PURPOSE

Staff requests City Council approval of plans and specifications for the installation of fiber optic cable on Magnolia Boulevard, and approval of Change Order No. 3 to Bid Schedule No. 1155, San Fernando Corridor ITS Project, to add $296,668.43 to the contract with KDC, Inc. (Dynalectric) to incorporate work for the Magnolia Boulevard project.

BACKGROUND

On January 25, 2005, Council authorized the award of a contract for the construction of traffic control devices and fiber optic communications along the San Fernando Boulevard Corridor to Dynalectric following a formal construction bid process.  The total Dynalectric construction bid for the project was $3,162,654.46.  Change Orders No. 1 and 2 later amended the total contract price to $3,352,593.90 (6% higher than the original price).  Change Order No. 3 will increase the total contract price to $3,649,396.89, which is 15.39% above the original approved price.  The total cost of all change orders is $486,742.43.  Since the total amount of all change orders is greater than 10% of the original project cost, City Council approval is required for the latest change order.

Council approved the installation of fiber optic communications cable along Magnolia Boulevard as Project No. 15957 in the Fiscal Year 2005-2006 budget, with a budgeted amount of $350,000.  The Magnolia Boulevard fiber optic cable project will install the communications cable along Hollywood Way between Clark Street and Magnolia Boulevard and along Magnolia Boulevard between Hollywood Way and Buena Vista Street. The Magnolia Boulevard project is contiguous to and will connect facilities installed with the San Fernando Boulevard ITS project.  It is work similar to that included in the San Fernando Boulevard ITS project.

ANALYSIS

Staff requests City Council approval of the Magnolia Boulevard project plans and specifications to enable this work to be undertaken with the San Fernando Boulevard ITS project.  The approval of Change Order No. 3 to the San Fernando Boulevard ITS project will permit the additional work to be incorporated into the existing Dynalectric contract for similar work.  A complete set of the Magnolia Boulevard plans are on file with the City Clerk for public inspection.

A project of this magnitude is normally awarded by competitive bidding; however, the current bidding environment has seen significant price increases of 50 percent or more from prices received one year ago.  The existing Dynalectric contract allows additional work to be added to the San Fernando Boulevard Corridor ITS Project using the January 2005 unit construction prices with the consent of both parties.  Negotiations with Dynalectric resulted in a cost to complete the Magnolia Boulevard project of $296,802.93.  The negotiated price is 18 percent below the project budget, and it retains the 2005 unit prices for labor used by Dynalectric.  Some increase in materials prices for items such as conduit, fiber, and signal control systems were included in the negotiated unit prices to account for the current materials price increases of these items.

The Change Order to the San Fernando Boulevard ITS project has been declared Categorically Exempt in accordance with CEQA Guidelines Section 15.301(c).

FISCAL IMPACT

The funds for Change Order Nos. 1 and 2 were included in the San Fernando Corridor ITS Project, Project No. 13292.  Funds for Change Order No. 3 are available in the Magnolia Boulevard Project, Project No. 15957.  The existing budgeted monies will fully fund the project expansion.

RECOMMENDATION

Staff recommends that City Council approve plans for the installation of fiber optic communications cable along Magnolia Boulevard and approve Change Order No. 3 for Bid Schedule No. 1155, San Fernando Corridor ITS Project in the amount of $296,668.43 to fund the Magnolia Boulevard project construction.

Attachment:  Change Order No. 3 for BS 1155, San Fernando Corridor ITS Project

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