HomeMy WebLinkAboutResolution No. 4241, Bozeman Water Reclamation Facility, Phase 1, Change order 4.pdf Commission Memorandum
REPORT TO: Honorable Mayor and City Commission
FROM: Bob Murray, Project Engineer
Rick Hixson, City Engineer
Chuck Winn, Assistant City Manager
SUBJECT: Bozeman Water Reclamation Facility, Phase 1 Improvements – Change
Order No. 4
MEETING DATE: February 8, 2010
AGENDA ITEM TYPE: Consent
RECOMMENDATION: Motion and vote to approve and authorize City Manager to sign
Bozeman Water Reclamation Facility, Phase 1 Improvements – Change Order No. 4.
BACKGROUND: Attached is a copy, of change order number 4 for the above referenced
project which modifies the wage rates for this project. The City has always intended on
financing a large portion of the Water Reclamation Facility improvement costs through a loan
from the SRF (State Revolving Fund) Program. The Finance Department began working with
SRF on funding this project in 2006. The project, funding package, and construction contract
were approved by SRF prior to awarding the construction contract in 2008. It was decided to
wait on closing the loan until we expended the available City funds in order to reduce the amount
of interest that we ultimately pay on the loan.
When the admin/lab and digester projects were advertised for bid in November, we heard for the
first time that we would be required to pay Federal Davis Bacon Wages on those projects. We
were assured however that our large Phase I project that was under construction would be
grandfather in and could continue to use the Montana Prevailing Wage rate it was bid under.
Shortly thereafter, we were informed by SRF that a federal law had gone into effect October 30,
2009 that required the use of federal wage rates on SRF projects, and the EPA who funds the
SRF program would not allow our project to be grandfathered since the loan was not closed prior
to the effective date of the law.
Since that time, the SRF staff and bond council have both made appeals to the EPA, both of
which were denied. Staff has also had discussions with all of our federal delegations hoping they
could convince the EPA to reverse their decision, but to date the EPA has refused. This issue has
much larger financial considerations to several other states than it does Montana, and as such it is
going to be the focus of a federal hearing in the upcoming months. In the interim however, the
EPA will not allow our loan to be closed without a change order being processed to require
federal rates to be utilized from October 30th until the end of the project or until the EPA’s
decision is reversed whichever comes first.
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The attached change order institutes the federal rates on the project. It is written so that we will
need to make a lump sum payment to cover the labor since October 30, 2009 retroactively, and
then we will pay the incremental difference between the rates for the labor utilized on the project
on a monthly basis. If the EPA’s decision is reversed in the future, the rates will revert back to
the Montana Prevailing Wage rates, but we will not be able to recoup the dollars spent between
October 30, 2009 and the reversal of the decision.
No change in contract time is being provided with this change.
FISCAL EFFECTS: If the federal wage rates must be utilized for the remainder of the project,
it is estimated that it will increase the project cost by approximately $300,000.
ALTERNATIVES: As suggested by the City Commission.
Attachments: Change Order No. 4
Resolution 4241
Report compiled on: 2/2/10
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COMMISSION RESOLUTION NO. 4241
A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF BOZEMAN,
MONTANA, APPROVING ALTERATION/MODIFICATION OF CONTRACT
WITH WILLIAMS BROTHER CONSTRUCTION, LLC., BILLINGS,
MONTANA.
WHEREAS, the City Commission did, on the 10th day of November 2008, authorize award of the
bid for the Bozeman Water Reclamation Facility Phase I Improvements project, to Williams Brother
Construction, LLC., Billings, Montana; and
WHEREAS, Section 7-5-4308, Montana Code Annotated, provides that any such alterations or
modifications of the specifications and/or plans of the contract be made by resolution; and
WHEREAS, it has become necessary in the prosecution of the work to make alterations or
modifications to the specifications and/or plans of the contract.
NOW, THEREFORE, BE IT RESOLVED by the City Commission of the City of Bozeman,
Montana, that the proposed modifications and/or alterations to the contract between the City of Bozeman, a
municipal corporation, and Williams Brother Construction, LLC., as contained in Change Order No. 4,
attached hereto, be and the same are hereby approved; and the City Manager is hereby authorized and directed
to execute the contract change order for and on behalf of the City; and the City Clerk is authorized and
directed to attest such signature.
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Resolution No. 4241, Change Order 4 for WRF
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PASSED AND APPROVED by the City Commission of the City of Bozeman, Montana, at a
regular session thereof held on the 8th day of February 2010.
__________________________________________
JEFFREY K. KRAUSS
Mayor
ATTEST:
________________________________________
STACY ULMEN, CMC
City Clerk
APPROVED AS TO FORM:
_____________________________________________
GREG SULLIVAN
City Attorney
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