HomeMy WebLinkAbout14 Tank Rehab 2023 Bid Rejection TRUCKEE - AGENDA ITEM #14
Public Utility District
MEETING DATE: April 5, 2023
TO: Board of Directors
FROM: Neil Kaufman, Water System Engineer
Chad Reed, Water Utility Director
SUBJECT: Consideration of Rejection of All Bids for the Ski Run Water Storage
Tank Rehabilitation Project
APPROVED BY -
Bn`an C. Wright,.'General Manager
RECOMMENDATION:
Reject all bids received for the Ski Run Water Storage Tank Rehabilitation Project.
BACKGROUND:
The District currently operates 34 water storage tanks located throughout the water
distribution system:
• 30 ground level welded steel tanks
• Two ground level bolted steel tanks
• One partially buried pre-stressed concrete tank
• One elevated welded steel tank
The tanks range in volume from 100,000 gallons to 1.5 million gallons with the oldest tank
constructed in 1963 and the newest tank constructed in 2021.
Many of these tanks are still utilizing their original interior coating systems, which are
approaching 50 years old. The design standards and seismic engineering requirements
have also changed significantly and while the tanks are not out of compliance, many of
the tanks do not meet current standards.
During preparation of the 2020 Water System Capital Improvement Plan update, staff
identified the need for significant increases in funding for annual water storage tank
maintenance projects. In order to efficiently plan for and manage the additional projects,
the need for an outside engineering consultant was identified. In June 2021, the Water
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Department issued a Request for Proposals (RFP) to select a consultant to perform the
engineering work associated with the District's water storage tank rehabilitation plan.
After review of the proposals, a contract was awarded to Carollo Engineers in August
2021.
Staff and Carollo Engineers identified the District's Roundhill Tank as the first water
storage facility to be addressed within the larger storage tank rehabilitation plan. During
the development of the project specifications and bid documents, staff consulted with
Carollo Engineers regarding a cost benefit analysis between rehabilitation and
replacement. It was recognized at the time that the recent shift in labor costs and
materials had narrowed the gap between the two options from a cost perspective but
consensus was that rehabilitation was still the most favorable option.
Bid documents for the rehabilitation of Roundhill Tank were completed by Carollo in
March 2022, with a Bid Opening held in April, 2022. On May 4, 2022, a contract was
awarded to Resource Development Company (RDC) of Sparks, Nevada. During the
rehabilitation project, it was determined that the metal tank shell and weld materials were
found to be at a much more advanced state of degradation than originally anticipated. To
address this advanced stage of degradation, a change order was approved to address
the discovered issues. Recognizing that there was already substantial progress in the
completion of the Roundhill Tank Rehabilitation Project prior to discovery of the additional
necessary work, staff determined the change order issuance was appropriate. However,
it was also acknowledged that with the additional change order work, the overall cost of
rehabilitation was quickly approaching engineer's estimates for complete replacement.
ANALYSIS:
In September 2022, the Board of Directors approved a contract with Carollo to conduct
engineering evaluations and prepare bid documents for the rehabilitation of the Ski Run
and Prosser Lakeview Tanks. The cost proposal for this work was $182,975. The Board
also approved a ten percent change order allowance for a total authorization not to
exceed $201,300.
Based upon the field inspections, it is believed that the Ski Run tank is in better condition
than the Roundhill Tank. However, it should be noted that the configuration of the water
system prevents the tank from being removed from service and completely drained to
perform a thorough interior inspection. It should also be noted that the Ski Run Tank was
built by the same contractor in the same general time frame as the Roundhill tank and a
similar level of repairs are expected.
As noted above, an overall review of water system operations and water storage
capacities was conducted. This review determined that the Ski Run Tank has a critical
function in moving water to the highest portion of the Tahoe Donner subdivision. Simply
removing the tank from service is not feasible. In an effort to reduce the project cost, the
scope of work was slightly reduced with items such as replacement of the roof vents and
ladders and installation of a sample port removed from the contract.
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A set of bid documents for rehabilitation of the Ski Run tank was prepared and bidding
began in early February 2023. The bid opening was held on March 2, 2023. Five bids
were received:
Bidder Location Amount Responsive
Euro Style Management Sacramento, CA $395,000 Yes
Resource Development Company Sparks, NV $505,100 Yes
Paso Robles Tank Hemet, CA $649,116 Yes
Crosno Construction Arroyo Grande, CA $670,884 Yes
Unified Field Services Corporation Bakersfield, CA $54,548,737 Yes
It should be noted that there was a mathematical error in the bid from Unified Field
Services Corporation. Correction of this error using the procedure indicated in the bid
documents results in the final bid price given above.
All bids received were over the engineers estimate, of$361,000. The apparent responsive
low bidder was Euro Style Management for $395,000 or nearly ten percent over the
engineer's budget. In addition to the overage, staff knows additional costs would be
incurred for the construction-phase engineering, construction inspection and
administration. There are sufficient funds available to proceed with the bid from Euro
Style Management. However, it is position of the Water Department that spending $450k
- $500k to rehabilitate the existing tank is not advisable for the following reasons:
1) The existing tank is functional, but is undersized. At 100,000 gallons, it is the
smallest tank in the system (the Armstrong Tank is also 100,000 gallons in size).
2) The rehabilitated tank would not be upgraded to current seismic codes and the
diameter to height ratio of the smaller tanks makes them more susceptible to
damage in an earthquake event.
3) The rehabilitated tank would not be upgraded to current industry standards. As
noted above, certain items were deleted from the scope as a cost savings
measure.
The existing pump station at the Ski Run tank is original construction (50 years old). The
building is in fair condition with chalet-style wood stick framing and a metal roof. The
electrical switchgear has not been replaced and the structure is too small to allow for
proper maintenance of the pumps and equipment.
The overall plan for this site involves replacement of the pump station with a new CMU
block building and electrical switchgear. The site piping was replaced in 2008 and
provisions for a new pump station structure were included in that work. The generator at
the site was installed in 2008 and will remain. After the new pump station is constructed
and the old pump station is demolished, there will be sufficient space for construction of
a larger tank (200,000 to 250,000 gallons) at the site.
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Goals and Objectives:
This item is in support of the following goals and objectives:
District Code1.05.020 Objectives:
1. Responsibly serve the public.
3. Provide reliable and high quality water supply and distribution system to meet current
and future needs.
5. Manage the District in an environmentally sound manner.
6. Manage the District in an effective, efficient and fiscally responsible manner.
Strategic Goals:
1. Manage for Financial Stability and Resiliency.
FISCAL IMPACT:
There is no direct fiscal impact associated with rejecting the bids for the Ski Run Water
Storage Tank Rehabilitation. The Water Department will proceed with redevelopment of
the Ski Run Tank site. Contracts for design and construction associated with this work
will be presented to the Board at future date.
It is likely that an outside contract will also be necessary for demolition and removal of the
existing Prosser Lakeview Tank.
ATTACHMENTS:
None.
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