01-17-2006 - Award of Bid for Construction Contract for Removal or Upgrades of City Maintenance Yard Fuel Station (Project #BP-03304)e • •
City of West Covina
TO: Andrew G. Pasmant, City Manager Memorandum
and City Council AGENDA
FROM: Shannon Yauchzee, Director ITEM NO. D-3c
Public Works Department DATE January 17, 2006
SUBJECT: AWARD OF BID FOR THE CONSTRUCTION CONTRACT FOR THE
REMOVAL OR UPGRADES OF THE CITY MAINTENANCE YARD FUEL
STATION (PROJECT NO. BP-03304)
RECOMMENDATION:
It is recommended that the City Council take the following actions:
1. Award a contract to Advance Petroleum Corporation in the amount of $96,926, and authorize
the Public Works Director/City Engineer and City Clerk to execute the contract for the
decommissioning and removal of the fuel station equipment and underground storage tanks
located at the City Maintenance Yard.
2. Accept the State of California bidding requirements and "piggy -back" on the State contract
. with US Bank Corp for Voyager fuel card services.
3. Direct staff to return with a report on the installation of above ground fueling tanks at one or
more City facilities for future emergency preparedness.
DISCUSSION:
On December 7, 2005, a County of Los Angeles Department of Public Works (LADPW)
inspector documented that the City of West Covina tanks were non -compliant, and instructed the
City to pull a permit to either remove or upgrade the fuel tanks before January 30, 2006. The
fine from this agency for non-compliance was stated to be $500 per each day of violation,
however, its sister agency (South Coast Air Quality Management District) may issue concurrent
fines for the same violation (up to $10,000 per violation). Please refer to Attachment No. 1 for
more background information.
Fuel Cards
Many cities, such as Chino, have removed their fuel tanks and are strictly using fuel cards for
fleet fueling. These cards can be used at most private fuel stations and can be assigned to either a
person or a vehicle. The system uses a PIN number, vehicle mileage, and a detailed reporting
system to monitor fuel usage. Voyager fuel cards.are used by numerous governmental agencies
for fleet fueling including 25 state governments. The City of Chino was contacted and they are
extremely satisfied with this system. The system is used by the State of California and thus the
City can "piggy -back" on the State procurement process.
Emmency Preparedness
Currently, the underground fuel tanks- in the City Maintenance Yard provide enough fuel to run
City vehicles during a time of emergency. If the fuel tanks are removed it is recommended that
the above ground tanks holding three to four thousand gallons of unleaded and diesel fuel each
be installed at least at one location and possibly two locations. These smaller tanks can cost up
to $100,000 or more, but are necessary in the event of an emergency to fuel public safety
vehicles. Until such time as these tanks are installed, the Maintenance Division has an
agreement with the West Covina Unified School District for emergency fuel and is negotiating an
agreement with the City Covina. They will also investigate a contract with a rental company to
provide an emergency fuel truck and/or obtain an agreement with the City of Covina or another
jurisdiction for emergency fuel.
` • •
Andrew G. Pasmant, City Manager
and City Council
Page 2 — January 17, 2006
Bid Process
The Building Division staff issued a Request for Bids that would allow the City to accomplish
either the required upgrades, or the decommissioning and removal of the fuel system's equipment
and storage tanks.
The project was advertised in the San Gabriel Valley Tribune on December 13 and December 20,
2005. On December 21, 2005, a mandatory pre -bid informational meeting was held at the project
site with eight firms present. On December 27, 2005, two bids were received and opened in the
office of the City Clerk.
The following is a list of the bids submitted to either upgrade or remove the City Maintenance
Yard Fuel System.
hAi
R
grades
No
u
Contractor_:<
�U
N
i Bd Aimo nt
Btd Amount '
.« ..:
..
....
1.
Advanced Petroleum Corporation
$96,926
$218,152
2. 1
Fleming Environmental Inc.
$99,850
1 $258,460
Note: Professional Service Industries submitted a bid in the amount of $98,760 for removal
work, and $197,890 for upgrades work. Due to the late delivery of that bid to the City Clerk's
office, staff was forced to find it non -responsive.
After reviewing all bids, staff believes that Advance Petroleum Corporation, of Rancho
Cucamonga, is best qualified to perform this construction project.
As the performance of the upgrade work required by Senate Bill 989 will not indemnify the City
against any future demands that may be made by LADPW, or by SCAQMD, staff is forced to
recommend that the fuel system at the Maintenance Yard now be decommissioned and
permanently removed. Staff has found that most cities are removing their below ground tanks
and either installing above ground tanks and/or going to a fleet fuel card such as Voyager. The
issuance of Voyager fuel cards is required whether the tanks are removed or upgraded.
ALTERNATIVES:
Listed below are the following alternatives for this project.
1. Accept the bid of Advance Petroleum Corporation in the amount of $218,152 for the design
and construction of State required upgrades of the fuel station and underground storage tanks
located at the City Maintenance Yard, and authorize the Public Works Director/City Engineer
and City Clerk to execute the contract. This alternative will require the use of General Fund
Reserves in the amount of $90,000 for the balance of funding necessary to perform these
upgrades. It is also very likely that future regulations will again require additional upgrades
to the underground tank costing in the hundreds of thousands of dollars. This alternative will
require the use of the Voyager for all City vehicles during construction. The issuance of
Voyager fuel cards will ensure that the City's vehicle fuel needs are met during the time the
tanks are either removed or upgraded.
2. Re -advertise the project, seeking additional bids from other contractors. As this project has
already received qualified bids from qualified contractors, it is highly unlikely that this
project's costs will lower after the deadline already set and extended by its jurisdictional
agencies has lapsed. This alternate will cause the project to be delayed by approximately six
weeks, and incur additional advertising costs. This delay will require another extension from
LADPW, which is unlikely and could subject the City to fines.
0 . 0
Andrew G. Pasmant, City Manager
And City Council
Page 3 — January 17, 2006
FISCAL IMPACT:
As part of the 2004-2005 Capital Improvement Program budget, the City Council approved
$160,00 to upgrade the City Fuel System. Funding for the decommissioning and removal of that
system is now recommended, as follows:
�. Approved=Funding Source �
-� � ` `Account No �
� Aniount���- �s
:��
q
Capital Projects
160.83.8544.7500
$3,000
Construction Tax
161.83.8544.7500
96,000
Fleet Management
365.83.8303.7500
55,000
In addition to the $96,926 for the construction contract, the sum of $15,074 is needed for contract
contingencies and administration costs, and for performing site -related surveys, tests, and
inspections. Total funding of $112,000 will be needed'to complete this project. The remaining
amount of $42,000 can be used towards installing above ground emergency fuel tanks.
Staff advises that City liability for the treatment of soils contaminated at this site by its previous
owner, although such may exist, are interests that remain outside of the scope of Senate Bill 989.
LADPW will require the City to perform tests upon the soils in the immediate project areas to
detect the presence of possible contaminates. Although no fuel spills have ever occurred in those
areas during the City's occupancy of this site, should the tests of this project reveal the presence
of such contaminates, this project may immediately be returned to City Council for further
review. If contaminated soils are found, the removal could cost in the tens to hundreds of
thousands of dollars.
There are currently some fuel savings to the City due to buying fuel in bulk. These savings vary
significantly due to the economy and the market. The total annual savings due to purchasing
bulk fuel is estimated to be $44,000 per year. The annual cost to permit and maintain the below
ground tanks costs the City about $9,000 per year resulting in a net savings of $35,000 a year.
These savings are insignificant compared with the cost to upgrade the tanks at this time
($250,000) and the unknown costs to maintain and upgrade the tanks in the future. The future
installation of above ground tanks could recoup these savings and will be analyzed further as part
of studying the costs for above ground tanks.
The City currently buys both unleaded and diesel fuel in bulk quantities at rates less than retail.
Use of the Voyager fuel cards will cause the City to purchase all fuel at retail rates. Based on
historical usage, this will increase the City's annual net fuel costs by an estimated of $35,000.
Prepared by: Bru R. Hammill
Construction Coordinator
Reviewed/Approved by:
.Attachment No. 1
r;D_S;)
Finance
Reviewed/Approve by: Shannon A. Yauchzee
Director/City Engineer
ATTACHMENT NO. 1
Background
The fuel station at the City Maintenance Yard was originally developed from facilities that had
been in use as a privately operated gasoline service station. That service station and its available
surrounding land were purchased by the City of West Covina. The City Maintenance Yard and
outlying buildings were subsequently built in areas surrounding the old service station. In 1991,
the fuel tanks were replaced with more modern equipment.
During the construction of the modern fuel facilities, soil sample tests revealed that previous fuel
spills had contaminated the soil directly below the old fuel dispensing stations, and also
contaminated the soil that surrounded the location of the old UST's. The location for the
installation of the modern fuel facilities was then moved from those contaminated areas to
another site within the City Maintenance Yard. These facilities were built in accordance with the
environmental regulations and construction codes then in effect.
Beginning in 1993, the City Maintenance Division used State grant funding to decontaminate and
remove the soils that were immediately below the old service station's fuel facilities that had
tested positive for heavy concentrations of Volatile Organic Compounds (VOC's), to an
approximate depth of 14 feet below grade. During this process, the oversight agency monitoring
the project's progress, the County of Los Angeles Department of Public Works (LADPW),
required the City to increase the project's scope of work by performing more extensive testing of
the old service station's soils. That agency also required the City to prepare a formal "Site
Action Plan" (SAP), an environmental control report that would empower LADPW to require the
City to decontaminate all soils that showed the slightest presence of VOC's, to an approximate
depth of 85 feet below grade.
On August 6, 1996, City consultants contacted the California Regional Water Quality Control
Board (CRWQCB) to request a waiver from the increased scope of work issued by the LADPW.
On September 24, 1996, the State granted the City that requested waiver from any further
remediation requirements, and accepted the closure of that project.
From their installation in 1991 until present, City Maintenance Division staff performed all the
required maintenance services and monitored the performance of that equipment in accordance
with all required Federal, State, and County standards. During this time, there have been no
known, recorded, or reported fuel spills or leaks ("Unauthorized Releases") occurring at that site.
On May 14, 2001, a new State law (Senate Bill 989) was passed that increased the construction
and performance requirements of new fuel system facilities. This law also required the operators
of existing fuel systems to replace the existing access covers and manholes used to fill and
service underground tanks with new covers and manhole systems that were both larger in size
and capable of passing newly required "pressurization" tests. This law additionally required that
all existing fuel stations (fuel pump islands) be rebuilt to include a new spill -proof pan and spill
sensors to be installed directly underneath each fuel pump.
Implementation and enforcement of this law began immediately for all newly constructed fuel
systems, however, existing fuel systems were exempted from the need to perform these upgrades,
per the State request, for more than two years. During this State -requested delay, the regional
jurisdictional agencies responsible for oversight of local fuel system operations indopendertly
increased the scope of Senate Bill 989 by adding their own agency's methods of implementation
to it. The two jurisdictional agencies responsible for oversight of the local construction projects
made to perform the. fuel facility upgrades cited in Senate Bill 989 are the LADPW and the South
Coast Air Quality Management District (SCAQMD).
:...,,., .. ._�.I