1. Declare Leed Electric, Inc. (Leed), first low bidder, to be non-responsive, as discussed in this report.

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1 Joint Report No. 3 CD No. 6 REQUEST TO AWARD A CONTRACT FOR THE DONALD C. TILLMAN WATER RECLAMATION PLANT (DCTWRP) CHLORINE CONTACT TANK GATE ACTUATORS (CIP 6210) (REBID) - WORK ORDER NO. SZD11277 RECOMMENDATIONS 1. Declare Leed Electric, Inc. (Leed), first low bidder, to be non-responsive, as discussed in this report. 2. Declare Kiewit Infrastructure West Co. (Kiewit), second low bidder, to be the lowest responsive, responsible bidder, and award them a contract for this project for $607, Authorize the President or two members of the Board of Public Works (Board) to execute the contract after approval as-to-form has been obtained from the City Attorney. TRANSMITTALS 1. Summary of bids received on March 30, Copy of the letter dated April 15, 2016, from the Office of Contract Compliance (OCC) to Mr. Seyed A. Jamali, Leed. 3. Copy of the dated April 18, 2016, from Mr. Seth A. Jamali, Leed, to the OCC. DISCUSSION Background The DCTWRP Chlorine Contact Tank Gate Actuators project will provide automation through the addition of actuators to a total of 10 existing slide gates in and around the chlorine contact tanks at DCTWRP. There are currently eight gates, four per phase, in operation within the chlorine contact tanks which consist of two influent and two effluent gates each. There are additionally two filter dump gates, one per phase. The scope includes installation of Rotork actuators to the 10 gates, modifications to the stems in Phase 1, removal and replacement of the stem guides, and the electrical work and instrumentation to provide power to the actuators and signals to the Distributed Control System. The contract duration is 455 calendar days.

2 Joint Report No. 3 Page 2 Figure 1: DCTWRP Project Site Plan The project has been reviewed for environmental considerations. It was determined to be categorically exempt pursuant to the provisions of the California Environmental Quality Act (CEQA) of 1970 under Article III of the City s CEQA Guidelines. Bid Review The two lowest of the five bids received (Transmittal No. 1) compared with the City Engineer s estimate of $699,326 are: Business Inclusion Program Outreach Codes: MBE = Minority Business Enterprise WBE = Women Business Enterprise SBE = Small Business Enterprise EBE = Emerging Business Enterprise DVBE = Disabled Veteran Business Enterprise OBE = Other Business Enterprise Bid No. Contractor Name Bid Amount High/Low Pledged MBE WBE SBE Low Bid Leed (SBE, LBE) $546, % Low 2 nd Bid Kiewit (OBE, LBE) $607, % Low 0.00% 0.00% 18.01% EBE DVBE OBE 18.01% 0.00% 3.28% MBE WBE SBE 0.00% 0.00% 0.00% EBE DVBE OBE 0.00% 0.00% 27.18% Based on the range of bids that was submitted for this project, staff believes that these bids are reasonable. The contract may be awarded to either of the above bidders, subject to verification of all other bidding requirements.

3 Joint Report No. 3 Page 3 Local Business Preference (LBP) Program City Ordinance No adopted the LBP Program. This program is designed to increase local employment and expenditures in the local private sector. Bidders that qualify as a Local Business Enterprise (LBE) may be granted an 8 percent reduction of their bid amount solely for bid evaluation purposes. Additionally, all non-lbe bidders may be granted a 1 percent reduction, up to a maximum of 5 percent, of their bid amount for bid evaluation purposes, for every 10 percent of their bid that is to be performed by an LBE subcontractor. The (BCA) has verified that both Leed and Kiewit are certified LBEs. Business Inclusion Program (BIP) On January 12, 2011, the Mayor issued Executive Directive No. 14 which created the BIP. This program provides MBE, WBE, SBE, EBE, DVBE, and OBE firms an equal opportunity to compete for and participate in City contracts. Additionally, the BIP requires bidders to perform and document a BIP Outreach via the internet utilizing the Los Angeles Business Assistance Virtual Network service. This project was advertised with anticipated participation levels of 4 percent MBE, 2 percent WBE, 25 percent SBE, 8 percent EBE, 3 percent DVBE, and with mandatory BIP documentation requirements. The project was also advertised with the Board s Mandatory Subcontracting Minimum (MSM) requirement of 25 percent. The bidders MSM percentages for this project were calculated after subtracting the fixed cost items of $30,000 from their total bid amounts. The OCC, based on a review of the documents, reported the following: Leed, first low bidder, complied with the BIP Outreach requirements of the bid. Leed pledged participation levels of 0 percent MBE, 0 percent WBE, percent SBE, percent EBE, 0 percent DVBE, and 3.28 percent OBE. However, Leed failed to meet the Board s requirement of 25 percent MSM participation by only listing percent subcontractor participation in their bid proposal. In an dated April 15, 2016 (Transmittal No. 2), the OCC notified Leed that the OCC would be recommending that their bid be deemed non-responsive for failing to meet the MSM requirement for this project. Communication Received In an dated April 18, 2016 (Transmittal No. 3), Seth Jamali, Leed, responded to the OCC notification, stating that the results of their outreach yielded limited subcontractor participation. According to the Contractor, the majority of this project is electrical work and no other electrical contractor quoted us a bid even though we

4 Joint Report No. 3 Page 4 made the good faith effort. As a result, the 25 percent subcontractor requirement could not be met under any circumstances. Staff Response The bid specifications state that To be eligible for the award of this project, the Board requires the bidder to subcontract a minimum percentage of its bid to any qualified available subcontractor, and list all subcontractors, regardless of bid amount, that the bidder wishes to be credited toward achieving the required MSM. Furthermore, Failure to list the subcontractors and subcontracting amounts with the bid sufficient to meet or exceed the required MSM, may cause the bid to be rejected by the Board as non-responsive. Accordingly, it is the bidder s responsibility to conduct an outreach to potential subcontractors, including vendors/suppliers, that is sufficient to meet or exceed the required MSM percentage set for this project. The OCC in consultation with the Bureau of Engineering staff confirmed that the dollar value of the supplies that Leed would have needed in order to perform its work on this project was sufficient to meet or exceed the MSM percentage. Therefore, had Leed listed vendors/suppliers for its needed materials, Leed would have sufficiently met the MSM requirement. Based on these findings, the OCC recommends that the Board find Leed s bid to be non-responsive for failure to meet the MSM participation requirement for this project. The second low bidder, Kiewit, complied with the BIP Outreach requirements of the bid. Kiewit pledged participation levels of 0 percent MBE, 0 percent WBE, 0 percent SBE, 0 percent EBE, 0 percent DVBE, and percent OBE. The contractor complied with the MSM requirement by pledging a subcontractor participation level of percent. In view of the above findings, Kiewit, second low bidder, becomes the lowest, responsive, responsible bidder. Kiewit pledged the following subcontractor utilization: Gender/Ethnicity Codes: AA = African American APA = Asian Pacific American NA = Native American M = Male HA = Hispanic American SAA = Subcontinent Asian American C = Caucasian F = Female Subcontractors MBE/WBE/ SBE/EBE/ DVBE/OBE Gender/ Ethnicity of Bid Dollar ($) Amount Big Sky Electric, Inc. OBE 27.18% $165,000

5 Joint Report No. 3 Page 5 Compliance with the City s Non-Discrimination Policies Kiewit has complied with the Affirmative Action, Non-Discrimination, and Equal Employment Practices Provisions, Equal Benefits Ordinance, and Slavery Disclosure Ordinance requirements of the bid. Previous Work Record Kiewit has worked on numerous contracts issued by the Board. No significant or unresolved problems in inspection, contract compliance, or bidder responsibility have been experienced by the BCA. The following table summarizes the previous MBE, WBE, SBE, EBE, DVBE, and OBE participation levels pledged by Kiewit in the past five years: Pledged Utilization Table No. of Contracts Awarded under the BIP: 7 Awarded under the MBE/WBE/OBE Subcontractor Outreach Program: 0 Total Dollar Value of Contracts Awarded under the BIP: $28,220,000 Awarded under the MBE/WBE/OBE Subcontractor Outreach Program: $0 Pledged Pledged Pledged Pledged Pledged Pledged WBE MBE $ SBE $ EBE $ DVBE $ OBE $ $ Amount Amount Amount Amount Amount Amount $83,000 $2,394,000 $864,691 $83,000 $0 $8,050, Total MBE Total WBE Total SBE Total EBE Total DVBE Total OBE 0.29% 8.48% 3.06% 0.29% 0% 28.53% Contractor Performance Evaluation In accordance with Article 13, Chapter 1, Division 10, of the City of Los Angeles Administrative Code (L.A.A.C.), the Project Manager and the City Inspector for this construction contract shall submit Contractor Performance Evaluation Reports to the BCA upon completion of this contract. Peak Hour Construction and Right-of-Way Obstruction Regulations All contractors must comply with the requirements specified in the Los Angeles Municipal Code Section related to peak hour traffic restrictions, unless an exemption from the Peak Traffic Hours Prohibition is approved. Contractor Responsibility Ordinance All contractors participating in this program are subject to compliance with the requirements specified in the City of Los Angeles Contractor Responsibility Ordinance

6 Joint Report No. 3 Page 6 No (Article 14, Chapter 1, Division 10, L.A.A.C.). Failure to comply with all the requirements specified in the Ordinance may render this bidder s contract subject to termination pursuant to the conditions expressed therein. Enhanced Electrical Safety Policy If the estimated value of the electrical work for this project is $100,000 or more, the electrical work will be performed and inspected under the conditions of the most current, amended Board s Enhanced Electrical Safety Policy. Bid Bond Extension Leed and Kiewit were requested to extend their Bid Bond which expired on June 28, The contractors have agreed to extend their Bid Bond until October 7, Conclusion In view of the above findings, staff recommends that the Board find Leed, first low bidder, to be non-responsive; declare Kiewit, second low bidder, to be the lowest responsive, responsible bidder; and award Kiewit the contract for this project. Program Review Committee (PRC) Approval The PRC approved a total budget of $843,900, including contingency, for this project on December 10, STATUS OF FINANCING There is no impact to the General Fund. No funding is required in Fiscal Year The total funding for this project is not-to-exceed $728,400. However, funds and appropriations for future fiscal years are not yet identified and existing appropriations may change based on available cash balances. Therefore, funds and appropriations, once determined by the Director of Sanitation or designee, will be reviewed and certified by the Director of the Office of Accounting or designee, as to the status and availability of funding. The contract contains a Financial Liability Clause which states that the City s liability under this contract shall only be to the extent of the present City appropriation to fund the contract. However, if the City shall appropriate funds for any succeeding years, the City s liability shall be extended to the extent of such appropriation, subject to the terms and conditions of the contract. The following funding has been verified and approved by the Director of the Office of Accounting subject to the conditions described above: Fund No.* TBD Appropriation Unit No. Budget Fiscal Year Contract Contingencies Total WCIP BUDGET SZD11277 FUTURE $607,000 $121,400 $728,400 Total $607,000 $121,400 $728,400 *To be determined by the Director of the Bureau of Sanitation or appointed designee.

7 Joint Report NO.3 Page 7 ( MJS JKS RMK KRR WFB ) Report reviewed by: BOE (ADM and EED) and BOS (FMD) Report prepared by: Project Award and Control Division Respectfully submitted, A~~~ Gary Lee Moore, PE, ENV SP City Engineer Julie Sauter, PE Division Engineer Phone No. (213) Compliance Review performed and approved by: Hannah Choi, Pr g 'm Manager Office of Contract Compliance Statem~F~ed by: Victoria A. Santiago, Director ~( 4 Office of Accounting ~ \,.: I' Date: tj \? J KSI AS/ PAC. eeg Questions regarding this report may be referred to: Amy So, PE and Project Manager Phone No. (310) Amy.So@lacity.org