Council angry after unsatisfactory bid for golf course improvements

The city found itself in a difficult lie on Wednesday and the long planned golf course project appeared to stall.

After lengthy planning with city officials and Project One, Staples Golf Design only received one contractor bid for municipal course improvements, set to start this fall. Both Staples Golf and the city council deemed this bid unsatisfactory.

The city contracted Staples Golf to design, plan and coordinate the irrigation project at Hillside Golf Course. This project includes an irrigation system, a reservoir storage area and an irrigation pumping system, with possible additions if the budget allowed.

Andy Staples of Staples Golf addressed Sidney's City Council last night to explain why the project received only one unacceptable bid and what could be done to remedy the situation.

"This isn't the position that we all thought that we'd be in," Staples admitted. "As disappointed as I am, I think this is a going to end up being a good thing."

The city asked Staples and Project One to solicit the construction of an irrigation system with a 30 year life cycle and wanted the project complete by the end of this year. Staples Golf held a pre-bid and had eight prospective contractors in attendance.

"The interest was fair," Staples said.

The only company that actually submitted a bid was Wadsworth Golf Construction Company. Its bid exceeded what Staples Golf had budgeted.

"We felt at that point that it was a little higher than what we were expecting," Staples said.

The design company was surprised that they didn't receive more bids, but believe they know why. Staples Golf asked for feedback from the president of Wadsworth and questioned if they could do anything to amend pricing. Wadsworth said its price couldn't be changed, so Staples Golf conducted a survey of additional companies to find out why they decided not to bid on the project.

"For the most part, what was resounding was that the timing of this project happened to be at the worst time for a lot of these contractors," Staples said.

Additional contractors might be more interested if they were given more time to complete the project or if the start date was later, he continued.

"One of the reasons that we thought this project would be well-timed is because we thought there would be guys who were hungry for work,” Staples said. "It turns out that not only are these guys not hungry for work, they're overloaded and could not commit to this project."

They called all the potential bidders who were present at the pre-bid. They asked these contractors what the ideal schedule would be and most agreed that mid September would be better.

"We did a lot of investigating," said Scott Bustos of Project One.

The group also wanted to determine how to minimize the risk of receiving unappealing bids a second time.

"We can't come back saying we got one bid again," Bustos said.

Wadsworth's bid for a performance bond was $128,000 while the project budget for a performance bond was $100,000. A performance bond ensures that a contractor will finish the job that they started.

"Why is that so high?" asked councilman Mark Nienhueser.

Staples explained that Wadsworth lumped other costs in with the bid performance bond, even though it was asked not to.

"You guys have problems with the way you're bidding the plans and the specifications," Nienhueser said. "Because that's not industry standard."

Nienhueser asked why $1500 per day liquidated damages was included in the specifications. This forces the contractor to pay $1500 per day for every day they go over schedule.

"Liquidated damages in November to a golf course are miniscule," Nienhueser said. "Not gonna lose many green fees in December."

The city asked the design team to include this measure, Staples said.

"Why would we care if a project's not completed, whether it's November 30 or December 30?" Nienhueser asked. "That's how you scare people away."

The rules were written this way so the project would be done before the freeze, Staples said.

Some contractors shied away from this bid because of its lack of a rock clause. The design team dug holes on the golf course so the contractors could see that there was very little rock. If the contractor agreed to this bid contract, they wouldn't be able to charge the city for rock removal.

"In irrigation, a rock clause can be hundreds of thousands of dollars," Staples said.

With the bid, the group tried to push the liability for the uncertainty of encountering rock onto the contractor rather than the city. This would limit unexpected costs to Sidney.

"Contractors like to have a rock clause in there just to cover themselves and we eliminated that," Staples said.

Nienhueser argued that trying to push liability onto the contractor would raise prices and wouldn't be beneficial in the long run.

"You're kidding yourself if you think it's not costing you anything," Nienhueser said.

Staples was adamant that the specifications were written to protect the city and so that the project would be completed in a timely fashion.

"But if you've written the plans and the specs so tight that it causes contractors to inflate their number to cover their risks, it's not protecting the city," Nienhueser argued. "It's inflating our costs and causing us higher project costs and it's scaring people off from bidding the project."

Councilman Chris Gay wondered if the project should be split between different contractors with varying specialties.

The design group agreed that the project could be separated into three portions which would be the pond, the irrigation system and the pump station. They could award these portions individually or together. This could open up the market to more contractors.

Nienhueser expressed worry about the time frame for both bidding and construction. Staples reassured the board that the design team has three weeks to put together the new bidding documents with all the necessary adjustments.

"We feel pretty good that there are guys out there waiting for this to come back out," Staples said.

Councilman Roger Gallaway was thankful that those working on the project labored to fix issues with the original specifications.

"I think the schedule is very workable," Gallaway said. "I think the recommendations they made for revisions are reasonable and should help us get much better results."

Others were not so pleased with this outcome.

"I'm disappointed that all these recommendations weren't brought up to begin with," Gay said.

The city tried to do things differently with this project, allowing Project One and Staples Golf to team up, said Sidney Mayor Wendall Gaston. He wasn't sure how well this was working out.

"I just think it's not very good at all," Gaston said.

The role that the city contracted with Project One for was mainly architect selection. It was agreed that the bidding would be done by the architect and design team and Project One would supplement that. Then Project One would oversee the construction and make sure the architect and his team stayed on task.

"It just seems very disjointed," Gaston said. "That's how I feel about it."

The design group developed a list of recommendations for how to change the project and re-bid it. They asked the board to approve a revised bid schedule. The council rejected all bids and accepted revisions to bid items and to allow new bids for items individually or as a whole.

"I think the process is now to let you guys move forward and let's try it again," Gaston said.

The new recommendations include a later start and end date, relaxation of liquid damages and the possibility of dividing the project between separate contracts.

"What I think ends up happening here is crystallizing with the city, what they're out for their contractor to do," Staples said. "If we're out to allow the contractor to have a little more flexibility, we're all more than willing to work with the city to make sure we give you guys exactly what you need."