Competitive bidding for public projects is intended to guard against favoritism and help ensure that taxpayers get the most value for their money. But Sacramento city officials say they must suspend the process for a pedestrian/bicycle bridge or risk losing $6.9 million in federal funding.
The City Council on Tuesday will consider rejecting all bids for an overcrossing planned to link the Curtis Park Village neighborhood with Sacramento City College and a Regional Transit light-rail station, suspending competitive bidding and authorizing the city manager to enter a contract with Viking Construction.
Viking Construction was the low bidder among five firms vying for the project, but its bid was challenged by the third-lowest bidder, C.C. Myers. Complying with competitive bidding requirements would necessitate a protest hearing before an arbitrator, who would make a recommendation to the City Council, a process that could not be completed in time to meet the Oct. 31 deadline for awarding the bid, said Nicholas Theocharides, the city’s engineering services manager. If the deadline is not met, the city will lose $6.9 million in federal funding for construction of the project.
Suspending competitive bidding is rare in the case of public works projects, Theocharides said. It typically occurs only when no bids or not enough bids are received, or when the bids are deemed not to be responsive to the terms of the bid advertisement.
Both city code and the city’s administrative policy provide for suspension of the process if it is deemed in the best interest of the city and approved by a two-thirds vote of the council, he said.
Construction funding for the project was allocated by the California Transportation Commission in August 2013, with the requirement that the city award the construction contract within six months. When the bids received exceeded available funding, the city rejected them all, requested a time extension from the commission, modified the plans and called for new bids.
Under state requirements, the city is permitted a one-time extension for award of the contract. The commission granted an eight-month extension in January, extending the award date to the end of October.
When the city received five bids July 30, C.C. Myers notified the city that it would file a protest if the contract were awarded to either of the two lowest bidders, Viking Construction or MCM Construction, on the grounds that those firms failed to list a specially licensed electrical contractor. Theocharides said city staff members examined the bid documents and determined that this information was missing. But when the city issued a notice of intent to award the bid to C.C. Myers, the third-lowest bidder, Viking Construction filed a protest, arguing that its bid was wrongfully rejected.
Viking Construction’s low bid of $5,836,463.65 was followed by MCM Construction’s bid of $5,872,424.50 and C.C. Myers’ $5,995,000.
At issue is whether the work to be done by the specially licensed electrical contractor constitutes more than 0.5 percent of the total cost of the construction work, Theocharides said. If it does, that subcontractor must be listed. He said Regional Transit requested a specially licensed contractor for relocation of its electrical lines. Viking stated that the portion of the electrical work for which the specially licensed contractor was required accounts for less than a half-percent of the total construction costs and therefore it was not required to list that subcontractor on bid forms.
“We said we’re not so sure, but give us a breakdown of equipment, labor and supplies,” Theocharides said. Viking provided the breakdown, showing that work done by the specially licensed subcontractor would account for less than a half-percent, he said.
“I think it’s clear we don’t have time to vet this … It’s in the city’s best interest not to lose $6.9 million,” Theocharides said.
He said the city will make sure Viking provides the specially licensed contractor as required for the electrical work.
C.C. Myers representatives did not return phone calls seeking comment on the city staff’s recommendation.
Randy Jenco, president of Viking Construction, said the city is correct in moving to contract with his firm, although he said he doesn’t recall seeing this procedure used anywhere else.
“My attorney says it is definitely within their power to do it,” Jenco said.
If the city doesn’t award the bid, it will lose the funds, no contractor will get the work and the bridge won’t be built, he said.
“If I was on the losing side, I’m not sure that I wouldn’t just walk away … I would rather have one of my competitors being busy so they’re not as hungry for the next job,” Jenco said. “I think most public agencies, if they were about to lose funds, would award the job to somebody.”
That’s the way Theocharides sees it.
“Speaking for the city staff recommendation, $6.9 million in federal funds is a very good sum of money,” he said. “This is a solid project in terms of the benefits for enhancing transit facilities in the region.”
Call The Bee’s Cathy Locke, (916) 321-5287.