Since the award of a WSDOT State Pedestrian and Bicycle Safety Grant in 2013, the proposed Olympic Drive Phase 1 Non-Motorized Improvements have been undergoing planning, design, and permitting. During this time, the project scope and budget have been amended several times - most recently in June of this year to include undergrounding of electrical service to preserve trees.

The full proposed improvements to Olympic Drive include:

• Pedestrian improvements on the east and west side of Olympic Drive
• Pedestrian improvements at Harbor View meeting ADA compliance
• Stormwater quality treatment infrastructure
• Two retaining walls (along the west side expansion and at the corner of the police station)
• East, west, and center left turn lanes for bicycle facilities
• Replacement of a substandard water main in Olympic Drive and Harbor View
• Installation of new fire service for Olympic Drive
• Pedestrian lighting, extension of Waypoint Park gateway south, landscaping, and wayfinding embellishment into the downtown corridor
• Retention of large standing trees
• Undergrounding power within project

Construction Budget:

The remaining budget available for construction after design and other costs is approximately $1.2M which closely matched the engineer’s estimate for the base bid part of the work. This remaining budget includes the additional $120,000 authorized by the City Council in June. 

In order to create options for budget flexibility, the City bid the project with three optional construction alternatives: pedestrian lighting ($39,000 est.), Phase 2 sidewalk expansion on the east side adjacent to the police station ($190,394 est.); and planting replacement of large trees ($4,475 est.).

Bids were solicited through the local newspapers and the bid opening was held on Thursday, June 29, 2017. The City received one bid from Sound Pacific Construction in the base bid amount of $1,588,764.60. See attached bid results.

Even in a busy construction market, it is atypical to have only a single bidder for public works projects. The base bid was approximately 18% higher than the engineer’s estimate. A review of the proposal and unit costs indicates that the bid costs are generally higher across the board, and the difference is not attributable to particular project components. 

Staff has concerns that, in the absence of other bids, it is difficult to know if the current construction pricing is based on reduction in available workforce, availability of materials, or the location and complexity of the project. The project location is complex due to its location within the state highway, proximity to the ferry terminal, significant traffic control requirements, right of way constraints, and signalized intersections. The addendum to underground existing overhead electrical distribution and modifications to plans and specifications to protect existing trees was a significant change to the project scope and the change created a complex addendum late in the bid period. The addendum work required new disciplines and the prospective bidders may not have been receptive to a late change of this significance during a competitive bid climate.

Staff has reviewed the bid documentation and contractor's qualifications, and has contacted six (6) other contractors who received the bid package but declined to bid on the project. Other contractors indicated the reasons for not submitting bids included:

- Ongoing workload and lack of time to prepare bids

- Highly restrictive working hours for road closures in the specifications

- Concern about risk associated with liquidated damages

- Complexity of estimating bids for bid alternatives

Some bidders indicated that they would be interested in bidding this project later in the year, assuming some of the above items could be changed in the contract.

If the Council elects to accept this bid, the project's total funding would need to increase from $1,716,360 to $2,472,469. The project would require additional funding of roughly $756,000 above existing approved budgets.  This additional funding would support the higher construction cost for the base bid and all three alternatives (roughly $596,000) and would provide contingency funding for the project equal to 10% of the base bid ($160,000). Combined with the recent June approval of $120,000 in additional funding, a total budget adjustment of $876,000 would be required. Grant funding for the project remains at $764,200, which represents roughly 31% of total project costs.

Given the significant increase in project costs, the complexity of the project, and the absence of competing bids, staff recommends that the City reject the current bid and take time to assess options for the project and  readvertise at a later date.