DATE: October 8, 2024
TO: Board of Supervisors
SUBMITTED BY: Steven E. White, Director
Department of Public Works and Planning
SUBJECT: Award Contract 24-06-M Road Preservation Treatments
RECOMMENDED ACTION(S):
TITLE
1. Adopt specifications for Contract 24-06-M Road Preservation Treatments (Contract); and
2. Reject request by American Pavement Systems, Inc. (American), 1012 11th Street Suite 1000, Modesto, CA 95354, the lowest bidder, who requested relief from its bid outside of the statutory time frame (Public Contract Code section 5103) for such request, and authorize the Director of the Department of Public Works and Planning (the “Director”) to inform American of such rejection;
3. Authorize the Director to either accept payment in the amount of $6,563.75 from American which is equal to the difference between the bid of American in the total amount of $4,564,129.75 and the bid of the second lowest bidder Talley Oil, Inc. (Talley Oil), 12483 Road 29, Madera, CA 93638-8401, in the total amount of $4,570,693.50 or prosecute the forfeiture of a portion of American’s bid bond, $6,563.75, issued by surety Travelers Casualty and Surety Company of America, $456,412.98, for American’s failure to enter into the Contract to recover the difference between the bid of American in the total amount $6,563.75 and the bid of Talley Oil, in the total amount of $4,570,693.50; and
4. Award the Contract to the second lowest bidder, Talley Oil, in the amount of $4,486,318.50 for the base bid and Additives 1 through 5.
REPORT
Approval of the first recommended action will result in your Board’s adoption of specifications for the proposed Contract.
Approval of the second recommended action will reject the request by American, the lowest bidder, who requested relief from its bid outside of the statutory time frame (Public Contract Code section 5103) for such request and authorize the Director to inform American of such rejection.
Approval of the third recommended action will authorize the Director to either accept payment in the amount of $6,563.75 from American which is equal to the difference between the bid of American in the total amount of $ $4,564,129.75 and the bid of the second lowest bidder Tally Oil, in the total amount of $4,570,693.50 or prosecute the forfeiture of a portion of American’s bid bond, $6,563.75, issued by surety Travelers Casualty and Surety Company of American, for $456,412.98, for American’s failure to enter into the Contract to recover the difference between the bid of American in the total amount of $4,564,129.75 and the bid of Talley Oil, in the total amount of $4,570,693.
Approval of the fourth recommended action will authorize the Board to award the Contract to the second lowest bidder, Talley Oil, in the amount of $4,4486,318.50 only for Additives 1 through 5. Additive 6 cannot be awarded as it exceeds the budget for County Service Area (CSA) 35M.
Tally Oil’s bid lists American as a subcontractor which is scheduled to perform 40% of the contracted work. However, this is not a bar to awarding the Contract to Tally Oil notwithstanding American’s late withdrawal of its bid and forfeiture of its bond.
This item pertains to locations in Districts 1, 2, 4, and 5.
ALTERNATIVE ACTION(S):
There is no alternative to the first recommended action if your Board wishes to pursue this project.
For the third recommended action, the Board may choose to grant the request for bid relief from the lowest bidder, American Pavement Systems, Inc. (American), or accept a cash payment in lieu of proceeding with forfeiture of its bid bond. Your Board may also, request a forfeiture of a lesser amount but that will not fully offset the County’s loss. The difference between the total bid amounts of Talley and American is equal to $6,563.75.
In lieu of the fourth recommended action, the Board could choose to reject bids 2 through 5 and direct staff to rebid the project.
FISCAL IMPACT:
There is no Net County Cost associated with the recommended actions. The anticipated construction cost for the project is $4,696,318.50, based on the second lowest bid, including the base bid and Additive Locations 1 through 5, plus the Director’s allowance for change orders of $210,000.
The project will be funded with the County’s SB-1 Road Maintenance and Rehabilitation Account. Sufficient appropriations and estimated revenues are included in the Department of Public Works and Planning - Roads Org 4510 FY 2024-25 Adopted Budget.
Additive Location 6, for County Service Area (CSA) 35M, is not recommended for award, due to the second low bid of $84,375 exceeding the engineer’s estimate, of $31,750 by 166%. In comparison, American’s price for Additive Location 6 was $46,000, or 45% higher than the engineer’s estimate, and was intended for award when the project was originally scheduled for award American on September 10, 2024.
DISCUSSION:
The Department of Public Works and Planning (Department) proposes to place bituminous seal coats, cape seal coats, slurry seal coats, and traffic striping on various roads in Fresno County. Generally, the work to be done consists of applying a thin surface treatment of asphaltic emulsion (asphalt, water and a binder) to various existing roads in Fresno County. The seal coat will be constructed on 67 centerline miles of roadway on County roads. The project includes roads that currently show signs of distress such as alligator, block, longitudinal, and transverse cracking identified by the Road Maintenance & Operations Division. Additive 6 included an additional 12 centerline miles of CSA 35M road to be slurry sealed.
This road maintenance and rehabilitation project was advertised on August 6, 2024. A bid opening was held on August 29, 2024. Five bids were received. A list of bidders and their respective bid amounts with all additive items included, is shown below. The lowest bid, or basis of award, is determined based on the total bid amount, base bid, and all additives, whether any additive bids are awarded.
Bidder Total Bid Amount
American Pavement Systems, Inc. $4,564,129.75 - Bid Relief Requested
Talley Oil, Inc. $4,570,693.50
Doolittle Construction, LLC $5,393,393.00
VSS International, Inc. $5,411,120.00
Pavement Coatings Co. $5,624,963.05
A verbal report was scheduled to be presented to the Board on September 10, 2024, but was postponed because the lowest bidder, American, requested to be relieved of its bid the morning of the Board meeting. A formal letter was received from American requesting bid relief on September 10, 2024 (“Attachment A”) because it entered an incorrect total for one of the bid items. Specifically, for Base Bid Item #53, Traffic Control System, they entered the amount of $30,000 when they intended to enter $512,000, resulting in a $482,000 deficit in their bid.
The Department determined that American’s request for bid relief did not meet all requirements of Public Contract Code section 5103 which provides that the bidder must provide notice to the County “within five working days, excluding Saturdays, Sundays, and state holidays, after the opening of the bids of the mistake” when filing for relief. (Pub. Contract Code, § 5103, subd. (b).) Because the bid opening was held on August 29, 2024, American’s September 10, 2024, request for bid relief was received outside the five working day requirement. The Board may determine that American forfeits their bid bond and refuses to execute the construction contract with them, in accordance with Public Contract Code sections 5101 and 5106.
The second lowest responsive bid, based on their base bid and all additive items, is $4,570,693.50, from Talley Oil, Inc., which was $241,225 or 5.6% higher than the engineer’s estimate of $4,329,468.50. In compliance with Public Contract Code section 5106, the Department recommends awarding Contract 24-06-M Road Preservation Treatments to the second lowest responsive bidder, Talley Oil, Inc., awarding the base bid and Additive Locations 1 through 5.
Base and Additives Talley Oil, Inc. Bid
Base Bid $3,857,621.91
Additive 1 - Location 9A (El Dorado, 0.3 s/o Cal. Aqueduct) $89,275.09
Additive 2 - Location 10A (El Dorado, Dorris Ave (SR198)) $87,228.00
Additive 3 - Location 11A (El Dorado, SR145 to 1.10 s/o SR145) $80,442.25
Additive 4 - Location S3A (Malaga Area) $180,829.50
Additive 5 - Location S4A (Del Rey Area) $190,921.75
Additive 6 - Location CSA 35M* $84,375.00*
*not recommended for award
Additive 6 is for 12 miles of slurry seals in CSA 35M roads. The bid amount for Additive 6 from Talley Oil, Inc. was in the amount of $84,375.00, which is $52,625 or 166% higher than the engineer’s estimate of $31,750. This amount exceeds the CSA’s budget and cannot be awarded at this time.
Bidder Bid for Additive 6 - CSA 35M
American Pavement Systems, Inc. $46,000
Talley Oil, Inc. $84,375
Doolittle Construction, LLC $39,250
VSS International, Inc. $33,000
Pavement Coatings Co. $77,500
Staff recommends awarding the base bid and Additive Locations 1 through 5, in the total amount of $4,486,318.50.
The project has a narrow construction window because the materials used are weather sensitive and must be performed during cool dry weather. Due to the request for bid relief, the award has been postponed three weeks from the originally scheduled award date of September 10, 2024. This later award date will likely prevent construction from commencing until Spring 2025.
Specifications were prepared by the Department and are on file with the Department. The Department has determined that the Road Preservation Treatments project is categorically exempt from the provisions of CEQA under Section 15301(c) - Existing Facilities.
ATTACHMENTS INCLUDED AND/OR ON FILE:
Location Maps
Bid Summary
Attachment A
CAO ANALYST:
Salvador Espino