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HomeMy WebLinkAbout35-87 RESOLUTION• RESOLUTION 35-87 No resolution written for this resolution. May 19, 1987 WEDINGTON SEWER IMPROVEMENT DISTRICT Attorney Rick Osborne, speaking for the Wedington Sewer Improvement District, told the Board that an error had been made when notice was sent to owners of property within the district. Osborne said notice was sent by regular mail and the law requires notice to be made by certified mail. Osborne said that the public hearing would have to be held again, for public comment to determine the sufficiency of the petition, and that at the next Board meeting on June 2, the Board would have to consider re- enactment of the ordinance. Osborne said bond counsel has also advised a number be assigned to the district -- Wedington Drive Sewer Improvement District No. 1. The Mayor opened the public hearing for public comment to determine the sufficiency of the petition to form the district. The Mayor asked if anyone wished to speak. Osborne told the Board the signers of the petition constitute own over 65% of the assessed value of property in the district. The hearing was closed, to be reopened for comments on June 2. WASTEWATER TREATMENT PLANT ITEMS SLUDGE VEHICLES. The Mayor introduced the award of bid for sludge application vehicles for the wastewater treatment project. She reported that CH2M Hill, the engineer, recommends the award of bid to the lower of two bidders, I.M.E., bidding a lump sum of $208,000; she said the engineer reports grant money is available for these vehicles out of contingency amounts which will be otherwise unused since there were more deductive change orders than additive ones. Director Bumpass, seconded by Hess, moved the award of bid as 147.4 recommended. Upon roll call, the motion passed, 7-0. I'2 147.1 147.2 147.3 SLUDGE SPRINKLERS The Mayor introduced the award of bid for sprinklers for the 147.5 sludge management project. She reported the engineer recommends the award to Hobbs -Adams Engineering Company, bidding a lump sum price of $329,232. She noted the engineer had judged Hobbs -Adams to be the lower of three bidders since the "apparent" low bidder could not meet delivery requirements. She added that only four of the 16 sprinklers would be grant eligible, with the remainder of the expense to be taken from contingency funds. 148. May 19, 1987 148.1 Dennis Sandretto, speaking for CH2M Hill, updated the Board on a revision to their recommendation. Sandretto said the "apparent" low bidder, Rainbow, had made an exception from. 120 days to 180 days. Sandretto said Rainbow has now pointed out that the bid document states that the contract award may take 75 days from the bid opening to the Notice of Award, with 120 days following that until the delivery date. Sandretto said Rainbow had calculated a total of 195 days, and therefore proposed 180 days. 148.2 Sandretto said Rainbow also submitted a standard warranty which indicated it superceded all other warranties, and had conditions in opposition to the warranty requirements of the contract documents. Sandretto said Hobbs -Adams submitted a statement that they would abide by the warranty in the document. Sandretto said for that reason the engineer has determined Rainbow is "not responsive". 148.3 Sandretto said that, according to the City Attorney, Arkansas law would permit the Board to award to a contractor who is not the lowest bidder but EPA regulations dictate the Board award to the lowest responsible responsive bidder. 148.4 Sandretto said, excluding sales tax, Hobbs -Adams' bid is about $7,000 higher than Rainbow's bid. 148.5 148.6 Director Hess asked if the differences in warranties would create a greater cost to the City. Sandretto said the possibility was there, the equipment was worth close to $250,000, and if there was some major defect in all of the equipment, he could foresee the possibility of a substantial cost. In reference to the point of hydraulic drive versus mechanical drive, Sandretto added that Rainbow has submitted a calculation showing their drive to be less expensive than Hobbs -Adams' drive. Hess commented that correspondence received after bids --have already been opened is probably not relevant. 148.7 The City Attorney quoted from McQuillan on Municipal Corporations, which he indicated correctly stated the law in Arkansas -- that "bids cannot be changed in substance after presentation and the lapse of the designated time for opening bids but merely irregularities in form may, after opening, be corrected or disregarded. In proper circumstances the contract may be awarded to one who is not the lowest bidder where this is done in the public interest and the exercise of discretionary power granted under the laws without fraud, unfair dealing or favoritism and where there is a sound and reasonable basis for the award is made." McCord said that the EPA, however, takes the position that, if you don't award to the lowest responsible bidder meeting bid specifications, the award will not be grant -eligible. 148.8 McCord quoted from the law, which states -- "if the lowest bidder does not comply with valid conditions in Fr J May 19, 1987 connection with his bid, the municipality may and should reject such bid. There must be a substantial compliance with the proposal to warrant the consideration of the bid. If the omission or irregularity is merely technical, it may be overlooked. But if there is a substantial requirement affecting the amount of bid or the like, the municipality must reject such bid, notwithstanding it is the lowest bid." Sandretto advised the Board to send its resolution to EPA for their concurrence, and if they agree, the award is grant eligible. McCord said if all bidders unquestionably met bid specifications and the Board awarded to a bidder other than the lowest bidder because it preferred the equipment, the EPA would not participate...if however a particular bidder is the low bidder but does not meet bid specifications, under the law the contract should not be awarded to that bidder. Sandretto suggested, if the Board agrees with the engineer, it pass a resolution making the award conditional upon the actions of the EPA. Director Lancaster moved approval of a resolution, to be drafted by the City Attorney, to award the contract to Hobbs -Adams. Director Bumpass asked that the bidders be permitted to address the Board. A representative from Rainbow Irrigation Systems of Fitzgerald, Georgia addressed the Board. He said he didn't think the point was whether or not the EPA will accept the form of their bid. He said they thought they were making an improvement in their exception to the delivery requirements. He said they agreed to the terms of the contract in all cases. He said they had offered a more efficient drive system which will cost less to operate. He said they did not take exception to the warranty but used a standard warranty form in their package which was not intended to override the warranty in the contract. He asked the Board for a chance to perform the job better for $7,000 cheaper. Director Martin said he thought the Board wanted to do business with the lowest responsive bidder but just can't tell at this point what the EPA's position will be. The Rainbow representative said if the EPA judges their bid to be 149.8 nonresponsive they will withdraw their bid. The City Attorney said he thought the only legal issue, as far as 149.9 the responsiveness of the bid, is the warranty, and the question of whether it was a mere irregularity in form that can be 149.1 149.2 149.3 149.4 149.5 149.6 149.7 - 1 0 May 19, 1987 150.1 corrected or disregarded, or is this an attempt to change the bid after the deadline. 150.2 A representative from Hobbs -Adams addressed the Board. He said the specs required a gas hydraulic drive system. He said they bid the project strictly as requested, making no exceptions to gas hydraulic drive. He said had they made that exception their bid would have been slightly lower, as the gas mechanical engine drive is less costly than the gas hydraulic drive. He said they specified 8 h.p. gas hydraulic drive to be certain that the drives can achieve the maximum speed desired. He said they were prepared to deliver in 60-90 days from acceptance date if it would be in the best interests of the project. 150.3 The City Attorney said he understood the intent of Director Lancaster's motion was approval of a resolution authorizing execution of a contract for the equipment with Hobbs -Adams based upon a determination by the Board of Directors that the warranty bid by Rainbow did not meet the specifications, unless Rainbow protests and EPA determines that Rainbow's bid did meet bid specifications. Director Lancaster agreed. 150.4 Lancaster's motion was seconded by Director Marinoni. 150.5 Director Bumpass said he thought there was a risk in losing grant eligibility. He asked what would happen if Rainbow protested and the EPA found their bid to be responsive. It was clarified that in that case Rainbow would be awarded the bid. 150.6 Director Martin asked what would happen if Rainbow did not protest and the EPA decides the City did not take the low bid. Martin said the award should not be conditioned only upon Rainbow's protest. Sandretto suggested the resolution be worded to indicate the Board is awarding the bid.to the lowest responsible responsive bidder who has been determined to be Hobbs -Adams. He explained that if the EPA decides the City made the wrong choice they will not approve the award of the bid to Hobbs -Adams, and the bid award would then fall back to Rainbow. 150.7 Sandretto said he thought a response would be received from the EPA within 45 days. 150.8 The City Attorney read proposed wording for a resolution: "A resolution authorizing the execution of a contract for the equipment in question with Hobbs -Adams Engineering Company, based upon a determination by the Board of Directors that Hobbs -Adams is the lowest responsible responsive bidder. Said authorization is contingent upon any timely protest by Rainbow to the EPA being rejected, but if such protest is upheld, execution of the contract for said equipment is hereby authorized with Rainbow. Directors Lancaster roll call, RESOLUTION RESOLUTION May 19, 1987 151 and Marinoni agreed with the proposed wording. Upon the motion passed, 7-0. NO. 35-87 APPEARS ON PAGE OF ORDINANCE AND BOOK ENGINEERING AMENDMENT The Mayor introduced a resolution authorizing an amendment to the contract with CH2M Hill to provide additional resident inspection and engineering services during the construction period between April 1, 1987 and September 30, 1987, as a result of the contractor's delay in contract completion. She said the engineer estimates $90,000 for the period from April 1 to September 30. She said the staff reports the amount could be billed to the contractor under a provision in the contract calling for damages. Director Bumpass moved to authorize the amount, provided that Olson pays for it. Bumpass asked if the City could be assured that money could be claimed against the bond under liquidated damages, in the event Olson does not complete the contract. Sandretto said the City is presently withholding liquidated damages from the contractor because of the contractor's claim for additional weather delays. .Sandretto said the engineer would have a problem making their contract conditional upon the City's ability to collect from the contractor. Bumpass said he thought the rate payers should not have to undergo an additional burden paying for these problems. Public Works Director Burch said the City does have recourse and is depending on liquidated damages provided for in the contract with Olson. Director Hess asked if $90,000 could be retained from payment to Olson. The City Attorney quoted from the contract provision which states "in the event that the contractor should fail to complete the work within the time limit or the extended time limit agreed upon, liquidated damages shall be set at the rates designated in the proposal plus any moneys paid by the owner to the engineer for additional engineering and inspection services associated with such delays." Director Hess asked if the City could withhold money as liquidated damages, against claims for payments made by the contractor. The City Attorney said the City could do that if it is the positionit decides to take. Hess said if the City would pay the engineer and withhold liquidated damages from the contractor he would second the motion. Director Bumpass accepted that amendment. The City Attorney suggested a proviso that such withholding is permitted under contract documents. Bumpass and Hess agreed with the proviso. Upon roll call, the motion passed, 7-0. RESOLUTION NO. 36-87 APPEARS ON -PAGE OF ORDINANCE AND RESOLUTION BOOK COLLECTION SYSTEM CHANGE ORDER The Mayor introduced approval of a change order to the contract with Garvey Companies, for additional compensation due to work 151.2 151.3 151.4 151.'