Report Prepared by: Paul Flores, EIT, Assistant Engineer, Engineering Department
Title
SUBJECT: Award Bid to Diede Construction Inc. for the Merced Yosemite Regional Airport Terminal, Project Number CP230073, in the Amount of $15,184,559.87
REPORT IN BRIEF
Considers awarding a Construction Contract to Diede Construction Inc. in the amount of $15,184,559.87 for the Merced Yosemite Regional Airport Terminal project.
RECOMMENDATION
City Council - Adopt a motion:
A. Awarding the Merced Yosemite Regional Airport Terminal Project, Project CP230073 to Diede Construction Inc, in the amount of $15,184,559.87; and,
B. Approving a transfer in the amount of $2,384,075 from the Fund 1017-Economic Development Opportunity and appropriating in Fund 5006-Airport CIP to Project CP230073; and,
C. Authorizing the use of pooled cash in accordance with the Funding Plan described, until grant reimbursement is received; and,
D. Authorizing the City Manager or Deputy City Manager to execute the necessary Construction Contract and to approve change orders not to exceed 5% of the total contract; and,
E. Authorizing the Finance Officer to make necessary budget adjustments.
Body
ALTERNATIVES
1. Approve, as recommended by staff; or,
2. Approve, subject to conditions other than recommended by staff (identify specific findings and/or conditions amended to be addressed in the motion); or,
3. Deny; or,
4. Refer to staff for reconsideration of specific items (specific items to be addressed in the motion); or,
5. Continue to a future meeting (date and time to be specified in the motion).
AUTHORITY
Charter of the City of Merced, Article XI, Section 1109 - Contracts on Public Works, and Merced Municipal Code Chapter 3.04, Article IV - Public Works Contracts.
CITY COUNCIL PRIORITIES
As provided for in the 2023-24 Adopted Budget.
DISCUSSION
In May 2022, the City of Merced applied for a grant from the Federal Aviation Administration for Federal Assistance (Development and Equipment Projects) in the amount of $349,099.
On May 15, 2022, City staff selected and authorized Mead & Hunt Inc., to proceed with the Merced Yosemite Regional Airport Terminal Planning Study.
On July 5, 2022, City Council appropriated $600,000 to prefund Airport grants for Airport feasibility study, design, and environmental services.
On August 15, 2022, City Council accepted the Grant Offer for Airport Improvement Program (AIP) Project No. 3-06-0152-029-2022, Issued by the Federal Aviation Administration for the Merced Regional Airport, in the Amount of $331,644 for the Commercial Airport Terminal Planning Study. Acceptance of the grant requires a local match of $17,455.
On September 29, 2022, City staff authorized Mead & Hunt Inc., to proceed with the Geotechnical Investigation and Site Surveying to begin the design process in the amount of $130,257.91.
On October 3, 2022, City Council approved the first Amendment to the Professional Services Agreement with Mead & Hunt, Inc., to increase the maximum contract amount from $750,000 to $2,500,000 to complete all the tasks associated with the Merced Yosemite Regional Airport Terminal Project.
On December 5, 2022, City Council was given an update and received public comment for the environmental review of the Merced Yosemite Regional Airport Terminal Project. No comments regarding the environmental review were given. Additionally, City Council approved a supplemental appropriation of $1,100,000 from the Economic Development Opportunity Fund. The additional funding paid for the design of the Merced Yosemite Regional Airport Terminal Project.
Additionally, on December 5, 2022, City staff authorized Stantec Consulting Services to perform and Independent Fee Estimate in accordance with FAA standards of the Design Scope of Work provided by Mead & Hunt Inc. This authorization was for $9,500.
On December 22, 2022, City staff authorized Mead & Hunt Inc., to proceed with the full design of the Merced Yosemite Regional Airport Terminal Project. The Design and Environmental portions of the project ran concurrently to meet the March 30, 2023, advertisement date set by the design team.
On March 29, 2023, the City received the NEPA Categorical Exclusion from the FAA. This document cleared the project environmentally and cleared the City to advertise the project for construction. Additionally, Mead & Hunt Inc., transmitted the Construction Documents for the Merced Yosemite Regional Airport Terminal Project.
On March 30, 2023, the City advertised the project for construction bids from plans and specifications prepared by Mead & Hunt under City staff direction for the Merced Yosemite Regional Airport Terminal project. Bids were opened on April 27, 2023.
On May 2, 2023, AMG & Associates (2nd bidder) filed a bid protest against Thompson Builders Corporation’s bid proposal (lowest apparent bidder). AMG claimed Thompson’s bid proposal had irregularities and challenged the potential project award to the company.
On Monday May 8, 2023, Mead and Hunt prepared the FAA CARES Act grant application, with the assistance from City staff, and submitted to the FAA. Staff was then notified by the FAA that it was received and accepted and in good standing. The grant request was for a total of $14,451,000 ($13,551,000 FAA CARES Act grant plus $900,000 prior FAA grant transitioning from operations to capital). Staff anticipated receiving final award notice before June 30, 2023.
On May 15, 2023, the City Council authorized the City Manager or Deputy City Manager to accept CARES Act Funding from the FAA when available in June of 2023.
On June 1, 2023, The City, at the direction of FAA, requested that the FAA CARES Grant #26 issued to the Merced Yosemite Regional Airport (MCE) be amended by modifying the requested amount to $13,521,462.00 (from $3,364,156 to $16,885,618). The FAA responded with the Grant Amendment Letter (Attached) that stated acceptance of the amended amount and the FAA obligation to provide the funding. Funding will be available soon in the FAA’s Delphi Invoicing System.
On June 5, 2023, the City rejected all bids and directed staff to rebid the project. Bidders were notified of the decision to rebid the following day.
On June 15, 2023, the project was re-advertised for rebidding with plans and specifications updated by Mead & Hunt. Bids were opened for the project on July 6, 2023, at 2:00pm. The bids were evaluated by Mead and Hunt and City staff. It was determined that the lowest apparent bidder and the second bidder contained discrepancies that could not be waived. Thus, staff recommended once again, that the City Council reject all bids and readvertise the project.
On August 7, 2023, the City council again rejected all bids and directed staff to rebid the project. Bidders were notified of the decision to rebid the following day.
On August 10, 2023, the City re-advertised the project with plans and specifications updated by Mead & Hunt for the new bid date. The project was advertised, and bids were opened on September 6, 2023, at 2:00pm with the following bid results:
|
1 |
Bobo Construction, Inc. |
$ 15,916,794.00 |
|
2 |
Thompson Builders Corp. |
$ 17,475,501.00 |
|
3 |
Diede Construction, Inc. |
$ 15,184,559.87 |
|
4 |
Katch Environmental, Inc. |
$ 19,081,632.00 |
The bids were reviewed for responsiveness and completeness. This time the bids were acceptable for award of construction of the project with the low bidder, Diede Construction, Inc. Following is the proposed project budget for City Council’s consideration to award:
|
Construction |
$ 15,184,559.87 |
|
Contingency |
$ 759,227.99 |
|
Engineering, Testing & Inspection |
$ 1,050,000.00 |
|
TOTAL: |
$ 16,993,787.86 |
The project calls for the construction of a new 11,000 square-foot airport terminal. The Merced Yosemite Regional Airport terminal needs substantial improvements and modifications to enhance the customer, visitor, and pilot experience. With the CARES Act funding grant, it would provide the opportunity for the City to build the new terminal.
Grant funding accounts for $14,451,000 of the total project cost where additional funding will be needed to complete the project. The remaining balance of $2,542,788 will need to be funded by other sources. The City proposes to use following funding sources:
• The terminal design portion of the project has funds remaining in the amount of $158,713 that will be transferred to the Construction.
• Economic Opportunity fund proposes to provide the remaining funding of $2,384,075.
IMPACT ON CITY RESOURCES
This project was established as a Capital Improvement Project to be funded by FAA CARES, and Economic Development Opportunity Fund. Pooled cash will be a necessary until grant reimbursement is received. With the approval of the transfer from Fund 1017- Economic Development Opportunity and appropriation in Fund 5006-Airport CIP in the amount of $2,384,075; there will be sufficient funding to complete this project.
The current balance available within Fund 017-Econoic Development Opportunity Fund is $2.8 million. If this transfer is approved, it would leave a balance of approximately $400,000.
ATTACHMENTS
1. Bid Results
2. Construction Contract
3. Grant Amendment Letter