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Home My WebLink About#16 District pipeline replacement AGENDA ITEM #16 Public Utility District m MEETING DATE: October 2, 2024 TO: Board of Directors FROM: Neil Kaufman, System Engineer Chad Reed, Water Utility Director SUBJECT: Consideration of Authorizing a Change Order Allowance for the District Pipeline Replacement — 2024 Construction Contract From $295,310.50 to $620,000. APPROVED BY: Brian C. Wright, General Manager RECOMMENDATION: Authorize an increase in the change order allowance for the District Pipeline Replacement— 2024 construction contract from $295,310.50 to $620,000, for a total contract amount not to exceed $3,573,190. BACKGROUND: The Water Department has an ongoing need to replace existing water pipelines that fall into two basic categories. 1. Pipes in poor condition and require repeated repairs 2. Pipes that are old, undersized (typically 4-inch diameter and smaller) and have exceeded their useful life The District Pipeline Replacement — 2024 project covers about 5,900 feet of pipeline at three locations along Northwoods Boulevard in the Tahoe Donner area. The Town of Truckee plans to repave the Northwoods Boulevard loop during the summer of 2025, and the District has coordinated with the Town to perform this pipeline replacement work in 2024 before the paving work is performed. The bid documents for the 2024 project were structured with a base bid covering about 4,800 feet of pipeline, with an additive alternate for an additional 1,100 feet of pipeline. The bid opening was held at 10:00 am on January 24, 2024. Seven bids were received. On February 7, 2024, the Board of Directors awarded the construction contract to Hansen Brothers Enterprises (HBE) of Grass Valley, California, for an amount of $2,953,189.50. The Board also established a ten percent change order allowance of $295,310.50 for a total authorization not to exceed $3,248,500. Page 1 of 4 Page 190 of 231 ANALYSIS AND BODY: HBE began work on the project in early June 2024. To date, there has been one approved change order in the amount of$26,439.03. This work involved rerouting and replacing an under-drain on Northwoods Boulevard near Fjord Road. The District was unaware of this under-drain, and it was not identified by the Town of Truckee during the Underground Service Alert (USA) process. The bid schedule for the project is based upon a replacement pavement thickness of four inches. However, the actual pavement thickness on Northwoods Boulevard is six inches. As a result, the Water Department expects that pavement restoration costs will be about $200,000 above the original bid prices. Therefore, about $226,000 of the original $295,310.50 change order allowance has been allocated. In recent Water Department Updates to the Board, staff has discussed a significant water leak that has recently developed on a pipeline at the intersection of State Route 89 North and Rainbow Drive. This pipe is the only water distribution system connection to about 200 customers in the southern portion of the Prosser Lakeview subdivision. This 8" pipe is located inside a 12" steel casing installed in 1966. Per the as-built drawing for this pipe, the casing is about 250 feet long and extends from edge of right-of-way to edge of right-of-way. The District has potholed this existing casing at two locations to verify the accuracy of the as-built drawings. The casing is estimated to be about 25 feet deep at the west end and is in proximity to an existing overhead utility pole. At the east end, the casing is estimated to be about 17 feet deep, and the east end is also located in proximity to an existing overhead utility pole. In addition, the east end is directly underneath the telecom equipment that serves the entire Prosser Lakeview subdivision. Removing and replacing the 8" pipe within the existing 12" casing is very problematic due to the depth of the casing at the ends, and need to temporarily support and/or re-route the existing overhead utility lines and the existing telecom cabinets. About 1,200 feet north of Rainbow Drive, there is an existing 8" water pipe stubbed to the west edge of right-of-way. At this location, there is also an existing 10" steel water pipe running parallel to State Route 89 just outside the east edge of right-of-way. The terrain at this location is relatively flat, and the Water Department has determined that installing a new pipe across State Route 89 at this location can be accomplished more quickly and with less disruption to the Prosser Lakeview residents than removing and replacing the existing pipe inside the casing. After District staff had additional discussions with Caltrans, they will allow the District to open cut the roadway, versus requiring the "bore and jack" method of crossing Highway 89. Since the District has received permission to open cut the road 1200' north of Rainbow Drive, staff is working to expedite this alternate pipeline alignment installation and safely isolate the leaking section of pipe currently supplying Prosser Lake View Estates before winter. Staff has requested that HBE provide a price proposal for the additional work. The price proposal from HBE totaled about $325,000. Therefore, it is requested that the Page 2 of 4 Page 191 of 231 Board increase the change order allowance for the District Pipeline Replacement — 2024 construction contract from $295,310.50 to $620,000 for a new total contract amount not to exceed $3,573,190. GOALS AND OBJECTIVES: District Code 1.05.020 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. District Code 1.05.030 Goals: 1. Manage for Financial Stability and Resiliency 2. Environmental Stewardship: Create a sustainable resilient environment for all our communities. FISCAL IMPACT: Pipeline replacement is an annual recurring item within the capital budget and a 10- year capital improvement plan of the water utility, with a ten-year annual average of $2.33M. The water utility's approved capital budget for FY24 included $1.946M for 3500 feet of pipeline replacement, equating to $556 per foot. The budget also included $338,000 for a new pipeline, which is now known to be delayed to a linked project currently planned for 2027. Fiscal Impact Components ($000s) $3.249 for the pipeline replacement construction contract (this agenda item) $0.190 other project costs (inspection, geotechnical testing) associated with this project Total estimated cost of $3.439 $1.946 budget 2024 pipeline replacement Additional $1,493 variance to budget $4.878 Water's FY24 system capital project total budget + $1.493 variance for pipeline replacement - $0.380 known new pipeline project delayed to 2027 _ $5.991 Water's FY24 system capital project total forecast The above represents a $1.113 or 23% variance over the FY24 water system capital project budget. Page 3 of 4 Page 192 of 231 The water utility had an operating reserve fund balance of $8.2M as of 12/31/2023, which is $1.3M greater than the minimum balance per District policy. The FY24 Budget includes a $1.1 M operating reserve transfer to the capital reserve fund, and is expected to end FY24 at a budget (and policy target balance) of $6.6M. Water's capital reserve balance was $3.1 M as of 12/31/2023 and FY24 budget (post-transfer in) is $4.5M. Review of budget and financial master plan, the $4.5M capital reserve has sufficient funds for the additional expenditure in FY24. ATTACHMENTS: 1. SR 89 Photos Combined Page 4 of 4 Page 193 of 231 w li! A. 3 9'4p .. His ,� ►�.,, .. -tea �� `A. � F t 7� y'7 � ,, � - •• - y�x , r ✓ Yc� � SwF � r ,A. ✓ 4� FL'i M 4 .. _ f - r ,yrx q; is f t �! Ifop 4i Owl ty r v -is�" r �G G t J+•d 7*,' - � - It - .. ;y `ltfy �/r�,1 r��W _ ! �Ts""af• r. �.^' �Y �-�� :� .fir, �ti� ;� �ur . rl r', Page 195 of 231 "•. s +wry k Pak r �.� ' a - > a. .f�.w' �'+^ �+'� is•r '�', , .►, �i r rye ' • �. � i�r N' 4 s s•Y•' t �. �-'.• �►,%,i � _ .y •r gyp.. ` < ? - R;m ._ u. - It �y 5 r. 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