REPORT TO THE CITY COUNCIL FROM: NICHOLAS D. MASCIA, PE, Assistant City Manager Interim Director - Capital Projects Department AARON A. AGUIRRE, Director Parks, After School, Recreation, and Community Services Department BY: JOSHUA S. RHODES, PE, Assistant Director Capital Projects Department, Construction Management Division KELLY YOST, PE, Construction Manager Capital Projects Department, Construction Management Division SUBJECT ..Title Approve the substitution of listed Subcontractor, Tosted Asphalt, Incorporated of Madera, California for court surfacing and equipment with Benyon of Fresno, California, for the Rotary East Pickleball Courts - Project ID PC00358. (Bid File 12500848) (Council District 6) ..Body RECOMMENDATION Staff recommends that the City Council approve the request from Harris Development Corporation, dba HBC Enterprises, to substitute Tosted Asphalt, Incorporated of Madera, California and utilize Benyon of Fresno, California for the court surfacing and equipment portions of this project. EXECUTIVE SUMMARY On December 5, 2024, a contract was awarded in the amount of $854,126.40 to Harris Development Corporation, dba HBC Enterprises (HBC Enterprises) of Fresno, California, for the construction of new Pickleball Courts at Rotary East Park. HBC Enterprises has requested to substitute Tosted Asphalt, Incorporated of Madera, California (Tosted), who is listed in the bid documents as performing the court surfacing and equipment portions of the project, with Benyon of Fresno, California (Benyon). This action requires City Council approval per Public Contract Code Section 4107, whereas the consent of the awarding authority is required to approve a request by a prime contractor for a substitution of a subcontractor. The replacement of the Subcontractor for court surfacing and equipment portions of the contract will not increase the cost of the project nor affect the contract term. BACKGROUND On December 05, 2024, a contract was awarded in the amount of $854,126.40 to HBC Enterprises, for the construction of eight (8) pickleball courts within Rotary East Park, located at 6464 N Cedar Avenue, including the installation of court lighting, fencing, and seating. The Notice to Proceed has not been issued. In HBC Enterprises' original proposal, Tosted was listed as the Subcontractor for the court surfacing and equipment portions of the contract. On January 8, 2025, HBC Enterprises provided the City of Fresno with a written request to substitute the listed Subcontractor, as the listed Subcontractor provided a revised cost that was not incorporated into the bid submission of HBC Enterprises and exceeds the original submitted estimate. HBC Enterprises has requested that they be allowed to substitute Benyon to perform the court surfacing and equipment portions of the contract in place of Tosted. On January 21, 2025, in accordance with provisions of Section 4107 of the Public Contract Code, the City of Fresno sent notification to Tosted, at the company's last known address, of the proposed substitution via FedEx shipment, which was delivered to Tosted on January 24, 2025. The City of Fresno received a written response from Tosted on January 28, 2025, posing no objection to the substitution. 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). Section 4107 of the Public Contract Code allows the Prime Contractor to substitute listed Subcontractors with prior consent from the awarding authority. The City Attorney's Office finds the proposed substitution of subcontractor to be legal and proper if the City Council consents to the substitution. The Community Workforce Agreement (PLA), adopted by City 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 the City Council approve the request from HBC Enterprises to substitute Tosted and utilize Benyon for the court surfacing and equipment portions of this project. ENVIRONMENTAL FINDINGS Based on staff analysis, it was determined that the Project is categorically exempt from the requirements of CEQA, pursuant to Section 15061(b)(3), as the Project activities would have no significant impact on the environment. LOCAL PREFERENCE Local Preference was not implemented because of federal ARPA funding. FISCAL IMPACT The Rotary East Pickleball Courts Project is located in Council District 6 and is funded utilizing Fiscal Year 2025 appropriations from American Rescue Plan Act (ARPA), Park Impact Fees, Measure P Category 1 and District Infrastructure Improvement Funds. The replacement of the Subcontractor for court surfacing and equipment portions of the contract will not increase the cost of the project and will have no impact on the General Fund. Attachments: Harris Development Corp dba HBC Enterprises, Substitution of Subcontractor Letter City of Fresno, Substitution of Subcontractor - Tosted Asphalt Inc. Letter FedEx Delivery Verification Tosted Asphalt, Incorporated, Response to Substitution of Subcontractor Letter Vicinity Map