HomeMy WebLinkAbout20 - C-3270 - Bonita Canyon Sports ParkJanuary 22, 2002
CITY COUNCIL AGENDA
ITEM NO. 20
TO: Mayor and Members of the City Council
FROM: Public Works Department
SUBJECT: BONITA CANYON SPORTS PARK, CONTRACT NO. 3270 —STATUS
REPORT AND SURETY TAKEOVER AGREEMENT
RECOMMENDATIONS:
Receive and file status report.
2. Approve Surety Takeover Agreement and authorize the City Manager to execute
the Agreement.
PROJECT BACKGROUND AND STATUS:
On May 9, 2000, the City Council awarded the $6,276,000 Bonita Canyon Sports Park
Improvements contract to Castello, Inc., of Escondido, California. The park has three
distinct use areas - East Park, Mid Park, and West Park. The contract included the
following basic park components:
(a) Three 200 -foot youth baseball fields
(b) One multi - purpose baseball /soccer field
(c) Mid Park - three mid -youth soccer fields
(d) West Park youth soccer fields
(e) East Park restroom and equipment storage facilities
(e) East Park on the site parking for 240 vehicles
(f) West Park on site parking for 115 vehicles
(f) East Tot Lot
(g) Green open spaces with earth berms, pedestrian walking trails, and lights
(g) Picnic areas
(h) West Park Tot Lot
(i) Mid Park restroom facility
Total Original Contract Amount $6,276,000.00
Change Orders to Contract: $ 568,584.45
Total Project Cost with Approved Change Orders $6,844,584.45
Current Percent Completion of Approved Contract
Payments to Castello $5,667,365
Retention (escrow) $ 325.544
$5,992,910
($5,992,910 1 $6,844,584) = 88%
SUBJECT: BONITA CANYON SPORTS PARK, CONTRACT NO. 3270 —STATUS REPORT AND TAKEOVER AGREEMENT
January 22, 2002
Page 2
CURRENT UPDATE:
In November, 2001, work on the project stopped due to financial difficulties of the general
contractor, Castello, Inc. (Castello). The park was approximately 88% complete and the
construction was scheduled for completion in February 2002 with five months of plant
establishment and maintenance to follow. The park opening was being planned for July
2002.
Through a number of meetings held in November, Castello attempted to obtain financial
assistance from the bonding company for the project, St Paul Surety. In December the
Surety rejected their request. Because of this, the City terminated the Contractor's right to
work on the project by letter on December 21, 2001, and also formally requested that the
Surety assist with completion of the project through the project bonds.
The Surety provided a draft Takeover Agreement to the City for review and comment. It
was reviewed by Public Works Staff and by the City Attorney's Office. A number of
changes were made to the Agreement and it is now ready for Council consideration and
approval. This Agreement allows the Surety to substitute themselves in place of the
original contractor, Castello, and keeps all the covenants and requirements of the original
contract the same. Per this Agreement, an agreed upon contractor will be retained by the
Surety to complete the work. The City will make all further progress payments, including
retention, to the Surety, who then will pay the completion contractor. The performance
and payment bonds of the Surety also remain in effect.
The Takeover Agreement requires that the completion contractor be retained within thirty
days of the signing of this Agreement, and the construction work be completed within 90
days of their start of work. It is now estimated that after the park construction is complete,
and after the 5 -month landscape establishment and maintenance period, the park would
open around November 2002.
Staff recommends that Council approve the Takeover Agreement and authorize the City
Manager to execute the agreement.
Respectfully su
WORKS DEPARTMENT
G. Badum, Director.
By: 4cwl
R. Gunther, P.E.
Construction Engineer
Attachment: Takeover Agreement
TAKEOVER AGREEMENT
BETWEEN
UNITED STATES FIDELITY AND GUARANTY COMPANY
AND
CITY OF NEWPORT BEACH
This is a Takeover Agreement dated
Fidelity and Guaranty Company (USF &G), a
and City of Newport Beach, (hereinafter "Obligee ").
I.
RECITALS
200_, between United States
corporation (hereinafter "Surety "),
A. On or about May 9, 2001, Obligee entered into a contract in the amount of
$6,276,000.00 (hereinafter the "Contract ") for a project known as Bonita Canyon Sports Park,
Contract No. 3270 (hereinafter "Project ") with Castello, Inc. (hereinafter "Principal "). A copy of
the Contract is attached hereto as Exhibit A (Contract). Change orders totaling $568,584.45 have
been approved to date, for a current total project amount of $6,844,584.45.
B. As required by the Obligee, Surety issued Performance and Payment Bonds
numbered KF1564 dated May 15, 2000, each bond in the amount of $6,276,000.00 (hereinafter
the "Performance and Payment Bonds ") naming Castello, Inc. as Principal and City of Newport
Beach as Obligee. The Bonds are attached hereto as Exhibit B.
C. On or about December 21, 2001, Obligee terminated Castello, Inc.'s right to
proceed with further performance of the project. Obligee has tendered completion of the balance
of the project to surety under the performance bonds.
Page 1 of 10
D. Without waiving any of the rights of its Principal or the rights of USF &G,
USF &G (Surety) has agreed to procure the completion of the Remaining Work under the
Contract subject to the terms and conditions of this Agreement.
NOW, THEREFORE, based on the mutual covenants, promises and commitments, the
exchange of valuable consideration, the receipt and sufficiency of which is acknowledged, and
based on the Recitals set forth above which form a part of this Agreement, Surety and Obligee
agree to the following terms and conditions:
II.
TERMS AND CONDITIONS
1. Recitals. The above recitals are adopted and made a part of this Agreement.
2. Incorporation of the Contract. The Contract is incorporated by reference into this
Agreement, including, without limitation, the Instructions for Bidders, the Contract Terms and
Conditions, the Plans or Drawings, and any Special Conditions and Specifications, and all
addenda, change orders and modifications to those documents issued in accordance with the
Contract.
3. The Current Contract Amount. As of the date of this Agreement, the Contract
Amount is $6,844,584.45 (hereinafter "Contract Amount "). Obligee has paid Principal
$5,667,365.98 to date and Obligee has retained $325,544.93 as retainage.
4. Surety to Procure Completion of Contract. Surety shall be responsible for
procuring the completion of the Remaining Work. Surety shall procure the performance of the
Remaining Work through one or more Completing Contractors (hereinafter "Completing
Contractor ") which it shall engage. Surety is acting as a Performance Bond Surety and not a
Page 2 of 10
Contractor. Surety shall choose the completion Contractor or Contractors with concurrence of
the Obligee.
5. Obligee's Obligations under the Contract. Except to the extent provided in this
Agreement, Obligee shall have all rights, claims, interests, obligations and responsibilities under
the Contract with respect to Surety to the same extent and effect as if Surety had executed the
Contract initially instead of Principal. Obligee's rights shall include the right of approval of sub-
contractors.
6. Obligee's Right With Respect to Changes in the Work. Obligee reserves the right,
to the extent appropriate under the Contract, to issue further change orders. The tenns of these
change orders, including the attendant extensions of time and valuation of the change order work,
shall be determined as provided in the Contract. Further, in the event the Obligee seeks the
performance of additional work which is not subject to valuation by application of the unit and /or
lump sum prices set under the Contract, it shall negotiate the appropriate value for such work
with Surety. Surety and its Completing Contractor acknowledge that time is of the essence in
this Agreement and in the Contract.
7. Schedule for Completion of Contract and New Completion Date. Surety, through
its Completing Contractor or Subcontractors, will advise the Obligee of a schedule for the
completion of the Contract. The balance of the contract work will be accomplished on a
mutually agreed upon schedule. Further, Obligee agrees: (i) to grant to Surety the full benefit of
whatever extensions of time and other associated relief, including for excusable delays, that are
appropriate under the Contract. Completion Contractor shall start work on project within 30
calendar days of signing of the Takeover Agreement. Completion Contractor to complete project
work within 90 calendar days of start of work. All other terms and conditions in the Contract
Page 3 of 10
regarding the completion of the Project, including the assessment of future liquidated damages
shall remain unchanged. Surety reserves the right to request additional extensions of time and
does not waive its right to time extensions.
8. Completing Contractors. Each Completing Contractor shall be a Contractor to
Surety and no contractual relationship pursuant to this Agreement shall exist between Obligee
and Completing Contractor. Each Completing Contractor shall provide all insurance required
under the Contract, but shall not be required to provide payment and /or performance bonds,
unless requested to do so by Surety. Surety reserves the right to terminate its contract with a
Completing Contractor at any time, subject to seven business days' prior written notice to
Obligee, and to contract with another Completing Contractor. Routine day -to -day operations and
decisions as to the manner of performance of the Contract shall be made by the Completing
Contractor, subject to the terms and conditions of the Contract, provided, however, that the
Completing Contractor must obtain Surety's written prior consent to: (i) agree to any changes in
the Contract (ii) agree to any additive or deductive change orders in excess of $5,000; (iii) agree
to any back charges or deductions of any nature; (iv) agree to any schedule changes; and (v) agree
to any adjustments in the Contract amount. The work shall be subject to inspection and
acceptance by the Obligee, as provided in the Contract. All communications concerning matters
of contract administration of the Contract (i.e., contractual or other notices required by law,
payments, change orders, extensions of time, delays, claims, among other matters) shall be
communicated to a Completing Contractor only in writing, with a copy forwarded to Surety and
Obligee on a current basis by telecopier as provided in this Agreement.
9. Payments to Surety. The remaining contract amount (including any retentions)
will be paid by Obligee to Surety as provided herein and as further set forth in the contract
Page 4 of 10
documents. Payments shall be made at the address set forth in paragraph 14 of this Agreement.
The total liability of the Surety under this Agreement and the Performance Bond for the
completion of the work under the Contract is limited to and shall not exceed the penal sum of the
Performance Bond in the amount of $6,276,000.00. All payments made by the Surety, less any
amounts paid to Surety by Obligee, for the performance of the work under the contract shall be
credited against the penal sum of the Performance Bond. It is acknowledged and understood by
the parties that any credits taken against the penal sum shall be net of any finds paid to the
Surety by the Obligee pursuant to this Agreement. Nothing in this Agreement constitutes a
waiver of such penal sum or an increase in the liability of the Surety under the Performance
Bond.
10. Payment Bond. Surety's Payment Bond under the Contract shall remain in full
force and effect according to its terms. Surety agrees to investigate all proper payment claims
made against it, but shall have the right to settle, compromise, defend, appeal, pay or dispute
such claims as it, in its sole and complete discretion, may deem appropriate. Except as required
by law, in no event shall the Obligee withhold any portion of the estimated Contract amount, on
account of claims, stop notices, liens, suits or demands by person or entities furnishing or
alleging to have furnished labor and/or materials to the Projects; provided, however, that the
Surety shall defend, indemnify and hold harmless the Obligee from any loss which may arise by
virtue of such claims, stop notices, liens, suits and demands.
11. Payment Requisitions. Surety, through its Completing Contractor or Contractors,
shall submit to Obligee the information or documentation required regarding the work performed
as set forth in the Contract.
Page 5 of 10
12. Offset. All monies due, and to become due, pursuant to the Contract and this
Agreement, including, without limitation, progress payments, payments for extra work or
additional work orders, retention, final payment for work on behalf of Surety by the Completing
Contractors, shall be made to Surety unconditionally and without offset except as set forth in this
agreement, the Contract and as allowed by law. All payments shall be made directly to Surety by
check payable to the Surety at the address stated in paragraph 14 of this Agreement.
13. Mutual Reservation of Rights. This Agreement is solely for the benefit of the
Obligee and the Surety. The Obligee and the Surety do not intend by any provision of this
Agreement to create any rights in or increase the rights of any third party beneficiaries, nor to
confer any benefit upon or enforceable rights under this Agreement or otherwise upon any one
other than the Obligee and the Surety. The Surety and the Obligee mutually reserve all rights,
claims, causes of actions, demands and defenses, known or unknown, now existing or accruing
hereafter that they have or may have against each other. It is not the intention of the Surety in
entering into this Takeover Agreement to waive, prejudice, amend, alter, revise, release or in any
way adversely affect any claim, cause of action or defense, known or unknown, that it, as Surety,
or the Principal, might have against the Obligee or any other person, party or entity.
Furthermore, it is not the intention of the Obligee in entering into this Takeover Agreement to
waive, prejudice, amend, alter, revise, release or in any way adversely affect any claim, cause of
action or defense, known or unknown, that it might have against the Surety or Principal or any
other person, party or entity. The Surety is entering into this agreement for the sole purpose of
mitigating potential damages to it and /or its Principal. The offer, negotiation and execution of
this agreement is not an admission by Surety that the Surety has any liability under the
circumstances. Nothing in this agreement or the performance of the Contract shall be deemed to
Page 6 of 10
be an admission by Surety or Castello, Inc. or a waiver of any right or defense of Castello, Inc. or
Surety.
14. Notices. All notices and correspondence to Obligee shall be sent by first class
U.S. mail, postage prepaid, with a copy by telecopier or by certified U.S. mail, return receipt
requested, to:
City of Newport Beach
Public Works Department
3300 Newport Road
P.O. Box 1768
Newport Beach, CA 92658 -8915
Attn: Bill Patapoff, P.E. City Engineer
Robert Gunther
Fax No.: 949 - 644 -3318
Phone No.: 949 - 644 -3311
All notices and correspondence to Surety shall be sent by first class U.S. mail, postage prepaid
with a copy by telecopier or by certified U.S. mail, return receipt requested to:
United States Fidelity and Guaranty Company
Bond Claims Department
Attn: Peter A. Fjellstad
P.O. Box 4689
Federal Way, WA 98003 -4689
Fax No.:
Phone No
With a copy to:
(253) 945 -1559
(253) 945 -1542
Sam Powell
St. Paul Fire and Marine Insurance Company
Construction Services Department
P.O. Box 4689
Federal Way, WA 98003 -4689
Fax No.: (253) 945 -1559
Phone No.: (253) 945 -1548
Page 7 of 10
15. No Third -Party Rights. Nothing in this Agreement shall be deemed to create any
rights in favor of, or to inure to the benefit of, any third party or parties, or to waive or release
any defense or limitation against third party claims.
16. All Claims Referred to Surety. Obligee agrees to refer all inquiries to Surety
related to payment of suppliers and Contractors on Projects.
17. Warranties. It is understood and agreed that upon completion of the Project the
Surety and Completing Contractor shall be responsible for any warranty obligations as set forth
in the Contract.
18. Agreement Binding on Successors. This Agreement shall be binding upon the
successors and assignees of Surety and Obligee.
19. No Modification Except in Writing. This Agreement cannot be modified except
in a writing signed by all Parties.
20. Conflict Among Documents. In case of conflict between the provisions of this
Agreement and the provisions of the Contract and/or Performance and Payment Bonds, the
documents in this following order shall control: (1) this Agreement; (2) Performance and
Payment Bonds; and (3) the Contract. Further, this Agreement, the Contract and the
Performance and Payment Bonds constitute the entire agreement between Obligee and Surety
and, together, supersede all prior negotiations, representations, offers, other writings and oral
statements of every description.
21. Law Applies and Dispute Resolution. This Agreement and the perforniance under
this Agreement, shall be governed by, and construed in accordance with, the laws of the State of
California and that, in any suit, action, or proceeding that may be brought arising out of, in
Page 8 of 10
connection with, or by reason of this Agreement, the laws of the State of California shall be
applicable and shall govern to the exclusion of the law of any other forum. The parties agree that
any dispute arising out of, or related to this Agreement, shall be resolved by litigation. The
exclusive venue for that litigation or any suit, action or proceeding shall be the courts located in
the State of California.
22. No Waiver. The failure of either party to exercise in any respect a right provided
for in this Agreement shall not be deemed to be a subsequent waiver of the same right or of any
other right unless expressly agreed to by the party in writing.
23. Severability. The invalidity or enforceability of any particular provision of this
Agreement shall not affect the other provision of this Agreement and the Agreement shall be
construed as if the invalid or unenforceable provisions were omitted.
24. Additional Documents. The parties agree to execute, acknowledge and deliver
such other instruments, releases or documents as may be reasonably necessary to carry out or
fulfill each party's covenants and obligations under this Agreement.
25. Survival of Warranties. All representations and warranties made in this
Agreement shall survive the execution and delivery of this Agreement and the consummation of
the transaction contemplated thereby.
26. Counterparts. This Agreement may be executed in any number of counterparts
each of which when executed and delivered shall be deemed to be an original with all
counterparts constituting but one and the same instrument. The execution of this Agreement by
any parties hereto will not become effective until counterparts hereof have been executed by all
parties. The parties executing this Agreement hereby represent and warrant that they are properly
authorized to bind the respective party.
Page 9 of 10
27. Construction. The Obligee and Surety have been represented by counsel who
have materially participated in the authorship of this Agreement, it being understood that the rule
of construction that a written agreement is construed against the party drafting or preparing such
agreement shall not specifically be applicable to the interpretation of this Agreement.
WHEREFORE, Surety and Obligee have executed this Agreement by their authorized
representatives.
DATED: United States Fidelity and Guaranty Company
By:
Its and lawfully
authorized representative
DATED: City of Newport Beach
ATTEST:
APPROVED AS TO FORM:
LOM
tkover1205.doc
By:
Its and lawfully
authorized representative
Page 10 of 10
CITY OF NEW1 JRT BEACH
CONTRACT CHANGE ORDER
CONTRACT NO. 3270
PROJECT TITLE: Bonita Canyon Sports Park
CONTRACTOR: Castello, Inc.
ENCUMBRANCE NO.: E043404
ORIGINAL CONTRACT: $6,276,000.00 18- Oct -01
� ?EW POR
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°7tiFOaN�P
CHANGE ORDER: 26
PAGE: 1 OF 1
CCO SUMMARY COST: $ 537,068.07
CCO TOTAL IN % 8.56%
COMPLETION DATE: 29- Nov -01
CHANGE REQUESTED BY: City of Newport Beach CO. TYPE: Lump Sum
DESCRIPTION: Modifications to tree planting, slopes and seed materials.
following changes are hereby incorporated into the project plans and specifications :
1 INCREASE tDECREASE 1
1) Provide and install additional soil for added berms in westpark.
As per attached 9/19/01 proposal. 11,250
2) Increase the seed rate of Ballfield 1A mix from 12 # /1000SF to 15 # /SF
as per attached 9/17/01 proposal. 3,477
3) Provide additional screening trees in south Westpark per attached proposal. 1,375
4) Provide additional screening trees in mid Westpark per attached proposal. 2,310
5) Provide and install jute neting for mid park slope to
control erosion of soil. Per attached proposal. 4,770
IN CONTRACT TIME 5 WORKING DAYS
contractor, have given careful consideration to
NETCHANGE 23,182.86
proposed and hereby agree, if this
is approved, that we will provide all equipment, furnish all material, except as may otherwise be noted above, and
perform all services necessary for the above specified work, including field and home office expense and will accept
as full payment therefor the prices shown above.
ACCEPTED, DATE: J Ai - a —O
BY: t' -O�L
APPROVAL RECOMMENDED:
CONTRACTOR: Castello, Inc.
TITLE:
CONSTRUCTION ENGINEER
DATE: /`Vaz /o
APPROVED: l � � DATE: �L7L)2lF)I
CITY ENGINEER �—
CITY OF N LWPORT BEACH
PROGRESS PAYMENT
CONTRACT NO. 3270
PROJECT: Bonita Canyon Sports Park
BUDGETNUMBER:
See Below
ORIG. CONTRACT:
56,276,000.00 EXTRAS: $568 ,584.45
ENCUMB. NO.
E043404 %OFTOTAL 9.060/6
COMPLEnON DATE:
15-Ocl -01
o� rEa Poq\.
t
R
PAYMENTNO.: 17
PAGE: I OF 1
DATE 02- Nov -01
TOTAL $6,644,584.45
Send Payment to. AMOUNT EARNED:
Castello, Inc. RETENTION:
4S0 Co poratc Drive PREVIOUS PAYMENTS:
Escondido, Gl 91029 -1507 AMOUNT DUG
CONTRACTOR DATE CONSTRUCTION ENGINEER
r i
y ,6, - PU BLIC NrORKS DI RECTOR
55,992,910.91
5325,544.93
S5,461,743.56
1205;622.13
!�
DATE
DATE
DESCRIPTION EST.AM
UNITS
BIDPRICE
AMT. COMP.
AMT.EARNED
1
Base Bid
I
LS
5,996,000.00
93.9092%
55,454,098.36
2
West Park Tol Lot
)
LS
65,000.00
21.6397%
14,065.61
3
Mid Park Restroom
1
LS
215,000.00
82.18615
176,700.01
Subtotal
5,644,864.20
Change Order #1 Earthwork /Subdrains
1
LS
532,000.00
100115
32,000.00
Change Order #2 Time Extension
1
LS
$0.00
100%
0.00
Change Order #3 Sewer Work
1
LS
$11,298.75
100%
11,295.75
Change Order #4 Change SD Piping
1
LS
($9,996.00)
100%
(9,996.00)
Change Order #5 Mod to Sidewalks
I
LS
(543,504.45)
100%
(43,504.45)
Change Order #6 Storm Drain Mod
1
LS
$1,700.16
100%
1,700.16
Change Order #7 Water Main Abandon
1
LS
$5,500.00
100%
5,500.00
Change Order #8 Delete T -Patch Paving
1
LS
(53,856.00)
100%
(3,856.00)
Change Order 99 Sewer Extra Work
1
IS
523,509.55
100 °5
23509.55
Change Order #10 Grading Import Material
1
LS
$6,108.00
100%
6,109.00
Change Order # 11 Irrigation Pipe Revisions
I
LS
($101,870.00)
SO%
(51,496.011)
Change Order '12 Electrical Connections
1
LS
2,892.00
100%
2,592.00
Change Order #13 Install services
1
LS
60,458.95
100 °5
60,458.95
Change Order #14 Modify Outlet Structure
1
IS
7,311.30
100%
7,311.30
Change Order #15 Epoxy Irrg Mstr Valves
I
LS
7,16930
100%
7,16930
Change Order #16 Bleacher Changes
1
LS
14,370.40
100%
14,370.40
Change Order #17 Tennis/ Basketball Courts
1
IS
113,000.00
70%
79,100.00
Change Order #18 Sleeving/conduit /hangei
1
LS
10,717.24
100%
10,717.24
Change Order #19 Storm Drain Repairs
1
LS
9,765,04
100%
9,765.04
Change Order #20 Irrigation Modifications
1
IS
6,462.00
100%
6,462.00
Change Order #21 Copper Ciickets
1
LS
7,142.00
100%
7,142 .00
Change Order #22 Planting Mod
1
LS
3,927.00
100%
3,927.00
Change Order #?7 Add Westpark OS
1
LS
336,603.70
45%
151,471.67
Change Order #24 Weed Kill / Paint Poles
1
LS
7,357.00
100°0
7,357.00
Change Order #25 Fertilizer / Stakes / AC+
1
LS
5,819.27
100 °o
5,819.27
Change Order #26 Add Berm, +Seed, +Trees
1
LS
23,182.86
60%
13,909.72
Change Order #27 Tennis & B -Ball Court Ad
1
LS
31,516.35
60%
15,909.83
E043404 Account Number,.
7441 - 04120434 S2ly3,622. 11
7532- C4120434 $0.00
7021 - 6112(1434 $0.00
7531 - 6600292 Soot)
Total $22211
Send Payment to. AMOUNT EARNED:
Castello, Inc. RETENTION:
4S0 Co poratc Drive PREVIOUS PAYMENTS:
Escondido, Gl 91029 -1507 AMOUNT DUG
CONTRACTOR DATE CONSTRUCTION ENGINEER
r i
y ,6, - PU BLIC NrORKS DI RECTOR
55,992,910.91
5325,544.93
S5,461,743.56
1205;622.13
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