To Consider Agreement with Critical Solutions, Inc., for Project and Construction Management Services
The General Manager referred to the packet, which contained the consulting agreement with Critical Solutions, Inc. (Exhibit A – Scope and Exhibit B – Fees) for all the various tasks involved and Exhibit C – Schedule. He said a number of revisions have been made and Attorney Mark Cornelius has reviewed it. With each revision, the contract became more precise on exactly what the District needs are, what we are trying to focus on and what services will most benefit the District in all projects. The General Manager is pleased to recommend the approval of the agreement.
Interim Project Manager Sarvi commented that they basically started looking at the scope and went through it in detail. He said the number of reports and meetings were examples of the focus of the scope. He stated the fee corresponds to the scope and is very compatible and fair for this project that could last for 3 - 4 years.
Project Manager Ron Johnson is anxious to get started and has started on a preliminary basis. He is looking forward to working with the architect and the team, and to make it a reality.
Board Member Bonato looked at Exhibit B and was very comfortable with this exhibit and was able to see the breakdown. She questioned a couple of things that had been removed and about whether they were removed because staff felt they are things we don’t really need or were they budget busters. She said for example, the project procedures manual and documents manual have been left out. She asked why? Project Manager Johnson answered that typically for a larger project (i.e. a multi-billion dollar airport with hundreds of people involved), there might be a manual telling people how to navigate through the system, but with smaller projects, in his experience, the manuals are not needed. He commented that when the project is completed, the manuals are usually just filed away and nobody would ever go back to look at them. There was a discussion about this and he said they felt that it could be eliminated and it would also save the District money.
Board Member Bonato was glad to see all engineering and constructability reviews included regarding the combination of the Senior Center and Teen Center for purposes of bidding. She said it looks as if there has been a real effort to put the two together and to use CSI’s time efficiently by having both of these projects happen at the same time. She commented that the inspection pricing is about the same for both of these projects as it would be for the Community Center. Johnson replied that the pricing was typically related to the length of construction. He said we are looking at approximately a 12-month construction time for both projects, excluding the demolition.
Board Member Bonato also asked how the formal contract best insures we can control the costs of the construction. Hamid answered that the best way to control costs is to control the schedule. This is where Ron and his team come in to make sure that all the parties (architects, District, the City and everybody that’s working on this project as well as the approval process) understands the importance of the schedule and they stay focused on the schedule and on the project. Interim Project Manager Sarvi said that in general, the art of project management is to keep everybody focused on the schedule and on the project and all the details of the project. He said Johnson is good at that and that’s what we can expect of him and his firm. Board Member Bonato stated that upon checking companies for selection, CSI’s reputation for bringing their project contract on time was very good. She commented that Johnson’s track record should bring some comfort.
Board Member Shepard asked about liability insurance at $1 million. Hamid was asked if we should put into the contract that the construction manager be named as an additional insured. Hamid replied that the district is always an additional insured on the contractor’s certificate of insurance. He said the greatest liability is the contractor with all the equipment. Shepard asked if there was a problem on the job site, would that be covered under the general liability or the professional liability. He said it would go to the general contractor because he controls the site. He said the contractor on each of these projects will control the site and they are the one’s liable. He stated that is why a lot of times the District requests to be named additional insured because we don’t control the site.
Shepard also asked a question on Exhibit A, Page 3 – Was a decision made regarding pre-qualifying for bidders? Sarvi answered no, it has not been decided. She asked what are the pros and cons going in the direction to pre-qualify. Sarvi explained the pros of the pre-qualification process and how it allows you to exclude some of the contractors that don’t qualify. He commented that in this current market, there can literally be 20 to 30 contractors bidding and there may be some that are working right out of their pickup truck. He said having the pre-qualification process can weed out some of these contractors and this will provide a smaller pool and said he would still anticipate at least 10 contractors bidding on the projects. He said from a competitive point of view, there still can be very competitive bids whereas five to six years ago, through a pre-qualification process, there might only be 3 or 4 bids received.
Board Member Donaghu brought up a question under 3.3 on the Scope and where it specifically mentions for Item 1 questions; there is a log of questions and answers maintained, but there is no reference to a log, but Item 2 questions and answers that are required clarification by addendum. He asked if there is a log kept on that or is that part of the same log. Johnson said there will be a complete log of all the questions and answers that will be included in the addendum and that becomes part of the contract. Johnson said he prefers this practice because you can go back to say that question was answered during the bidding process, and here’s the answer.
Board Chair Sterrett found the contract to be pretty straightforward and the exhibits educational. Board Member Shepard had some further questions that Project Manager Johnson was able to answer or explain.
Another question the Board had was on the consulting contract deductible in the amount of $50,000. Johnson said that $50,000 is usually in the standard agreement and typically is not changed from one project to another, but if somebody does want to change it, CSI would make a case-by-case evaluation. He said it is a decision that the Board and the General Manager needs to make if they are requesting the amount to change from the $50,000. He mentioned there have been cases where they have accepted a higher deductible, but in order for them to meet that deductible, they’ll have to purchase projects specific policies, which is going to cost money and that money will be paid by the District. He said the District could lower it to $25,000 which would make it consistent with current deductibles. Johnson said it might be better to go down to $30,000 and then there is a little flexibility to stay under the $30,000.
Board Member Shepard was inclined to suggest that it be reduced to $25,000. The Board decided to state what exactly the maximum deductible is and have it not less than $25,000. Johnson was agreeable to that. The General Manager would be the final person to make sure all the certificates are received and Project Manager Johnson would be managing this from the front. He said the certificates need to be renewed each year, so they will need to be checked before a payment is sent out.
Upon motion of Donaghu/Shepard, the Board unanimously approved the agreement with Critical Solutions, Inc. for project and construction management services. |
