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HomeMy WebLinkAboutCOM 0597.002 2004-2006 ~(V Oi Harry Kim Mayor Bruce G McClure • Director . ~ •r+r~ . ii•a•M? County of Hawai' i Jiro A. Sumada Deputy Director DEPARTMENT OF PUBLIC WORKS Aupuni Center 101 Pauahi Street, Suite 7 ~ Hilo, Hawaii 96720-0224 (8081 y6L8321~F~x (SOS)961-8630 January 3, 2006 The Honorable Stacy Higa, Chair and Members of the Hawaii County Council 25 Aupuni Street Hilo, HI 96720 Rc: East Hawaii Reload Facility The bids for the East Hawaii Reload Facility have been received, and as indicated below, the lowest bidder was determined to be Isemoto Contracting Co. Ltd. Their bid of $9,338,285 was the lowest cost for the basic bid elements. In addition, their price of $8,838,048, representing the basic bid minus all eight of the deductive alternates, was also the lowest of the three bidders for this project. Isemoto Taisei San Juan Basic bid $9,338,255 $9,58],542 $10,773,1]7 Deductive alternates (500,237) (735,072) (1,008,879) Net bid after deductives ~ 8 846 470 9 764.238 The present $6.2 million appropriation is significantly less than the lowest bid. Given the funding shortfall, we have entered into negotiations with the lowest bidder to determine if there are areas where costs can he cut without impacting the functionality of the badly-needed Reload Facility. We are exploring every possible option for cost savings. So far Isemoto Contracting Co. Ltd. has agreed to an extension of their bid prices until March 7, 2006, while we continue discussions with them. It is expected that negotiations on a final contract amount will be completed in about two weeks. We respectfully request that you approve Bill 190 at your Finance Committee meeting on January 4, 2006 for the following reasons: Comm. Nom^Z_ Ref. To: Pt FG Counry of Hawai `i is an Cyual Opportunity Pruvidcr and Employer. Ref, lipfe ~ ~ ~ ~ L The Honorable Stacy Higa Chair January 3, 2006 Page 2 • We do not have a firm bid price past March 7, 2006. There is no guarantee that the contractor will be able to agree to additional extensions due to the various subcontractors involved in the project and changes in material costs. (See enclosed January 3, 20061etter from Isemoto Contracting Co., Ltd.) To enter into a contract, funding of the full contract amount must be available. If not approved at committee on January 4, the earliest the funding could be approved would be February 15, which allows approximately 3 weeks for the appropriation bill to be signed into law and a contract to be executed. • The appropriation amount can be amended at first reading before the full Council. After completion of negotiations with Isemoto Contracting Co. Ltd., if there is a reduction in cost, the amount requested can be amended at the time of first reading before the full council. • Landfill expansion plans require the Reload Facility. As the present permitted capacity of the South Hilo Sanitary Landfill approaches, it is more critical than ever to get the Reload Facility operational as soon as possible. It is anticipated that the Department of Health will approve the Count} s request to modify the slope profile of the landfill to expand its capacity. Upon approval and implementation of this change, it will be necessary at times to restrict commercial haulers from dumping directly at the landfill (as they presently do) because of the strict operational guidelines that must be followed to implement the steeper slopes. The reload building is where the commercial haulers will deposit their loads for compaction and deposit in the landfill by trained County employees. For further information, we have attached some additional questions and answers, and a summary of the bid cost elements, by category. The Finance Directot s previous communication of December 9, 2005 (Council Communication # 597) also provided background information on this project, using a question and answer format. If you have any questions or require further clarification, please dod thesitate to contact me or the Mayof suffice. AP O Bruce C. McClure, P.E. y Ki a Director County o Iawai'i enclosures cc: Department of Environmental Management Department of Finance County of Hawaf i is an Equal Opportunity Provider and Employer. ISEMOTO ~ MAIN OFFICE: 648 PIILANI STREET, P O BOX 4669, HILO, HAWAII 96720 PHONE 18061935-7194 FAX (6061 961-641 7 CONTRACTING CO. LTD. ? KONA BRANCH: 7/-50398 QUEEN KAAHUMANU HWV., P.O. BOX 3169, KAILUA-KONA, HI 96710 General CQIItra Ct Ol PHONE 160813299051 FAX 16061329-3261 Contractor's License No ABC1036 ESTABLISHED 1926 An Equal Opponuniry Employer Januazy 3, 2006 Mr. Bruce C. McClure Director, DPW County of Hawaii 101 Pauahi Street, Suite 7 Hilo, HI 96720-4224 SUBJECT: FAST HAWAII REGIONAL SORT STATION Job No. 5-3722 Deaz Mr. McClure: Pursuant to your letter dated December 30, 2005, and meeting held on the same date, we understand the County desires to negotiate an adjusted bid price for the above subject project. We acknowledge the available funds for this project is not sufficient to cover the cost of a functional facility based on our Base Bid price and Deductive Alternates, and that the County will require additional time to secure the funds for the Project. Based on our preliminazy discussions, we are confident our negotiated cost will not exceed our base bid cost of $9,338,215.00. Isemoto Contracting is agreeable to negotiate an adjusted contract amount under the condition that the project will be awazded by March 7, 2006. An extension beyond Mazch 7, may be considered, provided we will have the opportunity to add cost increases for labor and materials, if any, due to the delay of Award. I cannot over emphasis the urgency to negotiate and awazd this contract. The Island's construction boom, compounded by hurricane disasters of the Gulf States, has created material shortages and price increase throughout the United States. This trend is expected to continue during 200b and possible level off in the first quarter of 2007. If this project is re-bid, the County should expect a 12°/e minimum increase over our bid price of December 6, 2005. We look forward to meeting with your staff to discuss negotiations at your earliest convenience. Sincerely, Leslie Isemoto, President copy: Bryan Tomiyoshi, V.P., ICC Diane Shiro, Business Manager, DPW Barbara Bell, Director, DEM Dora Beck, P.E., Technical Services Chief, DEM QUESTIONS & ANSWERS East Hawaii Regional Sort Station Procurement Department of Public Works Job No. 5-3722 January 3, 2006 1. Why does the supplemental appropriation request ask for funding of the entire basic bid and not utilizing any of the deductive alternates? We prepared the supplemental appropriation request as the best solution. All of the deductive alternates were carefully reviewed to assess both the short-term and long-term impacts to the operation of the Reload building. Based on this, it appeared that award of the entire basic bid would offer the best long-term value to the County and the Public in that it minimizes future operational costs associated with the Reload building. However, we are also currently negotiating with the lowest bidder to look at all possibilities for cost savings, not just the previously identified deductive alternates. 2. What can we build with $6.2 Million? Assuming we were only constructing specific elements, and not a full project, we could afford the Reload building, the scale house (with one scale), roads, fencing, signage and sanitary sewer system. There would be no electricity, fire hydrants, potable water source or fire alarm system, and roads would be 2-1/2 inch thick instead of 4-inch, all of which would need to be negotiated since most of these items were part of the basic bid. We would still need approximately $1 million For construction management services and for change orders resulting from unforeseen field conditions. In short, we cannot build a fully functional facility with this funding. 3. What is the impact of constructing a $6.2 Million Reload Facility? There would be a need for a portable generator for electricity which will require onsite fuel tanks. Lack of fire hydrants will require a large catchment tank for the purposes offire-fighting. Lack of a fire alarm system will leave the Reload building unmonitored for fire during non-business hours. Having a commercial entry-only scale would result in doubling the commercial vehicular traffic through the entry scale. The use of a thinner asphalt road will result in more frequent roadway maintenance and repair activities. Absence of a potable water source is a major compromise to having an infinite source of water under pressure for fire-fighting capabilities. County water is considered a necessity for this project. Absence of dedicated construction management services means lack of project monitoring and documentation which will lead to ongoing problems. 4. What is the cost for construction of the Reload building? $1.686 Million represents the cost of the shell of the building $1.466 Million represents structural work $125,322 represents plumbing and ventilation $256,340 represents electrical and an emergency alarm & fire detection system $133,279 represents miscellaneous $3,666,619.41 is the total of these items. General site work is not included in these bid amounts, as it was included in the work for the whole site. General site work For the Reload building is estimated at $300,000 - $600,000 out of the total of $2.4 Million. Please see attached table. 5. What is the deadline for award of the project? The General Requirements and Covenants, County of Hawaii, Department of Public Works, requires that the contract be awarded within sixty (60) consecutive calendar days after the bid opening which would be January 20, 200b, unless a bid award extension date has been mutually agreed upon by the contractors and the County. Currently, the lowest bidder has offered to hold their price as long as the project is awarded by March 7, 2006. 6. What would happen if award of the bid is delayed past March 7? Due to the amount of construction work currently available in Hawaii, the Contractor may withdraw its bid. This situation affects the general contractor and their subcontractors, who may find it impossible to maintain their bid commitment after a set date. 7. When will the County be requesting the extension of the bid award date? The request For the extension will be made in writing prior to January 20, 2006. 8. What is an immediate consequence to the County if the bid were not awarded? One of the planned uses of the Reload building is to provide adrop-off area for the commercial haulers. It is anticipated that extension of the Hilo Landfill will take place soon. For safety reasons, during most of 2006, we will be intermittently restricting access bynon-County vehicles to the landfill It is important to be able to re-route the commercial haulers to the Reload building as soon as possible. 9. What are we doing now to implement landfill diversion before waste arrives at the landfills, or eventually at a Reload Facility? This fall, we began contracting with a vendor to place collection bins at many of our 2] transfer stations for various recycling services. We now have non HIS glass collection at fifteen transfer stations (Hilo, Papaikou, Honomu, Laupahoehoe, Paauilo, Honokaa, Waimea, Hawi, Puako, Kealakehe, Keauhou, Volcano, Glenwood, Keaau, and Pahoa). At eight of our transfer stations (Hilo,Waimea, Hawi, Puako, Kealakehe, Keauhou, Keaau, and Pahoa), there is collection for mixed traditional recyclables of cardboard, paper fiber, newspaper, magazines, plastic, and tin cans. HIS redemption is at nine transfer stations (Hilo, Waimea, Hawi, Puako, Kealakehe, Keauhou, Waiohinu, Keaau, and Pahoa). 10. What do you mean when you say the "Reload building", "Reload Facility", and "Sort Station Complex"? We call the actual building, with the tipping floor, where residents and businesses would take their trash, the Reload building. We call that building, and the infrastructure needed to make it functional, the Reload Facility. We call the whole facility design, with greenwaste diversion, scrap metal recycling, and bottle bill redemption, and any other activities that could reasonably be located at this site, the Sort Station Complex. 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