HomeMy WebLinkAbout2005-25873 Reso
RESOLUTION NO.
2005-25873
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY
OF MIAMI BEACH, FLORIDA, AUTHORIZING THE ADMINISTRATION TO
CONTINUE WITH THE CONSTRUCTION SCOPE OF WORK OF THE
POOL PORTION OF THE NORMANDY ISLE PARK AND POOL PROJECT,
INDEPENDENTLY FROM THE PERFORMANCE BOND CLAIM TO THE
ST. PAUL GUARDIAN INSURANCE COMPANIES, REGOSA
ENGINEERING'S SURETY COMPANY; AND APPROPRIATING $561,269
FROM THE NORTH BEACH QUALITY OF LIFE FUNDS, AND UP TO
$558,149 FROM THE PARKING FUNDS.
WHEREAS, pursuant to approval by the voters ofthe $15 Million General Obligation
Bond for the improvements to the City's parks on November 8, 1994, the City entered into
an Agreement with The Corradino Group, Inc. (the AlE Consultant) to provide architecture
and engineering services for the Normandy Isle Park and Pool Facility Improvements (the
Project); and
WHEREAS, the Project was extensively reviewed by the community during the
programming and design phases; and
WHEREAS, based on analysis ofthe projected demographic data ofthe region, and
in order to upgrade the quality of services being offered to the community, the
Administration and the AlE Consultant re-evaluated the scope highlighted in the Master
Plan, approved on June 19, 1996, and re-defined the Project to a more comprehensive
aquatic facility consisting of a pool with an aquatic play structure, and a four (4) lane lap
pool with night-swimming-quality lighting; and
WHEREAS, the Project also included construction of new restrooms and shower
facilities, multi-purpose activity building, outdoor trellis shade areas, and a concession
building; and
WHEREAS, also included were a new pedestrian promenade to traverse the length
of the park; new landscaping and irrigation, including a buffer between the park and the
adjacent residential neighborhood; a new multi-purpose court; a decorative perimeterfence
with new entry gate features; on-street parking; and sidewalk improvements; and
WHEREAS, on September 1, 2000, Invitation to Bid No. 136-99/00 was issued for
construction of the Project; and
WHEREAS, from the 1,128 vendors that were notified, the City's Procurement
Department received requests for plans and specifications, but the three lowest responsive
bids had significantly exceeded the available funding of $2,381 ,206, of which $2,175,000
was allocated for hard construction costs, $89,000 for ADA improvements, and the
remaining balance of $117,206 for fixtures, furnishing and equipment (FF&E), signage,
playground equipment, and special inspection fees; and
WHEREAS, on January 31,2001, the Mayor and City Commission rejected all bids
and on February 21, 2001, upon recommendation of the Administration, the City
Commission adopted Resolution No. 2001-24279, to issue Request for Proposal No. 21-
00/01 for the construction of the Project (the RFP); and
WHEREAS, on March 20, 2002, the Mayor and City Commission adopted
Resolution No. 2002-24800, awarding the construction of the Project to Regosa
Engineering, Inc. (Regosa), as the successful proposer pursuant to the RFP; the City
subsequently entered into a contract for construction with Regosa, in the amount of
$2,264,000 (Contract); and
WHEREAS, additional funds were appropriated to complete the construction:
$89,000 for ADA improvements and on-street parking improvements, and $300,000 to
complete funding for the hard construction costs of the aquatic facility, the ramps and
walkways, the perimeter fence, and the pool night swimming and security lighting; and
WHEREAS, some of the Project components, such as the multi-purpose court,
soccer field renovations, and site landscaping and irrigation, were not funded at the time;
and
WHEREAS, Notice to Proceed, essentially the commencement of construction
activities, was issued to Regosa on June 9,2002; and
WHEREAS, since the commencement of construction, several delays related to
coordination, unforeseen conditions, and deletions arose; and
WHEREAS, the Administration tried to work with Regosa, including the issuance of
a unilateral deductive change order to remove the park portion of the Project from the
scope of work, and reviewing a recovery plan and schedule to accelerate the completion of
the pool portion of the Project; and
WHEREAS, finally, pursuant to Article 8.8 of the Contract, on May 5, 2004, the City
Engineer issued a Notice of Default, and on June 9, 2004, the City Commission adopted
Resolution No. 2004-25595, accepting the Certification of Default issued by the City
Engineer; and
WHEREAS, this Resolution also authorized the City Manager to enter into any
agreements for the completion of work, as long as funding had been appropriated for the
work; and
WHEREAS, also included in the June 5, 2004 Resolution was the authorization for
the City to invoke the performance bond as a result of Regosa's default; and
WHEREAS, on June 16, 2004, Regosa and its surety, The St. Paul Guardian
Insurance Companies (the Surety), were given formal written notification that the
prosecution of work for the Project was removed from Regosa and a specific demand
against the Performance Bond was made; and
WHEREAS, Regosa demobilized from the site as of July 15, 2004; and
WHEREAS, the Administration and its consultants held meetings in the remainder of
2004 with the Surety to reach an understanding of the existing conditions and to agree on
the decisions to complete the Project; and
WHEREAS, the construction documents submitted to the Surety included a report
recommending a course of action for all the non-conforming work identified by the AlE
Consultant; the contour grading plan, produced by comparing the existing conditions data
from the survey performed on the park portion of the Project against the plans'
requirements; and the existing construction documents, marked with the pending scope;
and
WHEREAS, on December 9, 2004, in response to a second notice of demand to
honor the claim, the Surety acknowledged receiving all the documents; and
WHEREAS, on January 21 , 2005, the Surety responded that it would complete the
Project through a completing contractor and under a full reservation of all rights and
defenses under the Contract and bond; and
WHEREAS, on February 3,2005, CIP Staff, the City's Program Manager, URS, and
the AlE Consultant's representatives met at the site, with the construction consultant
(Qualex) representing the Surety; and
WHEREAS, a walk-through and a subsequent meeting were held, with the intention
to determine the content of the Invitation-To-Bid (ITB); and
WHEREAS, on March 18,2005, the Surety again stated that it continued to move
forward with performing diligent investigation to uphold its obligations under the bond; and
WHEREAS, in addition, per the Surety's request, the City forwarded a list of the
JOC Program Contractors to be included in the list of contractors invited to participate in
the ITB; and
WHEREAS, on April 6, 2005, Qualex advised that the ITB package was being sent
to the Surety on April 8, 2008, with the intention to advertise the ITB for three weeks and
schedule a price submittal by May 2, 2005; and
WHEREAS, at the time of the default, Regosa's contract balance was $1,198,820;
and
WHEREAS, since then, costs have been incurred related to the discussions with the
Surety, including clean up of the site, and additional work by the AlE Consultant to provide
submittals to the Surety, and additional work by URS; and
WHEREAS, these costs total approximately $235,000; and
WHEREAS, the City will be making a claim against the Surety for these costs; and
WHEREAS, in the meantime, the costs have been paid out ofthe Project, leaving a
balance of $963,820; and
WHEREAS, in order to complete the Project, whether with the Surety or if the City
were to resume construction independent of the Surety, there will be additional soft costs;
and
WHEREAS, the construction administration services for the AlE Consultant and field
observation services for URS will have to be extended; and
WHEREAS, there will be additional CIP Office fees and Art in Public Places fees
needed as well; and
WHEREAS, at this time, these soft costs are estimated to be approximately
$200,000; and
WHEREAS, these fees and services are being deducted from the balance of the
Contract, leaving a balance of $763,820; and
WHEREAS, if negotiations with the Surety do not conclude successfully and in an
appropriate timeframe, the Administration would like to be in the position to resume the
construction with a replacement contractor, and to pursue remedies with the Surety
independently; and
WHEREAS, the Administration has submitted the same construction documents and
information to a Job Order Contracting (JOC) Program contractor to independently price
the pool portion of the Project; and
WHEREAS, the construction cost, if the City were to independently complete the
construction with a JOC contractor, is $1,549,990; and
WHEREAS, also, a 20% Project contingency is budgeted, as the existing condition
of the Project is uncertain at best; and
WHEREAS, due to the poor performance of Regosa, there may be work that needs
to be demolished and redone by a new contractor; and
WHEREAS, the estimated construction cost is $1,883,238, including 20%
construction contingency and JOC coordination fee; and
WHEREAS, the remaining funding in the Project is $763,820; and
WHEREAS, the anticipated additional funding to complete the Project is $1,119,418;
and
WHEREAS, $561,269 is available from the North Beach Quality of Life Funds and
$558,149 is available from the Parking Funds; and
WHEREAS, once the City is reimbursed for its costs, the Parking Funds are to be
repaid first; and
WHEREAS, the City still will invoke the performance bond with the Surety, but
because the result of that effort will not be known for some time, the Administration would
need to appropriate the additional funding in advance and determine a settlement amount
later, similar to the effort to procure a replacement contractor on the Citywide Water and
Sewer Pump Station Upgrades Project; and
WHEREAS, the City will continue negotiations with the surety during the bidding
process; and
WHEREAS, by appropriating the funding identified above, it is anticipated that
mobilization can occur in early June 2005, and that construction would last approximately
300 days (or into April 2006); and
WHEREAS, the Administration would cease the ITB with the Surety in a timely
manner if it appeared that the Project could not be mobilized by that point, and resume
construction with the JOC Contractor; and
WHEREAS, the City would seek its full remedies under the law against the Surety
and Regosa for any and all costs incurred to finish the Project.
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City
Commission hereby authorize the Administration to continue with the construction Scope of
Work of the pool portion of the Normandy Isle Park and Pool Project, independently from
the performance bond claim to the St. Paul Guardian insurance Companies, Regosa
Engineering's surety company; and appropriate $561 ,269 from the North Beach Quality of
Life Funds, and up to $558,149 from the Parking Funds.
PASSED and ADOPTED this 20thday of April, 2005.
ATTEST: .
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: "R' b rt P h FORM & LANGUAGE
CITY CLERK ..0 e arc er & FOR EXECUTION
T:\AGENDA\200!:j\Apr2005\Regular\Pool - Appropriation Reso.cJoc
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~ Date
David Denner
CITY OF MIAMI BEACH
COMMISSION ITEM SUMMARY
m
Condensed Title:
A Resolution Authorizing The Administration To Continue With The Construction Scope Of Work Of The Pool Portion Of The
Normandy Isle Park And Pool Project, Independently From The Performance Bond Claim To The St. Paul Guardian Insurance
Com anies, And A ro riatin $1,119.418 To Provide Sufficient Fundin To Com lete The Pro'ect.
Issue:
Shall the City Commission appropriate funding to complete the Pool portion of the Normandy Isle Park and Pool project
independent from the Performance Bond Claim to the Surety for the former contractor?
Item Summary/Recommendation:
On September 1 , 2000, Invitation to Bid No. 136-99/00 was issued for the construction of the Normandy Isle Park and Pool project.
On January 31, 2001, the Mayor and City Commission rejected all bids due to them coming in over budget and subsequently
issued a Request for Proposal (RFP) for the construction of the Project. On March 20, 2002, the City Commission awarded the
construction of the Project to Regosa Engineering, Inc. Some of the project components, such as the multi-purpose court, soccer
field renovations, and site landscaping and irrigation, were not funded at the time. Notice to Proceed, essentially the
commencement of construction activities, was issued on June 9, 2002.
Since the commencement of construction, several delays related to coordination, unforeseen conditions, and deletions arose, The
Administration tried to work with Regosa, including the issuance of a unilateral deductive change order to remove the Park portion
of the Project from the Scope of Work, and reviewing a recovery plan and schedule to accelerate the completion of the Pool
portion of the Project. Finally, on May 5, 2004, the City Engineer issued a Notice of Default, which the City Commission certified
on June 5,2004. Also included in the June 5, 2004 Resolution was the authorization for the City to invoke the performance bond
as a result of Regosa's default. On June 16, 2004, Regosa and its Surety, The St. Paul Guardian Insurance Companies (the
Surety), were given formal written notification that the prosecution of work for the Project was removed from Regosa and a specific
demand against the Performance Bond was made. Regosa demobilized from the site as of July 15, 2004, On January 21,2005,
the Surety responded that they will complete the Normandy Isle Pool project through a completing contractor and under a full
reservation of all rights and defenses under the Contract and Bond, The Surety plans to advertise an Invitation to Bid (ITB)
package for three weeks and schedule a price submittal by May 2, 2005,
If negotiations with the Surety do not conclude successfully and in an appropriate timeframe, the Administration would like to be in
the position to resume the construction with a replacement contractor, and to pursue remedies with the Surety independently. The
Administration has submitted the same construction documents and information to a Job Order Contracting (JOC) Program
contractor to independently price the pool portion of the Project. The construction cost, if the City were to independently complete
the construction with a JOC contractor, is $1,549,990. There are other costs that need to be considered if the City is to proceed
with the construction on its own. Also, a 20% project contingency is budgeted, as the existing condition of the project is uncertain
at best. Additional funding in the amount of $1,119,418 would be needed to complete the project with a replacement JOC
Contractor, The City would seek its full remedies under the law against the Surety and Regosa Engineering for any and all costs
incurred to finish the Proiect.
Advisory Board Recommendation:
INA
Financial Information:
Finance Dept.
$ 558,149
$ 561,269
$1,119.418
2% Resort Tax Unallocated Funds
To Be Determined
Approved
Source of
Funds:
Ci Clerk's Office Le islative Trackin
M. Alexandra Rolandelli
City Manager
!
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ITEM R1l
DATE3-.)O....OS
CITY OF MIAMI BEACH
CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH, FLORIDA 33139
www.miamibeachfl.gov
To:
From:
Subject:
COMMISSION MEMORANDUM
Mayor David Dermer and Date: April 20, 2005
Members of the City Commission
Jorge M. Gonzalezt,.<- /~
City Manager -0
A RESOLUTIO f OF THE MAYOR AND CITY COMMISSION OF THE CITY
OF MIAMI BEACH, FLORIDA, AUTHORIZING THE ADMINISTRATION TO
CONTINUE WITH THE CONSTRUCTION SCOPE OF WORK OF THE
POOL PORTION OF THE NORMANDY ISLE PARK AND POOL PROJECT,
INDEPENDENTLY FROM THE PERFORMANCE BOND CLAIM TO THE
ST. PAUL GUARDIAN INSURANCE COMPANIES, REGOSA
ENGINEERING'S SURETY COMPANY; AND APPROPRIATING
$1,119,418 AS FOLLOWS TO PROVIDE SUFFICIENT FUNDING TO
COMPLETE THE PROJECT: $558,149 FROM 2% RESORT TAX
UNALLOCATED FUNDS; AND $561,269 FROM A FUNDING SOURCE TO
BE DETERMINED.
ADMINISTRATION RECOMMENDATION:
Adopt the Resolution.
FUNDING:
The City has received $558,149 from the 2% Resort Tax collections from Fiscal Year 2004
above and beyond the amount projected and budgeted, This funding is unallocated and
available for use on this project.
The balance of the necessary funding ($561,269) can be funded from one ofthe following
sources:
. Parking Enterprise Funds
. North Beach Quality of Life Uncommitted Funds
The Administration is seeking the Commission's direction on which funding source to use
to fund the balance of this project.
ANAL YSIS:
Pursuant to approval by the citizens of the $15 Million General Obligation Bond for the
improvements to the City's parks qn November 8, 1994, the City contracted with The
Corradino Group, Inc. (the Consultant) to develop the plans and specifications for the
Normandy Isle Park and Pool Facility Improvements (the Project), The Project was
extensively reviewed by the community during the programming and design phases.
Commission Memorandum
Normandy Isle Park and Pool Project - Appropriation to complete the pool portion of the Project
April 20, 2005
Page 2 of 5
Based on analysis of the projected demographic data of the region, and in order to
upgrade the quality of services being offered to the community, the Administration and the
City's Consultant re-evaluated the scope highlighted in the Master Plan, approved on June
19, 1996, and re-defined the program to a more comprehensive aquatic facility consisting
of a pool with an aquatic play structure, and a four (4) lane lap pool with night-swimming-
quality lighting. The Project included construction of new restrooms and shower facilities,
multi-purpose activity building, outdoor trellis shade areas, and a concession building. Also
included are a new pedestrian promenade to traverse the length of the park; new
landscaping and irrigation, including a buffer between the park and the adjacent residential
neighborhood; a new multi-purpose court; a decorative perimeter fence with new entry gate
features; on-street parking; and sidewalk improvements,
On September 1, 2000, Invitation to Bid No. 136-99/00 was issued. From the 1,128
vendors that were notified, the City's Procurement Department received 37 requests for
plans and specifications, but the three lowest responsive bids had significantly exceeded
the available funding of $2,381,206, of which $2,175,000 was allocated for hard
construction costs, $89,000 for ADA improvements, and the remaining balance of
$117,206 for fixtures, furnishing and equipment (FF&E), signage, playground equipment,
and special inspection fees.
On January 31,2001, the Mayor and City Commission rejected all bids and on February
21, 2001, upon recommendation of the Administration, the City Commission adopted
Resolution 2001-24279 to issue a Request for Proposal (RFP) for the construction of the
Project. This method of procurement allowed the Administration to do two things: negotiate
with the prospective proposers if the new proposals were above the City's available funding
and prioritize the construction of the Project per component, in the event the value
engineering process alone was unsuccessful addressing costs, without the drastic
elimination of essential architectural features and programs.
On March 20, 2002, the City Commission adopted Resolution 2002-24800, awarding the
construction of the Project to Regosa Engineering, Inc., pursuant to the Request for
Proposal No. 21-00/01, in the amount of $2,264,000; and appropriated additional funds to
complete the construction. Some of the project components, such as the multi-purpose
court, soccer field renovations, and site landscaping and irrigation, were not funded at the
time. Notice to Proceed, essentially the commencement of construction activities, was
issued to Regosa Engineering, Inc. ("Regosa") on June 9, 2002,
Since the commencement of construction, several delays related to coordination,
unforeseen conditions, and deletions arose, The Administration tried to work with Regosa,
including the issuance of a unilateral deductive change order to remove the Park portion of
the Project from the Scope of Work, and reviewing a recovery plan and schedule to
accelerate the completion of the Pool portion of the Project. Finally, pursuant to Article 8.8
of the City's Agreement with Regosa, on May 5, 2004, the City Engineer issued a Notice of
Default, and on June 9, 2004, the City Commission adopted Resolution 2004-25595,
accepting the Certification of Default issued by the City Engineer. This action also
Commission Memorandum
Normandy Isle Park and Pool Project - Appropriation to complete the pool porlion of the Project
April 20, 2005
Page 3 of 5
authorized the City Manager to enter into any agreements for the completion of work, as
long as funding had been appropriated for the work,
Also included in the June 5, 2004 Resolution was the authorization for the City to invoke
the performance bond as a result of Regosa's default. On June 16,2004, Regosa and its
Surety, The St. Paul Guardian Insurance Companies (the Surety), were given formal
written notification that the prosecution of work for the Project was removed from Regosa
and a specific demand against the Performance Bond was made. Regosa demobilized
from the site as of July 15, 2004.
The Administration held meetings in the remainder of 2004 with the Surety to reach an
understanding of the existing conditions and to agree on the decisions to complete the
Project. Regosa; The Corradino Group (Corradino), the Architect-of-Record; and URS, the
City's Program Manager, were also participants in these meetings. Per the Surety's
request, the CIP Office forwarded all documentation related to the Project and gave
responses to all inquires. The Construction Documents submitted to the Surety included a
report recommending a course of action for all the non-conforming work identified by the
Architect; the contour grading plan, produced by comparing the existing conditions data
from the survey performed on the park portion of the Project against the plans'
requirements; and the existing construction documents, marked with the pending scope.
On December 9,2004, in response to a Second Notice of Demand to honor the claim, the
Surety acknowledged receiving all the documents, On January 21, 2005, the Surety
responded that they will complete the Normandy Isle Pool project through a completing
contractor and under a full reservation of all rights and defenses under the Contract and
Bond. On February 3, 2005 CI P Staff, URS and Corradino representatives met, at the site,
with the construction consultant (Qualex) representing the Surety. A walk-through and a
subsequent meeting were held, with the intention to determine the content of the I nvitation-
To-Bid (ITB). On March 18, 2005, the Surety again stated that they continued to move
forward with performing diligent investigation to uphold its obligations under the bond. In
addition, per the Surety's request, the City forwarded a list of the JOC Program Contractors
to be included in the list of Contractors invited to participate in the bid process.
On April 6, 2005, Qualex advised that the ITB package was being sent to the Surety on
April 8, 2008 with the intention to advertise the ITB for three weeks and schedule a price
submittal by May 2, 2005.
At the time of the default, Regosa's contract balance was $1,198,820, Since then, costs
have been incurred related to the discussions with the Surety, including clean up of the
site, and additional work by the Architect to provide submittals to the Surety, and additional
work by the Program Manager. These costs total approximately $235,000, The City will be
making a claim against the Surety for these costs. In the meantime, the costs have been
paid out of the project, leaving a balance of $963,820.
Commission Memorandum
Normandy Isle Park and Pool Project - Appropriation to complete the pool portion of the Project
April 20, 2005
Page 4 of 5
In order to complete the project, whether with the Surety or if the City were to resume
construction independent of the Surety, there will be additional soft costs. The
Construction Administration services for the Architect and Field Observation services for
the Program Manager will have to be extended. There will be additional CIP Office fees
and Art in Public Places fees needed as well. At this time, these soft costs are estimated
to be approximately $200,000. These fees and services are being deducted from the
balance of Regosa's contract, leaving a balance of $763,820,
If negotiations with the Surety do not conclude successfully and in an appropriate
timeframe, the Administration would like to be in the position to resume the construction
with a replacement contractor, and to pursue remedies with the Surety independently. The
Administration has submitted the same construction documents and information to a Job
Order Contracting (JOC) Program contractor to independently price the pool portion ofthe
Project. The construction cost, if the City were to independently complete the construction
with a JOC contractor, is $1 ,549,990. Also, a 20% project contingency is budgeted, as the
existing condition of the project is uncertain at best. Due to the poor performance of the
prior contractor, there may be work that needs to be demolished and redone by a new
contractor.
JOC Construction Proposal
JOC Coordinating Fee
20% Construction Contingency
Total Estimated Construction Costs:
$1,549,990
$ 23,250
$ 309.998
$1,883,238
Less Remaining Funding:
($ 763,820)
Additional Funding Needed:
$1,119,418
The additional funding needed is anticipated to complete the project. Of course, the City
still will invoke the performance bond with the Surety, but because the result of that effort
will not be known for some time, the Administration would need to appropriate the
additional funding in advance and determine a settlement amount later, similar to the effort
to procure a replacement contractor on the Citywide Water and Sewer Pump Station
Upgrades project.
By appropriating the funding identified above, it is anticipated that mobilization can occur in
early June 2005, and that construction would last approximately 300 days (or into April
2006). The Administration would cease the ITB with the Surety in a timely manner if it
appeared that the project could not be mobilized by that point, and resume construction
with the JOC Contractor. The City would seek its full remedies under the law against the
Surety and Regosa Engineering for any and all costs incurred to finish the Project.
Commission Memorandum
Normandy Isle Park and Pool Project - Appropriation to complete the pool portion of the Project
April 20, 2005
Page 5 of 5
CONCLUSION:
The Administration recommends that the Mayor and City Commission adopt the resolution,
and authorize the Administration to proceed with the completion of the pool portion of the
Normandy Isle Pool project if the construction commencement will be significantly delayed
past June 2005. The Administration is also recommending that the Mayor and City
Commission appropriate $558,149 from the 2% Resort Tax collections from Fiscal Year
2004, and appropriate $561,269 from another funding source as outlined above, to provide
sufficient funding for the completion of construction of the pool portion of the Normandy
Isle Park and Pool Project.
T:\AGENDA\2005\Apr2005\Regular\Pool - Appropriation Memo.doc