GENERAL COMMITTEE
	TO:	Mayor and Members of Council
	FROM:	Alan Brown, Director of Engineering
	PREPARED BY:	Alan Brown, Director of Engineering Allan Arbuckle, Manage of Infrastructure and Capital Works
	DATE OF MEETING:	April 4, 2005
	SUBJECT:	Tender Award - Contract 018-T-05 Construction of Cachet Estates/Glenbourne Park Water Distribution System

RECOMMENDATION:

THAT Contract Tender No. 018-T-05 for the Construction of Water Distribution System for Cachet Estates and Glenbourne Park Subdivision be awarded to the low bidder, Memme Excavating Co. Ltd. in their proposed amount of $6,156,025.92 excluding GST;

AND THAT the Mayor and Clerk be authorized to execute a contract with Memme Excavating Co. Ltd. for the construction of the Cachet Estates and Glenbourne Park Subdivision water distribution systems.

AND THAT a contingency amount of $430,922 exclusive of GST be established to cover any additional construction costs and that the Director of Engineering and Treasurer be authorized to approve expenditure of this contingency amount up to the specified limit.

AND THAT staff be authorized to undertake appropriate measures as defined in the report to limit the overall project cost to a maximum value of $6,666,000 exclusive of GST.

AND THAT staff be authorized to obtain 3 proposals from qualified consulting engineering firms and select a firm in accordance with the Town’s purchasing bylaw to provide geotechnical, materials and hydrogeological testing services during construction in the upset limit amount of $65,000 exclusive of GST.

AND THAT the design budget for the project be increased by a total of $14,600 to cover the cost of services not included in the design consultant’s original terms of reference including the preparation of designs for the servicing to the Cachet Estates lots fronting onto Woodbine Avenue, peer review and water system modelling services prepared for the project.

AND THAT a contingency of $ 50,000 excluding GST be established to retain a qualified consulting firm or firms as a preferred supplier to provide specialized technical services during construction of the project and that the Director of Engineering be authorized to approve expenditure of this contingency amount up to the specified limit.

AND THAT the consulting engineering firm of Masongsong Associates Engineering Limited be retained as a preferred supplier for contract administration and construction inspection services in the upset limit amount of $138,510.58 plus GST.

AND THAT subject to receipt of the Region of York’s financial contribution and the property owner’s signed release, the Town Treasurer be authorized to issue payment to the registered owner of the lot in an amount equal to the Region’s contribution of approximately $5,790 per lot.

AND THAT funds for Contract No. 018-T-05, Construction of Water Distribution System for Cachet Estates and Glenbourne Park Subdivision be provided from the Engineering Department’s 2004 Capital Budget account # 083-5350-6135005.

AND THAT funds be borrowed to finance this project from the Life Cycle Replacement and Capital Reserve Fund, to be fully repaid with interest from the benefiting property owners assessed under Section 391 of the Municipal Act.

AND THAT upon payment of all invoices, any remaining funds in the Engineering Department’s 2004 Capital Budget account # 083-5350-6135005 for the construction of Water Distribution System for Cachet Estates and Glenbourne Park Subdivision be returned to its original funding source.

AND THAT upon completion of the project, staff report back to Council with the Fee Bylaw under Section 391 of the Municipal Act to assess the final cost and repayment terms to each of the benefiting property owners.

AND THAT the Director of Engineering report back as to sanitary servicing options and funding for the Glenbourne Park area and specifically the Angus Glen proposal to advance the sanitary sewer installation on Glenbourne Park Drive.

AND THAT staff be authorized to issue a purchase order to Masongsong Associates Limited in the upset limit of $10,000 to prepare sanitary servicing concepts and costs for Glenbourne Park Drive area and such cost be funded from the Engineering Department 2005 operating budget.

AND THAT Kees Schipper, Commissioner, Transportation and Works, for the Region of York be advised accordingly

PURPOSE:

The purpose of this report is to award the contract for the construction of the water distribution system for Cachet Estates and Glenbourne Park subdivisions.

BACKGROUND:

Well Impacts

The Region of York is undertaking an extensive dewatering program as a part of the construction of Phase II of the 16^th Avenue trunk sanitary sewer (Stone Mason Drive to Woodbine Avenue ). The hydrogeological investigations conducted by the Region indicate that the dewatering will adversely impact a number of wells in the Cachet/Glenbourne Estates subdivisions as shown on Attachment “A”. To mitigate the effects of the dewatering, the Region proposed two options:

• Before the dewatering starts, the Region proactively drill new wells or lower the pumps of those wells they have identified will be affected. During the dewatering period and recovery period (approximately 5 years), the Region will mitigate any other wells which may be affected by the dewatering process; or,
• The Region provide a cash-in-lieu contribution via the Town to the residents towards the construction of a municipal water system to service the existing lots in this area which are currently serviced by private wells subject to the receipt of a release from the impacted property owners.

In June of 2003 Council authorized staff to retain a consultant to undertake preliminary designs and cost estimates for the construction of a municipal water system to service the area and in May of 2004, staff were authorized to proceed with the detailed design of the system based on the support of residents for a construction of a municipal system funded by all benefiting property owners in the area at a cost of $129,500. Specialized engineering services related to geotechnical were also retained at a cost of $14,600 which brings the design fee to $144,100. The detailed designs for the project have been completed and tenders for the construction of the system have now been received.

Section 391 – Municipal Act

The construction of the watermain is to proceed under the provisions of Section 391 of the Municipal Act which allows a Municipality to impose a fee on property owners benefiting from the construction of a municipal service such as a watermain. This fee will be assessed on an equal basis per property and will include the total project costs including construction costs, consultant fees, engineering fees and permit costs. The preliminary cost for the construction of the water distribution system was approximately $6.0 million resulting in a cost attributable to each benefiting property owner of approximately $20,000 for the 303 lots in this area. This estimated cost was provided to area residents in May of 2004 and was supported by approximately 67% of the surveyed property owners. The residents were also advised that if the project costs were more than 10% above the estimate ($22,000) than the residents would be resurveyed for support of the increased cost.

Staff will report back upon completion of the project to finalize the project cost, confirm payment terms (i.e. 10 year term with interest or lump sum) and obtain Council’s approval of the fee by-law.

Region of York Contribution

The Region has committed a total of $1,650,000 as a part of the 16^th Avenue sewer well mitigation program to reduce the resident’s cost of installing the municipal water system in lieu of performing well mitigating measures. This contribution equates to approximately ±$5,790 for each of the 285 properties that are currently on private wells (5 lots are vacant) and is subject to the property owner signing a release. If the property owners sign a release and their well is impacted, the Region will install temporary measures such as a water tank or adjust their well intake to provide water until the municipal system is installed and operational. Upon completion of the municipal system, the Region will require the owner to connect to the watermain within 6 months. If a resident does not provide a signed release by April 21^st, 2005, the Region will undertake appropriate well mitigation measures and the financial contribution will not be available to the resident.

The Regional contribution of ±$5,790 per lot will be finalized and forwarded from the Region directly to the Town together with the signed release document. Upon receipt of this payment and documentation, the Town Treasurer will issue payment to the property owner.

Resident meetings

Meetings with area residents were held on January 11 2005 and March 9 2005 with local Ward Councillor D. Horchik, Region and Town staff to provide residents with details of the proposed Town watermain construction project and the options available from the Region regarding cash-in-lieu payments to mitigate the potential adverse impacts to their wells

DISCUSSION:

The tender for the construction of the Cachet Estates/Glenbourne Park water distribution system was issued in accordance with Purchasing By-law #2004-341. Contractors interested in constructing the project were prequalified and tenders were issued to 5 prequalified contractors on February 18th 2005. The tender was closed on March 16^th 2005 with a total of five contractors submitting bids in the following amounts adjusted to correct mathematical errors:

Contractor	Inclusive of GST and of disbursements
Mardave Construction Ltd 48 Millwick Drive Toronto, ON M9L 1Y3	$7,597,000.00
Comer Group Ltd 50 Fernstaff Crt., Unit 8 Concord, ON L4K 3L6	$6,943,205.33
Kapp Contracting Inc. 71 Buttermill Avenue Vaughan, ON L4K 3X2	$6,596,770.42
Memme Construction 1315 Shawson Drive Mississauga, ON L4W 1C4	$6,586,547.73
Clearway Construction Inc. 379 Bowes Road Concord, ON L4K 1J1	$7,481,614.98

The bids were verified for accuracy and compliance with the tender terms and conditions. Engineering, Purchasing staff and Masongsong Associates Ltd. the Town’s design consultant have reviewed the tenders submitted by the 2 lowest bidders (Memme Excavating Co. Ltd. and Kapp Contracting Inc.) and are satisfied that all terms, conditions, bid prices and specifications comply with the Town’s requirements.

CONSULTANT SERVICES:

Construction Supervision and Contract Administration Services

In June 2003, proposals were submitted by 4 consulting firms for the design and contract administration of this project. Of the four submissions, Masongsong Associates Engineering Limited was selected and Council approved funds for the design to proceed with subsequent approval of the Contract Administration portion. Masongsong Associates have provided a proposal for contract administration based on 2.25% of the project construction cost and have submitted a committed list of resources for contract administration duties. Staff are recommending that a purchase order for $138,510.28 plus GST be approved for Masongsong Associates Engineering Limited to complete the contract administration for this project as permitted by Section 7, 1) (g) of the Town’s Purchasing By-law 2004-341.

There are a number of areas within the project where high ground water levels and poor soil conditions are expected to pose significant technical challenges during the installation of the watermain. Trenchless techniques will also be employed for the watermain installation in some locations to minimize the impact to environmentally sensitive areas. To assist staff in dealing with these potentially complex issues, a contingency allowance of $50,000 exclusive of GST has been identified to retain specialized consultants on a preferred supplier basis as permitted by Section 7, 1) (g) of the Town’s Purchasing By-law 2004-341.

For quality control purposes, a specialized firm to provide geotechnical, materials and hydrogeological must be retained for testing services during construction. Staff will be soliciting proposals for this work from three qualified firms in accordance with the purchasing bylaw and have included an allowance of $65,000 exclusive of GST to cover the cost of these services.

FINANCIAL CONSIDERATIONS:

Staff recommends that the tender for the Construction of Water Distribution System for Cachet Estates and Glenbourne Park Subdivision be awarded to the lowest bidder, Memme Excavating Co. Ltd. in the amount of $6,156,025.92 exclusive of 7% GST. The total cost of constructing the project is as follows;

Item	Cost excl. GST
Construction Cost	$6,156,025.92
Construction Contingency (7%)	$ 430,922
Engineering Design Fees	$ 144,100
Contract Administration	$ 138,510.58
Geotechnical, materials & hydrogeological testing allowance	$ 65,000
Specialized technical services allowance	$ 50,000
Engineering Department project management fee @ 2.5%	$ 153,900.65
Total Project Cost	$7,138,459.15

Funding for the project will be provided by the benefiting property owners in accordance with Section 391 of the Municipal Act. The total cost of the project will be shared equally among the existing 290 property owners, and future 13 lots by Angus Glen on Cachet (303 total). In the interim funds to finance this project will be borrowed from the Life Cycle Replacement and Capital Reserve Fund. Following completion of construction, a fee by-law authorized by Section 391 of the Municipal Act will be prepared and repayment from the benefiting property owners (303 lots) will commence.

Based on the current estimated total project cost, the cost per lot to each benefiting homeowner is approximately $23,559 excluding GST or approximately $3,559 more than the original estimated cost per lot provided to the property owners and $1559 more than the upset limit committed to under the original survey.

Although Section 391 of the Municipal Act does not require resident approval for the increased assessment, as previously mentioned the Town of Markham is committed to resurvey the residents if the project cost exceed $6,600,000 or $22,000/lot. Engineering staff and the Town consultant have therefore reviewed opportunities to reduce the overall projects costs by $472,458.85 which will maintain the original estimate $6,666,000 (303 lots x $22,000/lot). Savings can be realized through the following;

• Project Design – A review of the standards and modification of the design of the project.
• Engineering Fees – reduction of the engineering departments fees
• Construction Contingency – The extent of utilization of the contingency allowance of $430,922.00 cannot be determined at this time but any under expenditure at the end of the project can be applied.

As there is sufficient opportunity to realize the $472,458.85 cost savings, staff therefore recommend the overall project cost be limited to $6,666,000 and staff be authorized to reduce costs from any or all of the above options.

CONSTRUCTION SCHEDULE

The current schedule for the project, to be finalized with the contractor, is to have this contract completed by late 2005/early 2006.

Angus Glen West Village

Angus Glen Development has filed a draft plan application for their West Village which includes 13 lots on Cachet Parkway. Angus Glen has approached staff to pursue the option of including the installation of a sanitary sewer on Cachet Parkway to service their proposed lots under our watermain contract.

In order to finalize this option Engineering staff have to first review the overall sanitary servicing for the Glenbourne area and finalize the size and depth of the Angus Glen sewer needed to service the area and not just their 13 lots. Staff therefore request approval to retain our watermain consultant on a preferred supplier basis at an upset limit of $10,000 to prepare servicing concepts, cost estimates for the sanitary servicing of Glenbourne area.

Staff will report back to Committee as to the overall sanitary concept for the Cachet/Glenbourne area, sanitary servicing options, costs for the Glenbourne area residents and recommendations as to the Angus Glen proposal.

BUSINESS UNITS CONSULTED AND AFFECTED:

The Finance and Legal Departments have reviewed this report and their comments have been incorporated.

ATTACHMENTS:

Attachment A – Location Plan

Alan Brown, C.E.T. Director of Engineering

Jim Baird, M.C.I.P., R.P.P. Commissioner of Development Services

Q:\Development\Engineering\REPORTS\2005\March\ Cachet wmTender Award doc