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W A F E ft F k F A G Y t Y ; E 1' RIVERSIDE PUBLIC UTILITIES Board Memorandum PUBLIC U T I L I T I E 5 BOARD OF PUBLIC UTILITIES DATE: March 18, 2011 ITEM NO: 4 SUBJECT: SAN BERNARDINO WATER SUPPLY LINE WASHINGTON STREET 48-INCH WATER TRANSMISSION MAIN REPLACEMENT PROJECT — INCREASE WORK ORDER NO. 1017774; AUTHORIZE ADDITIONAL CHANGE ORDERS ISSUE: That the Board of Public Utilities consider: 1) approval of an additional capital expenditure for Work Order No. 1017774 to account for changed conditions and additional paving for the project within the City of Colton; and 2) authorize staff to issue change orders in an amount not to exceed 18% of the original contract amount. RECOMMENDATIONS: That the Board of Public Utilities: 1. Approve an increase in an amount not-to-exceed $350,000 for Work Order No. 1017774; and 2. Authorize staff to issue change order in a cumulative amount not to exceed $594,044, or 18%, of the original contract amount. BACKGROUND: The San Bernardino Transmission Main Replacement—Washington Street 48-inch Water Supply Project was awarded to L,H. Woods 8 Sons, Inc. (LHWS) for construction by the Public Utilities Board (Board) at its regular meeting on August 20, 2010. LHWS began with the pipe construction on December 8, 2010 and began to encounter several changed conditions, including unknown utilities and utilities incorrectly shown on the plans, which were the result of poor as-built plans by the City of Colton. Consequently, the contractor was required to relocate utilities as part of change orders. Furthermore, during the construction of the 48-inch diameter transmission pipeline, Washington Street has been degraded beyond the trench limits due to the heavy machinery and equipment required to install the new 48-inch pipeline. It was also determined that the existing street did not have the appropriate base material for supporting the existing layer of asphalt, causing the pavement to crack and break apart due to heavy construction equipment traffic. LHWS will be required to remove the additional damaged asphalt and replace it with an appropriate structural section. In addition to the additional paving requirements for Washington Street, staff anticipates increased costs associated with the higher cost of asphalt and petroleum based products following the project's bid opening eight months ago. The approved existing contract amount with LHWS per the Board action on August 20, 2010 is $3,240,444, with a corresponding Work Order amount of$4,000,000. Staff requests an increase to Work Order No. 1017774 to a total of $4,350,000 to accommodate the increased Purchase Order, as well as other anticipated costs by City engineering, field forces and temporary construction easement fee needed to complete the project. Staff is evaluating other aspects of the project to reduce the total project cost below $4,350,000; however, additional authority is needed now to ensure the project can continue without interruption.