E2. LZ Tanks Roof Replacement and Rehab Bid Rejection RecommendationCITY OF
KALISPELL
MEMORANDUM
To: Doug Russell, City Manager
From: Susie Turner, PE, Director of Public Works
Re: Lower Zone Storage Tanks Roof Replacement and Rehabilitation- Bid
Rejection
Meeting Date: February 6, 2023
BACKGROUND: The Lower Zone Roof Replacement Project generally consists of the
replacement of the existing wooden roof structures on the 1.7 MG and 2.7 MG tanks located on
Buffalo Hill in Kalispell. The project includes demolition of the existing roof structures, site
utility modifications, construction of a new foundation, construction of a new concrete dome
roof, and rehabilitation of existing concrete inside of the tanks.
BIDDING RESULTS: Bids were opened on January 26, 2023, at City Hall. One responsive bid
was received from DN Tanks, LLC ("DN Tanks") of Grand Prairie, TX. Below is a summary of
bid amounts for each bid schedule. Schedule 1 is for the 1.7 MG tank and Schedule 2 is for the
2.7 MG tank. The Certified Bid Tabulation is attached to Morrison Maierle's Bid
Recommendation Memo. Bid totals are listed low to high and summarized as follows:
Schedule 1
Schedule 2
Total Bid
Contractor
Reservoir 1
Reservoir 2
Price
1.7 MG
2.7 MG)
DN Tanks, LLC
$4,822,400
$6,434,990
$11,257,390
Grand Prairie, TX
Engineers Estimate
$3,094,000
$4,373,290
$7,467,290
Morrison-Maierle, Inc.
The contractor's cost to complete the project exceeds the engineers cost estimate by $3,790,100.
Reasons for the differences between the engineer's estimate and contractors are summarized in
the attached Morrison Maierle's Bid Recommendation Memo.
RECOMMENDATION: Considering the higher -than -expected bids, the FY 23 budgeted
amount for the project, and the information received from the bidder, staff recommends
revisiting the alternative analysis to further investigate different roof types and rebidding the
project at a later date.
201 1' Avenue E IPhone (406)758-7720
PO Box 1997 Public Works Department Fax (406)758-7831
Kalispell, MT 59903 1 www.kalispell.com
FISCAL EFFECTS: None at this time. FY 23 Water Fund allocated $549,036 from line item
969 -Lower Zone Reservoirs Replacemnet for consultant fees and the construction cost of
$7,270,000 was scheduled to be supported through a State Revolving Fund Loan.
ACTION REQUESTED: Motion to reject all bids for the Lower Zone Storage Tanks Roof
Replacement and Rehabilitation Project.
ALTERNATIVES: As suggested and approved by the City Council.
ATTACHMENTS: Morrison Maierle Bid Recommendation Memo
2 1 P a g e
Morrison
Maierle
engineers surveyors planners scientists
TO: Susie Turner, P.E., Public Works Director
FROM: Jeff Cicon, P.E.
DATE: January 31, 2023
JOB NO.: 0387.058
memo
RE: Lower Storage Tanks Roof Replacement Recommendation of Award
❑Urgent El For Review ❑Please Comment ❑Please Reply ®For Your Use
Background:
The Lower Zone Roof Replacement Project generally consists of the replacement of the existing wooden
roof structures on the 1.7 MG and 2.7 MG tanks located on Buffalo Hill in Kalispell. The project includes
demolition of the existing roof structures, site utility modifications, construction of a new foundation,
construction of anew concrete dome roof, and rehabilitation of existing concrete inside of the tanks. The
basis for the recommendation to install a concrete roof was determined in an alternatives analysis report
completed in March 2022.
Bidding Results:
Bids were received on January 26, 2023 and read aloud at 2:30 pm at City Hall. One responsive bid was
received from DN Tanks, LLC ("DN Tanks") of Grand Prairie, TX. Below is a summary of bid amounts for
each bid schedule. Schedule 1 is for the 1.7 MG tank and Schedule 2 is for the 2.7 MG tank. The Certified
Bid Tabulation is attached to this memorandum. Bid totals are listed low to high and summarized as
follows:
Schedule 1
Schedule 2
Contractor
Reservoir 1
Reservoir 2
Total Bid Price
(1.7 MG)
(2.7 MG)
DN Tanks, LLC
$4,822,400
$6,434,990
$11,257,390
Grand Prairie, TX
Engineers Estimate
$3,094,000
$4,373,290
$7,467,290
Morrison-Maierle, Inc.
The low bid of $11,257,390 exceeds the Engineer's Estimate by $3,790,100, or approximately 50%.
Morrison-Maierle has previous work experience with DN Tanks and their site work contractor, S&L
Underground. DN Tanks qualification questionnaire shows they have completed recent projects of similar
size and scope and are qualified to complete this project. Based on previous experience, Morrison-
Maierle has no concerns with regards to DN Tanks or their ability to complete the project.
Since this is a specialized rehabilitation project, the number of qualified contractors is limited and
receiving only one bid was not unexpected. However, the bid exceeding the estimate by such a large
margin that further investigation is warranted. The construction estimate was prepared based on quotes
from material suppliers, contractors, and recent project bid tabulations. In some cases, these quotes were
adjusted to account anticipated inflation.
Page 1
Lower Storage Tanks Roof Replacement Recommendation of Award J Morrison
Maierle
After discussion with their subcontractors and suppliers, DN Tanks offered the following potential
explanations for the higher -than -expected bid:
• Construction Schedule: The bid package required both tanks to remain in service through the
peak water demand in the summer, requiring most of the work to be completed in the spring of
fall. This gave potential contractors limited flexibility for scheduling the work and drove the price
up.
• Existing Site Conditions: The existing sites do not provide adequate space for construction staging
or lay -down areas (especially on Tank #1). As such, DN Tanks anticipated staging and hauling
materials off -site, driving the price up.
• Material Cost Increases: While the cost estimates were prepared using the best information at
the time, it is difficult to keep ahead of material costs in the current bidding environment. As
such, these estimates oftentimes lag behind the bid prices.
• Deep Foundation Costs: Due to the age of the tanks, the existing conditions of the subgrade was
inconsistent and could not be relied upon to support the new roof system. Therefore, micropiles
were designed to support the load of the new roof structure. Because Kalispell is in a high seismic
zone, these piles also needed to withstand lateral loads, which increased the price.
Summary of Budgeted Funds
The project is funded through a combination of local funds and a State Revolving Fund Loan. The overall
project budget is $9,058,600, with a construction budget as follows:
Construction: $7,462,000
Contingency: $746,000
Total Construction Budget $8,208,000
Therefore, the low bid of $11,257,390 exceeds the budgeted funds by $3,049,390 (without allowing a
contingency).
Potential Cost Saving Alternatives
Potential cost saving alternatives could include the following (exact savings would need to be negotiated
with DN Tanks):
• Remove stairs and railing from the dome and replace with a ladder and safety cable.
• Remove the requirement to import trench backfill since the pipe will not be installed below a
driving surface.
Award Options
The City has the options available in terms of awarding a contract for this project:
1. Award Schedule 1-Reservoir 1 in the amount of $4,822,400.
2. Award Schedule 2-Reservoir 2 in the amount of $6,434,990.
3. Award Schedule 1-Reservoir 1 + Schedule 2-Reservoir 2 in the amount of $11,257,390.
4. Reject all bids and re -bid the project at a later date.
Page 2
Lower Storage Tanks Roof Replacement Recommendation of Award J Morrison
Maierle
Recommendation
Morrison-Maierle believes that revisiting the original alternatives analysis to further investigate different
roof types would benefit the City. Therefore, it is our recommendation to reject all bids and re -bid at a
later date.
Page 3
Site Preparation
LS
1
$340,000.00
$340,000.00
$385,600.00
$385,
Micropile Installation
LS
1
$275,000.00
$275,000.00
$857,600.00
$857,
Design and Installation of Foundation and
Stem Wall
LS
1
$730,000.00
$730,000.00
$584,300.00
$584,
Existing Roof Demolition
LS
1
$180,000.00
$180,000.00
$351,600.00
$351,
Existing Outlet Baffle Structure Demolition
LS
1
$5,000.00
$5,000.00
$26,700.00
$26,
Design and Installation of New Free -span
Dome
LS
1
$910,000.00
$910,000.00
$1,483,000.00
$1,483,
Access Stairs and Slab
LS
1
$45,000.00
$45,000.00
$41,600.00
$41,
Joint Waterproofing
LS
1
$182,000.00
$182,000.00
$103,400.00
$103,
Outlet and Overflow Pipe Improvements
LS
1
$35,000.00
$35,000.00
$266,700.00
$266,
Inlet Pipe Improvements
LS
1
$25,000.00
$25,000.00
$48,500.00
$48,
Site Electrical
LS
1
$25,000.00
$25,000.00
$41,300.00
$41,
Landscape, Topsoil, and Reseed
LS
1
$45,000.00
$45,000.00
$115,200.00
$115,
Tank Cleaning, Disinfection, and Startup
LS
1
$5,000.00
$5,000.00
$7,100.00
$7,
Schedule 1 Total: $3,094,000.00 $4,822,
Engineer Estimate
DN Tanks
We
Item Description
UofM
Quantity
Unit Price
Extension
Unit Price
Exten
2 - Reservoir 2
Mobilization/Demobilization (10%)
LS
1
$397,000.00
$397,000.00
$577,100.00
$577,
Construction Surveying
LS
1
$5,000.00
$5,000.00
$22,000.00
$22,
Exploratory Excavation
HR
20
$300.00
$6,000.00
$976.00
$19,
Site Preparation
LS
1
$340,000.00
$340,000.00
$390,300.00
$390,
Micropile Installation
LS
1
$320,000.00
$320,000.00
$1,219,200.00
$1,219)
Design and Installation of Foundation, Stem
Wall, and Internal Slab
LS
1
$1,100,000.00
$1,100,000.00
$764,500.00
$764,
Existing Roof Demolition
LS
1
$200,000.00
$200,000.00
$365,900.00
$365,
Existing Outlet Baffle Structure Demolition
LS
1
$5,000.00
$5,000.00
$31,800.00
$31,
Design and Installation of New Free -span
Dome
LS
1
$1,420,000.00
$1,420,000.00
$2,267,400.00
$2,267,
Access Stairs and Slab
LS
1
$45,000.00
$45,000.00
$43,800.00
$43,
Joint Waterproofing
LS
1
$230,000.00
$230,000.00
$124,100.00
$124,
Overflow Pipe Improvements
LS
1
$25,000.00
$25,000.00
$115,900.00
$115,
24" Butterfly Valve
LS
1
$30,000.00
$30,000.00
$41,500.00
$41,
Floor Drain Piping
LS
1
$20,000.00
$20,000.00
$48,800.00
$48,
12" DR 18 C900 PVC Bypass Water Main
LF
392
$120.00
$47,040.00
$300.00
$117,
12" Ductile Iron Bypass Water Main
LF
75
$130.00
$9,750.00
$330.00
$24,
12" MJ Gate Valve
EA
5
$5,000.00
$25,000.00
$8,000.00
$40,
12" MJ Bend
EA
8
$3,000.00
$24,000.00
$2,690.00
$21,
12" MJ Tee
EA
2
$4,000.00
$8,000.00
$3,200.00
$6,
12" Water Main Connection to Cl Pipe
EA
2
$5,000.00
$10,000.00
$5,800.00
$11,
12" Water Main Connection to Ex. 18"x12"
Reducer
EA
1
$7,500.00
$7,500.00
$7,400.00
$7,
12" Water Main Connection to Ex. 12" HDPE
Pipe
EA
1
$10,000.00
$10,000.00
$7,400.00
$7,
Relocate Existing Air Release Valve and Vault
LS
1
$10,000.00
$10,000.00
$12,200.00
$12,
Type 2 Pipe Bedding
LF
200
$20.00
$4,000.00
$20.00
$4,
Abandon Existing Bypass Main
LS
1
$5,000.00
$5,000.00
$4,900.00
$4,
Site Electrical
LS
1
$15,000.00
$15,000.00
$22,000.00
$22,