A2 ADMINISTRATIVE REPORT Date: April 30, 1996 Dept. File No.1.40.96.05 TO: Vancouver City Council FROM: General Manager Engineering Services SUBJECT: Award of Contract No. 9602 for the Installation of Steel Pipelines and Related Work - False Creek Area (Dedicated Fire Protection System, First Phase) RECOMMENDATION A. THAT Contract No. 9602 for the Installation of Steel Pipelines and Related Work - False Creek Area be awarded to the low bidder meeting the contract requirements, B. Cusano Contracting Inc., for the net total tender price of $3,048,800, using the funding sources identified. (The applicable G.S.T. rebate has been subtracted from the total tendered price.) B. THAT the bid bonds from the unsuccessful tenderer be returned. C. THAT the Director of Legal Services be authorized to enter into a construction services contract with B. Cusano Contracting Inc. for Contract No. 9602, for the Installation of Steel Pipelines and Related Work for the DFPS, False Creek Area, in consultation with the General Manager of Engineering Services. COUNCIL POLICY Construction contracts over $300,000 are to be awarded by City Council. PURPOSE This report recommends that the contract to construct the first phase of Dedicated Fire Protection System -- Steel Pipeline System be awarded to B. Cusano Contracting Inc., the low bidder meeting qualifications. BACKGROUND In April 1992, City Council approved in principle the concept and funding of a Dedicated Fire Protection System (DFPS). The system is designed to provide large volumes of high pressure fire fighting water. During normal operations the system will supplement the City s water system. In the event of an emergency, when the City s water system is disrupted, the DFPS will utilize salt water, pumped directly from the ocean. When the DFPS project is completed, coverage will include the Downtown, West End, Kitsilano, Downtown east side and Fairview Slopes. The Dedicated System project includes the construction of 3 pump stations, a dedicated system of watermains and a new radio transmitter station on Grouse Mountain. All facilities are being designed to remain operational following the maximum credible seismic event for the Lower Mainland. To date, intake structures at Coal Harbour and False Creek, the False Creek Pump Station and the new radio transmitter station have been completed. The Coal Harbour Pump Station will be completed in June, 1996. The pump stations have been constructed with specialized Fire Department connections, capable of drawing the pump station's full capacity. One Fire Department hose tender truck, designed to complement the DFPS, is presently in service at Fire Hall #8. A second hose tender truck will be purchased this year from funds budgeted in the 1996 Capital Budget. The tender trucks each carry one mile of large volume, high pressure hose and specialized fittings to create above-ground mains. Therefore, only a skeletal grid of underground dedicated mains are required because of increased system coverage from the Fire Department equipment. The pump stations can also be utilized immediately, while the dedicated mains are being constructed. DISCUSSION The installation of the steel pipelines and related work represents the fifth major construction phase of the City s Dedicated Fire Protection System project, which was approved in principle subject to funding, by Council on April 16, 1992. The pipelines and related works contract will be administered as a series of lump sums. The construction services contract includes quoted unit prices for specific additions and deletions. The successful contractor has submitted a detailed breakdown of the lump sum prices tendered, which will be used for the computation of interim progress payments. The final cost of the contract may vary as a result of variances from the estimated quantities of work and/or changes to the scope of work; however it is anticipated that the work will be completed within budget. Two complete tenders were submitted. All tenders contained the appropriate bonding. A summary of the bids, as announced at the tender opening, is as follows: Contractor Tender Price B. Cusano Contracting Inc. $3,167,200.00 Lockerbie & Hole Contracting Inc. $3,756,405.00 In accordance with City policy, which is detailed in our tender documents, the submitted tenders are checked for arithmetic accuracy. The true tender value is the correct extension of unit prices against the estimated quantities and then the correct addition of all unit sum and lump sum costs. Both tenderer's submissions were arithmetically correct. The tender submitted by the low bidder, B. Cusano Contracting Inc., meets all the contract requirements, including insurance and bonding, and construction completion date. B. Cusano Contracting Inc. have demonstrated experience with similar types of construction work and have completed similar work in a satisfactory and timely manner, according to references. BUDGET & SUMMARY The breakdown of the recommended low bid from B. Cusano Contracting Inc. can be summarized as follows: Construction Contract: $3,167,200.00 Less G.S.T. Rebate $ 118,400.00 Net Total Contract Value $3,048,800.00 The engineer s cost estimate, for the installation of steel pipelines and related work contained in contract 9602, excluding materials pre-purchased by the City of Vancouver, was $2,910,873.37 including net GST. Even though the low bid submitted exceeded the engineer s estimate by 4.7%, the low tender was close to the estimate and the engineering team believe it represents fair market value for the tendered scope of work. While the construction cost for this phase of pipeline construction is validated by the engineer's estimate, it is above the unit cost per metre for pipeline set by the project conceptual design report and budget. The project team recommend completing the critical pipe work that connects the Coal Harbour and False Creek pump stations at the present design and construction standard. This section of the DFPS pipe system connects the three primary pump stations and contains the key remote SCADA monitored and controlled valve stations. The post seismic performance of this key section of pipeline will be critical to the successful performance of the overall dedicated system. Deep trenches for consistent seismic foundation, heavy utility congestion in the Downtown area, and high construction standards to ensure post seismic reliability all contribute to the overall cost for this pipe work. The project engineering team will investigate a variety of options for the future downtown pipe loops that include reducing the scope of work, lessening the post seismic resistance, or increasing the overall project budget and/or implementation schedule. Funds are available to be allocated from the approved 1995 and 1996 Waterworks Capital Budget for the award of construction services contract 9602 to the low bid construction tender, meeting contract requirements, submitted by B. Cusano Contracting Inc., for the Dedicated Fire Protection System, Installation of Steel Pipelines and Related Work - False Creek Area. * * * * *