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  Agenda Item   16.    
City Council Meeting
Meeting Date: 09/19/2023  
FROM: Bill Gallardo

Award Contract with Kana Pipeline, Inc. for the Associated Road High-Pressure Water Line, CIP No. 7476 (Project)
  1. Approve the Plans and Specifications; 
  2. Receive bids; 
  3. Award Contract to the lowest responsive and responsible bidder, Kana Pipeline, Inc.for $2,399,420.00; and,
  4. Authorize the City Engineer to issue Change Orders up to a "not-to-exceed" amount of 10% of the Contract Price.
Associated Road High-Pressure Water Line, CIP 7476 (Project) is programmed in the FY 2023-24 Capital Improvement Program (CIP) in the amount of $2,750,000.  The Project is located along N. Associated Road from Birch Street to the south and Lambert Road to the north (Attachment A).  The project generally consists of, but is not limited to, contractor mobilization, furnishing, and installing approximately 3,963 linear feet of 12” cement mortar-coated steel pipe with fittings, waterline tie-ins, and any potential incidentals or unknowns per the Plans and Specifications. This Project will complete the high-pressure water line loop from Birch Street to Lambert Road.

On July 3, 2023, the Final Plans and Specifications (“Bid Documents”) were accepted by staff, and the Project was advertised for bids on the website and subsequently published in the Star Progress paper before bid opening. A hard copy of the bid documents is available at the City Clerk’s office for review (Attachment B). One addendum was issued during the bid period, which updated the plans and specifications. Therefore, staff recommends the City Council approve the Plans and Specifications with Addendum #1 as bid.     

On August 3, 2023, staff received five (5) bid proposals (See Bid Result Table). Soon after that, staff tabulated the bid proposals and determined that the apparent low bid amount was $2,399,420 from Kana Pipeline, Inc. (“Kana”) of Riverside, CA (Attachment C).  The Engineer’s Estimate was $2,100,000. Staff evaluated the bid proposal and determined that the bid unit prices from Kana were considered reasonable compared to the Engineer’s Estimate and the current bid unit prices at the time of bid.  

Bidder Name Bid Amount
Kana Pipeline, Inc. $2,399,420.00
Teichert Energy & Utility Group, Inc. Dba Teichert Utilities $2,537,075.00
T.E. Roberts, Inc. $2,698,769.00
Dominguez General Engineering, Inc. $2,974,169.00
Boudreau Pipeline Corp. $3,224,820.00

Kana has been in the construction business for 39 years and has completed construction of similar waterline improvement projects for the City of Huntington Beach and City of Anaheim.  Their California Contractor’s license is 461487 – A (General Engineering), and Department of Industrial Relations registration number is 1000000223. Both licenses have been verified by staff, and their submitted bid package meets the City’s proposal requirements. In addition, staff contacted the Cities of Huntington Beach and Anaheim, where the contractor received a favorable review. Therefore, staff recommends that the City Council consider awarding a Construction Contract to Kana as the apparent lowest responsive and responsible bidder, in the amount of $2,399,420.00 (Attachment D).
The Finance Committee reviewed staff's recommendation at their September 12, 2023, meeting and recommended for City Council approval.  
The approved FY 2023-24 CIP Project budget for Construction and Construction Engineering is $2,750,000. The total cost for Construction and Construction Engineering is $2,748,362, which includes the apparent low bid amount of ($2,399,420), a 10% contingency ($239,942), and Construction Engineering costs ($109,000). The funds within the approved budget are from the Water Fund (Fund 420) and Gas Tax (Fund 220). Therefore, there are sufficient funds to complete the Project construction. Upon completion of the Project, the remaining fund balances will be de-obligated and transferred back into the Water Fund (Fund 420) and Gas Tax (Fund 220), respectively.  There is no fiscal impact to the General Fund from this Project.  See budget table below:
Description Amount
Construction (Kana Contract) $2,399,420
Construction Contingency (10%) $239,942
Construction Engineering $109,000
Total Construction Cost $2,748,362
Approved FY 23-24 Budget $2,750,000

The Project will complete the high-pressure water line loop from Birch Street to Lambert Blvd. If City Council approves staff recommendations, the Project is anticipated to start construction in October 2023 and be completed by February 2024.
William Gallardo, City Manager
Prepared by:  Ryan Chapman, PE, Assistant City Engineer
Concurrence:  Michael Ho, PE, Public Works Director
Attachment A - Location Map
Attachment B - Bid Documents
Attachment C - Kana Pipeline, Inc Bid Proposal
Attachment D - Construction Contract Agreement

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