PURPOSE:

Staff requests that the City Council adopt a resolution authorizing staff to enter into a Construction Agreement with Griffith Company to install three relocated water transmission lines as part of the State Route 134 Ramp Project.  Staff is also requesting that the City Council direct staff to appropriate an additional $220,600 from Unappropriated Fund 127 Development Impact Fees to cover an increase in cost from the original engineer�s estimate.  This utility work is reimbursable by Caltrans per a Utility Agreement executed March 19, 2007.

BACKGROUND AND ANALYSIS:

The City of Burbank must relocate a number of City water and electric facilities near the vicinity of Alameda Avenue and Hollywood Way in coordination with construction of a new westbound on ramp at the State Route 134 interchange with Hollywood Way.  Construction for this project, which is currently underway, requires lengthening of overpasses at Alameda Avenue, Hollywood Way, and Pass Avenue to accommodate the new onramp.  Modification of these bridges requires relocation and modification of City-owned electrical and water facilities, which must be coordinated with the other bridge work.  On March 13, 2007, City Council directed staff to execute a Utility Agreement with Caltrans defining the specific water and electrical utilities that need to be relocated as part of the project.  This Utility Agreement also quantifies the estimated total costs for these relocations and stipulates that Caltrans will reimburse the City for costs associated with their design and construction.

A portion of the water utility relocations will be performed by Burbank Water and Power (BWP) crews with materials secured by the City.  However, staff proposes that placement of new water mains in the bridges themselves be performed by Griffith Company, the general contractor for the overall 134 project.  Staff believes that the work can be better coordinated with less chance of delay to the project schedule if the utility work is performed by the same contractor as the freeway project.  Caltrans also agrees with this approach and staff from all three agencies (the City, Caltrans, and Griffith Company) have developed a project scope of work and cost to perform the required utility construction.  This scope and construction cost is based on the utility plans developed by the City�s water engineering consultant and general BWP utility line specifications.

Water engineers hired by BWP developed an engineer�s cost estimate for all required water utility relocations associated with the 134 Ramp Project, which was used to develop the scope and cost estimates contained in the Utility Agreement with Caltrans.  This overall estimate includes a cost for an outside contractor to perform the utility work in the bridges in the amount of $185,000, and this cost item was built into the overall utility estimate used in the Utility Agreement.  The actual cost negotiated with Griffith Company is $405,600, or slightly more than twice the engineer�s estimate.  The original estimate did not precisely quantify the complexity of the work required to install the utilities within the tight confines of the existing portions of the freeway bridges and the connections to be made to the existing water lines, and as a result the actual cost exceeded the estimated cost of this portion of the project by a significant amount.  Caltrans has been fully involved in the price negotiations with the City and Griffith Company, and is fully aware of the scope of the increase.  The remainder of the utility work to be performed outside of the bridges themselves, as well as inspection activities and construction management, is being performed by BWP resources or consultants hired by BWP, and these costs are not projected to exceed the costs outlined in the Utility Agreement.  Thus, staff believes that there should be no additional cost escalations outside of the utility work being performed by Griffith Company.

The Utility Agreement with Caltrans allows for reimbursement of the water and electrical utility relocations up to the cost estimate included in the agreement.  This amount was estimated at $468,500 and includes design costs, construction costs performed by BWP, construction costs performed by the contractor (Griffith), construction management, and inspection activities.  In addition, the Utility Agreement allows for a 25% contingency of these costs.  Thus, the total reimbursable cost for water utility work under the Utility Agreement is $585,625 including contingency.  With the increased cost for the utility work to be done by Griffith, the total projected water line utility relocation cost is $689,100.  Assuming all other water utility costs remain within their estimates, Caltrans and the City must execute an amended Utility Agreement to increase the reimbursable cost amount by $103,475 in order to seek full reimbursement.  Caltrans has indicated to the City that it agrees with the increased cost amount and intends to amend the Utility Agreement to reflect these additional costs, but due to project timelines, the City must proceed with the construction prior to executing an amended Utility Agreement.  In particular, the City must be ready to install the new water lines at a specific point in the construction timeline for the Caltrans bridge work.  It is imperative that the City be ready to perform this work in concert with Caltrans� timeline to prevent project delays for the overall project. Thus, there is a small risk that these additional costs might not be reimbursed; however, Caltrans has verbally acknowledged the cost increases and has indicated that they will amend the agreement.  Therefore, it highly likely that an amendment will be approved for full reimbursement.

FISCAL IMPACT:

Funds to front the required utility construction have already been budgeted for this project, but additional funds are required to front the additional project cost of $220,600.  Staff proposes to fund this additional cost via Fund 127 Development Impact Fees.  If approved by the City Council, $220,600 from account 127.ND000.30004.0000.000000 Unappropriated Development Impact Fees would be transferred to project account 127.CD33A.70002.17613.  As noted above, it is expected that these additional funds will be reimbursed by Caltrans as part of the overall freeway project.

RECOMMENDATION:

Staff recommends that Council adopt the proposed resolution authorizing staff to enter into a Construction Agreement with Griffith Company in the amount of $405,600 to perform water line relocation as part of the State Route 134 Project, and to amend the Fiscal Year 2007/2008 Budget in the amount of $220,600 in Development Impact Fee funds to front the increase costs associated with the utility relocation.

LIST OF EXHIBITS:

Exhibit A:         Construction Agreement with Griffith Company for D.I.P. Water Line Installation at Hollywood Way, Alameda Avenue, and Pass Avenue Bridges