substitution does not impact the UBDE commitments and will not affect the UDBE 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 changes in 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. Attachment: Request for Substitution