Agenda - Council Work Session - 07/22/2025

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CC Regular Session Meeting Date: 07/08/2025 Primary Strategic Plan Initiative: Address infrastructure needs. 7. 2. Title: Adopt Resolution #25-128 Approving Change Order No. 3 and Engineering Amendment No. 3 for Improvement Project #21-09, Centralized Water Treatment Plant Purpose/Background: Purpose: The purpose of this case is to adopt Resolution #25-128 approving Change Order No. 3 and Engineering Amendment No. 3 for Improvement Project #21-09, Centralized Water Treatment Plant. Background: Advanced Engineering and Environmental Services, Inc. (AE2S) was hired by the City of Ramsey to design and prepare final plans and specifications for the Water Treatment Plant (WTP). AE2S was also hired by the city to provide construction services during construction. Magney Construction, Inc. (Magney) was awarded the construction contract for construction of the WTP. When the project was bid, bid alternate #1 was added in response to comments received from contractor's during the pre -bid meeting that the project schedule was very tight and that adding several months to the project schedule may help reduce bid prices since contractors tend to increase their bid prices if they have concerns that liquidated damages may be assessed if completion deadlines are not met. Magney therefore submitted a bid deduction for bid alternate #1 in the amount of -$50,000 based on a 28-month construction schedule versus a 24-month schedule per the base bid. When the city awarded the contract for construction, only the base bid was awarded meaning Magney has 24-months to complete the project. During construction, the city approved 2 Change Orders and 2 Engineering Amendments as follows. • Change Order #1 — Increased project costs $794,153.71 to apply prevailing wages so awarded grant funds could be used. • Change Order #2 — Extended completion dates by 88 days due to delays in obtaining DOLI and building permits. No cost increase was associated with this CO. • Engineering Amendment #1 — Increased construction services fees $225,100 due to construction schedule extension. • Engineering Amendment #2 — Increased construction services fees $2,683.15 due to building permit requirement for as -built survey. Also included $14,640.69 for engineering services due to plan revisions needed to address new DOLI code and city site plan review process. City staff met with and held numerous conversations with staff from AE2S and Magney Construction regarding Change Order No. 3 and Engineering Amendment No. 3. City staff felt there were generally three options for moving forward with these requests, as follows. • Option #1 — Present Change Order #3 and Engineering Amendment #3 as is and request City Council approval. • Option #2 — Agree to a more equitable distribution of costs across all parties resulting from these requests. • Option #3 — Leave the schedule as is and apply liquidated damages through the contract, if needed. City staff expressed that the city has endured significant project delays and cost increases during this project, and