SUBJECT: RESOLUTION AUTHORIZING AWARD OF A CONTRACT TO ANDES CONSTRUCTION FOR THE REHABILITATION OF SANITARY SEWERS IN THE AREA BOUNDED BY MACARTHUR BOULEVARD, RHODA AVENUE, STEINMETZ WAY AND MAPLE AVENUE SUBBASIN 80-111 (PROJECT NO. C158210) FOR THE AMOUNT OF ONE MILLION FIVE HUNDRED FOURTEEN THOUSAND DOLLARS ($1,514,000)

PURPOSE AND SCOPE

In accordance with the Measure H Charter Amendment, which was passed by the voters at the General election of November 5, 1996, we have made an impartial financial analysis of the accompanying Council Agenda Report and Proposed Resolution. The purpose of our analysis was to evaluate the reasonableness of the proposed $1,514,000 award. In making our analysis we reviewed the documentation regarding the competitive bid and contract award process.

Since our impartial financial analysis was not an audit, we did not apply Government Auditing Standards as issued by the Comptroller General of the United States.

SUMMARY

The work to be completed under this project is part of the City's annual Sanitary Sewer Rehabilitation Program to eliminate wet weather sewer overflows. The project was advertised for bid, and the engineer's estimate for the work is $1,866,205. The City Clerk received three (3) bids, which are summarized below:

Darcy & Harty/JW Contruction	$1,258,470
K.J. Woods	$1,508,000
Andes Construction, Inc.	$1,514,000

Although Andes Construction, Inc. was not the low bidder, the Agency recommends that it be awarded the contract for the following reasons:

(1) Andes Construction, Inc. filed a formal contest of award and compliance against the low bidder, Darcy & Harty/AJW Construction. During the prolonged investigation Darcy & Harty/AJW withdrew its bid from consideration, stating that due to extensive workloads it would not be able to meet LBE/SLBE goals.

(2) The second lowest bidder, KJ Woods, did not meet the LBE/SLBE goals.

CONCLUSION

The proposed resolution appears to be reasonable.

Prepared by:

Jack McGinity, CPA

Issued by:

Roland E. Smith, CPA
City Auditor

Report completion date:
June 12, 2003

Report Number:03-108