City Council Chambers, Legislative Bldg., 745 Fourth St., Sparks, NV
General Business: 6.3
Background: The City of Sparks Council approved the original NV Energy Agreement on Aug. 22, 2011. The Franchise Agreement between the City and NV Energy requires that the City has to reimburse NV Energy for the cost of undergrounding the Overhead Power Transmission Facilities for the Prater Way Phase III Streetscape project. The original estimated cost for NV Energy to underground the power from View Street to 22nd Street along the north side of Prater Way was $454,725. This comprised of a contracted construction estimate of approximately $214,442 for undergrounding of conduits and NV Energy’s cost to install the new wiring at $240,283.
NV Energy obtained bids from three local contractors. The low bid was $299,883.28, which was over the original estimate by $85,441.28. During the course of construction multiple unforeseen issues arose with the undergrounding of the conduits. These unforeseen conditions caused change orders in the amount of $108,437.69. Staff has reviewed the change orders with NV Energy and determined the City is only responsible for $54,682.95 of these change orders. A summary of these change orders is attached for the Councils review.
The total contracted construction cost related to the City of Sparks at the end of the project was $354,566.23. NV Energy’s cost to install the new wiring was estimated $240,283 in January 2011. NV Energy’s portion of the construction did not take place until Dec. 2012 thru Feb. 2013. During this time they had an increase in labor, transportation, and overhead cost. The labor cost increase was due to negotiated contracts and increased by 7%, the transportation cost increased 14% due to fuel and maintenance and the overhead was approximately 2.35%. This equates to an additional $56,114.50 in cost over the original estimate, for a total cost of $296,397.50. The original estimated cost for the project was $454,725, with these additional construction costs the final cost of the project to the City is $650,963.73.
A Summary of the estimated project cost and actual project cost is attached for Councils review. Staff is requesting approval of $196,238.73 in additional funds for the cost of the improvements associated with the NV Energy undergrounding of the Overhead Power Transmission Facilities for the Prater Way Phase III streetscape project. Since the completion of the project, City and NV Energy staff has met on several occasions to review project costs and the responsible party for each. The additional costs as outlined above are justifiable expenses based upon staffs review.
Alternatives: 1. City Council could approve the additional cost for NV Energy Agreement for the Adjustment of Utility Facilities between the City and NV Energy as outlined by Staff. 2. City Council could reject the additional cost for NV Energy Agreement for the Adjustment of Utility Facilities between the City and NV Energy and provide direction to the City Manager.
Recommended Motion: I move to approve the additional cost for the NV Energy Agreement for the Adjustment of Utility Facilities between the City and NV Energy in the amount of $196,238.73.
Prater Way NV Energy Final Cost Summary for agenda 2-24-14.pdf
Summary for PWUG Ph 3 Contractor CO to City of Sparks.pdf