COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Department of Public Works

DATE:

July 22, 2005

BOARD MEETING DATE:

August 9, 2005

SPECIAL NOTICE/HEARING:

None

VOTE REQUIRED:

Majority

TO:

Honorable Board of Supervisors

FROM:

Neil R. Cullen, Director of Public Works

SUBJECT:

Relieving the Low Bidder from Their Bid, Rejecting All Bids Received, and Authorizing the Director of Public Works to Re-Advertise the Reconstruction of Ninth Avenue – North Fair Oaks Area (Project No. RD100, F-36 [305-1B])

Recommendation

Adopt a resolution relieving the low bidder from their bid, rejecting all bids received for the reconstruction of a portion of Ninth Avenue and authorizing the Director of Public Works to re-advertise the project for construction in the Spring of 2006.

Vision Alignment

Commitment: Responsive, effective and collaborative government.

Goal 20: Government decisions are based on careful consideration of the future impact, rather than temporary relief or immediate gain.

Rejecting all the bids avoids possible litigation by the low bidder who made an error in their bid, and will allow us to obtain more competitive bids when the construction market is more favorable.

Background

Previous Board Action

Adopted Resolution No. 067385 on June 21, 2005, which adopted plans and specifications, determined prevailing wage scales and called for sealed proposals for the above-mentioned project.

History

On Tuesday, July 12, 2005, bids were accepted for this project and subsequently referred to this office for checking and recommendation. We determined that the low bidder made a $54,000 error in their bid and that the other two bidders were considerably higher than the low bidder’s intended bid, and higher than the engineer’s estimate.

Discussion

Error by Low Bidder

The low bidder, Half Moon Bay Grading and Paving, Inc. (HMB Grading), submitted a bid of $305,305. However, there was a discrepancy between the unit price and the total price of Class 3 concrete. The corrected bid using the unit price as provided by the contract terms reduces their bid to $251,305. HMB Grading confirmed their error and requested that they be relieved of their bid as provided by Section 5101 et. sec. of the Public Contract Code. We are satisfied that their error was legitimate and are recommending that your Board relieve them from their bid. The alternative is for HMB Grading to file a complaint in superior court. We believe they would prevail.

Rejection of Other Bids

The engineer’s estimate for the work was $320,000. A summary of the bids received is as follows:

1.

Half Moon Bay Grading and Paving, Inc. (uncorrected bid)

$305,305.00

2.

Interstate Grading and Paving, Inc.

$327,792.00

3.

Pavex Construction Company

$415,510.90

We would have recommended that a contract be awarded to HMB Grading if their bid did not contain the discrepancy as discussed above. We do not believe the other bids are competitive as they are 7.4% and 36.1% above HMB Grading’s intended bid.

We have evaluated the construction market and believe that the contractors are busy due to the prolonged rainy season that prevented construction from going forward earlier in the year. We believe that we can receive better bids for the work by delaying bids until next spring. We also believe that this is a prudent course of action, as a significant amount of storm water flows down Ninth Avenue; and re-bidding the work now would take construction into the winter and may exacerbate drainage issues for the area. We are therefore recommending that the Director of Public Works be authorized to re-advertise the project for bids in late 2005/early 2006 in order that construction can begin in the early spring. HMB Grading is precluded from re-bidding this project if you relieve them from their bid as provided by Section 5105 of the Public Contract Code.

A form of resolution rejecting all bids and authorizing the Director of Public Works to re-advertise the project has been approved as to form by County Counsel.

Fiscal Impact

Re-bidding the work is estimated to cost $1,000 and will be paid for with Road Funds.

There is no impact to the General Fund.

A copy of our report has been sent to the property owners on Ninth Avenue and the Fair Oaks Council and we will report to your Board any comments that we receive.