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HomeMy WebLinkAboutAgenda Statement 1988/05/10 Item 6COUNCIL AGENDA STATEMENT • Item ~ Meeting Date 5/10/88 ITEM TITLE: Resolution~5",~ Rescinding Resolution No. 13437 accepting ids and awarding contract for Sewer Rehabilitation - Phase I and II at Various Locations in the City of Chula Vista, California", and awarding contract to the second low bidder, Bob Diment Backhoe Service SUBMITTED BY: Director of Public Works ~~ REVIEWED BY: City Managerc~,~~ ~ (4/5ths Vote: Yes No X ) On February 2, 1988, the City Council by Resolution Flo. 13437 accepted bids and awarded a contract for "Sewer Rehabilitation - Phase I and II at Various Locations in the City of Chula Vista, California" to Intertec Construction Co. The contractor, however, was unable to provide the required performance bond before the contract could be executed. Intertec Construction Co. has notified the City (see attached letter dated April 4, 1988) that they will be unable to complete the contract documents and enter into a contract with us. RECOMMENDATION: That Council: • 1. Adopt resolution rescinding award of contract to Intertec Construction Co. 2. Award contract to second low bidder, Bob Diments Backhoe Service, E1 Cajon, in the amount of $289,550.40. BOARDS/COMMISSIONS RECOMMENDATION: Not applicable. DISCUSSION: On February 2, 1988, the City Council awarded a contract in the amount of $269,222.45 to Intertec Construction Co. for the Sewer Rehabilitation - Phase I and II project. Intertec was the low bidder amongst the eight bids we received for the contract. Bids ranged from $269,222.45 to $468,524.50 (see attached A-113 for 2/2/88 Council meeting). Since the award of the project, Intertec attempted in good faith to obtain the erformance, material and labor bonds required by the contract documents. They failed to obtain the performance bond. We tried to assist the contractor by providing them with sufficient time to resolve their bonding problem because of their low bid and the professionalism of their staff. Unfortunately, they were unable to resolve the problem and thus, we must annul the award of the contract and declare Intertec in default. • / - ~' Page 2, Item 6 • Meeting Date 5 0 88 Staff has initiated the process to collect on Intertec's forfeited bid bond. This bond is in the amount of $26,922.25. Bid bond funds are to be deposited in the General Fund. We have reviewed this matter with the City Attorney's office and had been advised that the contract can be awarded to the second low bidder, Bob Diments Backhoe Service. This bid is also below the engineer's estimate of $432,919 by $143,368.60 or 33.1 percent. Staff has met with Bob Diment and his attorney. The company has agreed to indemnify the City of Chula Vista from any litigation brought by other contractors in case the award of the bid is challenged due to the expiration of the 60-day award period. Attached is a copy of the contractor's disclosure statement. FINANCIAL STATEMENT: Funds Required for Construction a. Contract Amount $289,550.40 b. Contingencies (approx. 10~) 28,949.60 Total Funds Required for Construction $318,500.00 • Funds Available for Construction Approximately $569,000 has been budgeted for this project and is available for construction. FISCAL IMPACT: Routine City maintenance after completion of project. WPC 3740E tip C;i~Y ~~~:~:~~~cil of Chula 1~is a, California Dated ~/il /.F ~ ... - ~.~ / ~'