8B Consent 2017 0417 - Laserfiche WebLink

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3 From a June 2015 City of Berkeley City Council staff report: “Based on experience with the Community Workforce Agreement (CWA) in effect since January 2011, staff has identified additional costs associated with the CWA:  Construction labor costs for CWA-covered projects are approximately 5-10% higher than for non–CWA projects.  There are additional administrative costs for non-union Contractors and possibly workers on CWA projects, including initiation fees that vary between the unions and payment into the union trust fund. These costs apply to Contractors who want to utilize their non-union core workers as is permitted under the CWA, and those costs might be passed on to the City of Berkeley.  The Public Works staff cost associated with administering the agreement is approximately $500- $1,000 per project. Recent bid results suggest the CWA may decrease the number of bidders and correspondingly increase construction costs. Some contractors have indicated that they are not interested in bidding CWA projects. The impact of receiving fewer bids at higher cost due to the CWA is particularly significant in the current economic climate when the City is receiving fewer bids. Below are four recent examples: 1. FY 2014 Green Infrastructure Project: Engineers estimate - $578,426. The City received one bid for $673,131.The Contractor has not bid Berkeley CWA projects and has indicated it may not do so in the future. Without the bid, staff would have re-bid the project. Re-bidding the project would have delayed the project three months and incurred additional staff costs. 2. Potter/Bolivar Paving Project: Engineers estimate - $950,000. The City received three bids and the low bid was $828,254. The next lowest bid was $1,114,613. The low bid Contractor has not bid Berkeley CWA projects and has indicated they may not do so in the future. 3. FY 2015 Street Rehabilitation Project: Engineers estimate - $2,700,000. The City received five bids. The low bid was $2,187,475.. The Contactor’s pavement sealing subcontractor has indicated they will not agree to be bound by the CWA, and the Contractor is looking for alternatives to complete the work as bid. The Contractor and the Building Trades have looked for other contractors to complete the sealing work under the CWA. Thus far, one firm has indicated they will complete the work under the CWA, for an amount 50% greater than the $175,000 bid cost. The City informed the Contractor that they are responsible for complying with the CWA, irrespective of whether their current subcontractor chooses to do so. Discussions with the Contractor are ongoing. 4. FY 2015 Measure M Street Surface Seal Project: Engineers estimate - $1,900,000. The City received one bid from American Pavement Systems for $2,715,147. Most pavement sealing contractors have indicated they did not consider bidding the project because it is a CWA project, and may not bid CWA projects in the future. Because the bid was 42% over the engineers estimate, staff re-bid the project. To complete the project within the paving season staff removed some of the work and bid the remaining work in two bid packages, with engineer’s estimates of $753,392 and $770,999. The City received two bids for each project and the low bids were $1,024,500 and $1,017,695, or 36% and 32% over the 24