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  Agenda Item   20.    
City Council Meeting
Meeting Date: 08/15/2023  
FROM: Bill Gallardo

Maintenance Agreement with Sancon Technologies Inc. for Placement of Cured-in-Place Pipe (CIPP) and Manhole Rehabilitation
Award contract to Sancon Technologies Inc. (Sancon) for placement of Cured-in-Place Pipe (CIPP) and manhole rehabilitation at identified locations within the City of Brea for a period of one year, with the capability to renew the contract for four additional one-year periods and authorize the City Manager to approve contract renewals for a not-to-exceed amount of $300,000.
To properly maintain a cost-effective solution of the City's sewer infrastructure, including mainlines and manholes, a process called Cured-in-Place Pipe (CIPP) is used. CIPP allows the rehabilitation of existing sewer lines without the need to dig up the entire length of the pipe and replace it. It uses a material inflated with air and inserted into the existing pipe.

In 2017, City Council awarded a contract with Sancon to perform these CIPP services for $300,000 annually for five years. The contract has expired, and staff has solicited these services through the Request for Proposal (RFP) process. 

On March 30, 2023, the City received three responsive bids to the RFP. Staff reviewed the proposals to determine the bidder's ability to provide sufficient staffing and equipment to perform the work at a competitive price and meet the City of Brea’s production goals and high-quality work standards.

After reviewing the qualifications and pricing of the proposals, staff ranked the bidders as follows:
Contractor 6” Linear Ft. Cost 8” Linear Ft. Cost 10” Linear Ft. Cost
Sancon Engineering $38.00 $38.00 $38.00
Southwest Pipeline $39.00 $38.00 $45.00
Insituform Technologies $40.00 $38.00 $45.00

Based on pricing comparisons, staff found Sancon's pricing the most cost-effective and responsive to the City's requirements. Sancon's proposal yielded a savings of over 3.1 percent compared to the second-lowest bidder, Southwest Pipeline.  Staff's prior experience with Insituform Technologies found extra charges for items other proposers included in their pricing, such as cutting in for lateral connections. Staff has no historical experience working with Southwest Pipeline, but their prior proposal submittals included higher pricing compared to Sancon.
Staff has established a good working relationship with Sancon over several years. Sancon has been responsive to City staff setting up pre-construction meetings and providing informational brochures on their operations and products to inquiring residents. Based on this determination, staff recommends awarding the annual sewer mainline for placement of CIPP and manhole rehabilitation to Sancon for the annual sewer mainline relining. The Public Works Department has considered performing this work. Still, it needs in-house expertise, necessary equipment, and staffing to conduct this work without hiring personnel and purchasing additional equipment.
On Tuesday, August 8, 2023, the Finance Committee recommended adding the pricing comparisons and additional information regarding Consumer Price Index (CPI) and potential price increase information. The requested information was added to this report and shared with the Finance Committee members before the Council Meeting. This item was recommended for the August 15 City Council meeting.
Staff posted an RFP for a CIPP and manhole rehabilitation contractor to the website. The City received three responsive bids. Based on proposal reviews and price comparisons, staff recommends awarding the contract to Sancon. This is a one-year contract with renewal for up to four additional one-year periods at the City's discretion. This recommendation is based on the ability of Sancon to meet all the City's requirements, including pricing, responsiveness, and high-level customer service, as well as the company's overall stability. 
Annually, as part of the renewal consideration, staff will review the contract based on current prevailing wage rates and any Consumer Price Index (CPI) increases. The agreement does allow for an annual CPI adjustment for each renewal. If annual CPI adjustments exceed three percent, staff will bring this item back for City Council approval.

Public Works budgets $300,000 per year in CIP accounts Fund 510 for this work. There is no cost to the General Fund, and no additional appropriation is needed.
William Gallardo, City Manager
Prepared by: Jerry Mestas, Public Works Supervisor
Concurrence: Michael Ho, Director of Public Works/City Engineer
Price comps
Sancon Bond
Sancon agreement

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