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3. Resolution 4394 - Thomas, Dean & Hoskins Change OrderAgenda -February 17,1998 AGENDA ITEM 3 -RESOLUTION 4394-THOMAS, DEAN & HOSKINS CHANGE ORDER - WOODLAND COURT PROJECT BACKGROUND/CONSIDERATION: This item has been discussed on other occasions. You, as requested, have received a memo authorizing the project and the related issues since the May 4, 1994 start date. The additional compensation of approximately $25,000 is still being requested due to the time increase authorized in the change order approved by the Council in June, 1996. That change order included changing the contract to a working day contract from a calendar day contract. RECOMMENDATION: This is a difficult decision and the ultimate settlement of the issue may be a legal interpretation either in court or by an arbitrator. Please refer to Resolution 4375 that was tabled by prior Council action and the Resolution 4390 that was postponed indefinitely on January 5, 1998. In the November 3 packet an October 31, 1997 memo was submitted by Glen Neier. The last two sentences in the second paragraph are extremely important; (A) "cannot disagree that T D & H expended more time on the project" (B) does not appear to be a change in scope of services for T D & H My January 5 recommendation was to approve the change order. This was based upon the fact that the work was done by T D & H and was required because of the change order that made the construction contracts run 122 days rather than 60 days. It is apparent that a change by the City made T D & H incur additional cost. On the other hand, the original contract with T D & H was a Agenda -February 17, 1998 "not to exceed" contract. At the time of the construction change order there apparently was no discussion about a change in the engineering contract. Due to the possible litigation of this claim and Nupac's claim, the Council needs to make a decision and let the staff and insurance attorneys handle the legal process. It is still my opinion that we should approve the change order for T D & H. My recommendation is to authorize or deny the change order at this meeting to enable any further process to begin. ACTION REQUIRED: The Council should either approve or disapprove the change order without extensive discussion in a public setting. It is apparent that under any condition, some type of legal action is forthcoming from the parties involved in this project. This Resolution is identical to 4390 - but since it was postponed indefinitely, it died. Approval or disapproval of RESOLUTION 4394 should be completed. RESOLUTION NO. 4394 A RESOLUTION TO ALTER AND AMEND THE CONTRACT WITH THOMAS, DEAN & HOSKINS, INC. ON THE WOODLAND COURT/TETON TERRACE PROJECTS. WHEREAS, the City on May 5, 1994 did enter into a contract with Thomas, Dean & Hoskins, Inc., for the construction of certain improvements connected with the Woodland Court/Teton Terrace Projects, and WHEREAS, certain elements in the project required additional work, as well as time to complete; and said additional work and time requirements could not have been necessarily foreseeable when the original construction contract was entered into, and said changes are contained in Addendum "D", attached hereto and are by this reference made a part hereof; and WHEREAS, upon the advise and recommendation of Roger Sommerville, of Thomas, Dean and Hoskins, Inc., (the City's Consulting Engineers) it appears in the best interests of the City to approve said changes and alterations. NOW THEREFORE, pursuant to the provisions of Section 7-5- 4308(1) MCA be it hereby resolved: 1. The alterations and modifications of the contract between the City of Kalispell and Thomas, Dean & Hoskins, Inc., dated January 6, 1997, as set out in Addendum "D" attached hereto are hereby approved, and 2. As soon as the alterations and modifications are agreed to in writing, signed by the City Manager, as hereby approved by the Council, this approval thereof shall be in effect. PASSED AND APPROVED BY THE CITY COUNCIL AND MAYOR OF THE CITY OF KALISPELL THIS DAY OF , 1998. William E. Boharski, Mayor ATTEST: Clerk of Council j\wp\res\chngtdh : i 1 ►1 / lu i The Agreement dated the 5th day of May, 1994, by and between the City of Kalispell and Thomas, Dean & Hoskins, Inc. is hereby amended as follows: Part H - Payment for Services Paragraph F, add the following: The fee for construction management services for the Woodland Court Project shall not exceed fifty-nine thousand, two hundred and twenty-five and NO/ 100 dollars ($59,225.00). Fee shall be billed at two times payroll plus out of pocket expenses at actual cost plus ten percent (10%). Mileage shall be charged at a rate of $0.35 per mile. The fee for construction management services for the Teton Terrace Project shall not exceed twenty-five thousand, three hundred and NO/ 100 dollars ($25,300.00). Fee shall be billed at two times payroll plus out of pocket expenses at actual cost plus ten percent (10%). Mileage shall be charged at a rate of $0.35 per mile. In Witness whereof the parties hereto have executed this amendment to the contract this the _ day of , 1996. THOMAS, DEAN & HOSKINS, INC. Michael W. Fraser Vice President CITY OF KALISPELL, MONTANA Clarence Krepps City Manager Addendum "D" Agenda -November 3, 1997 AGENDA ITEM 7 - RESOLUTION 4375-THOMAS, DEAN & HOSKINS-WOODLAND COURT BACKGROUND/CONSIDERATION: This project has an ongoing review by the City Attorney and other members of the staff. Additional inspection time was apparently required for this project and is the reason for this change order request. I have enclosed a memo from the City Attorney. Since this project was started and basically finished prior to my arrival, I have turned this review to those who are familiar with the project. Specific questions for this item should be directed to the City Attorney. RECOMMENDATION: On this item, a recommendation should be received from the City Attorney ---there could be legal actions pending for this project. ACTION REQUIRED: If you desire to approve the change order, this action should be completed by RESOLUTION 4375. 11. The CitE of KAlisi2efl Office of the City Attorney Glen :Meier, City Attorney lkic" Hickel, Asst. City Attorney Theresa White, Legal Secretary October 31, 1997 Incorporated 1892 To: Manager, Majcfrf and City Council From: Glen Re: Telephone (406)758-7708 P.O. Bo: 1997 Kalispell MT 59905-1997 Fa: (406)758-7758 For the past several months this office has been involved in a series of on -going discussions with NuPac and Thomas, Dean and Hoskins regarding final pay estimates and engineering billings on the above -referenced project. As of the date of this memo there are three outstanding issues disputed by the City in Schedule III for NuPac, (backfill sewer, backfill water, and subbase course material). TD&H has submitted a request for a Change Order increasing the hump sum construction services agreement from $27, 900.00 to $59, 225.00, TD&H claims extra cost associated with the inspecting beyond the anticipated completion date of the NuPac schedule. I have attached hereto, a copy of Addendum C to the TDAH pontract,_wherein a-1 ump. swn_ fee for inspection was established and a basis for payment formalized. I have fiirther attached hereto a recapitulation of the Monthly Man Hours expended by TD&H on the Woodland Court Project. I have reviewed daily logs and reports made by TD&H and cannot disagree with TD&H's contention that the firm expended more time than expected on the project. However, it does not appear that the additional time occasioned a change in Scope of Services. This office has retained the services of Jerry Hanson, PE. and Dick Smith, RLS and we are attempting to reconstruct the project in reverse in an effort to reconcile the dispute with NuPac and TD&H. The effort will require some expenditure of time and money. This office previously communicated our position on the NuPac claim in May of this year. Basically the stance has not changed, but certain matters have come to our attention which we feel a duty to investigate. This office has prepared a Change Order Resolution at the request of TD&H for your consideration. The decision on whether to grant the Change Order rests entirely with the Council. Lkwp*aisa.wpd Agenda -January S, 1"S AGENDA ITEM 12 - CHANGE ORDER/ FINAL PAYMENT- THOMAS, DEAN & HOSKINS-WOODLAND COURT BACKGROUND/CONSIDERATION: I have enclosed, within the bills, a final billing from Thomas, Dean & Hoskins for the Woodland Court project. This billing has been held for several months to allow additional discussions and research to determine the factors involved in the additional costs for service from the engineer. This billing, together with one of the contractors submissions for additional work, has been reviewed by the staff, the attorney, and other sources of information to determine why the City had extra costs. Upon a thorough review, the City Attorney has advised that the additional work and hours submitted were completed and apparently justified within this project. (I have enclosed the latest memo from the City Attorney.) RECOMMENDATION: Based upon a lengthy and thorough review of this bill and request for a change order, I must recommend that the change order be approved and the final payment for the additional dollars be paid. This is a project that was started approximately three years ago. At that time a decision was made to "split" the contract by "cherry -picking" the sections of the low bids rather than awarding the bid to the over-all single low bidder. This decision, in my opinion, rather than creating the desired savings, actually created administrative and engineering inefficiencies that over -run the potential cost savings. ACTION REQUIRED: Approval of the change order is required by RESOLUTION 43". Incorporated 1892 Office of the City Attorney Glen Neier, City Attorney Richard Hickel, Asst. City Attorney Theresa White, Legal Secretary January 2, 1998 TO: Mayor, Council and Manager FROM: Glen Neier, City Attorna�'- Re: Woodland Court Change Order Telephone (406)758-7708 P.O. Box 1997 Kalispell MT 59903-1997 Fax (406)758-7758 Please note the amount change in Paragraph 1, last sentence of my memo. The latest "Addendum D" is also enclosed. The City of KalisDeLl Incorporated 1892 Office of the City Attorney Telephone (406)758-7708 Glen Neier, City Attorney P.O. Box 1997 Richard Hickel, Asst. City Attorney Kalispell MT 59903-1997 Theresa White, Legal Secretary Fax (406)758-7758 December 31, 1997 TO: Mayor, Council and Manager FROM: Glen Neier, City Attorney Re: Woodland Court Change Order Amendment On October 31, 1997 this office informed the Council as to the status of the above entitled change order request by Thomas, Dean and Hoskins. TD&H provided design and inspection services on the Woodland Court Project. According to information provided to PBCDD and this office, TD&H provided inspection services for a total of 122 days on a contract which provided for 60 working days to complete. As a result of the delay in contract completion, TD&.H's actual expenses exceed their estimated fee by $25,197.59. Resolution No. 4390, in your packet, authorizes amending the contract with TD&H and allowing payment. It is my understanding that the Woodland Court project has funds available to make this payment. NuPac also has a claim pending against the City and has requested a change order. We are at impasse in negotiations on the claim and will probably proceed to litigation or arbitration. is\wp\fraiser1.wpd ADDENDUM "D" The Agreement dated the 5th day of May, 1994, by and between the City of Kalispell and Thomas, Dean & Hoskins, Inc. is hereby amended as follows: Part III - Payment for Services Paragraph F, add the following: The fee for construction management services for the Woodland Court Project shall not exceed Fifty Two Thousand, Three Hundred, Sixty Two and 59/100 Dollars ($52,362.59). Fee shall be billed at two times payroll plus out of pocket expenses at actual cost plus ten percent (10%). Mileage shall be charged at a rate of $0.35 per mile. In Witness whereof, the parties hereto have executed this Amendment to the contract this _ day of , 1997. THOMAS, DEAN & HOSKINS, INC. Michael W. Fraser Vice President CITY OF KALISPELL, MONTANA Clarence Krepps City Manager RESOLUTION NO. 4390 A RESOLUTION TO ALTER AND AMEND THE CONTRACT KITH THOMAS, DEAN & HOSKINS, INC. ON THE WOODLAND COURT/TETON TERRACE PROJECTS. WHEREAS, the City on May 5, 1994 did enter into a contract with Thomas, Dean & Hoskins, Inc., for the construction of certain improvements connected with the Woodland Court/Teton Terrace Projects, and WHEREAS, certain elements in the project required additional work, as well as time to complete; and said additional work and time requirements could not have been necessarily foreseeable when the original construction contract was entered into, and said changes are contained in Addendum "D", attached hereto and are by this reference made a part hereof; and WHEREAS, upon the advise and recommendation of Roger Sommerville, of Thomas, Dean and Hoskins, Inc., (the City's Consulting Engineers) it appears in the best interests of the City to approve said changes and alterations. NOW THEREFORE, pursuant to the provisions of Section 7-5- 4308(1) MCA be it hereby resolved: 1. The alterations and modifications of the contract between the City of Kalispell and Thomas, Dean & Hoskins, Inc., dated January 6, 1997, as set out in Addendum "D" attached hereto are hereby approved, and 2. As soon as the alterations and modifications are agreed to in writing, signed by the City Manager, as hereby approved by the Council, this approval thereof shall be in effect. PASSED AND APPROVED BY THE CITY COUNCIL AND MAYOR OF THE CITY OF KALISPELL THIS DAY OF , 1998 William E. Boharski, Mayor ATTEST: Debbie Gifford, CMC/AAE Clerk of Council j\wp\res\chngtdh