01/29/1991 - City Council Public Works Committee /_ 3�_ q�
NSP RATE INCREASE
Enclosed on page 124 is notification by NSP that an 8.1 percent rate increase has been
filed with the Minnesota Public Utilities Commission.
INDEPENDENT SCHOOL DISTRICT 191 FINANCIAL REPORT
Enclosed on page t 11 is a copy of a letter from Independent School District 191
referencing the Comprehensive Annual Financial Report for the Fiscal Year ending June
30, 1994 District 191. A copy of this document is filed in the City Administrator's office.
If any member of the City Council would like to inspect the document, please ask!
BLUE RIBBON TASK FORCE MEETING
The Blue Ribbon Task Force meeting was held on Wednesday, January 30. In attendance
were City Councilmember Gustafson and Assistant to the City Administrator Hohenstein.
The purpose of the Blue Ribbon Task Force process is to allow the Cities of Mendota
Heights, Inver Grove Heights and Eagan to meet with MAC staff and ultimately agree on
operating procedures that develop noise contours acceptable to all three (3) communities.
After several months of negotiation and meetings, it appears that the Corridor Task Force
has reached agreement. A special thanks to Councilmember Gustafson for his commitment
and involvement in the meetings and to Assistant to the City Administrator Hohenstein for
the analysis and pre ntation he gave to this issue. Citizens who were in attendance seemed
very appreciative. T• I „ 1
DARE GRADUATIONS
As a reminder, Mayor Egan is scheduled for the DARE graduation at Deerwood
Elementary on February 4 at 9:30 a.m., City Councilmember Pawlenty at Northview School
on February 8 at 1:30 p.m. and Councilmember McCrea at Woodland Elementary School
on February 15 at 2:00 p.m. City Councilmembers Gustafson and Wachter have attended
DARE graduations at Thomas Lake Elementary and Pinewood Elementary respectively.
PUBLIC WORKS COMMITTEE
The Public Works Committee held a meeting on Tuesday, January 29, from 3:00 p.m. to
5:00 p.m. for the purpose of reviewing a change order policy and three (3) specific change
orders, two of which pertain to the Cliff Road Water Treatment Plant and the other to the
Maintenance Facility Expansion. There was an excellent discussion on the philosophy of
change orders and direction was given to the Director of Public Works for preparing a
change order policy to later be reviewed and considered by the City Council. Both City
Councilmembers Wachter and McCrea were present for the meeting.
AMM PRIORITY POLICY ISSUES/1991
Enclosed on pages through`)is a copy of the AMM Priority Policy Issues for 1991.
Mayor Egan and City Administrator Hedges attended the AMM reception held at the Kelly
It
',. ___fr. i,.... i 9
PUBLIC WORKS_. ITTE8
TUESDAY, z ARY 291` 1991
.x.
Cry m
I. Review Change'Qr er #6 & ;#7, ` Contract 89-13
(Cliff Road Water + t zit Plante
80tract 9
#i g)Con a Ch nce i Qrt r r ►ansion/sview #�I3. ( iatena
i3. Rev Change Ca ##
IV. other
V. Adjourn 5:00 P.M.•
MEMO TO: PUBLIC WORKS COMMITTEE
• COUNCILMEMBER TED WACHTER, CHAIR
• COUNCILMEMBER PAM MCRAE
• THOMAS L HEDGES, CITY ADMINISTRATOR
FROM: THOMAS A COLBERT, DIRECTOR OF PUBLIC WORKS
DATE: JANUARY 25, 1991
SUBJECT: AGENDA INFORMATION FOR JANUARY 29, 1991 PUBLIC WORKS COMMITTEE
At the January 15, City Council meeting, the City Council
recommended that the Public Works Committee meet and discuss
several change orders that are pending under two different City
contracts, and also review and discuss a change order policy for
the City of Eagan. Enclosed please find the agenda and discussion
for each of these scheduled items.
,
N
a
` .. .
ITEM I. R4vIEN CHANGE ORDERS #6 & #7.. OONTR CT 89-13
(CLIFF 40AD MATER TREATMENT FACTLTTY)
Change Order #6 is fort h a total add-on of $93,078 .consisting of two
parts described as folows
Tart 3.: In. sitpating; ti Treatment Plant facility at its -
curren t location, ` soil boring results indicated a
lens o " soft essible clay type material as I
locate approximately 20 +/- feet deep below the 1
footi = and foundation for the 2 million gallon
clear all reseritoir portion of this treatment
facili t`y. In tom`=°design phase of this project, an
evalua ion. analysis was performed to determine
whethe> this material . should be removed through
excava,, ion Or Whether it should be solidified` and
stabil zed through a grout injection process. By
evalua, ing t e ;so .l boring and estimating the extent
of the ..Or soils:area, it was determined to be most
cost - ffectiv to pursue the grout injection
proces An` estimated quantity of grout was ..
calcul ted and ;scified as a part of the lump sum
` base contract cement. However, due to the
quanti ,y having -tg be, "guesstimated", the contract
do .;:,�37y., is requested a unit price per cubic yard for
any ads;itional grout that may exceed the contract
estit a (286 cubic yards) . As the soil
stabil :.xation progressed .. " er the contract, the
• subcon , etor wee not ;able to stabilize the
underl.{ ing • poorr soils within the contract's
estima -. quantities. Su _ equently once this
method':had `been osen, it 'was necessary for the
contr. ,`tor to continue to pump additional grout into
the so 1 until -further soil tests determined that '',
this ompress :ble .layer. had been stabilized.
Subse• eritly, an additional 332 cubic yards (118%)
had to;be injected resulting in an additional cost
of $91;300.
Bart 2: During the construction of the high service pump
room onion of , the treatment plant, it was
discov red that .. : ssary reinforcing steel
within the contract fuss inadvertently omitted from
the o ginal. desist ,'plans. In order to provide y.
struct al stability for the pumps to be placed on
this c ncrete slab, additional reinforcement had to
be ins ailed at stn additional cost of :$852.
1
5
, Y
, i
The total amount of Change Order #7 to Contract 89-13 results in
an additional cost of $4,495.32. This change order is broken down
into four parts and is described as follows:
Part 1: During the excavation of the treatment plant in the ;,
area of the ravine in the rear yard of the
previously eXisting • single-family house at the
corner of cliff and Pilot Knob Road, an abandoned
dump was discovered containing unsuitable materials
ranging from garbage to buried tette debris which had
to be removed to prevent future' settlement of the
ground around. the backs fled area of the treatment
plant. This disposal area wee not known at the time
of bidding and resulted in additional costs incurred ,.
by the contractor 'ti) properly dispose of this
material resulting in .an additional cost of $926.
Part 2: During the consttian of the clear well reservoir,
it was discovered that the sump pit did not provide
for the separate reinforced concrete wall
segregating this, from the rest of the clear well
floor. subs" ntly, this omission had to be
corrected duri # field construction at an. additional
cost of $1,416.
Start. 3: In reviewing the sip drawings and construction
plans as phased -cons ruction progressed near the 1
vicinity of tbs.-chlorine and high service pump room, 1
it was disco. , that additional lintels and •'
reinforcing abovdthe doorways and in the walls were
inadvertently omitted from the original design plans
and had to be in*tel.l.ed during construction at an
additional cost Of $1,234. ?
Pat 4: Again,, in reviewing shop drawings and construction
plans during phased construction, it was discovered
that additional liAtele and reinforcing was
necessary above theay to the mechanical room
to properly support 'Mechanical ducts and piping
through . ove . d .mil at an addonal cost of
$919.32.
Enclosed on pages / throug are copies t the change
processed by orders as rocessed b. our c tittf engineer to,-.=the general
contractor. It is my understainding that; some of the prices in '�
Change Order #7 have changed and ill be updated at the meeting on
Tuesday.
4.
Also enclosed on pages is a smeary of the various
work requests that lave been "' forwarded to the contractor
identifying their current statue and incorporation into a related
change order. ,
t
r .. • . -
l .
•
� � _ .-. .� -
•
4 - - X
•
• ✓E•. y..
. H-,, .t
r } T.
•
}fie•
: ' . ' t.:
. .... -- •.7'....,'.'• -,:•:-,,,-:,',
•
}
wa
a. .
�
j
f.
i
CHANGE ORDER
DATE: December 29, 1990
PLACE: Eagan, Minnesota FILE NO: 49500-CO
PROJECT: Cliff Road Water Treatment Facility
PROJECT NO. : 548; CONTRACT NO. : 89-13
CONTRACTOR: Penn-Co Construction, 1301 Corporate Crt. Dr. , Ste. 150, Eagan, MN 55121
BOND CO.: (Safeco Ins. Co. of Amer.) Alexander & Alexander, PO Box 1360, Mpls. MN
CHANGE ORDER NO. : 6 55440 Attn: Chris Watters
DESCRIPTION OF WORK:
Total
Change Order Item Amount
1. ADJUSTMENT IN COMPACTION GROUT QUANTITY
This item provides for an adjustment in the volume of subsurface grout injected as part of
the compaction grouting operation. This work was necessary to consolidate a soft clay layer
in the area of the clear well at a depth such that mass excavation to remove and replace the
material was uneconomical.
Payment for this item shall be based on the unit rate of $275.00 per cubic yard of grout
placed as bid in the Bid Proposal and the difference between the actual volume of grout
injected (612 cu. yds.) and the grout volume estimate contained in the specifications (280
cu. yds.) . The quantity adjustment is 332 cu. yds. , and the Contract Add is 332 x $275, or
$91,300.
ADD for Item No. 1 $91,300.00
2. CONCRETE REINFORCEMENT IN HIGH SERVICE PUMP ROOM PIT
This item provides for additional concrete reinforcement in the pit in the floor of the High
Service Pump Room. The reinforcement was omitted from the construction plans.
Payment for this item shall be based on a mutually agreed upon lump sum of $852.00
ADD for Item No. 2 $852.00
J -
•
CHANGE ORDER
DATE: December 29, 1990
PLACE: Eagan, Minnesota FILE NO: 49500-CO
PROJECT: Cliff Road Water Treatment Facility
PROJECT NO. : 548; CONTRACT NO. : 89-13
CONTRACTOR: Penn-Co Construction, 1301 Corporate Crt. Dr., Ste. 150, Eagan, MN 55121
BOND CO. : (Safeco Ins. Co. of Amer.) Alexander & Alexander, PO Box 1360, Mpls. MN
CHANGE ORDER NO. : 6 55440 Attn: Chris Watters
Total
Change Order Item Amount
3. REMOVAL OF TREE DEBRIS
This item provides for the removal and hauling from the site of four loads of tree debris
discovered below the surface at the south end of the clear well area. The material was not
evident from subsurface explorations and therefore is an unforseen condition of the project.
Payment for this item shall be based on a mutually agreed upon lump sum of $926.00.
ADD for Item No. 3 $926.00
TOTAL ITEM NO. 1 - Adjustment in Compaction Grout Quantity $91,300.00
TOTAL ITEM NO. 2 - Reinforcement in high Service Pump Room 852.00
TOTAL ITEM NO. 3 - Removal of Tree Debris 926.00
TOTAL THIS CHANGE ORDER NO. 6 $93,078.00
ORIGINAL CONTRACT AMOUNT $8,094,000.00
PREVIOUS CHANGE ORDERS -112,052.19
THIS CHANGE ORDER NO. 6 - ADD 93,078.00
REVISED CONTRACT AMOUNT $8,075,025.81
Recommended for Approval by:
BONESTROO, ROSENE, ANDERLIK &
ASSOCIATES, INC.
.
By Tc d K -Lc;0
Approved by: PENN - • • STRU ON
By 41119104r/IWO
Approved by: CITY OF EAGAN, MINNESOTA
By , Mayor Distribution
1 City
By , Clerk 1 - Bonding Co.
1 - Contractor
Date: 1 - BRA
•
CHANGE ORDER
DATE: January 16, 1991
PLACE: Eagan, Minnesota FILE NO: 49500-CO
PROJECT: Cliff Road Water Treatment Facility
PROJECT NO. : 548; CONTRACT NO. : 89-13
CONTRACTOR: Penn-Co Construction, 1301 Corporate Crt. Dr. , Ste. 150, Eagan, MN 55121
BOND CO. : (Safeco Ins. Co. of Amer.) Alexander & Alexander, PO Box 1360, Mpls. MN
CHANGE ORDER NO.: 7 55440 Attn: Chris Vatters
DESCRIPTION OF WORK:
Change Order Item
1. REMOVAL OF UNFORESEEN STUMPS AND DEBRIS
This item provides for the removal and off-site disposal of tree debris discovered in the
area of the south end of the clear well. The material was not detected by preliminary site
investigations or soil borings.
Payment for this item shall be based on a mutually agreed upon lump sum of $926.00.
ADD for Item No. 1 $926.00
TOTAL ITEM NO. 4 - ADD $926.00
2. INSTALL CONCRETE WALL IN AREA OF GRIDS 2 AND G
This item provides for the installation of a reinforced concrete wall in the area of Grids 2
and G in the clear well corner. This item results from an omission on the plans, where a
sump in the corner of the clear wall was not shown. Provision for the sump requires the
construction of a wall separating the sump floor and the raised floor throughout the rest of
the clear well.
•
Payment for this item shall be based on a mutually agreed upon lump sum of $1,416.00.
ADD FOR ITEM NO. 2 $1,416.00
TOTAL ITEM NO 2 - ADD $1,416.00
3. RELOCATE AND PROVIDE ADDITIONAL LINTELS
This item provides for additional lintels and reinforcing at the chlorine room door, Door
11SA, and in the walls near the High Service Pump Room and Hall 106 as shown on Figures SR3
through SR9 previously submitted. This item results from an omission on the plans.
Payment for this item shall be based on a mutually agreed upon lump sum of $1,234.00.
ADD for Item No. 3 $1,234.00
TOTAL ITEM NO. 3 - ADD $1,234.00
•
CHANGE ORDER
January 16, 1991
Eagan, Minnesota
JJECT: Cliff Road Water Treatment Facility FILE NO: 49500-00
OJECT NO. : 548; CONTRACT NO. : 89-13
CONTRACTOR: Penn-Co Construction, 1301 Corporate Crt. Dr., Ste. 150, Eagan, MN 55121
BOND CO. : (Safeco Ins. Co. of Amer.) Alexander & Alexander, PO Box 1360, Mpls. MN
CHANGE ORDER NO. : 7 55440 Attn: Chris Vatters
Change Order Item
4. ADDITIONAL LINTEL AT DOOR 106A
This item provides for an additional lintel above Door 1O6A which was omitted from the
plans. The 4 x 13 louver is necessary to support the wall through which several mechanical
ducts and piping pass.
Payment for this item shall be based on a mutually agreed upon lump sum of $919.32.
ADD for Item No. 4
$919.32
TOTAL ITEM NO. 4 - ADD
$919.32
•
• •Y
CHANGE ORDER
January 16, 1991
f;E: Eagan, Minnesota FILE NO: 49500-CO
,MECT: Cliff Road Water Treatment Facility
ItOJECT NO. : 548; CONTRACT NO. : 89-13
.CONTRACTOR: Penn-Co Construction, 1301 Corporate Crt. Dr. , Ste. 150, Eagan, MN 55121
'BOND CO. : (Safeco Ins. Co. of Amer.) Alexander & Alexander, PO Box 1360, Mpls. MN
CHANGE ORDER NO. : 7 55440 Attn: Chris Watters
TOTAL ITEM NO. 1 $926.00
TOTAL ITEM NO. 2 1,416.00
TOTAL ITEM NO. 3 1,234.00
TOTAL ITEM NO. 4 919.32
TOTAL THIS CHANGE ORDER NO. 7 $4,495.32
ORIGINAL CONTRACT AMOUNT $8,094,000.00
PREVIOUS CHANGE ORDERS -18,974.19
THIS CHANGE ORDER NO. 7 - ADD 4,495.32
REVISED CONTRACT AMOUNT $8,079,521.13
Recommended for Approval by:
BONESTROO, ROSENE, ANDERLIK &
ASSOCIATES, INC.
By "Ca K t
Approved by: PENN-CO CONSTRUCTION
By
Approved by: CITY OF EAGAN, MINNESOTA
By , Mayor Distribution
1 - City
By , Clerk 1 - Bonding Co.
1 - Contractor
Date: 1 - BRA
•
STATUS OF CHANGE ORDERS
Eagan Cliff Road Water Treatment Plant
Contract No. 89-13, Project No. 548 January 24, 1991
Work ChAnge
Bequest Description Order
Number o Work $tatus Number AMQuilt
1 Replace instrumentation
supplier with Custom Controls S 1 $ -95,000.00
2 Remove trees at S end of site;
Shorten retaining wall S 2 -7,755.00
3 Delete filter bypass NE - -13,828.00
4 Provide additional membrane
waterproofing S 3 +6,603.00
5 Replace chlorination system
manufacturer with W&T S 4 -8,546 .69
6 Adjustments in well
abandonment quantities S 5 -3,297 .50
7 Delete clear well overflow
extension and manhole S 5 -6,413.00
8 Place surcharge material
in area of clear well S .5 +2,357 .00
9 Adjustment in compaction
grouting quantity E 6 +91,300. 00
10 Concrete reinforcement in
Supp. Backwash Pump Pit E 6 +852 .00
11 Removal of unforeseen
stumps and debris P 6 +926.00
12 Install concrete wall in area
of Grids 2 and G in Clear Well P 7 +1,416 .00
13 Relocate and provide addi-
tional lintels P 7 +1,234 .00
14 Grading changes, relocate
water station, delete manholes $
15 Additional lintels @ Door 106A P 7 +919.32
Co .
0 . SB L I OOSSt! ' OOZ11S3NOB ZS : 0 T I ZIP T b — SZ — Niel'
•
Work Change
Request Description
pumbez of Work Status Number &Mount
16 Change injector supply line
from galv. to PVC $
17 Reduced-size control console
and separate graphics panel $
18 Delete flagpole $
19 Increase size of altitude valve
manhole from 6 ' to 7 ' $
20 Replace cast-in-place entrance
columns with precast columns $
21 Remove add. burled debris * +6, 113.00
Abbreviations:
S: Change order has been signed by all parties
NE: Change order was not executed
E: Change order has been signed by Penn-Co and sent to City
P: Change order has been prepared and sent to Penn-Co
$: Quote from Penn-Co has been requested
*: Quote has been received from Penn-Co
£ 6 d S3 L I OOSS '' '3 OOalS3NOH Ss;: e T T 6 - � Z - Ntit'
• II* 4' I?�� . . ORE #2.
This particular ,change order consists of 11 different it as
summarized , a litter from th City's architect dat ' :' meter 17
of pages through ,. ; , The net effect 0 t3 it change
order would be to reduce . U contract 'amount $592. ,
lehowever, it ..1....‘,,,,i,4. ' ben ; fence and adriitxanal earth �'`
work {+$3134.1)' as i of E er Item bill have to be ..
completed and paid or tilt- , � N rate punch has agreement beyond
the scope of this eon a pit will have ' be delayed until
after this contract mss; feted.
You will. note that thi + er s ;refers to " I 4".
This is
a referent i a .-- ins tructions ,th .ch
is s ` art documentation wi ` filed dr .< . and techn 1. work
din . ion related to each of. 4 change $ # . This in +motion
is very technical and`. c-� : a :-will b fable at the Public
,.. storks 'Committee=see ng if fi e a addit questions r icing
these change order items.
rt,
l
t -
t
.
i'
i
.r
•
•
1
.•
. ,,. ..
r:.r.
{s�
f: `.-4^
_^rg .. .
r.1 - - ,mo 4-i
•
}
ii.'
.i.',k .
:Y' - - f
THRESHER SQUARE • DAVID I.BENNETT
700 THIRD STREET SOUTH MARK DONALD W G SWENSON RINGROSE
MINNEAPOLIS.MN 55415 DENNIS 1 SUTLIFF
PHONE 16121370-0700 DAVID L GRAHAM
FAX.6121370-1378 PETER E IARVIS
•
B • R • W • A R C H l T E C T S • I N C.
CHANGE ORDER NO. 2
TO: City of Eagan DATE: January 2, 1991
3830 Pilot Knob Road FILE NO.: 83-9004 9.2
Eagan, MN 55121 PROJECT: Eagan Maintenance
Facility
City of Eagan Project #559 CONTRACTOR: Shaw-Lundquist
Contract #89-03 Associates
The Contract is changed as follows:
For changes to the contract that involved additions or deductions of items
including field conditions, hidden conditions, resolutions of details and
deletions for work to be performed later. Refer to attached letter for
detailed information.
The Original Contract Sum was $565,262.00
Net change by previously authorized
Change Order (297.00)
The Contract Sum prior to Change Order was $564,965.00
The Contract Sum will decrease by this
Change Order in the amount of (582.00)
The new Contract Sum including this
Change Order will be $564,383.00
•
The Contract Time will be unchanged.
_
ARC 4 ' T CONTRACTOR OWNER
lB�j e chitects, Inc. Shaw Lundquist Assoc. City of Eagan •
700 Third Street S 2805 Dodd Road 3830 Pilot Knob Road
Minneapolis, MN 55415 St. Paul , MN 55121 Eagan, MN 55122
DATE: /./5-q/ DATE: DATE:
NOTE: There was a typo/mathematical error on Change Order #1. The number
$564,745.00 should have been $564,965.00. The correct number is used
above.
9.
AN AFFILIATE OF THE BENNETT RINGROSE.WOLSFELD IARVIS GARDNER.INC..GROUP
ARCHITECTURE.URBAN DESIGN PLANNING TRANSPORTATION ENGINEERING
MINNEAPOLIS•DENVER•PHOENIX•TUCSON•ST PETERSBURG
THRESHER SQUARE DAVID I.BENNETT•7(01111RD STREET`SOUR l MARK G SWENSON
MINNEAPOLIS.MN 55415 DENNIS I.SUiLIFF
PHONE 16121370-1)700 - --- DAVID I.GRAHAM
FAX 16121370-1378 PETER E IARVIS
DONALD W RINGROSE
B • R • W • A R C H I T E C T S • I N C.
December 17, 1990
Tom Colbert
Arnie Erhart
City of Eagan
3830 Pilot Knob Road
Eagan, MN 55122
RE: Eagan Maintenance
83-9004
City #559, Contract #89-03
Gentlemen,
The following is a list of proposed adds and deducts to the contract along
with an explanation of why these items were required:
1. Surcharge by City of Eagan for Permit $283.00
Note: The contractors were advised that they
need to pay for electrical permit and fees eat*.
(See copy of note) . After award, the contrac-
tor was charged the additional fee by the State .
of Minnesota..or A. no+t elte*r►a.d surehAvle.
2. Masonry Items
a. ASI#4: Revised grade beam detail $410.00
Note: After discussion, this number was
reduced from $600+. This was detailed
making some assumptions, as we were deal-
ing with some non-exposed conditions.
Thus, there were some field modifications.
b. ASI#5: Revised detail at the blockwall/stair $411.00
Note: This detail has been discussed at some
length and revised a couple of tithes. In addition,
the dollar amount has been argued and lowered.
This was also a buried condition. When
workmen demolished the floor and opened up
the footings, we had to make revisions to
the footing/column location. -
AN AFFILIATE OF TI IT:BENNETT RINGROST:.\VOI SF111,I)IARVIS GARDNER.INC..GROUP
ARCHITF("1!IRF I IRR:\N DE SIGN PLANNING TI:!\N-POI:I\I ION FNGINFFRING
\IINNI:AI't)I lS•1 ILNVI R•1'111)1 NIX• 1 111 ti■)N•ST PI'I1 RS131IRG
Arnie Erhart
December 17, 1990
Page 2
c. Credit for not installing block at old Door (160.00)
to grinding room 136B.
Note: We kept the door in place.
d. Credit for floor joints at Vehicle Maintenance Bay • (80.00)
Note: The contractor did not install per
specification
e. ASI#6: Add dowls at overhead door $167.00
Note: We did not show dowls on our plans
but in the field I felt it necessary to
tie the footing to the concrete apron.
3. ASI#6: Additional Sheet Metal at roof of $460.00
V.M. connection to existing storage building
Note: I would not allow the contractor to
cut into the metal panels as I was afraid
this would destroy the integrity of the
Butler building panels. Thus, we needed .. ,
to provide a watertight seal and quite a
bit more sheet metal was required.
4. ASI#6: Return dryvit from face of wall to $345.00
door with a drip at the top (at new overhead
door) .
Note: Frankly, I do not believe this was
adequately detailed on the base set and this
final detail provided a more permanent return
detail at the door.
5. Roof detail at existing Vehicle Maintenance $713.00
wall/new office
Note: In a field direction, I advised the
contractor to remove the stucco and provide
a steel angle with an extended leg to
carry the steel decking. There was 45
lineal feet of this.
•
Arnie Erhart
December 17, 1990
Page 3
•
6. Delete fence and earthwork and receive credit (3,341.00)
Note: We decided it would be better to not
do any earthwork or fencing in the area of
the Salt Storage Building until that separate
contractor can complete his work. The subcon-
tractor will provide same work next year for
same price.
7. Upsize the trolly for beam $210.00
Note: If push came to shove, we could say
this is not justified, however, I believe the
contractor honestly provided a standard size
unit and we needed a wide flange unit.
Please call me if we need to discuss any of the items. I can provide a Change
Order summarizing the changes, if accepted, for council review and approval .
Sincerely,
BRW ARCHITECTS, INC.
J- f -, L. Oertel , AIA
As .cute
JLO/ag
cc: 83-9004 9.2
ITEM III. RISVIEj! CE ►1OE Q' POLICY
This past fall, the City Council expressed concerns regarding the
timing and amount of various change orders that wex� being
processed for Council approval. Subsequently, they directed staff
to look at the City's present policy pertaining to change orders
and to provide additional information and guidelines for
consideration of and processing future change orders to City
contracts. Enclosed on pages o through is a memo
prepared by the public WorksDirec r addressing this issue.
1
i
i
•
}
1
leV
MEMO TO: THOMAS L HEDGES, CITY ADMINISTRATOR
FROM: THOMAS A COLBERT, DIRECTOR OF PUBLIC WORKS
DATE: JANUARY 25, 1991
SUBJECT: CHANGE ORDER POLICY
On occasion, the City Council has raised questions and expressed
concerns regarding the timing and/or amount of various change
orders that periodically are processed for Council approval.
Subsequently, you have requested the departments of Parks &
Recreation along with Public Works to review the City's change
order policies and procedures and to provide a summarization for
the Council 's information and benefit. The following report
summarizes the issues associated with public contracts and their
change orders.
TYPES OF CONTRACT
There are two basic types of contracts that are employed by the
City of Eagan for major capital improvements; LUMP SUM and UNIT
PRICE.
The Lump Sum type of contract is primarily used for architectural
type capital improvements involving structures and buildings (i.e.
park shelters, treatment plants, maintenance facility, city hall,
etc. ) . In these type of contracts, the total contract amount is
one base price and progress payments are based on percentage
completion of significant specific elements or the contract as a
whole. Usually, an itemized breakdown for significant aspects of
the contract is requested with the bid proposal documents or
subsequent to receipt of bids to be used in processing the pay
request.
The Unit Price type of contract is primarily used for other
municipal type of improvements where the complexity of the building
materials is relatively limited to a manageable number of line
items where unit quantities (square yard, ton, lineal foot, etc. )
can be estimated. The contractor then applies a unit price to
each line item construction element. Then, through the extension
and summation of the unit quantity and related bid price, a total
estimated contract amount can be arrived at. Periodic pay requests
are then based on field measurements of the quantity of line item
elements on a monthly basis.
In the Lump Sum contract method, the contract documents reference
the specific contract dollar amount. If for any reason this
contract amount must change, it requires a formal amendment to the
contract documents which usually takes the form of a Change Order.
In the Unit Price contract method, the controlling contractual
obligation is the unit prices submitted with the bid proposal with
the total contract costs being recognized as an estimate to be
revised based on final quantities installed. Therefore, the final
•
contract amount could change without impacting the contract
documents, thereby eliminating the necessity for any formal Change
Orders being processed. However, under this Unit Price type of
contract, if a line item construction element needs to be added,
deleted and/or revised or the unit price for any particular line
item element needs to be changed, this would constitute an
amendment to the formal contract document thereby requiring a
formal Change Order to be processed and approved by both
contractual parties.
Under the guideline of the Uniform Municipal Contracting Law, the
City is required to solicit competitive bids for any public
expenditure that exceeds $15,000. It also limits to 20% the amount
that a City can add to any contract without having to formally
resolicit competitive bids for the additional work. This is based
on the recognized fact that the vast majority of contracts are
subject to some change from the original contract amount through
its normal life.
REASONS FOR CHANGE ORDERS
Depending upon the type of contract method as described above,
there are numerous reasons why a formal amendment or Change Order
to the contract becomes necessary during the progression of
construction. These are listed and described as follows:
1. Errors and Omission In Design
Due to the complexity or scale of many projects, various
numbers of different disciplines (electrical,
architectual, structural, etc. ) and the numerous cross
references from one plan sheet to another, the human
element becomes a factor in recognizing that there will
sometimes be certain errors and omissions that occur
during the design phase that are only discovered once the
improvement is being built. Once it is recognized and
identified, it becomes evident that it needs to be
installed to protect the integrity of the improvement.
And, had it been included in the original design, the
contractor would have been properly informed and would
have taken it into consideration in submitting his bid.
Subsequently, a Change Order is processed to provide for
this additional cost to be incurred by the contractor
through no fault of his own.
2. Unknown Conditions
While the City tries to provide the contractor with as
much information as possible through soil borings,
asbuilt record plans, etc. , there are times when unknown
conditions exist and are not discovered until the plans
have been designed, contract awarded and construction
initiated. Again, had these unknown conditions been
discovered through a more detailed and expensive
preconstruction investigation, it would have been
included in the design plans and bid proposal documents.
Subsequently, the contractor, if he is made aware of
those conditions, would have taken that into
consideration in submitting his original bid.
Subsequently, a Change Order is processed to address the
additional work incurred by the contractor to deal with
a condition that was unknown to all parties at the time
the contract was executed.
3. Field Design Changes
When the detailed plans and specifications are prepared
in the office, they take into consideration the best
available information on existing conditions. However,
plans and specifications are a scaled representation of
much larger projects to be constructed in the field.
Subsequently, once construction has been initiated,
although a particular design may work on paper, it
becomes apparent that it cannot physically be constructed
in the field due to a variety of reasons. Some of these
reasons could be that conditions changed at the time of
construction from when the design was prepared.
Subsequently, a field design is performed which may
require a major change in the construction method or
scope to protect the integrity of the original project's
design and/or intent. Subsequently, this often times
requires additional work beyond the scope of the original
project which necessitates a formal amendment or Change
Order to the original contract document.
4. Additional Work
Many times, it becomes economically feasible and
efficient to have the contractor perform additional work
beyond the scope of immediate contract because of timing,
favorable unit prices, ease of construction coordination,
etc. , to amend the contract to allow the City to
compensate the contractor for performing this additional
work. Many times through easement acquisition
negotiations, property owners request various
improvements to their property in lieu of cash payments.
This would be additional work beyond the scope of the
contract which many times can be performed more
economical than providing cash payment to the property
owner.
Also, on large dollar volume contracts, the economies of
scale theory provides the City with more favorable unit
prices than could be obtained through competitive bidding
on a much smaller size project that would fall within the
20% discretionary limitation provided to the City. Also,
/ •
•
•
•
this relieves the City of the timely competitive bid
solicitation process thereby allowing it to perform
smaller projects on a timely and economical basis through
a Change Order process.
5. Change in Scope/Extent of Work
While this is very similar to #4, it pertains more
primarily to expanding the scope of the improvement at
hand by allowing the City to expand the quantities or
size of the improvement based on very favorable unit
prices received. In other words, if a bid comes in much
lower than budget and provides additional flexible
dollars, this would allow the City to expand the size or
scope of the improvements through a Change Order process
rather than changing the original design quantities and
rebidding.
6. Lump Sum Contract
As defined earlier, Lump Sum contracts lack specific unit
prices for every little individual item that comprises
the overall improvement. Subsequently, because the
contract document is locked into a specific dollar
amount, any variation or deviation for any of the above
reasons requires a formal change order to the contract
lump sum amount.
7. Change In Schedule/Completion Date
Every contract document contains a substantial completion
date as well as possible interim completion dates for
specific phases. Many times, there are multiple
contracts working on a larger overall improvement as well
as other jurisdictions, agencies, etc. , (public
utilities, MNDoT, etc. ) , that the City does not have
contractual control over. If these other entities for
whatever reason are unable to complete their work in the
time frame required for the City's contractor to proceed
as originally anticipated, the contractor is precluded
from maintaining progress and/or meeting his original
completion date. Also, unusual weather conditions,
strikes, material delivery delays, etc. , are all beyond
the contractor's control and subsequently affect his
ability to meet the contractual completion date. As
evaluated by the project manager, many times an extension
or modification to the contractual completion dates are
appropriate. However, they must be done through a formal
Change Order process to amend the contract documents.
8. Subsequent Acceptance of Alternate Bids
During the original design and bid solicitation phase,
many times bids are requested for various alternatives
and/or additional work for further consideration and
evaluation. Subsequently, it becomes economically
efficient to include these options to the contract as
budget allocations permit through a Change Order process
without having to resolicit competitive bids.
As can be seen by the above various occasions for Change Orders,
they involve activities that are usually beyond the foresight
and/or responsibility of either party to the original contractual
documents. Many times, these Change Orders can result in credits
as well as additional costs depending upon their individual
circumstances. With each Change Order, a detailed description of
the work performed along with a justification or purpose for that
Change Order is identified. The proposed contract Change Order
format attached to the memo will provide a compilation of all
pertinent information for processing with the contract amendment
for Council 's consideration.
PROCESS METHOD
Change Orders are prepared at either the request of the Contractor
who formally notifies the City of a claim for additional
compensation or by the City requesting additional work of the
Contractor. In either event, once the discovery or proposal is
identified, a detailed description of the additional work is
prepared and a method of payment is identified. This information
is then put into a Work Request which is then submitted to the
Contractor for consideration and cost proposal. The Contractor's
response and proposal is then evaluated by the Project Manager to
determine if all issues have been identified and if the additional
cost is reasonable for the requested work. Many times, the Project
Manager will either adjust the cost proposal or request a
resubmittal from the Contractor to better reflect a cost that would
be reasonable and acceptable to the City. Once this negotiation
process has been completed, a formal Change Order document is then
prepared and sent to the Contractor for execution. Once it has
been agreed to by the Contractor, it is then processed to the City
Council for formal approval and ratification. Copies of this
Change Order are then distributed to the City's central file, the
Project Manager's field file, the Contractor's office as well as
his bonding company.
Present contract documents stipulate that if the Contractor wishes
to makes a claim for an increase in the contract sum, he must give
the Project Manager written notice within 10 days after the
occurrence of the event giving rise to such claim. A supplemental
notice of the amount of the claim with supporting data must be
delivered to the Project Manager within 30 days of the occurrence
/ .
unless the City allows an additional period of time to ascertain
accurate cost information. Subsequently, the preparation of a
Contract Change Order document could take from 30 to 60 days from
the occurrence of the event to formal Council consideration
depending upon the extent of negotiations. There are occasions
when a Change Order can be prepared based on estimated quantities
if the work involved would take place over a longer period of time.
Also, this would provide the Contractor an opportunity to be
compensated for actual work performed which is comparable to the
unit price contract rather than a lump sum Change Order which could
have to be readjusted at a later date for a number of reasons.
LIMITATIONS AND GUIDELINES
As can be seen by the complexity and number of City improvement
contracts, a significant amount of professional management is
necessary to protect the expenditure of public dollars. No two
projects, managers or contractors are the same. There are numerous
variables that must be taken into consideration in achieving the
best end product for the best price within the most efficient time
frame while trying to avoid costly and timely litigation and
arbitration in this litigious society. Subsequently, the Project
Managers must employ a significant amount of judgment and
discretion in managing these Contracts. However, it is appropriate
that certain guidelines be established to maximize the management
of these public dollars in improvements as well as helping to
assure uniformity in the application of City policies.
Larger governmental agencies (EPA, MnDOT, etc. ) do not have
specified limitations or constraints for Project Managers
representing the contractual interest of the agency. A survey of
other metropolitan suburban communities has not discovered any type
of formal policy pertaining to Change Orders. Managing public
contracts including Change Orders is recognized as being one of the
management responsibilities of the individual assigned. However,
guidelines are a method by which the City Council can determine to
what level of detail they wish to be involved in managing these
public contracts. Historically, the City Council has created a
policy whereby if the bid proposal exceeds the feasibility
report/engineer's estimate or budget by more than 10%, a new public
hearing is held or bids are re-advertised. This is the very first
opportunity to manage and control the cost of a contract. Once a
contract is awarded, it is assigned to a Project Manager to
continue to monitor and control costs. Historically, the Project
Manager has had the authority to approve changes in the unit
quantities under a unit bid contract. Also, discretion has been
provided for minor changes to the scope of the project and related
negotiations on a limited basis. On a lump sum contract, any
changes subsequently require a formal Change Order. The following
proposal may help to provide a uniform basis for defining this
"limited basis".
/9.
•
PROJECT MANAGER'S AUTHORIZATION AUTHORITY
CONTRACT AMOUNT MAXIMUM CHANGE ORDER AMOUNT
0 - $500,000 $35,000 (7%)
$500, 000 - $1,000,000 $50, 000 (5%)
$1,000,000 - $2,000, 000 $70,000 (31%)
$2, 000,000 + $85,000
This would imply that the Project Manager has the discretion to
authorize on behalf of the City of Eagan additional work as
necessary up to these maximum amounts. If conditions of the
Contract require that a formal Change Order be processed, it would
then be processed to the City Council for formal ratification. If
a Work Request proposal exceeded these limitations, a formal Change
Order would have to be prepared and processed by the City Council
before work could be initiated except in an emergency which
endangers life or property. In such a situation, the Council would
be so informed while work is proceeding with the formal Change
Order to be considered at the next available Council meeting.
As mentioned previously, any additional work resulting in a formal
Change Order within the limits of the Project Manager's discretion
will be processed within 60 days of the initiation of that work for
Council ratification. These limitations would pertain to singular
work requests and cumulative line item unit bid proposals not
requiring formal Change Orders. Any Work Requests exceeding these
guidelines would require formal Council approval of the Change
Order before the work could be initiated.
SUMMARY
The Council 's interest in the amount and timing of Change Orders
being processed is very appropriate and has allowed the staff to
evaluate our past practices and compare them with other public
agencies to ensure that we are managing the public tax dollars to
the highest degree possible. If these guidelines are acceptable,
they will be reviewed with all individuals who are employed as
Project Managers to ensure compliance. We would continue to
welcome additional discussion regarding this Change Order policy
in general or specific individual Change Orders so that we can
provide additional information and response as appropriate. Please
let me know if I can provide any additional information or action
on this matter.
Respect y submitted // ,
f' - /
Director of Public Works
cc: Ken Vraa, Director of Parks and Recreation
Michael P. Foertsch, Assistant City Engineer
Steve Sullivan, Parks Planner/Landscape Architect
Joe Connolly, Superintendent of Utilities/Buildings
Arnie Erhart, Superintendent of Streets/Equipment
TAC/jj/jf le)
CONTRACT CHANGE ORDER
. __..,_..,____. __\
3830 PI101 KNOB ROAD
EAGAN,MINNESOTA 55122-1897
LPHONE:(612)454 6100
-��"t', �itv Or aa an FAX (612)454 8363
CONTRACT #: CHANGE ORDER NO. :
PROJECT #: DATE:
PROJECT NAME:
PROJ. DESCRIPTION:
CONTRACTOR: ENGINEER:
DESCRIPTION OF CHANGE ORDER WORK:
JUSTIFICATION FOR/PURPOSE OF CHANGE ORDER
Est. Est.
Change Order Start Completion Unit Estimated
Item(s) Date Date Unit Price Quantity Amount
---- ..111010 Page 1 of 2
THE LONE OAK TREE...THE SYMBOL OF STRENGTH AND GROWTH IN OUR COMMUNITY
.—)
Equal Opportunity/Affirmative Action Employer
CONTRACT STATUS
TIME/COMPLETION DATE AMOUNT
Original Contract
Change Order #
Subtotal of Previous Change Orders
This Change Order
New Subtotal of All Change Orders
Revise Contract
RECOMMENDED FOR APPROVAL: APPROVED:
By: By:
Project Manager Contractor
Date: Date:
By:
City Department Manager
Date:
City of Eagan Council Action
Date:
Mayor:
Clerk:
Distribution:
1-City
2-Contractor
1-Engineer