Meeting_Body
CONSTRUCTION COMMITTEE
APRIL 18, 2019
Subject
SUBJECT: PROJECT NO. 202808 CMF Building 5 Dust Collection System PROJECT
Action
ACTION: AUTHORIZE INCREASE IN LIFE OF PROJECT BUDGET
Heading
RECOMMENDATION
Title
AUTHORIZE an increase in the life of project (LOP) budget for Project No. 202808 by $440,000 for Central Maintenance Facility (CMF) Building 5 Dust Collection System project from $785,000 to $1,225,000.
Issue
ISSUE
On January 23, 2019, two bids were submitted in response to the solicitation of capital project CMF Building 5 Dust Collection System Project. The bid for the lowest responsive, responsible bidder is $972,000, which exceeds the funds available for this project.
Background
BACKGROUND
In August 2017, the Metro Board of Directors authorized the use of a design-build contracting method for the CMF Building 5 Dust Collection System Project. The Board Report [File No. 2017-0176] stated that the project would replace the ineffective, inefficient air scrubber system, which also uses more than 10,000 gallons of potable water each day. The proposed dust collection system is consistent with Metro’s intent to reduce energy use and to conserve potable water, as outlined in Metro’s Environmental Policy, Water Use and Conservation Policy, and Energy Conservation and Management Plan.
Discussion
DISCUSSION
On January 23, 2019, two bids were received and opened for the CMF Dust Collection System project. Both bids were higher than the LOP budget established for this project. As a result, additional funds are needed. As a lesson learned, our new practice is to set LOP budgets later in the design/procurement process to minimize the potential for an LOP increase.
Determination_Of_Safety_Impact
DETERMINATION OF SAFETY IMPACT
This Board action will not have an adverse impact on safety standards for Metro. It will however increase safety as projects become more energy and operationally efficient.
Financial_Impact
FINANCIAL IMPACT
The funding for FY19 is included in Project 202808, CMF Building 5 Dust Collection System project, Cost Center 8510 Construction Contracts/Procurement.
Since this is a multi-year capital project, the cost center manager, project manager, and Chief Program Management Officer will be responsible for budgeting for costs in future years.
Impact to Budget
Funding for this project is from Sustainability Implementation Program, which is funded with Green Fund. As the project addresses the water conservation and energy efficiency, this is an appropriate funding source.
Implementation_Of_Strategic_Plan_Goals
IMPLEMENTATION OF STRATEGIC PLAN GOALS
This project supports the implementation of Metro’s Strategic Plan Goals, with specific alignment to Initiative 1.3 - manage transportation demand through fair and equitable pricing structures and Initiative 5.2 - exercise good public policy judgment and sound fiscal stewardship by: 1) reducing electricity consumption and costs at Metro facilities; 2) reducing water consumption and costs; and 3) improving the air quality and working condition in CMF Building 5.
Alternatives_Considered
ALTERNATIVES CONSIDERED
Metro has explored reducing the scope of the project and conducting a new solicitation; however, the potential exists for the submission of bids that are higher due to the current competitive nature of the construction marketplace.
The Board may reject the request for an LOP increase. This is not recommended as it would leave in place the existing, inefficient air scrubber system that does not meet air quality standards and uses 10,000 gallons of water per day.
Next_Steps
NEXT STEPS
Staff will execute a contract with the lowest responsive, responsible bidder for the installation of the dust collection system in Building 5 at CMF.
Attachments
ATTACHMENTS
Attachment A - Procurement Summary
Attachment B - Funding and Expenditure Plan
Attachment C - DEOD Summary
Prepared by: Cris B. Liban, EO, Environmental Compliance and Sustainability
(213) 922-2471
Reviewed by: Richard Clarke, Chief Program Management Officer (213) 922-7557
Debra Avila, Chief Vendor/Contract Management Officer (213) 418-3051
