Staff Report
PREPARED BY: LISA PETERSEN
Town Engineer
Reviewed by: Town Manager, Assistant Town Manager, Town Attorney, Finance Director, and Parks and
Public Works Director
110 E. Main Street Los Gatos, CA 95030 ● 408-354-6832
www.losgatosca.gov
TOWN OF LOS GATOS
COUNCIL AGENDA REPORT
MEETING DATE: 02/19/2019
ITEM NO: 10
DATE: FEBRUARY 13, 2019
TO: MAYOR AND TOWN COUNCIL
FROM: LAUREL PREVETTI, TOWN MANAGER
SUBJECT: PPW JOB NUMBER 18-811-9901. ANNUAL STREET REPAIR AND
RESURFACING PROJECT (RUBBER CAPE SEAL).
A. AUTHORIZE CONTRACT AWARD TO THE PROJECT LOW BIDDER,
AMERICAN PAVEMENT SYSTEMS, IN AN AMOUNT NOT TO EXCEED
$1,053,800, INCLUDING A TEN PERCENT CONSTRUCTION
CONTINGENCY.
B. AUTHORIZE STAFF TO EXECUTE POTENTIAL CHANGE ORDERS WITHIN
THE TEN PERCENT CONSTRUCTION CONTINGENCY.
C. RECOGNIZE $414,061 OF PROJECT REIMBURSEMENTS AND AUTHORIZE
A REVENUE AND EXPENDITURE BUDGET ADJUSTMENT OF $414,061 TO
THE ANNUAL STREET REPAIR AND RESURFACING PROJECT.
D. AUTHORIZE A REVENUE DECREASE OF $178,000 IN GAS TAX REVENUE
TO THE ANNUAL STREET REPAIR AND RESURFACING PROJECT.
E. AUTHORIZE A REVENUE INCREASE OF $10,650 IN GFAR REVENUE TO
THE ANNUAL STREET REPAIR AND RESURFACING PROJECT.
RECOMMENDATION:
Staff recommends that the Town Council:
A. Authorize contract award to the project low bidder, American Pavement Systems, in an
amount not to exceed $1,053,800, including a ten percent construction contingency.
B. Authorize staff to execute potential change orders within the ten percent construction
contingency.
C. Recognize $414,061 of project reimbursements and authorize a revenue and expenditure
budget adjustment of $414,061 to the Annual Street Repair and Resurfacing Project.
D. Authorize a revenue decrease of $178,000 in Gas Tax revenue to the Annual Street Repair
and Resurfacing Project.
E. Authorize a revenue increase of $10,650 in GFAR revenue to the Annual Street Repair and
Resurfacing Project.
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SUBJECT: PPW JOB NUMBER 18-811-9901. ANNUAL STREET REPAIR AND RESURFACING
PROJECT (RUBBER CAPE SEAL).
FEBRUARY 13, 2019
S:\COUNCIL REPORTS\2019\02-19-19 Interviews\10 PPW Job Number 18-811-9901 Annual Street Repair & Resurfacing (Rubber Cape Seal)\Staff
Report.docx 2/13/2019 3:08 PM
BACKGROUND:
The Town’s adopted FY 2018/19-2022/23 Capital Improvement Program (CIP) Budget
designates funding for the Town’s Street Repair and Resurfacing Program. This is a recurring
annual project for street rehabilitation activities throughout the Town to enhance vehicular
safety and maintain the roadway infrastructure in Los Gatos. It is important for the Town to
complete the annual street maintenance projects each year to prevent Town streets from
falling into more expensive repair categories.
At the Council meeting on December 18, 2018, the Council:
1. Approved the plans and specifications for the Annual Street Repair and Resurf acing
Project (Rubber Cape Seal) and authorized the Town Manager to advertise the project
for bid.
2. Authorized the Town Manager to award and execute a construction agreement in an
amount not to exceed $859,232, including contingencies.
3. Authorized staff to execute potential change orders in an amount not to exceed ten
percent of the contract award amount.
The project includes the streets shown in Attachment 1.
DISCUSSION:
Project bids for the Annual Street Repair and Resurfacing (Rubber Cape Seal) project were
opened in the Town Clerk’s office on February 6, 2019. The bids came in higher than the
approved award amount, which requires staff to return to Council and request approval of a
higher contract award amount. The following five bids were received for the project:
American Pavement Systems (APS) - $958,000
VSS International - $1,017,120
G. Bortolotto - $1,020,020
Intermountain Slurry Seal - $1,022,632
Telfar Pavement Technology - $1,079,260
The Engineer’s Estimate for the project was $781,120. The main cost differences between the
Engineer’s Estimate and the project low bidder, APS, were the prices for slurry seal, rubber cape
seal, and traffic control. Although staff used bid pricing from past projects with an escalation
factor for the estimate, the continued upsurge in labor and material prices in the Bay Area have
further increased construction prices. Additionally, the bidders noted that the Town’s hillside
streets are more difficult to work on and require more time and traffic control services, thereby
increasing the cost.
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SUBJECT: PPW JOB NUMBER 18-811-9901. ANNUAL STREET REPAIR AND RESURFACING
PROJECT (RUBBER CAPE SEAL).
FEBRUARY 13, 2019
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Report.docx 2/13/2019 3:08 PM
DISCUSSION (continued):
Town staff strives to bid projects early in the calendar year , which allows for better project bid
pricing. Projects that are bid early have more bidders and the contractors provide better
pricing because they are working to fill their construction schedules for the year. It is unlikely
better bids would be received if the project was bid again later in the year. Staff recommends
awarding the project to American Pavement Systems for $1,053,800, including a ten percent
construction contingency.
CONCLUSION:
Approval of the recommended actions will allow for delivery of a rubber cape seal project
allowing the Town to continue to maintain the Town’s pavement infrastructure.
ALTERNATIVES:
The Town Council may choose to reject all bids and rebid the project. This is not recommended
because the project was bid early in the year which provided a high number of bidders and
early bidding typically yields the lowest bid prices. Bidding the project again is likely to produce
less bidders and higher prices.
COORDINATION:
This report was coordinated with the Town Finance Department.
FISCAL IMPACT:
As additional funds beyond those currently budgeted to the project are required to award this
contract, several funding actions are required. These actions recognize revenue adjustments to
the Annual Street Repair and Resurfacing Project and collectively provide sufficient funding for
award.
On January 15, 2019, the Town Council approved the overlay phase of the Annual Street Repair
and Resurfacing Project, which identified a $275,000 reimbursement from the City of San Jose
for anticipated work. The recommendation is to recognize this as revenue in the project, as it is
already programmed in the expenditure budget.
In addition, the Town received reimbursements from the City of San Jose and utility companies
totaling $139,061 during the previous phase of the Annual Street Repair & Resurfacing Project.
The recommendation includes recognition of these funds as revenue back to the project.
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SUBJECT: PPW JOB NUMBER 18-811-9901. ANNUAL STREET REPAIR AND RESURFACING
PROJECT (RUBBER CAPE SEAL).
FEBRUARY 13, 2019
S:\COUNCIL REPORTS\2019\02-19-19 Interviews\10 PPW Job Number 18-811-9901 Annual Street Repair & Resurfacing (Rubber Cape Seal)\Staff
Report.docx 2/13/2019 3:08 PM
FISCAL IMPACT (continued):
Staff recently received notification from the State that the annual gas tax allocation will fall
short of forecast amounts by $178,000. Staff recommends recognition of a revenue decrease
to account for this change.
Lastly, the Town has collected $10,650 in FY 2018/2019 in Slurry Seal Fee revenue, which is
identified in the Town’s Fees and Fines schedule and intended for street maintenance where
small utility projects create need. Recognizing the revenue to the street maintenance project
completes the required nexus for the collection of these fees.
Street Repair & Resurfacing
Project 811-9901
Budget Costs
GFAR $ 2,482,289
Gas Tax $ 1,681,981
*Gas Tax Decrease $ (178,000)
*Project Reimbursements (City of San Jose & Utilities) $ 139,061
*Project Reimbursements (Planned from City of San Jose) $ 275,000
*FY 18/19 Slurry Seal Fee Collections $ 10,650
Total Budget $ 4,410,981
FY 18/19 Prior Commitments (Expenditures +
Encumbrances) $ 734,237
Additional Expenditures/Encumbrances since 1/5/2019 $ 30,045
Pending Change Order to MCK Construction $ 11,915
Rubber Cape Seal Project approved 12/18/18 $ 859,232
*Additional Rubber Cape Seal Need $ 194,568
Project Construction (Including Contingencies) $ 2,159,955
Staff Costs (12%) $ 262,800
Total Expenditures $ 4,252,752
Remaining Balance $ 158,229
*Actions recommended in this report.
ENVIRONMENTAL ASSESSMENT:
This is a project as defined under CEQA but is Categorically Exempt (Section 15301c). A Notice
of Exemption has been filed.
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SUBJECT: PPW JOB NUMBER 18-811-9901. ANNUAL STREET REPAIR AND RESURFACING
PROJECT (RUBBER CAPE SEAL).
FEBRUARY 13, 2019
S:\COUNCIL REPORTS\2019\02-19-19 Interviews\10 PPW Job Number 18-811-9901 Annual Street Repair & Resurfacing (Rubber Cape Seal)\Staff
Report.docx 2/13/2019 3:08 PM
Attachment:
1. Street List for Project 18-811-9901
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