REPORT TO THE CITY COUNCIL June 8, 2017 FROM: SCOTT L. MOZIER, PE, Director Public Works Department BY: ROBERT N. ANDERSEN, PE, Assistant Director Public Works Department, Construction Management Division BILL HERR, Construction Manager Public Works Department, Construction Management Division SUBJECT ..Title Approve a substitution of a listed subcontractor Super Seal & Stripe for the Manchester Transit Center Remodel, Project ID FC00019 (Council District 7) ..Body RECOMMENDATION It is recommended that the City Council approve the request from Davis Moreno Construction Inc., to substitute Super Seal & Stripe and utilize T&T Pavement Markings and Products to install the Traffic Stripes and Pavement Markings on the Manchester Transit Center Remodel project located in Council District 7. EXECUTIVE SUMMARY Davis Moreno Construction, Inc., the General Contractor who was awarded the referenced project, has requested to substitute Super Seal & Stripe who is listed in the bid documents as the Traffic Stripe and Pavement Markings installer. In accordance with the bid documents, Davis Moreno Construction listed Super Seal & Stripe for the Traffic Stripping portion of the project because the work exceeds one-half of one percent of the total contract amount. Davis Moreno Construction, Inc. notified the City by a letter dated March 7, 2017, that their Traffic Striping Subcontractor, Super Seal & Stripe after having a reasonable opportunity to do so, has failed or refused to execute a written subcontract. Davis Moreno Construction is asking that they be allowed to use T&T Pavement Markings and Products to perform the Traffic Stripes and Pavement Markings installation portion of the project. This action requires Council approval because Public Contract Code Section 4107 requires consent of the awarding authority to a request by a prime contractor for a substitution of a subcontractor. BACKGROUND On December 15, 2016, a contract was awarded in the amount of $1,445,814 to Davis Moreno Construction Inc., for the Manchester Transit Center Remodel project; the Notice to Proceed has been issued with a start date of March 13, 2017. In the original proposal, Super Seal & Stripe of Fillmore, California, was listed as the subcontractor for the Traffic Stripes and Pavement Markings portion of the contract. On March 7, 2017, Davis Moreno Construction provided the City a written request to substitute the listed Subcontractor, since the listed Subcontractor has refused to perform his or her subcontract under Public Contract Code Section 4107(a) (1). In accordance with Section 4107 of the Public Contract Code, a Prime Contractor may substitute a listed Subcontractor, with the consent of the awarding authority, when the listed subcontractor has refused to perform his or her subcontract as set forth in Section 4107. 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 Davis Moreno has requested that they be allowed to substitute T&T Pavement Markings and Products to perform the Traffic Stripes and Pavement Markings subcontract work in place of Super Seal & Stripe by letter dated March 7, 2017. Section 4107 of the Public Contract Code allows the Prime Contractor to substitute listed Subcontractors with prior consent from the awarding authority. In accordance with provisions of the Public Contract Code, the City has notified Super Seal & Stripe of the proposed substitution by certified mail delivered on March 13, 2017. Super Seal & Stripe provided written objections to the substitution but later rescinded their objection. 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 Traffic Stripes and Pavement Markings portion of the contract will not increase the cost of the project. This substitution does not affect the Disadvantaged Business Enterprise goal because there is no goal listed in the Contract Documents. 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 changers 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. Attachment: Request for Substitution