To: Honorable Mayor and Members of Town Council
From: Mark Marlowe, P. E., Director of Castle Rock Water
Title
Update: Plum Creek Water Purification Facility (PCWPF) Advanced Treatment Project - Initial Guaranteed Maximum Price (IGMP)
Body
________________________________________________________________________________
Executive Summary
This item is being presented to Council to provide an update on the status of the Plum Creek Water Purification Facility (PCWPF) Advanced Treatment Project.
The last update to Town Council on June 19, 2018 identified Town funding of a Professional Services Agreement with Burns & McDonnell Engineering (B&McD), for the design of the Advanced Treatment Project, in the amount of $1,528,086 (including a $72,766 contingency) and a lease agreement in the amount of $174,428 with Intuitech, Inc. for a six-month pilot testing of advanced treatment processes. Since the last Town Council update, a Pre-Construction Services Agreement has been awarded to Garney Companies (Garney) in the amount of $158,840. These services to be completed by Garney include construction cost estimating, constructability reviews, construction scheduling, work sequence planning, value analysis, review of alternate systems, permit assistance, and procurement planning for long-lead items.
Garney’s budgetary construction cost estimate in their proposal was $25,207,740 and was based on thirty percent complete plans and specifications. Castle Rock Water (CRW) has since worked with Garney and Burns & McDonnell Engineering (project design engineers) to establish the current Initial Guaranteed Maximum Price (IGMP) at $26,912,068. This cost includes general conditions, overhead and profit, and the cost to do the work. The cost estimate went up as more details were developed between the Request for Proposals and reconciliation of the budgetary GMP. This IGMP represents the most the Town can expect to pay for construction of the PCWPF Advanced Treatment project, barring any changes in scope (or other unanticipated cost increases, such as in labor and materials). However, during the pre-construction period, CRW will work with the contractor and designer to adjust the design so that construction fits within the budget.
The attached letter (Attachment A) identifies the referenced IGMP. Project team members are signing the attached letter (Attachment A) acknowledging the IGMP. Exhibits to the acknowledgement letter detail project costs used in development of the IGMP. Note that no allowances have been included for steel materials that may be impacted by the Section 232 Tariffs (includes a 25 percent rate increase on imported steel - Presidential order signed in March, 2018). The IGMP was developed with best costing information available at the time. Any actual tariff related project cost increases will be identified and justified in development of the Final GMP. Garney has estimated that a thirty percent cost increase across the board on potentially tariff impacted equipment and construction materials could add $1.4 million to the overall construction project.
Two work packages are being planned for design and construction. Work Package One (WP1) will include the one million gallon raw water blending tank and procurement of advanced treatment equipment packages. Bidding documents for WP1 are scheduled to be complete by mid-October. There will then be project bidding and review periods for WP1. Presentation of WP1 to Town Council is anticipated to be in December of 2018.
The remainder of the project will be included with Work Package Two (WP2) and WP2 bidding documents are scheduled to be ready for bidding in January 2019. A six week bidding and review period is anticipated. Presentation of WP2 to Town Council is planned for March 2019.
Budget Impact
Current known and estimated costs are shown below:
Burns & McDonnell Engineering Design (including $72,766 $ 1,528,086
contingency)
Intuitech, Inc. Six-month pilot testing $ 174,428
Garney Companies Pre-construction services $ 158,840
Garney Companies Construction costs $26,912,068
Burns & McDonnell Construction engineering services $ 1,100,000
(est. four percent of construction
Cost)
TOTAL $29,873,422
There is a balance remaining in account 211-4375-443.77-75 of $17,302,071, and approximately $13.8 million requested in the 2019 budget to award Work Package #2, for a total project budget of approximately $31,102,000.
Attachments
Attachment A: IGMP Letter