Bids for new water treatment plant rejected

There is good news and bad news for contractors interested in the city’s new water treatment plant project.

The good news is that contractors who did not toss in a bid now have that opportunity. The bad news is those who did will need to start over and compete with new bidders, or walk away.

City Manager Lance Willard said Tuesday the recent bid opening drew interest from several contractors on the five available contracts, which were for general, plumbing, HVAC, tank and electrical work.

The bids combined exceeded $13.9 million, the cut-off figure for the total estimate of $12.6 million, he said.

The city may reject bids that exceed the 10 percent threshold of the original estimate and City Council opted to do that Tuesday.

Dave Frank of Arcadis, the engineering firm designing the new plant, said the high bids were the result of increased manufacturer’s costs on specific equipment.

When the contractors realized they were going to exceed the limit they all began to pad their bids, he added.

“One thing we know for sure is the equipment estimates given to the contractors were higher than what we were given by contractors earlier this year,” he said to Councilman Bryan Blakeman, who questioned where the “disconnect” occurred with regard to pricing.

The bids were also high because some companies are busy right now and don’t necessarily need the work, he added.

“The bid climate is changing. The good news is hopefully that is a sign overall the economy is coming back up, but it is unfortunate we didn’t get this bid a year ago,” he said.

The city was halted on the project because of a delay in federal government funding. Originally, the new plant was to be constructed in 2011.

The funding was awarded last year in the form of a $10.2 million loan and $4.09 million grant through the United States Department of Agriculture (USDA) Rural Development Water and Waste Disposal Program.

It will cover a majority of the cost of the project and the 2 percent interest loan must be paid back over 40 years.

The city is currently in the process of conducting a water rate study to demonstrate to the USDA it has the ability to repay the loan, and Willard said that study should be presented by the next meeting.

The study is being done by the Ohio Rural Community Assistance Program.

Frank said now that the bids have been rejected contractors who did not bid this time around have the opportunity.

“A few others were going to participate but because of other bids they chose not to, but they have their numbers put together,” he told council.

The firm is in the process of interviewing the contractors and manufacturers to get “refreshed numbers” so they can modify bid documents that will be brought back to the table at a later date, he said.

“I think we will be ready in a couple of weeks to come back to the city with a recommendation and have the package ready for council’s approval,” he added.

The firm should have that recommendation at the Jan. 7 council meeting, he said.

A new bid opening will need to be scheduled.