February 28, 2006

SUBJECT:               Rejection of Bid for the Installation of Bicycle Lanes on Evelyn Avenue (No. F0509-18)

REPORT IN BRIEF

Request is made that Council reject the only bid received in response to Invitation for Bids No. F0509-18 for the installation of bicycle lanes on Evelyn Avenue for the Department of Public Works Engineering Division (Project No. TR-02/02-03A).

BACKGROUND

This project, known as the Evelyn Avenue Lane Reduction Project, consists of installing bike lanes on Evelyn Avenue between Bernardo Avenue and Sunnyvale Avenue and constructing associated modifications to signing, pavement delineation and traffic signal systems, including a reduction in the number of lanes for vehicular traffic.

Bid specifications were developed by the Public Works Engineering Division and Purchasing staff. The Notice Inviting Bids was published in The Sun on October 19, 2005; and the bid package was distributed to Bay Area Builders Exchanges and broadcast to potential contractors through the DemandStar by Onvia procurement network. Eleven contractors requested bid documents.

One bid was received and publicly opened on Wednesday, November 16, 2005.  That bid was from Prism Engineering of Santa Clara in the amount of $509,545.  The engineer’s estimate for the completion of this project was $165,000. 

DISCUSSION

In determining why the sole bid received was so far in excess of the engineer’s estimate, staff discovered that the drawings prepared by the consultant included an erroneous reference to slurry seal.  Although the project originally included slurry seal, it was the City’s intent that this requirement be deleted from the plans and specifications prior to issuance of Invitation for Bids No. F0509-18.  Unfortunately, one reference to slurry seal on the drawings was overlooked; and this resulted in the $509,545 bid from Prism Engineering.  It is also the most likely reason for the lack of other competitive bids.

Since $509,545 is far in excess of the project budget, staff recommends that Council reject the sole bid received and authorize staff to correct the error in the project plans and rebid the project. 

FISCAL IMPACT

Rejecting the bid has no fiscal impact at this time.

RECOMMENDATION

It is recommended that Council reject the sole bid received in response to Invitation for Bids No. F0509-18 and authorize staff to correct the bid documents and rebid the project.

Prepared by:

Elaine Wesely

Purchasing Officer

Reviewed by:

Mary J. Bradley

Director, Finance

Reviewed by:

Marvin Rose

Director, Public Works

Approved by:

Amy Chan

City Manager