Title
Proposed Change Order No. 1
GLWA-CON-158
Specialized Services Contract
Body
Agenda of: April 24, 2019
Item No.: 2019-149
Amount: Original Contract $10,092,799.90
Proposed Change Order No. 1 5,046,399.95
Total Revised Contract $15,139,199.85
TO: The Honorable
Board of Directors
Great Lakes Water Authority
FROM: Sue F. McCormick
Chief Executive Officer
Great Lakes Water Authority
DATE: April 3, 2019
RE: Proposed Change Order No. 1
Contract No. GLWA-CON-158
Specialized Services Contract
Vendor: LGC Global, Inc.
MOTION
Upon recommendation of Cheryl Porter, Chief Operating Officer - Water and Field Services, the Board of Directors (Board) of the Great Lakes Water Authority (GLWA), authorizes the Chief Executive Officer (CEO) to enter into Contract No. GLWA-CON-158 Change Order No. 1 “Specialized Services Contract” with LGC Global, Inc., at an increased amount of $5,046,399.95 for a total cost not to exceed $15,139,199.85 for an increased duration of one (1) year for a total contract length of three (3) years; and authorizes the CEO to take such other action as may be necessary to accomplish the intent of this vote.
BACKGROUND
The Specialized Services contracts have successfully been utilized to assist the Authority with unique projects to stay in compliance with state and federal regulations. They also provide the necessary support for urgent and emergency tasks that require immediate attention. Specifically, GLWA’s major maintenance responsibilities include the performance of corrective (i.e. immediate/urgent/emergency) and preventive (i.e. regularly scheduled intervals) on huge pumping units, motors, valves, and related support equipment at the Water Treatment Plants (WTP), Water Booster Stations (WBS), Pressure Regulating Valves (PRVs), Remote Sites, Sewer Lift Stations, and outfalls. The current contract, GLWA-CON-158, was advertised with the intent to award a two-year contract with subsequent annual renewal options for a period not to exceed three years. However, the renewal option language was inadvertently dropped from the associated contract language. This Change Order No. 1 seeks to amend the contract for a period of one year.
JUSTIFICATION
The CON-158 Specialized Services Contract is needed to accomplish a number of unique projects throughout the water treatment plants, water booster stations and wastewater collection system to keep these systems in operation. GLWA handles the base load of maintenance work. For peak loads, GLWA employees do not have sufficient equipment and staff necessary to perform all the specialized functions in addition to providing emergency maintenance work. This type of contract exists to provide the 24/7 operations with sufficient resources.
Award of CON-158 is crucial for the Authority to augment its equipment and provide specialized services to maintain the facilities, in order to comply with state and federal regulatory agencies directives assuring the health and welfare of GLWA customers in the area of water treatment, water transmission, sewage transport, collection, and discharge. This contract gives GLWA the flexibility to bring on additional specialized resources when the need arises. The original two-year contract had an upper limit of $10,092,799.90 and this change order requests an additional one year and $5,046,399.95 to reflect the current rate of utilization for this contract.
PROJECT MANAGEMENT STATUS
Original Contract Time 2 Years
Proposed Change Order 1 1 Year
New Contract Time 3 Years
PROJECT ESTIMATE
Original Contract Price $10,092,799.90
Proposed Change Order No. 1 5,046,399.95
New Contract Total $15,139,199.85
FINANCIAL PLAN IMPACT
Summary: The proposed contract with Lakeshore Global Corporation encompasses Operations & Maintenance expense only. The value of the contract is within the current financial plan in total. Sufficient funds will be provided in the Operations & Maintenance (O&M) financial plan for this contract related to contractual operating services, contractual professional services and repairs & maintenance.
Funding Source: Operations & Maintenance (O&M) Budget
Cost Center(s):
Systems Control Operations Centralized Services cost center 882301
Field Service Operations Centralized Services cost center 882431
Belle Isle Pump Station Wastewater Operations cost center 892342
Blue Hill Pump Station Wastewater Operations cost center 892343
Fischer Pump Station Wastewater Operations cost center 892347
Woodmere Pump Station Wastewater Operations cost center 892352
Expense Type(s): Contractual Operating Services (617900)
Contractual Professional Services (617903)
Repairs & Maintenance-Equipment (622300)
Estimated Cost by Year and Related Estimating Variance: See table below.
Fiscal Year Amount
FY 2018 Budget $5,046,400
FY 2019 Budget 5,046,400
FY 2020 Financial Plan 6,677,300
Total Financial Plan Estimate $16,770,100
Proposed Contract Amount $15,139,200
Variance (positive/ (negative) $1,630,900
SAVINGS, COST OPTIMIZATION, AND REVENUE ENHANCEMENT IMPACT
The award of this contract provides a variance of $1,630,900 ($16,770,100 financial plan estimate less $15,139,200 proposed contract amount). Contractual services are dependent on several factors such as, delays in estimated start and end dates, environmental constraints, and other unforeseen circumstances that can cause the expenses to fluctuate from fiscal year to fiscal year.
COMMITTEE REVIEW
This item was presented to the Operations and Resources Committee at its meeting on April 11, 2019. The Operations and Resources Committee unanimously recommended that the GLWA Board adopt the resolution as presented.
SHARED SERVICES IMPACT
This item does not impact the shared services agreement between GLWA and DWSD.