HomeMy WebLinkAboutAgenda Statement 1987/04/28 Item 4 COUNCIL AGENDA STATEMENT
Item 4
Meeting Date 4/28/87
ITEM TITLE: a) Resolution/ 'O S Authorizing and providing for the
issuance of bonds pursuant to the "Improvement Bond Act of
1915" for the special assessment district known and designated
as Assessment District No. 85-1 (Las Flores Drive)
b) Resolution Appropriating $162,156.82 for the
reserve fund as provided in the issuance of bonds pursuant to
the "Improvement Act of 1915" for special assessment district
known and designated as Assessment District No. 85-1 (Las
Flores Drive)
c) Resolution Making award for sale of bonds and
providing for the establishment of a redemption fund for the
special assessment district known and designated as Assessment
District No. 85-1 (Las Flores Drive)
d) Resolution Appropriating Assessment District No.
85-1 net bond proceeds of $1 ,558,013.48 for the Las Flores
Drive Improvement Project
e) Resolution Awarding contract for the construction
of certain public works of improvement in a special assessment
district known and designated as Assessment District No. 85-1
(Las Flores Drive)
V6///
SUBMITTED BY: Director of Public Works/City Engineer
REVIEWED BY: City Manager (4/5ths Vote: Yes X No )
City Council at its meeting on April 14, 1987, formed Assessment District No.
85-1 (Las Flores Drive) . The assessments were confirmed and the improvements
were ordered to be made.
RECOMMENDATION: That the City Council approve the resolutions proposed in
the title hereto.
BOARDS/COMMISSIONS RECOMMENDATION: Not applicable.
DISCUSSION:
In order to construct the improvements, it is necessary that the Council take
action on the five resolutions before it tonight.
Serial bonds will be issued to represent the unpaid assessment, and bear
interest at a rate not to exceed the current legal maximum rate of 12% per
annum. The length of the bonds is 15 years. Stone & Youngberg has made a
proposal for the purchase of the improvement bonds. The exact interest is not
determined until the day of the Council meeting.
Page 2, Item 4
Meeting Date 4/28/87
It is anticipated the rate will be between 8 and 9 percent. Marty O'Connor
with Stone and Youngberg will be at the Council meeting to answer any
questions concerning the bonds.
One of the resolutions this evening asks the Council to appropriate monies for
the reserve fund. This amounts to 10% of the confirmed assessment or
$162,156.82. The Council by previous action on November 18, 1986, had agreed
to fund the reserve funds. It is recommended that the City Council
appropriate these monies from the unappropriated balance of the General Fund.
Monies in the City funded reserve fund shall be utilized and appl ied as
follows:
a. Amounts in said reserve fund shall be transferred to the redemption fund
for the bonds if as a result of delinquencies in the payment of
assessments there are insufficient monies in said redemption fund to pay
principal of and interest on the bonds. Amounts so transferred shall be
repaid to the reserve fund from proceeds from the redemption or
foreclosure of property with respect to which an assessment is unpaid and
from payments of the delinquent assessments;
b. Interest earned on monies in the reserve fund shall accrue to the reserve
fund only to the extent that the amount of interest credited thereto shall
not result in the bonds becoming "arbitrage bonds" as defined in Section
148 of the Internal Revenue Code of 1986 (the "Code") and the regulations
promulgated thereunder, and any excess amount shall be credited back to
the General Fund of the City:
c. Upon the discharge of all assessments and bond obligations, the monies in
the reserve funds shall return to and become part of the General Fund of
the City and said monies are not to be utilized to assist in the discharge
of assessments but are strictly set aside as a loan to assist in the
purchase of properties resul ti ng from delinquencies in the payment of the
assessments.
Award of Contract
At 2:00 p.m. on September 1 7, 1 986, in Conference Room 2 and 3 in the Public
Services Building, the Director of Public Works/City Engineer received sealed
bids for "Construction of Earthwork and Grading, Street, Drainage and Utility
Improvements for the Extension of Las Flores Drive North of "D" Street in the
City of Chula Vista, CA". The work included clearing of the site, grading,
curbs, sidewalk, driveway approaches, water and fire protection facilities,
drainage facilities, underground electrical , telephone, cabl a television
facilities, and street lighting together with appurtenances and appurtenant
work to serve the benefitted properties. Bids were received from three
contractors as follows:
Bidder Bid Amount
1 . Erreca' s, Inc. - Spring Valley $1 ,195,970.00
2. Wm. Kirchnavy Construction, Inc. - San Marcos 1 ,255,117. 50
3. R. E. Hazard Contracting Co. - San Diego 1 ,31 8,81 8.65
Page 3, Item 4
Meeting Date 4/28/87
The low bid by Erreca's, Inc. was below the Engineer's estimate of $1 ,320,765
by $124,795 or 9.4%. We have reviewed the bid and believe it to be
satisfactory and recommend awarding the contract to Erreca's, Inc. in the
amount of $1 ,195,970.00. Funds for the award of this contract will come from
the proceeds of the sale of the bonds.
Attached is the Contractor's Disclosure Statement.
Erreca's Inc. has agreed to an extension in the award for the contract until
May 14, 1987. Attached is a copy of the letter granting this extension.
FISCAL IMPACT: The total cost of the project will be financed from bond
proceeds and General Fund monies as follows:
Bond Proceeds:
Account No. Description
Amount
623-6230-5201 Professional Services
623-6230-5291 City Staff Services $211 ,511 0 .00
0
1
623-6230-5569 Construction, Contractual 7,501 .
07
and Contingencies ,337,5 .778 8
TOTAL $1 ,558,013.48
General Fund Monies:
Account No. Description
Amount
Fund No. 544 Las Flores Drive Assessment
District 85-1 Special Reserve Fund $162,156.82
WPC 2741E
9tiff4/ the City Council of
Chula Vi a, California
Dated �� P7