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CC Work Session 2, 3,
<br />Meeting Date: 09/13/2022
<br />Information
<br />Title:
<br />Review Estimated Project Costs, Funding Sources, and Construction Schedules for Proposed Water Treatment
<br />Plant Improvements
<br />Purpose/Background:
<br />Purpose:
<br />The purpose of this case is to receive City Council consensus for Staff to request City Council approval of plans
<br />and specifications and authorization to advertise bids for the Water Treatment Plant project on September 27, 2022.
<br />Background:
<br />Feasibility Study
<br />Attached is a copy of the Feasibility Study dated March 4, 2021 for the proposed municipal water treatment plant
<br />improvements prepared by SEH, Inc. This study documents the City's existing water supply source, quality and
<br />quantity, existing water supply system infrastructure and proposed trunk watermain improvements, proposed water
<br />treatment process options and recommendations, water treatment plant site evaluations and recommendations,
<br />estimated costs, alternative funding sources, impacts to water rates, and a proposed project schedule. This study
<br />identified estimated project costs for both the necessary trunk watermain improvements and a centralized gravity
<br />filter water treatment plant at $28.67M.
<br />Water Treatment Plant Trunk Watermain Improvements
<br />On March 9, 2021, the City Council awarded a contract to SEH Inc. to prepare plans and specifications for
<br />Improvement Project #21-08, Water Treatment Plant Trunk Watermain Improvements.
<br />On October 26, 2021, the City Council approved plans and authorized bids using both a base bid and an alternate
<br />bid. The base bid specified a combination of open trenching and directional drilling the watermain, whereas the
<br />alternate bid specified directional drilling watermain across as much of the project area as feasible, and open
<br />trenching the remainder. As the time, the bidding environment for utility pipes was extremely volatile due to an
<br />overall shortage of pipe and appurtenant materials for various material types caused by supply chain disruptions
<br />due to extreme weather events, a shortage of drivers, shipping lane blockages, etc. These issues resulted in
<br />increased pipe costs and long delivery times between the time materials were being ordered and the time they were
<br />being delivered. On average, pipes were being delivered to project sites generally 3 to 6 months or more from the
<br />time they were ordered. Staff therefore recommended bidding this project as soon as possible, allowing an extended
<br />bidding window of 2 months, and allowing bidders as much time as possible to substantially complete the work in
<br />hopes of receiving the best bid prices possible.
<br />Construction costs for the trunk watermain improvements per SEH's Feasibility Study were estimated at
<br />$3,424,750. Construction cost estimates based on SEH's final plans and specifications were $4,875,068.50 for the
<br />base bid, and $4,916,194.50 for the alternate bid. The lowest base bid for construction costs was $6,737,287.45,
<br />and the lowest alternate bid received was $7,059,102.16. Due to the significant cost increase, the two bids received
<br />were rejected by the City Council on January 25, 2022, and Staff was directed to work with SEH to revise the
<br />approved plans to reduce costs and monitor the bidding environment to identify the most favorable time to re -bid
<br />the project.
<br />SEH has been working to reduce project costs by exploring alternate construction materials and methods, reducing
<br />watermain depths, reducing the amount of directionally drilled watermain, and exploring the viability of the City
<br />pre -purchasing watermain materials to avoid sales tax. However, SEH has also been working to incorporate
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