Title
Approval of a Resolution Authorizing Change Orders to the Contract with Pivetta Brothers Construction for the Fones Road Improvement Project
Recommended Action
Committee Recommendation:
Not referred to a committee.
City Manager Recommendation:
Move to approve a resolution authorizing Change Orders to the Contract with Pivetta Brothers Construction for the Fones Road Improvement Project.
Report
Issue:
Whether to approve a resolution authorizing Change Orders to the Contract with Pivetta Brothers Construction for the Fones Road Improvement Project.
Staff Contact:
Jim Rioux, Project Manager, Public Works Engineering, (360) 753-8484.
Presenter(s):
None - Consent Calendar Item.
Background and Analysis:
Original Contract
On August 13, 2024, City Council approved a contract with Pivetta Brothers Construction in the amount of $13,469,491.12 for the Fones Road Improvement Project.
Olympia Municipal Code 3.16.100 states the following:
“The City Manager or the City Manager’s designee is authorized to approve change orders with a cumulative total of $350,000 or less for any project. Council approval is required for cumulative change orders totaling over $350,000 for a project, except when such approval is deemed “urgent” by the City Manager. An “urgent” change order is defined as one where delay in implementation could cause environmental or property damage or endanger public safety, as determined by the City Manager. An “urgent” determination may also be made when delays are estimated to cost the City of Olympia $1,000 or more per day.”
Change Orders
To date, seven change orders have been approved totaling $330,183.45 or 2.4% of the original contract amount.
The project team has negotiated three additional change orders with Pivetta Brothers Construction. These change orders cover all additional contract costs to date, a delay claim for lost production during underground utility installation, and additional overhead resulting from project delay.
Most of these change order costs are a result of utility conflicts. There are numerous existing public and private utilities under the Fones Road corridor. Working around existing utilities is both complex and time consuming. Incurring significant additional costs while installing new infrastructure around existing utilities on a major road corridor project like Fones Road is not uncommon. Details of the changes are in the attached change orders.
The project team has also conducted an analysis to determine anticipated additional costs that we expect from overrunning certain bid items, such as flagger hours.
The total additional compensation for the three change orders, including additional costs for anticipated bit item overruns, is $2,066,233.17.
Construction Contingency
Approximately 73% of work under this contract has been completed. The remaining amount of the original contract to be completed and paid to Pivetta Brothers Construction is $3,715,509.16
Staff is requesting that City Council authorize the City Manager to approve the attached change orders plus change order authority up to 10% of the remaining contract amount to cover future contingencies, as summarized below.
Original Contract Amount $13,469,491.12
Change Order Authority per OMC $350,000
Total Authorized Original Contract Amount $13,819,491.12
Change Orders Approved to Date $330,183.45
Change Orders Negotiated, Not Paid $2,066,233.17
10% of Remaining Contract $371,550.92
Additional Change Order Authority to Complete Project $2,437,784.09
Private Utility Conflicts
Additionally, most issues that have resulted in increased costs have been related to conflicts with unmapped and unmarked private utilities. The project team has tracked associated costs and will seek reimbursement from private utilities at the completion of the project.
Climate Analysis:
This overall project will affect the City of Olympia’s Climate Mitigation Strategies as described below.
Strategy T1: Set land use policies that support increase urban density and efficient transportation networks and reduce urban sprawl.
This project will make it easier for people living and working on Fones Road to access transit and walk or bike to destinations along the corridor, including the shopping center at the north end of it. The project will also make it easier for people to walk or bike to or from the regional trails network. The frontage improvements may stimulate new infill development, which would increase density.
Strategy T2: Increase efficiency of the transportation system.
Adding a roundabout at the south driveway of Home Depot will increase the efficiency of how the intersection operates, plus it will slow traffic while maintaining its flow. Adding pedestrian and bicycle facilities between 18th Avenue and the trail crossing will make it easier for people to walk, bike, and get to transit on 18th Avenue and Pacific Avenue.
Strategy T4: Increase the use of public transit.
All of Fones Road is within a ten-minute walk of the transit lines on Pacific Avenue or 18th Avenue. Having a safe, off-street place to walk will make it easier for people to get to and from those bus stops.
Strategy T5: Increase use of active forms of travel (such as bicycling, walking).
The new separated shared-use paths between the Woodland Trail crossing and 18th Avenue, plus the new configuration of the trail crossing, will make it safer and more inviting to walk or bike. So, too, will the decreased operating speed on Fones Road.
Strategy W1: Increase the efficiency of municipal water and wastewater infrastructure.
The water utility will rebuild the water main under the street, which will ensure its continued operation into the future. Improving stormwater and wastewater facilities along this street contributes to the City’s infrastructure needs.
Equity Analysis:
The Fones Road corridor improvements will benefit people who live and work along the corridor by creating a safer, more accessible, and more complete street. The project adds new walking and biking facilities, improves access to transit stops on Pacific Avenue and 18th Avenue, and introduces access management and a new trail crossing that are expected to reduce the likelihood of severe or fatal collisions. New lighting and landscaping will further enhance safety and make the corridor more welcoming. The surrounding area includes a higher proportion of BIPOC residents, who stand to benefit from improved transportation safety and access, as well as a nearby mobile home park that provides a source of lower-cost housing for residents with low or limited incomes.
At the same time, the project may introduce burdens related to increased attractiveness and investment in the corridor. Improvements could contribute to rising rents and increased redevelopment pressure, which may lead to economic displacement of both residents and businesses. Mobile home parks are particularly vulnerable to these types of market pressures based on national trends.
Demographic context helps shape these conclusions, even though detailed workforce data for corridor employers is limited. The area includes large retail and industrial employers, and workers in these sectors are often in lower-wage occupations. Improved walking, biking, and transit access may reduce transportation costs for some workers by decreasing reliance on private vehicles.
Overall, the project helps address long-standing disparities by improving safety and multimodal access in a census tract identified as transportation disadvantaged by the U.S. Department of Transportation. The addition of separated bike lanes, pedestrian facilities, a roundabout, crosswalk improvements, and reduced operating speeds improves safety outcomes for all users while maintaining vehicle capacity that supports regional economic activity.
Neighborhood/Community Interests (if known):
None known associated with this recommended action.
Financial Impact:
There is sufficient funding in the project budget to pay for the additional change order costs. In addition to grants, Transportation, Wastewater and Drinking Water capital funds are included in the project budget. The change orders to the current construction contract with Pivetta Brothers Construction changes the contract amount up to $2,437,784.09 for the Fones Road Improvement Project.
Options:
1. Move to approve a resolution authorizing Change Orders to the Contract with Pivetta Brothers Construction for the Fones Road Improvement Project.
2. Direct staff to revise the Resolution for a lower change order amount. The project scope may be affected, and it will be more difficult for staff to negotiate future change orders in good faith with the contractor.
3. Do not approve the Resolution to increase change order authority. The City will need to reduce the scope of the project. The final project will not meet requirements of our funding partners and the City may be required to return grant funds.
Attachments:
Resolution
Change Order 8
Change Order 9
Change Order 10
Vicinity Map