HomeMy WebLinkAboutAGENDA REPORT 1994 1102 CC REG ITEM 08K ITEM a. x•
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Agenda Deport aromaAglieggaAK
City of Moorpar]c.
TO: The Honorable City Council
111,
FROM: Kenneth C. Gilbert, Director of Public Works
DATE: October 25, 1994 (Council Meeting 11-2-94)
SUBJECT: Consider Approval of an Amendment to the Contract
Requirements for Civil Engineering Services for
the Preparation of the Design for the
Reconstruction of the Spring Road Bridge.
DISCUSSION
On September 21, 1994, the City Council approved the
selection of Dwight French & Associates (DFA) to prepare the
design for the subject project. That action authorized said
work to be performed in a manner consistent with the
requirements of the Request for Proposals (RFP) , and the
Agreement set forth in the RFP, for a NOT TO EXCEED fee of
$84,443.
Paragraph F of the above mentioned Agreement requires
insurance coverage in the amount of $2 million. As stated in
the attached letter from John Whitman, President of DFA, this
fact was over looked during the preparation of their
proposal. The limits of insurance coverage normally provided
to the City and others by this firm is only $1 million. The
letter and back-up information goes on to state that the
additional cost to provide this additional insurance is
$15,000.
DFA has stated that the design fee they quoted was very
competitive and that they would be unable to provide these
design services for that fee amount if obliged to absorb
these additional costs.
The options available to the City at this point include 1)
the approval of an increase in the fee amount by $15,000, and
2) approval of a change in the insurance requirements.
RECOMMENDATION
Staff recommends that the City Council approve a revision to
the contract requirements by changing the limits of insurance
coverage from $2 million to $1 million.
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00107
I
RECEIVED
MT ? 11994DWIGHT
City Of Moorpark FRENCH
Public Works Department C ASSOCIATES
Professional Civil Engineering_
October 19, 1994
Mr. Ken Gilbert
Public Works Director
City of Moorpark
799 Moorpark Avenue
Moorpark, CA 93021
Subject: Agreement for Spring Road Bridge
Dear Mr. Gilbert:
You and Richard Hare have been helpful in resolving risk management issues in the
agreement. The level of Errors and Omissions (E & 0) insurance remains a large
problem for DFA. Attached is a letter from our insurance carrier with a quote for the
additional $1,000,000 of coverage. The premium for the first year is $15,000.00.
As I told you, Dwight French & Associates, Inc. (DFA) can not afford to go forward with
the agreement at our bid of $84,443.00 and pay the extra insurance premium. However,
we are fully prepared to go forward with the design at that price with our current
insurance coverage of $1,000,000 for Errors and Omissions insurance.
Let me make it clear that the issue arose due to my actions. Although you attached a
copy of the agreement to the RFP, I did not determine until you sent me the agreements
for signature, that you had increased your insurance coverage from $1,000,000 to
$2,000,000. Our current bridge work and all other engineering services which either DFA
or our parent company, Charles Abbott Associates, has provided for the City have been
done under a $1,000,000 E & 0 insurance coverage. By the way, all of our other
municipal clients who require E & 0 insurance require either $500,000 or $1,000,000
coverage.
As I understand the situation, there are several options, as follows:
(1) The City can disqualify our firm and engage the next qualified low bidder to
perform the services, assuming they have $2,000,000 coverage. If I
remember correctly, that option would cost the City significantly more
money as the next qualified bid was significantly more than $15,000 higher
than our bid.
00108
1470 South Valley Vista Drive, Suite 290, Diamond Bar, California 91765 riQ
■ (909) 860-3566 Fax No. (909) 860-3476 •
•
DWIGHT FRENCH & ASSOCIATES
Page Two
Mr. Ken Gilbert
City of Moorpark
October 19, 1994
(2) The City can rebid the project in hopes of receiving a lower bid. DFA's bid
was as low as you can find from an experienced firm. If we were asked to
rebid, our price would increase to include the insurance premium.
(3) The City can pay our increased premium either directly to our insurance
company or to DFA and we will go forward with the project.
(4) The City can relax their insurance requirements to $1,000,000 for E & 0
insurance and DFA will go forward with the project. You can assess your
liability from our actions on this project however, I am sure that $1,000,000
coverage would cover all situations which may arise.
Our bid was made in good faith. We want to provide these services at our bid price.
personally believe that the best option for both DFA and the City is for you to relax your
insurance requirements and let us get on with the project. I have made the appropriate
changes to the agreement and executed two copies on behalf of Dwight French &
Associates, Inc.
Please let me know the City's decision as soon as possible.
Sincerely,
DWIGHT FRENCH & ASSOCIATES, INC.
in C. Whitman
President
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00109
OT, - L8.1,941 (TUE) 16 :09 J. GREGORY BROWN 1NiG TEL:310 785 1379 P. 001
J. GREGORY BROWN & COMPANY
INCORPORATED
INSURANCE AND FINANCIAL SERVICES IWO AVENUE OF THE STARS
sulTE 460
LOS ANGELES.CALIFORNIA Y0067
TELEPHONE OW)7/04100
FACSIMILE(310)705./379
4695 MAC ARTHUR cOLIRT
SUITE 470
NENT/FORT BEACH, CALIFORNIA P2660
October 18, 1994 TELEPHONE(71i)633-7077
FACSIMILE(714)851,4107
John Whitman
Dwight French&Associates
1470 S.Valley Vista Drive,#290
Diamond Bar, CA 91765
Dear John:
In response to your inquiry on raising the limits of your policy to
$2,000,000 for the City of Moorpark project, your current carrier confirms the
following additional premiums:
Current year policy: $15,000
Next year's policy: $10,000
Once the two years'premium is paid, the coverage for this project will
become a permanent endorsement to your American Guarantee policy, providing
coverage on into the future.
If you have any further questions about this please don't hesitate to call.
Sincerely,
Earleen R. Thomas
Asst. Vice President
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