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APPROVE FINDINGS AND AUTHORIZE A PROGRESSIVE DESIGN-BUILD CONTRACT FOR THE DELTA WATER TREATMENT PLANT CAMPUS IMPROVEMENTS PROJECT (CITYWIDE)
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RECOMMENDATION
It is recommended that the City Council adopt a resolution to:
1. Approve findings pursuant to Stockton Municipal Code Section 3.68.070, which support and justify an exception to the competitive bidding process.
2. Authorize a Progressive Design-Build Contract in the amount of $1,290,632, to F&H Construction of Lodi, California for the preliminary design and development of a lump sum price proposal for the construction of Delta Water Treatment Plant Campus Improvements Project.
It is also recommended that the City Manager be authorized to take appropriate and necessary actions to carry out the purpose and intent of this resolution.
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Summary
The Municipal Utilities Department (MUD) Water Utility provides drinking water service to the northern and southern regions of the Stockton Metropolitan Area, with the California Water Service Company and San Joaquin County serving the central region.
The Delta Water Treatment Plant (DWTP), dedicated in 2012 as part of the Delta Water Supply Project, provides up to 30 million gallons per day of potable surface water from the Sacramento-San Joaquin River Delta and Mokelumne River.
The Campus Improvements Project (Project) will expand the DWTP campus to consolidate all water distribution staff & equipment, improve efficiency of treatment operations, establish a northern hub for MUD activities while improving climate resiliency, passive power generation, community engagement, and educational opportunities.
If approved by the City Council, this action will authorize a Progressive Design-Build contract (Exhibit 1 to the Resolution) with F&H Construction, to complete preliminary design and develop a lump sum price proposal for the construction of the Delta Water Treatment Plant Campus Improvements Project.
DISCUSSION
Background
In 2014, MUD staff completed an evaluation regarding the renovation and possible redesign of the outdated Water Field Office at 7400 West Lane and determined that expanding the DWTP Water Treatment Plant campus would more effectively accommodate distribution staff (30), equipment and the future operational needs of the Department.
When complete, the overall goals of the Project are to construct new facilities and upgraded infrastructure to unify all water division staff and create a northern service hub to improve utility logistics and future service operations. The Project will also add new meeting space for staff, City departments, local agencies, and the community. In addition, project objectives will provide for greater climate resiliency, passive power generation, water conservation, and educational opportunities.
On October 23, 2024, MUD staff issued a request for qualifications for firms capable of providing the required project services. Ten (10) firms submitted statements of qualifications. After reviewing the submissions and conducting interviews, staff shortlisted three (3) firms and invited them to submit proposals in response to a request for proposals (RFP).
The RFP outlined a two-phase Progressive Design-Build approach to meet Project goals and objectives. In Phase 1, the selected firm will advance the facility design to a level that supports bidding construction packages, leading to the Phase 2 lump sum or guaranteed maximum price, similar to the process used for the Delta Water Supply Project design and construction. Under a two-phase Progressive Design-Build approach, the RFP also includes an off-ramp option. If the City and the firm cannot agree on cost and schedule, the City may direct the firm to complete the design and prepare bid documents for a competitive bidding process.
MUD staff received three (3) proposals from firms in response to the RFP. A selection committee completed tours of facilities designed and constructed by each of the firms and evaluated their proposals based on the following: design/builder and key personnel
experience, construction capabilities, programming needs, architectural vision, timeline, relevant local experience, and cost. Based on these criteria, F&H Construction of Lodi, California received the highest ranking and was determined to be the most qualified firm for this Project.
Present Situation
F&H Construction submitted a Phase 1 price proposal of $1,290,632 for program management, a basis of design report, topographic and subsurface investigations, permitting and the Phase 1 design packages. The proposal also includes a first-phase lump-sum off-ramp fee to complete design, a second-phase off-ramp fee for design support during construction, and Phase 2 engineering and construction management fees, which will be set as percentages of the construction cost at the end of Phase 1.
With the execution of the contract, it is anticipated that the Phase 1 work will be conducted over the next 12 to 18 months and estimated construction of two to three years.
On April 9, 2026, the Council Water Committee reviewed a presentation of the Project and provided their support for the DWTP Campus Improvement Project.
Findings
Pursuant to the Stockton Municipal Code (SMC) section 3.68.070, the City Council may approve findings that support and justify an exception to the competitive bidding process. The following findings support and justify an exception:
1. A strict cost-competitive basis for the selection of professional services may lower the quality and thoroughness of the services provided.
2. Use of the RFP process is appropriate for this Progressive Design-Build Contract because it relies on the evaluation of professional qualifications and performance as the basis for selection of a vendor. Use of the criteria helps ensure the selection of a vendor that will provide the highest quality professional service, which is in the public interest.
3. Considering the size, complexity, and schedule requirements of the Project, the City does not have sufficient staff resources nor the expertise to design and construct a project of this size.
4. The City negotiated a contract following solicitation of competitive proposals in accordance with SMC section 3.68.070.A.3.
LOCAL EMPLOYMENT ORDINANCE
On September 1, 2009, the City Council adopted a Local Employment Ordinance requiring that 50 percent of the workforce on public works projects of at least $100,000 reside in the City of Stockton. The contract amount for this Project is more than $100,000 and subject to the Local Employment Ordinance.
COMMUNITY WORKFORCE AND TRAINING AGREEMENT
On July 26, 2016, the City Council adopted a Community Workforce and Training Agreement (CWTA). The CWTA became effective on August 25, 2016, and applies to all Public Works projects over $1,000,000 that are bid after the effective date. This Project is subject to the requirements of the CWTA.
ENVIRONMENTAL CLEARANCE
Environmental documentation is included in the preliminary design of the project. Once preliminary design is approved, staff will bring the construction contract and environmental documentation for City Council review.
FINANCIAL SUMMARY
Sufficient funds are available in FY 2025-26, project UH14014, account 6518-000-800007-600-602-00-65-000-000 for Phase 1 of the Progressive Design-Build Contract in the amount of $1,290,632. In addition, the Department will work to qualify for possible project funding through available state and federal sources.
This action has no impact on the General Fund or any other unrestricted funds.