Explanation
1. BACKGROUND
This ordinance authorizes the Director of Public Utilities to enter into a construction contract with Danbert, Inc., for the Greenway Avenue Area Water Line Improvements project, CIP #690236-100100, in an amount up to $4,534,285.44, and to encumber funds with the Department of Public Service for construction administration and inspection services in an amount up to $578,664.00, for a total expenditure of $5,112,949.44. It also increases the amount of loan funding that may be sought to finance this project.
The work consists of rehabilitating approximately 10,300 linear feet of 2-inch copper, 6-inch, 8-inch and 12-inch water mains. The work will be primary performed along Greenway Avenue, Parkwood Avenue, Burt Street, Eastwood Avenue, Woodland Avenue, Rose Avenue, Gibbard Avenue, East Fifth Avenue, North Broadleigh Road, Maryland Avenue, Denver Avenue, McAllister Avenue, East Cherry Street, and English Way.
Ordinance 1107-2022, passed 05/04/22, authorized the Department of Public Utilities to seek loan funding through the Water Supply Revolving Loan Account (WSRLA) Loan Agreements, jointly administered by the Ohio EPA’s Division of Environmental and Financial Assistance (DEFA) and the Ohio Water Development Authority (OWDA), for this project and several other projects. That legislation estimated the loan amount to cover the construction cost of the Greenway Avenue Area Water Line Improvements project would be $4,200,000.00. The actual construction cost for this project per the bids received for this project is higher than the $4,200,000.00 loan amount ORD 1107-2022 authorized for this project. This ordinance seeks City Council approval to increase the loan amount that can be sought for this project to cover the entire cost of construction and any additional administration costs that may be associated with seeking and administering the loan.
The Community Area for this ordinance will be 99 - Citywide as work will be performed in 48 - Milo-Grogan, 49 - North Central, 50 - East Columbus, 57 - Mid East, and 56 - Near East.
2. ECONOMIC IMPACT/ADVANTAGES; COMMUNITY OUTREACH; PROJECT DEVELOPMENT; ENVIRONMENTAL FACTORS/ADVANTAGES OF PROJECT
The goal of this project is to replace or rehabilitate the existing water lines that have a high break frequency. Replacement of these water lines will improve water service, decrease burden on water maintenance operations, and reduce water loss. The Neighborhood Liaison(s) has been contacted and informed of this project during the design phase. Further community outreach may result through the Neighborhood Liaison Program.
3. CONSTRUCTION CONTRACT AWARD
An Invitation for Bids for the Greenway Avenue Area Water Line Improvements project was advertised on the Vendor Services and Bid Express websites from 01/04/23 through 02/01/23. Four bids were received for the project and were opened on 02/01/23. The following companies submitted bids:
Company Bid Amount Compliance Number ODI Status
Danbert, Inc. $4,534,285.44 CC-004618 MAJ
Fields Excavating $4,619,463.31 CC-005416 MAJ
Elite Excavating $5,220,344.80 CC-001064 MAJ
John Eramo & Sons $6,064,603.83 CC-004251 MAJ
The Danbert bid was deemed the lowest, best, most responsive and responsible bid in the amount of $4,534,285.44.
4. CONTRACT COMPLIANCE INFORMATION
Danbert’s contract compliance number is CC-004618 and expires 02/09/24.
Searches in the Excluded Party List System (Federal) and the Findings for Recovery list (State) produced no findings against Danbert.
5. MINORITY AND WOMAN OWNED BUSINESS ENTERPRISE & SMALL LOCAL BUSINESS ENTERPRISE PROGRAM
This contract was bid with an anticipated City of Columbus MBE/WBE Program goal of 10% as assigned by the City’s Office of Diversity and Inclusion (ODI). After ODI’s review of the Utilization Plan and other related information the contractor submitted with their bid response, ODI has approved an MBE/WBE Program goal of 10% for this contract. Failure by the contractor to meet this goal subjects the contractor to the Penalties for Non-Compliance as described in the “City’s Minority and Women-Owned Business Enterprise & Small Local Business Enterprise Program Manual” and in the bid documents for this contract.
6. PRE-QUALIFICATION STATUS
Danbert and all subcontractors have met code requirements with respect to pre-qualification, pursuant to relevant sections of Columbus City Code Chapter 329.
7. FISCAL IMPACT
A transfer of funds from the Water System Reserve Fund, Fund 6003, to the Water Supply Revolving Loan Account Fund, Fund 6011, in the amount of $4,534,285.44 is needed to fund construction for this project. This transaction is a temporary measure that is required until a loan is executed with the Ohio EPA to reimburse the Water System Reserve Fund. The loan is expected to be approved in March, 2023. An amendment to the 2022 Capital Improvement Budget will be needed to reflect more money is being borrowed for the project ($4,534,285.44) than is currently shown in the 2022 Capital Improvement Budget ($3,000,000.00). These funds will also need to be appropriated to be transferred and then appropriated after transfer to the new fund.
Funds in the amount of $578,664.00 for construction administration and inspection are available and appropriated within the Water Bond Fund, Fund 6006. An amendment to the 2022 Capital Improvement Budget is needed to align budget authority with the proper project.
Title
To authorize an amendment to the 2022 Capital Improvement Budget; to authorize the appropriation and transfer of funds from the Water System Reserve Fund to the Water Supply Revolving Loan Account Fund; to authorize the Director of Public Utilities to enter into a construction contract with Danbert, Inc., for the Greenway Avenue Area Water Line Improvements project; to authorize the appropriation and expenditure of up to $4,534,285.44 from the Water Supply Revolving Loan Account Fund for the contract; to authorize an increase in the maximum amount of a loan that can be obtained to fund the construction of this project; and to authorize the expenditure of up to $578,664.00 from the Water Bond Fund to pay for construction administration and inspection expenses for the project. ($5,112,949.44)
Body
WHEREAS, the Department of Public Utilities is engaged in the Greenway Avenue Area Water Line Improvements project; and
WHEREAS, four bids for the Greenway Avenue Area Water Line Improvements project were received and opened on 02/01/23; and
WHEREAS, the lowest, best, most responsive and responsible bid was from Danbert, Inc.; and
WHEREAS, it is necessary to authorize the Director of the Department of Public Utilities to enter into a construction contract with Danbert for the Greenway Avenue Area Water Line Improvements project; and
WHEREAS, ORD 1107-2022 authorized this project to be funded by a loan to be obtained through the Water Supply Revolving Loan Account (WSRLA) Loan Agreements in an amount not to exceed $4,200,000.00; and
WHEREAS, the construction bids all exceeded the amount authorized for the loan and it is necessary to seek City Council's approval to increase the loan amount; and
WHEREAS, the 2022 Capital Improvement Budget must be modified to align budget authority with the proper project; and
WHEREAS, it is necessary to both appropriate and transfer funds from the Water System Reserve Fund to the Water Supply Revolving Loan Account Fund in order to temporarily fund this expenditure until such time as the City receives loan proceeds from the Ohio Water Development Authority to reimburse the Water System Reserve Fund; and
WHEREAS, the City anticipates incurring certain Original Expenditures (as defined in Section 1.150-2(c) of the Treasury Regulations (the “Treasury Regulations” promulgated pursuant to the Internal Revenue Code of 1986, as amended)) with respect to the construction of the Project described in this Ordinance (collectively, the “Project”); and
WHEREAS, it is necessary to appropriate and expend funds from the Water Supply Revolving Loan Account Fund to pay for the construction of this project; and
WHEREAS, it is necessary to expend funds from the Water Bond Fund to pay the Department of Public Service for construction administration and inspection services for this project; now, therefore
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
SECTION 1. That the 2022 Capital Improvement Budget authorized by Ordinance 1896-2022 be amended as follows to establish sufficient budget authority for this project:
Fund / Project Number / Project Name (Funding Source) / Current Authority/ Revised Authority / Change
6011 / 690236-100100 / Greenway Ave. Area WL Imp’s (WSRLA Loan) / $3,000,000.00 / $4,534,285.00 / $1,534,285.00 (To match the loan amount)
6006 / 690236-100000 / Water Main Rehabilitation (Voted Water Carryover) / $1,052,941.00 / $474,277.00 / ($578,664.00)
6006 / 690236-100100 / Greenway Ave. Area WL Imp’s (Voted Water Carryover) / $0.00 / $578,664.00 / $578,664.00
SECTION 2. That from the unappropriated monies and from all monies estimated to come into said fund from any and all sources, and unappropriated for any other purpose during the fiscal year ending December 31, 2023, the sum of $4,534,285.44 is appropriated in the Water System Reserve Fund, Fund 6003, per the account codes in the funding attachment to this ordinance.
SECTION 3. That the transfer of $4,534,285.44 or so much thereof as may be needed, is hereby authorized between the Water System Reserve Fund, Fund 6003, and the Water Supply Revolving Loan Account Fund, Fund 6011, per the accounting codes in the attachment to this ordinance.
SECTION 4. That from the unappropriated monies and from all monies estimated to come into said fund from any and all sources, and unappropriated for any other purpose during the fiscal year ending December 31, 2023, the sum of $4,534,285.44 is appropriated in the Water Supply Revolving Loan Account Fund, Fund 6011, per the account codes in the funding attachment to this ordinance.
SECTION 5. That the Director of Public Utilities is hereby authorized to enter into a construction contract for the Greenway Avenue Area Water Line Improvements project with Danbert, Inc., 8077 Memorial Drive, Plain City, Ohio, 43064, in an amount up to $4,534,285.44; in accordance with the terms and conditions of the contract on file in the Department of Public Utilities; and to obtain the necessary construction administration and inspection services for this project from the Department of Public Services in an amount up to $578,664.00.
SECTION 6. That the expenditure of $5,112,949.44, or so much thereof as may be needed, is hereby authorized to pay for this contract per the accounting codes in the attachment to this ordinance.
SECTION 7. That upon obtaining other funds for the purpose of funding water system capital improvement work, the City Auditor is hereby authorized to repay the Water System Reserve Fund the amount transferred above (Section 3), and said funds are hereby deemed appropriated for such purposes.
SECTION 8. That the City intends that this Ordinance constitute an "official intent" for purposes of Section 1.150-2(e) of the Treasury Regulations, and that the City reasonably expects to reimburse itself for certain Original Expenditures incurred with respect to the Project from the proceeds of obligations to be issued by the City in a principal amount currently estimated to be $4,534,285.44 (the "Obligations").
The City intends to make a reimbursement allocation on its books for the Original Expenditures not later than eighteen months following the later to occur of the date of the Original Expenditure to be reimbursed or the date the Project for which such Original Expenditures were made is "placed in service" within the meaning of Treasury Regulations Section 1.150-2(c). Upon the issuance of the Obligations, the proceeds of such Obligations shall be used to reimburse Water System Reserve Fund, Fund 6003, which is the fund from which the advance for costs of the Project will be made.
SECTION 9. City Council approves increasing the maximum amount of a loan to be obtained from the Water Supply Revolving Loan Account (WSRLA) Loan Agreement, jointly administered by the Ohio EPA’s Division of Environmental and Financial Assistance (DEFA) and the Ohio Water Development Authority (OWDA), to finance the construction of this project from $4,200,000.00 to $4,800,000.00.
SECTION 10. Funds are hereby deemed appropriated and expenditures and transfers authorized to carry out the purposes of this ordinance and the City Auditor shall establish such accounting codes as necessary.
SECTION 11. That the City Auditor is authorized to make any accounting changes to revise the funding source for all contracts or contract modifications associated with this ordinance.
SECTION 12. That the City Auditor is hereby authorized to transfer the unencumbered balance in a project account to the unallocated balance account within the same fund upon receipt of certification by the Director of the Department administering said project that the project has been completed and the monies are no longer required for said project.
SECTION 13. That this ordinance shall take effect and be in force from and after the earliest period allowed by law.