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REQUEST FOR <br />COUNCIL ACTION <br />CITY COUNCIL MEETING DATE: <br />MAY 20, 2014 <br />TITLE: <br />APPROVE CONTRACT CHANGE ORDER <br />TO ADD LOCAL STREET IMPROVEMENTS <br />TO THE EXISTING CONTRACT WITH ALL <br />AMERICAN ASPHALT, INC., IN THE <br />AMOUNT OF $1,000,000 <br />(PROJECT 146822) / <br />CITY MANAGfR <br />RECOMMENDED ACTION <br />CLERK OF COUNCIL USE ONLY: <br />APPROVED <br />❑ As Recommended <br />❑ As Amended <br />❑ Ordinance on 1' Reading <br />❑ Ordinance on 2n° Reading <br />❑ Implementing Resolution <br />❑ Set Public Hearing For <br />CONTINUED TO <br />FILE NUMBER <br />1. Approve a contract change order to add local street improvements to the construction contract <br />with All American Asphalt in the amount of $1,000,000, which increases the total estimated <br />contract to $7,786,182. <br />2. Authorize the City Manager to execute said change order in an amount not to exceed $1,000,000 <br />for construction of local streets. <br />3. Approve an appropriation adjustment recognizing $176,271 in unrecognized interest earnings on <br />Gas Tax revenue bond proceeds, transferring the funds to the Gas Tax Residential Street <br />Improvement revenue account, and appropriating the same into the Gas Tax Residential Street <br />Improvement expenditure account, which totals $1,000,000 when added to the undesignated <br />bond proceeds of $823,729. <br />DISCUSSION <br />The recommended action allows the City to commit the remaining balance of Residential Street <br />Repair bond funds principal before its expiration at the end of Fiscal Year 2013 -14. By issuing a <br />change order to the existing All American Asphalt, Inc., the contractor performing the Bristol Street <br />Improvements between 2nd and 10th Streets, the City can meet the bond issuance commitment <br />deadline and may benefit from low unit pricing for the residential street improvements. <br />In December 2007, the City leveraged gas tax revenues as debt service for a $68 million bond. The <br />funds were restricted for the purposes of rehabilitating local streets. Over the initial five years of the <br />Residential Street Repair Bond Program project, streets were rehabilitated at much lower costs. <br />Lower unit pricing from a favorable bid climate, economies of scale associated with large bid <br />quantities, and advanced construction techniques enabled the City to perform more street <br />rehabilitation work than anticipated. As a result, after each phase of construction, a balance <br />remained unexpended. The bond terms require that all proceeds be committed before the end of <br />Fiscal Year 2013 -14. <br />20A -1 <br />