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Home My WebLink AboutOES 06-11 Cif Report To Executive Committee PICKERING Report Number:.OES 06-11 281 Date: January 10, 2011 From: Everett Buntsma Director, Operations & Emergency Services Subject: Additional Costs for Tender T-11-2010 Full Depth Asphalt Removal and Replacement on William Street - File: A-1440 Recommendation: 1. That Report OES 06-11 of the Director, Operations & Emergency Services regarding additional costs for Tender T-11-2010 for full depth asphalt removal and replacement on William be received; 2. That additional costs in the amount of $45,467 plus HST over the original tender amount for the William Street component of T-11-2010 resulting in a revised tender amount of $129,539 be approved; 3. That the revised total net project cost for William Street be increased by $37,945 to $133,345; and 4. That Council authorize the Director, Corporate Services & Treasurer to finance the additional net project costs of $37,945 as follows: a. That the sum of $34,600 be funded from the Move Ontario Tax Grant, as provided for in the 2010 approved Roads Capital Budget for William Street. b. That the additional sum of $3,345 be funded from the Move Ontario Tax Grant 5. That the appropriate City of Pickering officials be authorized to take necessary action to give effect thereto. Executive Summary: As part of the 2010 Roads Capital Budget, full depth asphalt replacement on William Street was approved as a construction project. Tender T-11- 2010 was awarded to the low bidder Four Seasons Site Development Limited through the approval of Report OES 17-10 in July 2010, and subsequently Purchase Order 200486. Due to underlying granular base conditions and high water table on William Street, additional costs were incurred during construction in order to complete the project in a timely and acceptable manner. i Report OES 06-11 January 10, 2011 Subject: Additional Costs for Tender T-11-2010 282 Full Depth Asphalt Removal and Replacement on William Street Page 2 In order to offset some of the additional costs, the scope of the project was revised to defer the placement of top asphalt. Top asphalt and a contingency for base asphalt repairs will be recommended in the 2011 Capital Budget in order to complete the project. Due to the deferral of the top asphalt component, the amount spent within the original tender of $84,072 plus HST was reduced to $67,288 plus HST. However, contract change orders in the amount of $62,251 plus HST resulted in a total revised tender amount of $129,539 plus HST. It is recommended that the additional tender amount of $45,467 be approved. After adjusting for the provision of the project contingency identified in Report to Council OES-17-10, and net of HST rebate, the additional net project cost is $37,945 and results in a revised net project cost of $133,345. In accordance with Section 11 of the City's Financial Control Policy, the Chief Administrative Officer, Department Head and Treasurer may jointly approve changes to authorized expenditure amounts provided that the total amount of the over expenditure does not exceed the lesser of 10% of the approved capital expenditure or $100,000. Council approval is required for William Street as the over expenditure exceeds 10 per cent. Financial Implications: The following is a breakdown of the project costs related to William Street as reported in Report to Council OES 17-10: Tender T-11-2010 $84,072 Contingency 8,161 Other Associated costs 1,517 Total $93,750 HST(1.76%) net cost to City 1,650 Total Costs to Ci A roved Funds $95,400 CORP0227-07/01 revised Report OES 06-11 January 10, 2011 283 Subject: Additional Costs for Tender T-11-2010 Full Depth Asphalt Removal and Replacement on William Street Page 3 The following is a breakdown of the actual project costs: Costs within T-11-2010 $67,288 Approved Change Order #2 36,189 Approved Change Order #3 26,062 Total Revised Contract Costs $129,539 T-11-2010 Other Associated cost 1,500 Total Costs $131,039 HST (13%) 17,035 Gross Project Costs $148,074 HST Rebate (11.24%) (14,729) Net Project Costs to City $133,345 Net Project Costs (over) funds approved ($37,945) under OES 17-10 The following is a breakdown of the required funding: Approved Funds as indicated in OES17-10 $95,400 Funds Approved in 2010 Capital Budget 34,600 indicated as not required as per OES 17-10 Additional Funds required 3.345 Total Funds $133,345 Sustainability Implications: The original intent of the project included improving roadway geometrics, improving vehicular flow and reducing maintenance costs has still been met in spite of the additional costs related to the underlying granular base conditions. Completing the project in the manner undertaken still considered sustainable practices as only the unacceptable material was removed and replaced compared to a complete reconstruction. Background: As part of the 2010 Roads Capital Budget, full depth asphalt removal and replacement for William Street was approved as a construction project. Tender T-11-2010 was awarded to the low bidder, Four Seasons Site Development Limited through approval of Report to Council OES 17-10 and the issuance of Purchase Order 200486. CORP0227-07/01 revised Report OES 06-11 January 10, 2011 Subject: Additional Costs for Tender T-11-2010 284 Full Depth Asphalt Removal and Replacement on William Street Page 4 During construction, after the full depth removal of the asphalt, underlying wet conditions of the granular base prevented sufficient compaction. As water was punching to the"surface, it was decided that full depth sub-excavation of the granular material as many locations was required. The work was undertaken under the guidance of the City's geotechnical consultant for this project. A recommendation to install subdrains to continuously drain the granular base was accepted and undertaken. Due to these conditions, the placement of top asphalt has been deferred and was not completed under the contract. When the 2010 Capital Budget was approved, the amount approved for William Street was $130,000. The project was to be funded by the Move Ontario Tax Grant. When Report OES 17-10 was approved by Council, the project cost was reduced to $95,400 based on the tender results. The project cost included a contingency of $8,161 and other associated costs of $1,517. The revised project cost has been exceeded due to the required change orders. Two contract change orders were required in order to recognize the additional work and change in scope. The original tender amount of $84,072 plus HST was not fully incurred due to the deferral of the top asphalt component. The amount spent within the tender was $67,288 plus HST. Contract change orders resulted in additional costs of $62,251 plus HST. The total revised contract cost for William Street is $129,539 plus HST. In accordance with the approved City Financial Control Policy, over expenditures that exceed 10% of the approved capital expenditure requires Council approval. Although the additional costs have been incurred, as construction could not be halted, approval is being sought so that the additional costs can be invoiced and paid. Due to the recent recess of Council, this is the earliest opportunity for Council to accept and approve of the over expenditure. It is recommended that the additional cost required for this project be funded from the Move Ontario Tax Grant originally allocated to this project in the 2010 Capital Budget, as well as an additional amount of $3,345 from the same source. In order to complete the top asphalt component of William Street, staff will recommend the required funds in the 2011 Roads Capital Budget. Attachments: Not Applicable CORP0227-07/01 revised Reap ..rt OES 06-11 January 10, 2011 Subject: Additional Costs for Tender T-11-2010 Full Depth Asphalt Removal and Replacement on William Street , Page 5 Prepared By: Approved/Endorsed By: Riche d W. Hol orn, P. Eng Everett Bun a Div'~ion Head Director EZineering Services Operations & Emergency Services Caryn Kong, CGA Gillis Paterson, Senior Financial Analyst Director Capital & Debt Management Corporate Services & Treasurer RH:ds Copy: Chief Administrative Officer Recommended for the consideration of Pickering Ci Council . J-G~,ZdlC/ l1~ 7 Tony Prevedel, P.Eng. Chief Administrative Officer CORP0227-07/01 revised