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402-2001 RDA Reso RESOLUTION 402+2001 A RESOLUTION OF THE CHAIRMAN AND THE MEMBERS OF THE MIAMI BEACH REDEVELOPMENT AGENCY AUTHORIZING THE EXECUTIVE DIRECTOR OR HIS DESIGNEE TO OMIT ANY REMAINING WORK FROM THE CONSTRUCTION CONTRACT WITH ATLANTIC CIVIL, INC. (ACI) (CONTRACTOR) FOR THE SOUTH POINTE STREETSCAPE IMPROVEMENTS - PHASE I CONSTRUCTION (PROJECT), AND TO REMOVE THE PROSECUTION OF THE WORK FROM THE CONTRACTOR PURSUANT TO THE AUTHORITY GRANTED WITHIN THE CONSTRUCTION CONTRACT; FURTHER RATIFYING THE WAIVER OF FORMAL COMPETITIVE BIDDING (RELATIVE TO THE COMPLETION OF THE PROJECT) BY THE MAYOR AND CITY COMMISSION; AND, IN LIGHT OF A POTENTIAL EMERGENCY IN PORTIONS OF THE SOUTH POINTE AREA, AS A RESULT OF THE INCOMPLETE NATURE OF THE PROJECT, WHICH MIGHT AFFECT THE HEALTH, SAFETY AND WELFARE OF THE CITY, AUTHORIZING THE EXECUTIVE DIRECTOR OR HIS DESIGNEE TO TAKE ANY AND ALL NECESSARY ACTIONS TO EXECUTE THE PROSECUTION OF THE REMAINING WORK; FURTHER AUTHORIZING THE CHAIRMAN AND SECRETARY TO EXECUTE ANY AND ALL CONTRACTS, PURCHASE ORDERS AND CHANGE ORDERS, AS NECESSARY, AND AT THE RECOMMENDATION OF THE EXECUTIVE DIRECTOR, RELATIVE TO THE PURCHASE OF ALL NECESSARY GOODS AND SERVICES NECESSARY FOR THE PROSECUTION OF THE REMAINING WORK FOR THE COMPLETION OF THE PROJECT, PROVIDED THAT SUCH CONTRACTS, PURCHASE ORDERS, CHANGE ORDERS, AND OTHER DOCUMENTS SHALL BE SUBSTANTIALLY IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THE CURRENT CONSTRUCTION CONTRACT WITH ACI, AND SHALL NOT EXCEED THE CURRENT AMOUNT APPROPRIATED BY THE RDA FOR THE AFORESTATED PROJECT, WITHOUT THE FURTHER APPROVAL OF THE CHAIRMAN AND MEMBERS. WHEREAS, on June 28, 2000, the Chairman and Members of the Miami Beach Redevelopment Agency (RDA) authorized the Chairman and Secretary to execute a construction contract with Atlantic Civil, Inc. (ACI) (Contractor) for the construction of the South Pointe Streetscape Improvements -- Phase I (the Project) pursuant to Invitation to Bid No. 90-99/00, and said action was ratified by the Mayor and City Commission of the City of Miami Beach; and WHEREAS, on September 5,2000, ACI commenced the Project construction, which consists of roadway, drainage, water, sanitary sewer, lighting and landscaping improvements along Third Street from Michigan Avenue to Ocean Drive and along Washington Avenue from South Pointe Park to Fifth Street; a roadway and associated parking was also constructed to connect the South Pointe Park and the Park's existing parking lot; and WHEREAS, since the commencement of construction, several site development issues related to coordination of unforeseen conditions, omissions and deletions have arisen; and WHEREAS, ACI has refused to proceed with disputed work without first receiving an approved change order and has taken actions and/or positions to increase the difficulties of the Project; and WHEREAS, pursuant to its authority under its construction contract with ACI, on September 26, 2001, the RDA omitted the work along Washington Avenue, from South Pointe Drive to First Street, since the proposed work could not be completed by October 4, 2001, the date required by the RDA; and WHEREAS, pursuant to its authority under its construction contract with ACI, on September 7, 2001, the RDA omitted the work along Washington Avenue, from Fourth to Fifth Streets, as ACI refused the reasonable and responsible requests of the RDA to provide certain assurances that ACI would address the construction in this area in a manner that minimizes potential impacts to the residents and businesses; and WHEREAS, ACI has failed to complete the Project in accordance with the terms of its construction contract with the RDA and, accordingly, has been certified in default by the RDA (in concurrence with the Program Manager on the Project, Hazen and Sawyer), for failure to complete the Project in a timely manner; and. WHEREAS, it is the recommendation of the RDA staff assigned to the Project that the RDA exercise its rights, as contained within the construction contract, by omitting the balance of the remaining work from the contract, and by removing the prosecution of the work from ACI; and WHEREAS, accordingly, due to the potentially hazardous condition in portions ofthe South Pointe area, as a result of the Project still being incomplete, the RDA staff finds that there exists a potential emergency that might affect the health, safety and welfare of the City, and would therefore recommend that the Chairman and Members herein authorize the Executive Director to take any and all actions, as set forth in this Resolution and subject to the conditions below; taking all necessary steps to diligently complete the prosecution of the work on the Project. NOW, THEREFORE BE IT DULY RESOLVED BY THE CHAIRMAN AND MEMBERS OF THE MIAMI BEACH REDEVELOPMENT AGENCY, thatthe Chairman and Members authorize the Executive Director or his Designee to omit any remaining work from the Contract with Atlantic Civil, Inc. (Contractor) (ACI) for the South Pointe Streetscape Improvements - Phase I Construction (Project), and to remove the prosecution of the work from the Contractor pursuant to the authority granted within the construction contract; further ratifying the waiver of formal competitive bidding (relative to the completion of the Project) by the Mayor and City Commission; and, in light of a potential emergency in portions of the South Pointe area, as a result ofthe incomplete nature of the Project, which might affect the health, safety and welfare of the City, authorizing the Executive Director or his designee to take any and all necessary actions to execute the prosecution of the remaining work; further authorizing the Chairman and Secretary to award any and all contracts, purchase orders and change orders, as necessary, and at the recommendation of the Executive Director, relative to the purchase of all necessary goods and services necessary for the prosecution of the remaining work for the completion of the Project, provided that such contracts, purchase orders, change orders, and other documents shall be substantially in accordance with the terms and conditions of the current Construction Contract with ACI and shall not exceed the current amount appropriated by the RDA for the aforestated project, without the further approval of the Chairman and Members, and ratification by the Mayor and City Commission. PASSED and ADOPTED this 28th day of Novemb ATTEST: .=~r,f~ SECREtARY T:IAGENDA\20011n",,2801IREGJLARIACI Waiver of Bid RDARes,doc APPROVED AS TO FORM & lANGUAGE & FOR EXECUTION ~~ \\-1-\-0\ Date CITY OF MIAMI BEACH CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH, FLORIDA 33139 www.ci.miami-beach.fl.us To: From: Subject: ANALYSIS REDEVELOPMENT AGENCY MEMORANDUM Mayor David Dermer and Members of the City Commission J~rge M. Gonzalez("._ ..)f\(G d City Manager ~ Date: November 28, 2001 A RESOLUTION OF THE CHAIRMAN AND TH MEMBERS OF THE MIAMI BEACH REDEVELOPMENT AGENCY AUTHORIZING THE EXECUTIVE DIRECTOR OR HIS DESIGNEE TO OMIT ANY REMAINING WORK FROM THE CONSTRUCTION CONTRACT WITH ATLANTIC CIVIL, INC. (ACI) (CONTRACTOR) FOR THE SOUTH POINTE STREETSCAPE IMPROVEMENTS - PHASE I CONSTRUCTION (PROJECT), AND TO REMOVE THE PROSECUTION OF THE WORK FROM THE CONTRACTOR PURSUANT TO THE AUTHORITY GRANTED WITHIN THE CONSTRUCTION CONTRACT; FURTHER RATIFYING THE WAIVER OF FORMAL COMPETITIVE BIDDING (RELATIVE TO THE COMPLETION OF THE PROJECT) BY THE MAYOR AND CITY COMMISSION; AND, IN LIGHT OF A POTENTIAL EMERGENCY IN PORTIONS OF THE SOUTH POINTE AREA, AS A RESULT OF THE INCOMPLETE NATURE OF THE PROJECT, WHICH MIGHT AFFECT THE HEALTH, SAFETY AND WELFARE OF THE CITY, AUTHORIZING THE EXECUTIVE DIRECTOR OR HIS DESIGNEE TO TAKE ANY AND ALL NECESSARY ACTIONS TO EXECUTE THE PROSECUTION OF THE REMAINING WORK; FURTHER AUTHORIZING THE CHAIRMAN AND SECRETARY TO EXECUTE ANY AND ALL CONTRACTS, PURCHASE ORDERS AND CHANGE ORDERS, AS NECESSARY, AND AT THE RECOMMENDATION OF THE EXECUTIVE DIRECTOR, RELATIVE TO THE PURCHASE OF ALL NECESSARY GOODS AND SERVICES NECESSARY FOR THE PROSECUTION OF THE REMAINING WORK FOR THE COMPLETION OF THE PROJECT, PROVIDED THAT SUCH CONTRACTS, PURCHASE ORDERS, CHANGE ORDERS, AND OTHER DOCUMENTS SHALL BE SUBSTANTIALLY IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THE CURRECT CONSTRUCTION CONTRACT WITH ACI, AND SHALL NOT EXCEED THE CURRENT AMOUNT APPROPRIATED BY THE RDA FOR THE AFORESTATED PROJECT, WITHOUT THE FURTHER APPROVAL OF THE CHAIRMAN AND MEMBERS. On September 5, 2000, Atlantic Civil, Inc. (ACI) commenced the South Pointe Streetscape Phase I construction (the "Project"), which consists of roadway, drainage, water, sanitary sewer, lighting and landscaping improvements along Third Street from Michigan Avenue to AGENDA ITEM 3A- DATE II-~-O L I Page 2 of 6 Ocean Drive and along Washington Avenue from South Pointe Park to Fifth Street; a roadway and associated parking was also constructed to connect the South Pointe Park and the Park's existing parking lot. Since the commencement of construction, several site development issues related to coordination of unforeseen conditions, omissions and deletions have arisen. On January 31,2001, as a result of staff concerns, a status report was provided to the Redevelopment Agency advising that these conditions had contributed to time delays and additional costs. On May 16, 2001, staff reported to the Redevelopment Agency that the Contractor (ACI) submitted a Request for Equitable Adjustment (REA) in excess of $1.3 million, representing the increased costs the Contractor attributed to delays associated with the issues referenced above. Repeated City requests to the Contractor to submit specific documentation to support the Contractor's REA have been denied by the Contractor unless the City agrees to binding arbitration. Without this information, the City cannot evaluate the Contractor's REA and therefore, on August 10, 2001, the City advised the Contractor that the REA is rejected until such time that the Contractor forwards the requested information. The City's Project team has been actively addressing design and unforeseen site condition issues identified prior to April 2001 in order to allow ACI to proceed with construction without further delays. However, ACI has continued to claim that design and unforeseen site condition issues contribute to delays. ACllssues Separate from and in addition to the design issues, ACI has acted in a manner that has exacerbated the timely completion of this project. Since construction progress was proceeding in an untimely fashion, the Project team requested an acceleration schedule and cost proposal to perform the work along Washington Avenue from South Pointe Drive to First Street by October 4, 2001. In order to accomplish this task by the stated milestone date, it was acknowledged that ACI would have to work additional hours during the workweek. ACI forwarded a change order request in the amount of $588,480.74 for the Project team's review. The change order request also included language contrary to the contract documents and an anticipated completion date of October 12, 2001, with no guarantees that the work would be completed on schedule. The additional compensation amount was in addition to the value ofthe work as stated within ACI's bid price. Hazen and Sawyer and Kimley-Horn & Associates estimated the value of the Contractor's acceleration costs to range between $100,000 to $120,000. On September 26, 2001, the City/RDA omitted the work along Washington Avenue from South Pointe Drive to First Street pursuant to Section 9.5 - Omitted Items of the Contract since the proposed work could not be completed by October 4, 2001. On September 7,2001, the City/RDA omitted the work along Washington Avenue from Fourth to Fifth Streets. ACI refused the reasonable and responsible requests ofthe Project team to provide specific assurances that ACI would address the construction in this area in a manner that minimizes potential damages to the residents and businesses. Therefore, pursuant to Section 9.5 - Omitted Items of the Contract, the City/RDA omitted the work I Page 30f6 north of Fourth Street along Washington Avenue. On October 17, 2001 the RDA ratified the omitted work action. ACI has continually refused to continue with extra work and incidental work, such as field adjustments, unless a supplementary written agreement is provided. While the contract documents require a supplementary agreement for extra work, no such agreement is required for incidental work. On many occasions, the Contractor has delayed its own progress through its refusal to proceed with incidental work. Although incidental work is a normal occurrence when working within an urban corridor, the Contractor has typically asserted its intention to make a claim against the City for these delays. One example of these types of issues is detailed below. . On occasion, there has been the need to relocate the centerline location of a drainage structure to accommodate unforeseen site conditions or plan conflicts. Typically this work consisted of ACI identifying a utility in the field that was not identified in the plans, thereby necessitating a minor revision in the field to meet the functional intent of the design documents. This field revision typically required ACI's field superintendent to utilize a tape measure to remark the centerline location of the drainage structure anywhere from 12 inches to 36 inches to the left or right of the original location. This type of work does not require rework, resurveying, mobilization/demobilization, etc. Yet ACI would request increased payment for this work in the range of $3,500 and would stop its work until the City responded to its written request with a written response, thereby creating a delay. Construction work within an urban area, such as the South Pointe area, requires coordination with other contractors and/or utility companies who are also performing work in the area. This practical requirement is contained within the Contract Documents in Section 8.3 and exists because it is unreasonable to expect all other entities to refrain from any type of maintenance or other work within the construction area. However, ACI has continually refused to coordinate its work and/or has asserted its intent to make claims against the City for coordinating its work with others. An example of ACI's continued obstinate stance to coordinating with others is outlined below. . There is a commercial office building under construction at 119 Washington Avenue (Atlantic Center). As required by common industry practice, the Atlantic Center contractor (Buildtech) has routinely notified ACI of its work in an attempt to coordinate with ACI. ACI has typically refused to coordinate with Buildtech and on one occasion purposely parked a large number of idle equipment in a manner that would directly interfere with Buildtech's work. Essentially, ACI placed construction equipment in an area where Buildtech needed to locate a crane. Page 4 of 6 The Contract Documents also require ACI to provide access to all businesses and residents within the work area and to conduct itself in a manner that mitigates damages to businesses and residents that are related to the prosecution of the work. On many occasions, ACI has conducted itself in a manner that has blocked access to businesses or residents. ACI has also acted in a manner that indicates a disregard for the residents and businesses in the work area. A few examples of how ACI has conducted itself are listed below. . During Labor Day weekend, ACI installed concrete barriers in the middle of the sidewalk along Washington Avenue between 4th and 5th Streets. This action was intended to mitigate damages to these businesses located in this corridor and to preserve access to the businesses. Although this would be an appropriate measure if work was to commence, ACl's previous notices to the City did not call for any work in this area for at least the next four to six weeks, making the placement of these structures premature and potentially harmful to these businesses. Also, ACI provided no previous notice to either the businesses orto the City. ACI refused to provide any written work schedule or maintenance of traffic plan which would be used to provide the businesses necessary information on the duration of work and on what types of impacts they could expect to their businesses. (As a side note, based on these problems, the City eventually omitted this portion of the work from ACI's contract.) . Another example of citizen disregard is ACI's treatment of our large residential population of the Jewish faith. Prior to the high holy days, the Congregation Beth Jacob requested that ACI schedule their work in a manner that would mitigate the impact that the construction activities could have on the Congregation's services. Pursuant to this request, the City asked ACI to maintain low noise levels in the vicinity of the Congregation during specific dates. In response, ACI relocated its underground crews to another location and submitted to the City a Change Order Request in the amount of $27,966.01. Since the Contractor obviously had other underground work in the area, this Change Order was unnecessary and was rejected. Upon receiving the notice of rejection, ACI mobilized its crews in front of the Congregation on September 16th and proceeded to work. The City is in receipt of a letter to ACI from the Congregation indicating that on Yom Kippur the religious ceremonies were disrupted by ACI's construction activities. . On October 26, 2001 the Contractor proceeded to install concrete formwork along the 300 block of Washington Avenue. This installation isolated a parked vehicle in front of 323 Washington Avenue. Because of the work, the vehicle could not be moved out of its parking place. The vehicle owner approached City officials and notified them that the owner was late for work, was unable to utilize Page 50f6 his/her vehicle, and was therefore utilizing the public transportation system to get to work. Further discussions indicated that no formal notice was provided to the residents by the Contractor of its intent to work in this area. The Contractor did not take any steps to mitigate the impact of the work to these residents. ACI has proven to be very difficult to work with and on occasion has intentionally ignored field direction from the City's Project team. This refusal to cooperate has resulted in delays and has exacerbated the issues for this project. Two examples of this follow. . On April 3, 2001, ACI proceeded to install a drainage structure in an incorrect location. When the location was staked in the field, Kimley- Horn's representative noted that the staked location was incorrect and not consistent with the functional intent of the Contract Documents. ACI contended that the Contract Documents identified the location of the drainage structure and that this location was consistent with the location staked in the field. Upon review, a scrivener's error was noted in the Contract Documents with respect to the location of the drainage structure. ACI's field supervisor was notified of the scrivener's error prior to initiating installation of the drainage structure. However, the field supervisor indicated that ACI's project manager had instructed him to install the structure in the incorrect location anyway. After completing the installation, ACI forwarded to the City a Change Order Request to remove the structure from the incorrect location and to install it in the correct location at a cost of $7,681.21 plus the associated time delays related to this incident. . Beginning with the August 2001 payment, ACI has refused to certify its payment application for undisputed work. The City is unable to pay ACI for this undisputed work without ACI certifying the application is accurate. Based on this refusal to certify the pay application, the City submitted the situation to the Architect for resolution pursuant to section 5.1 of the contract. ACI chose to file a lawsuit against the City. The payment applications, as well as the checks to pay ACI, remain in the RDA office awaiting ACI to come in and certify the applications and pick up their checks. As of November 19, 2001 ACI has failed to complete the scope of work within the 350 day term established in the Contract. ACI and its Surety was informed of this failure and issued a notice of default in a letter dated November 9, 2001 from both the City and its Program Manager. ACI has failed to respond satisfactorily to this default notice. Although ACI has submitted a letter to the Program Manager alleging that it is entitled to additional time to complete the work, ACI has consistently refused to provide to the City appropriate substantiation of its claims. Since the City has insufficient information from the Contractor to evaluate its claims, it has to act on the information that it has. Based on the information the City has, the Contractor has failed to complete the work within the contractual timeframe and therefore the Contractor is in default of the time portion of the contract. Page 6 of 6 . Section 8.8 - Annulment of Contract, states: "If the Contractor fails to begin the Work under Contract within the time specified, or fails to perform the Work with sufficient workmen and equipment or with sufficient materials to insure the prompt completion of said Work, or shall perform the Work unsuitably, or shall neglect or refuse to remove materials or perform anew such work as shall be rejected as defective and unsuitable, or shall discontinue the prosecution of the Work, or ... from any other cause whatsoever shall not carry on the Work in an acceptable manner, the Engineer may give notice in writing to the Contractor and his Surety of such delay, neglect, or default, specifying the same, and if the Contractor, within a period of ten (10) days after such notice shall not proceed in accordance therewith, then the Board shall upon written certificate from the Engineer of the fact of such delay, neglect, or default and the Contractor's failure to comply with such notice, have full power and authority, without violating the Contract, to take the prosecution of the work out of the hands of said Contractor, to appropriate or use any or all materials and equipment on the ground as may be suitable and acceptable and may enter into an agreement for the completion of said Contract according to the terms and provisions thereof, or use such other methods as in its opinion shall seem advisable for the completion of said Contract in an acceptable manner. All costs and charges incurred by the Board, together with the costs of completing the Work under contract, shall be deducted from any monies due or which may become due said Contractor. In case the expense so incurred by the Board shall be less than the sum which would have been payable under the Contract if it had been completed by said Contractor, then the said Contractor shall be entitled to receive the difference, and in case such expense shall exceed the sum which would have been payable under the Contract, then the Contractor and the Surety shall be liable and shall pay to the Miami Beach Redevelopment Agency and/or the City the amount of said excess." Recommendations Therefore, pursuant to Section 8.8 of the Contract, the Project team recommends that the Miami Beach Redevelopment Agency Board take the prosecution of the work out of the hands of ACI and direct the appropriate City officials to take the necessary actions to prosecute the remaining work, including waiving formal bidding requirements. Further, based on the numerous difficulties created by ACI as noted above, the Project team recommends that the Miami Beach Redevelopment Agency Board omit the remaining balance of the work from the Contract with ACI pursuant to Section 9.5 of said Contract. The Commission and residents have been frustrated with the progress of this project. This action wil e str mental in allowing the City to see this project to completion. AR ov2801 IREGULARIRDA ACt Onisslon Work 2 mem.doc