HomeMy WebLinkAboutCC Resolution 12428 (West End Village Rehabilitation)RESOLUTION NO. 12428
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL
REJECTING ALL BIDS FOR THE FOURTH STREET/WEST END VILLAGE
REHABILITATION PROJECT (#11056), AND AUTHORIZING STAFF TO
REBID THE PROJECT.
WHEREAS, on the 5`h day of February, 2008, pursuant to due and legal notice
published in the manner provided by law, inviting sealed bids for proposals for the work
hereinafter mentioned, as more fully appears from the Affidavit of Publication thereof on
file in the office of the City Clerk of the City of San Rafael, California, the City Clerk of
said City did publicly open, examine, and declare all sealed bids or proposals for doing
the following work in said City, to wit:
"FOURTH STREET/WEST END VILLAGE REHABILITATION PROJECT"
PROJECT #11056
in accordance with the plans and specifications therefore on file in the office of said City
Clerk; and
WHEREAS, the four lowest bidders contained irregularities in their bids; and
WHEREAS, section 3.01 of the Contract Documents states that the awarding
authority has the sole discretion to reject all bids without any stated reason.
NOW, THEREFORE, IT IS HEREBY ORDERED AND RESOLVED that all
bids received for the 4th Street/West End Village Rehabilitation Project will be rejected in
accordance with Section 3.01, General Conditions of the Contract Documents, and that
staff will be directed to rebid the project, clarifying any ambiguities within the Contract
Documents.
I, ESTHER C. BEIRNE, City Clerk of the City of San Rafael, hereby certify that
the foregoing resolution was duly and regularly introduced and adopted at a regular
meeting of the Council of said City held on the 19th day of February, 2008, by the
following vote, to wit:
AYES: COUNCILMEMBERS: BROCKBANK, CONNOLLY, MILLER & CHAIRMAN BORO
NOES: COUNCILMEMBERS: NONE
ABSENT: COUNCILMEMBERS: HELLER
ESTHER C. BEIRNE, City Clerk
BAY CITIES PAVING & GRADING INC.
Buss 5029 Forril Drive, Concord, GA 94520
(925) 687.8666
FAX (925) 687-2122
Mail: Post Offlca BOX #6227, Concord, CA 94524-6227
February 15, 2008
Mayor Albert 1. Boro
City of San Rafael
P.O. Box 151560
San Rafael, CA. 9491571560
Re; 4' Street/ West End Village Rehab Project (#11056)
City Agenda Item No. 8 for City Council Meeting February 19, 2008
Dear Mayor,
This 'is to request that you award the subject contract to Bay Cities Paving & Grading, Jmc. ("Bay
Cities") as the lowest. responsive bidder rather than reject all bids. Today, Bay Cities received a
copy of the City's Council Agenda Report for Item No. 8 whereby the Public Works Department
("PWD") recommends that the City Council reject all bids and rebid the Project. The PWD's
supports its recommendation with the following general language:
"The four lowest bidders contained irregularities in theif bids. These irregularities are
based'on ambiguities in Government Codes, Business and. Professions Codes and our
Contractor documents regarding sub -contracting licensing requirements "
The 5d' lowest bidder, Team Ghilotti, has argued to the PWD that the four lowest bid all contain
the same irregularity and that the Contract should be awarded to it. To avoid any possible
disputes with the fift bidder, the PWD has recommended that all the bids be rejected. Contrary
to the position argued by Team Ghilotti, there are no irregularities in the bids submitted by the
four lowest bidders. The four lowest bidders have a total of over two hundred years of
experience in bidding for public entities and the argument that they all made the same error is far-
fetched. W1iile Bay Cities can understand the City's interest in trying to avoid disputes whenever
possible, the City should not bend to the desires of a discontented bidder simply because they
failed to provide a competitive bid. The argument that the four lowest bids contain the same
irregularity is without basis and the City's intention to revise its contract documents and re -bid the
Project could result in additional costs to the City ofapproasimately $500,000.
ffATEN ENT OF FACTS
The City issued specifications and bids for the 4' Street Project and solicited bids for the
construction of the Project. A major portion of the work involves the installation of a joint trench
to accommodate a future traffic system. The work of installing joint trenches and installing
conduits and cables within the conduits is eommoWy performed by general engineering
contractors using laborers. On February 5, 2008, bids were opened and Bay Cities submitted the
tis tits mUcy of Bay Cities, all employees are.tre W during employment withobt regard to rata, color, rellgla%, sex, national origin, ape, marital of Veteran status, Medical condition or handbag, orally
other legally prolacled status. This will acknoWedge that Bay Was Paving and Grading Inc. is an Equal Cpportunhy Employer, erxl bound by the clauses and conditions Idenh$ed In Exe Ows order
11245, as amended; theMetnam Em vatmms Readjustment Assistance Act of 1974, as amended, 38 ass 2012 and sermon 503 of the fienabUiiadon Act of 1979, as atnanded. and thetrimptem, ting
regulations anti which by this clause are incorporated herein.'
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Mayor Albert I $oro
February 15, 2008
Page 2
lowest bid of $3,504,384. The bid results are as follows:
1. Bay Cities $3,544,382
2. GbRotti Construction $3,524,479
3. Gordon N. Ball $3,603,305
4. Ghilotti Bros_ $3,644,414
5. Team Ghilotti $3,953,353
The bid opening was highly competitive and the range in bid prices between the top four bidders
was less tban 41/o. In the bid documents, the City listed a sub -breakdown of work which it
entitled "Lighting and Electrical Items-" Although the City's header referred to electrical work,
the vast majority of the work is for tate trench installation and is only tangentially related to
electrical work All four low bidders listed Hudson Excavation to perform the work. Folloviingr
the bid opening, the PWD contacted Bay Cities and asked why Bay Cities had not listed a licensed
electrical contractor to perform the electrical, work. Bay Cities explained that Hudson Excavation
possessed a General Enneering Class A: license and -was licensed to perform the general
engineering work of installing the joint trench (sawcutting, excavating, shoring trenches, laying
down.conduit, pulling wires, backfilling, etc. and associated streetwork). Bay Cities further
explained that Hudson untended to use a second -flier licensed electrical subcontractor (C.S_T) to
perform the hotwork of splicing of the electrical services into the existing loaded system. The
work involving the second-tier electrical subcontractor amounts to less than. $10,000. Bay Cities
and Hudson provided the PWD with the full documentation of the agreements and the costs of the
work. In subsequent verbal discussions, the PWD stated that it found that the bids of Bay Cities,
Ghilotti Construction, Gordon N. Ball, and Ghilotti Bros. were irregular because none of the
companies had listed the name of Hudson's second --tier electrician in its bid which was a violation
of Public Contract Code section 41.04. Based on this determination and the fear that Teen
Ghilotti might create a dispute, the PWD has recommended that all bids be rejected and the
Project be re -bird.
The bidding law regarding public work projects are contained in. California Public Contract Code
sections 4100-411.3. These sections of the Public Contract Code are commonly known as the
"Subletting and Subcontracting Fair Practices Act:' and were enacted to prohibit the evils of bid
shopping and bid peddling on public contracts. Section 4104 provides that the prime bidder set
forth in their bid, the name and the location of the place of business of each subcontractor who
will perfoun work or labor or render service to the prime contractor in excess of one --half of 1
percent (ill%) of the.prime contractor's total bid or $10,000 whichever is greater. Since all of the
prince bids were in excess of $3.5 million, the Public Contract Code only requires the listing of
subcontractors with sub bids in excess of $17,500. There is no dispute that the four lowest
bidders all listed their subcontractors who had submitted sub -bids in excess of 11M. In fact, all
had clearly listed Hudson in accordance with Public Contract Code § 4104 and the Section 3.03
of the City's Instructions to Bidders. Therefore, any arguments that the bidders shopped the bids
around to obtain an advantage over other bidders is ridiculous. There are no ambiguities or
Mayon- Albert J. Boro
February 15, 2008
Page 3
discrepancies between the City's Specifications and Public Contract Code § 4104 since the City
has reprinted verbatim the Public Contract Code into its Instructions for Bidders. The PWD's
position that the four lowest bids are irregular since the, four lowest bidders did not list C.S.T.
(the second-tier electrical subcontractor) is perplexing. Public Contract Code section §4107 has
never required that the prime bidders list second-tier subcontractors in their bids_ In fact, § 4107
only requires the listing of subcontractors who will perform work to the prime bidder. In its fifty
years of bidding public -work projects, Bay Cities has never known any public entity (Caltrans,
counties, cities, school districts, B.A R.T.) who has required second-tier subcontractors to be
listed. The bids of the, four lowest bidders are the same form of bids that have been submitted and
accepted on thousands of public work projects. The bids were not irregular.
TBE PWD' RECOMMENDATION MAX' COST THE CITY $500.000
ANIS DELAY THE PROJECT
In bowing to the claims of Team Gbilotti, the PWD appears to have made the incorrect
assumption that joint trench work and associated work can only be provided by electrical
subcontractors. If the City revises its specification to require that electrical companies can
perforin joint trench work; then it is likely that the City will incur an additional $500,000 in
additional and unneeded costs to construct the Project Joint trench work is the type of work
which Bay Cities and any of the prime contractors are entitled to perform and have performed as
general engineering contractors with Class A licenses. For instance, the CSLB specifically
provides that a general, engineering company can perform specialty work if that work is an
integral, part of the work of a general engineering company. The CSLB posts the following
question and answer in its Official Guide.
Can a general engineering ("All) contractor contract to perform the work of a single
trade (specialty work) if that specialty work is an integral part of the scope of work
for a general engineering contractor? For example, a general engineering contractor
can build a freeway wbich can include pouring concrete and putting up fences. Can
the "A" contractor take a contractor for concrete work only or to build a fence
only?
A "A" Contractor can contract to perform all or any part of a project that £alts under the
"A" classification ... Therefore, and "A" contractor could take a contract to build a fence of
pour concrete if the work was originally or currently part of the type of projects listed in
B&P section 7058 (airports, roads and similar "fixed works"). (Exlu`bit A).
The CSLF3's position reconciles with the Office of Attorney General's which has held that an "A
contractor may `engage in all types of construction without obtaining a supplemental
classification' for each specialized field of contracting." 40 Cal. Op. Att y Gen. 112 (1962) citing
with approval Oddo v. Hedde 101 Cal.App2d 375,385. There is nothing irregular or ambiguous
in the CSLB's, the Office of Attorney General's or California courts position regarding the
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Mayor Albert I Bozo
February 15, 2008
Page 4
general license: if a contractor has a Class A, general engineering license, he can perform
Weetwork and associated specialty work- Hudson Excavation has a Class A license and is
licensed to install the joint trench and associated work. -
The four lowest bidders fisted Hudson Excavation because Hudson Excavation offered a
competitive price to install the joint,trench work. If the City takes the unusual step to revise its
specifications, to require that joint trench work be only installed by electricians, then it is likely that
the bid prices will reflect the pricing of the fifth bidder whose bid was more than, $450,000 more
than Bay Cities' bid. Increased bid prices and delays to the start of the project are not in the
public's interest.
CONCLUSION
The four lowest bidders submitted prime bids that are in conformance with all laws, codes
and Contract Documents. There is no irregularities in these bids which listed Hudson Excavation
to perform joint trench* work and associated electrical work. As a general engineering contractor
with a Class A license, Hudson is more than qualified to perform joint trench work on the City's
project as it has done on hundreds of projects over the past twenty Yeats. Hudson will use C. S.T.
as its electrical subcontractor to perform the electrical work of splicing into the e.,dst:mg system.
None of the top four bidders listed C.S.T. on their Subcontractor Listing Form because C.S.T. is
a second-tier subcontractor and the Subletting and Subcontracting Fair Practices Act does not,
require the listing of second-tier subcontractors. There is no question that Hudson Excavation is
licensed to perform the work for which it is listed under the holdings of the CSLB, the Office of
the Attorney General or case law. The City can seek to reject all bid and revise its Contract
Documents to require that joint trench work be performed by an electrical subcontractor but this
would be like requiring that a dental surgeon perform teeth cleaning. Laborers working for
general engineering
., contractors commonly install joint trenches and conduit. If the City seeks to
prohibit Hudson and other general engineering companies from installing the joint trench, then the
City can expect that the costs of construction will be similar to the price of $3,953,353 submitted
by the ffth bidder rather than the price of $3,504,382 submitted by Day Cities, Day Cities
respectfully requests that the City reconsider its position and award the Project to Bay Cities.
aSincerely,
A�
anqu
eros
General Counsel
cc: Ken Nordoff, City Manager
Rob Epstein (City Attorney), Gus Guinan (Assistant City Attorney)