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Posted October 25, 2012 | 1 Comment
Strasburg awaits bids for wastewater plant project
By Alex Bridges
Construction firms interested in upgrading Strasburg's wastewater treatment plant have through Thursday to submit bids to perform the work, according to Town Manager Judson Rex, who gave an update Monday to members of the infrastructure committee.
Officials saw a high turnout of contractors and subcontractors at a recent meeting held ahead of the bid submission date, according to Rex.
"We continue to have a high level of interest in the project," Rex said. "We anxiously await those bids to see where the numbers finally come in at."
In an effort to keep the bids low, town Jay McKinley, chief operator of the facility, and staff cleaned up the site for the upgrades and moved materials from the construction area, according to Rex. Likewise, workers performed tests for lead-based paints and asbestos on the existing facility. The preliminary steps should indicate to contractors they face less of a risk going into the project and possibly lower the bid, Rex explained.
"So we're doing everything we can to make sure the bids come in competitively," Rex said.
Contractors have known about the project, one of the largest such efforts, for several years, according to Rex.
But Councilman Scott Terndrup noted that contractors likely already know a baseline amount on which they can base their bids -- the loans the town expects to receive for the project.
"They know the ... engineer's estimate and, if they've done their investigating, know how much we've been approved for," Rex said.
"So what's the competitive nature of the bid?" Terndrup asked.
"I think just knowing that it is a competitive bid and the contractor next to you could bid below that," Rex replied.
The town manager said the most recent list of interested parties who had plans developed, at a cost of $250 each, exceeded 30.
Councilman Don Le Vine asked whether Rex and other officials would look at the bids to see if a contractor hasn't just "low-balled" a price, only to come back during the project to change the price on a part of the work.
"So when we open bids on Thursday we'll list out the bids and it'll all be contingent on the full review of the bid proposal at that point," Rex said.
Terndrup expressed more concern about what contractors may charge beyond the cost estimate provided by the engineer. Rex explained the engineer bases the estimate on the cost of material and labor. As for cost to the contractor, the town likely would not know that information, according to Rex.
"So how can we differentiate between what is cost and what is just profit?" Terndrup asked.
"We can't really," Rex replied. "That's out of our purview."
Le Vine disagreed.
"It costs us X dollars and if the company can make a 50 percent profit, so be it," Le Vine said. "If they do a good job, meet all the codes and requirements, they can make as much as they can make. Our interest is only the bottom line; what final check we have to write."
"No, our interest is how much it's going to cost our taxpayers," Terndrup replied. "So if they're getting a 50 percent profit, that is our interest because these people have to pay for that."
Le Vine argued the council and the town has the responsibility of making sure the cost of the project remains as low as possible but should not interfere in the business of the contractor and how it makes a profit.
Rex noted that the bids must meet standards for the project. A contractor that bids too low runs the risk of losing money if the costs exceed that amount at no penalty to the town, Le Vine said.
"I think we know that's not the way it works, 'cause we've seen how it works -- they'll just put in an addendum and another addendum and another addendum," Terndrup said.
Town staff has the authority to approve such change orders during the course of the project construction, according to Rex and Le Vine.
"If it's just fluff that they're trying to get in there and they want more days and more money then we don't have to approve that," Rex said.
The project also comes with other safeguards for the town, such as a bond should the contractor default on the work, Rex added.
Contact staff writer Alex Bridges at 540-465-5137 ext. 125, or email@example.com