On February 14, the Sparks City Council approved changes to the Capital Improvements Plan for Fiscal Year 2022 that includes realignment of the Avenue of the Oaks, the Nugget Event Center Forecourt Project, and funds for Phase 2 of the Downtown Safety Barricades Project.
On March 22 of last year, City of Sparks staff presented the Capital Improvements Plan for FY 2022 to City Council that was initially approved, adopted, and included in the City Manager’s FY 2022 Final Budget Recommendations. However, staff recently determined that funding for two of the Projects is insufficient due to an unexpected rise in labor, materials, and construction costs. Staff suggested reallocating funds from other CIPs to make up for this shortfall so that it would create a zero fiscal impact to the CIP budget.
The CIPs impacted due to the rising costs include the Avenue of the Oaks Realignment and the Nugget Event Center Forecourt projects, and City staff recommended decreasing the budget in the Phase 2 of the Downtown Safety Barricades Project from $700,000 to $167,000 to cushion the other two funds.
The Avenue of the Oaks Realignment Project is a complex project involving the demolition of existing underground vaults, salvaging assorted items onsite, installing temporary concrete paving/paver placement/concrete roadway/electrical work, and landscaping on a section of roadway that is approximately 500 linear feet.
The project is further complicated by the requirement to maintain business access throughout the area.
According to the February 14th agenda item prepared by the City’s community services director and engineer, the City solicited bids the Avenue of the Oaks Realignment Project on December 16, 2021, at which time four bidders responded to the invitation to vie for the project. While the original Engineer’s Estimate was $990,786, an addendum was issued that raised it to $1,141,606.
Q&D Construction was the apparent low bidder at $1,435,315, representing a $293,709 overage when compared to the Engineer’s Estimate (a 22.8 percent difference). In general, Q&D Construction’s bid for the Avenue of the Oaks project was reasonable and fair but given the complexity of this project and because the original Engineer’s Estimate was prepared prior to the issuance of Addendum 1, the bids the City received are in line with this type of work.
Contractors bidding on this project have been faced with a lot of uncertainty regarding inflation, availability of materials, and a project with several abnormal bid items. After in-depth review of the bid and gaining a better understanding of the complexity in the bidding environment, City staff believes Q&D’s bid is reasonable and recommended moving forward with awarding a contract to Q&D Construction. (The other option would be to reject all bids and defer the project at least one year or until prices, materials, and labor begin to stabilize.) The project will also be subjected to additional costs related to activities such as inspection, material testing, and construction survey (estimated to cost approximately $100,000). With the total budget for the project originally set at $1,100,000, the project was underfunded by $435,314. Therefore, Staff recommended shifting $500,000 from the Downtown Safety Barricades Project – Phase 2 to cover this shortage.
Regarding decreasing the budget for Phase 2 of the Downtown Safety Barricades Project, Staff believes that between the NEC Forecourt Project, the Victorian Square Plaza reconstruction project, and Silverwing Development’s Promenade West and Promenade East projects, it cannot project how spending $700,000 allotted for Phase 2 of the Barricades Project will affect special events, and therefore recommends deferring the funds. Phase 1 of the project was completed in May 2020 and Phase 2 is currently in progress, in an overall $1.6 million effort to provide a higher level of security for Downtown Sparks special events.
Staff concludes that premature placement of expensive safety equipment in these areas could result in having to relocate or even abandon equipment in the future. There are approximately eight safety installations planned for these areas as part of Phase 2 of the Project; staff recommended deferring those costs to coordinate with future development and reduce the scope of work for Phase 2 of the Downtown Safety Barricades Project.
However, not completing the entire Downtown Safety Barricade Plan with Phase 2 means a future phase of this project may be needed and Funding for an additional phase(s) of this project will need to be identified in the future.
This recommendation to shift the funds around in Agenda Item 9.9 of the recent February 14th Sparks City Council meeting was approved in a majority vote. For the full agenda item discussion regarding the Capital Improvements Plan for FY 2022, visit https://cityofsparks.us/ and refer to page 241 of the February 14 Sparks City Council Agenda Packet.
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