CITY OF PORT ST LUCIE

CITY OF PORT ST LUCIE COUNCIL AGENDA MEMORANDUM Agenda Item #: 70 Meeting Date: 6/12/17 TO: VIA: Mayor and City buncil Russ Blackburn Ci y Manager David Graham, Assistant City Manager Patricia Roebling, P.E., Assistant City Manager - City En Jeff Snyder, OMB Director FROM: Cheryl Shanaberger- Director-Procurement Management Department James Angstadt, P.E., Public Works Director Agenda Item: Motion: Contract # 20160089 Milestone Construction Group, Inc. Change Order #1, additional hours - Construction Engineering Inspection (CEI) Services for Cameo Blvd. Sidewalk Construction Project, Public Works Dept. Submittal Date: 5/24/2017 STRATEGIC PLAN LINK: Vision 2030, Principle G, Convenient Mobility Options, "Sidewalks, bike paths/lanes and walkways connecting the City and neighborhoods." BACKGROUND: The original CEI contract for Milestone Construction Group, Inc. was in effect from June 28, 2016 until December 25, 2016 in the amount of $124,660.00. Amendment No. 1 to the contract extended the contract time to January 24, 2017 (thirty-one days) and added $24,990.00 for a new contract total of $149,650.00. The Contractor for the project, Marquee Development, did not complete the project within the scheduled contract time. Therefore, staff requested, as per the requirements of the Florida Department of Transportation (FDOT) Local Agency Program (LAP) Agreement that the CEI firm (Milestone) continue to provide construction oversight and documentation until the Project was complete. The City assessed liquidated damages upon the Contractor while the work continued. Council Agenda Memorandum 1/1.2

On March 24, 2017, the City terminated the Contractor's contract and the Contractor's Surety became the responsible party for completing the project. That following Monday, (March 27th) the CEI completed a safety inspection to ensure that the site was secured and safe and stopped work on the project. As this is a LAP project with FDOT, the City and FDOT then coordinated a program to continue the project to completion and certification. As of this date, the project has not been final inspected and certified. ANALYSIS: Change Order #1 provides payment for CEI Services from January 25 th through March 27 th which was beyond the time provided by Contract Amendment No. 1. The extended time and cost for CEI Services was necessary because the Contractor exceeded his contract time. This change order will increase the contract amount by $40,471.25 for a new contract total of $190,391.25 and add 61 days to the contract time for a new total of 272 days. FINANCIAL INFORMATION: Funds are available in the Road and Bridge CIP Fund, Road and Street Division, Professional Services, Cameo Blvd. Project. LEGAL INFORMATION: Reviewed by Ella Gilbert, Staff Attorney on 5/4/2017 and approved as to form. STAFF RECOMMENDATION: Approval of Change Order #1, a Time and Expense Contract #20160089 with Milestone Construction Group, Inc., in the amount of $40,741.25 for a new contract amount of $190,391.25 and add 61 calendar days for a new contract time of 272 calendar days. SPECIAL CONSIDERATION: The City will seek reimbursement from the Contractor's Surety for CEI Services which were a result of the Contractor exceeding the contract time. The Contractor was informed at the bi-weekly progress meetings and again via email that liquidated damages would start accruing January 15, 2017, however, the Contractor's production rates did not increase. Please see additional detailed information with respect to the Contractor's Surety and liquidated damages in the attached memorandum provided by the Public Works Department. PRESENTATION INFORMATION: N/A REQUESTED MEETING DATE: 6/12/2017 LOCATION OF PROJECT: The project is located on the east side of Cameo Blvd. from Port St. Lucie Blvd. north to Crosstown Parkway. ATTACHMENTS: Location Map, Change Order, Memorandum from Public Works Department, Correspondence to the Contractor & Surety. *All the attached items have been sent to the City Clerk. Any items not provided in the City Council packets are available upon request from the City Clerk. Council Agenda Memo randum V I.2

Cameo Boulevard Sidewalk Project Map produced by the Cty of Port St Lucie City Council Map Generator Website on: 11/19/2015 Scale: 0 0.2 0.4 0.8 I t t t I t t ^ mi

CHANGE ORDER No.: 1 DATE OF ISSUANCE: OWNER: City of Port St. Lucie OWNER's Project No.: 20160089 121 SW Port St. Lucie Boulevard Port St. Lucie, Florida 34984 CEI Engineer: CONTRACT FOR: Milestone Construction Group, Inc. 1391 NW St. Lucie West Blvd.; Suite 300 Port St. Lucie, Florida 34986 ENGINEER's Project # 2016-008 CEI and GEO Services on Cameo Blvd. Sidewalk Project You are directed to make the following changes in the Contract Documents. Description: City of Port St. Lucie Contract No. 20160089 Purpose of Change Order: 1. Extend Contract for CEI Services to meet FOOT reimbursement requirements on Cameo Blvd. Sidewalk after the Contractor (Marquee Development) exceeded contract time and fell into liquidated damages in accordance with Section XVI of the Contractor's Contract, entitled Termination, Delays and Liquidated Damages. All CEI costs shall be reimbursed to the City pursuant to the Contract. 2. All other contract provisions / addenda remain in full force and effect. Please see atached Document of Changes. CHANGE IN CONTRACT PRICE: CHANGE IN CONTRACT TIME: Original Contract Price Original Contract Time $ 124,660.00 180 days or date Previous Amendment No. 1 Net change from previous Amendment $ 24,990.00 31 days Contract Price prior to this Change Order $ 149,650.00 Net Increase (Decrease) of this Change Order $ 40,741.25 Contract Price with all approved Change Orders $ 190,391.25 Contract Time prior to this Change Order 211 days or date Net Increase (Decrease) of this Change Order 61 days Contract Time with all approved Change Orders 272 days or data ENGINEER: by Public Works Director

CITY OF PORT ST. LUCIE PUBLIC WORKS DEPARTMENT Accredited Agency - American Public Works Association MEMORANDUM To: From: Thru: Cheryl Shanaberger - Director of Procurement (via electronic submittal) Edith Majewski Project Coordinator James Angstadt, P.E. - Public Works Director Date: May 31, 2017 RE: Cameo Boulevard Sidewalk Project Milestone Construction Group, Inc. Contract No. 20160089 / Change Order No. 1 Additional Information with Respect to the Contractor's Surety and Liquidated Damages Construction of this project is funded through an FDOT LAP Agreement between the City and FDOT. This agreement requires that the City provide construction oversight by a qualified firm and maintain documentation showing that the project meets the state and federal requirements. Because the Contractor did not complete the work in accordance with the Contract time, FDOT and the City worked together to ensure that actions met the requirements of the LAP Agreement as well as the terms of the City's contract with the Contractor. A chronological summary of the events surrounding the surety and liquidated damages follows: January 14, 2017 - Construction contract end date. January 27, 2017 - City sent letter, by certified mail, notifying the Surety, American Southern Insurance Company, that the Contractor would be assessed liquidated damages beginning January 15, 2017 as per Section XVI of Contract #20150059 at the rate of $1,584.00 per calendar day. February 9, 2017 - Representatives from the City, Surety, FDOT and the Contractor conducted a walk-through of the site. March 24, 2017 - City and FDOT staff conducted a conference call and FDOT informed the City that the provisions of the LAP Agreement did not preclude the City from terminating the Contractor's contract and seeking the completion of the work and liquidated damages from the Surety. March 24, 2017 - The City Attorney's office sent a letter, via FedEx, to the Surety with a copy to the Contractor notifying the Surety that the City was terminating the Contractor's, Marquee Development, contract, and the City would be seeking liquidated damages. Surety received letter on March 27 th so the termination was effective on March 27 th. April 11, 2017 - The City sent a letter to the Surety requesting notification of how this project will be completed per the City's FDOT LAP Agreement. April 27, 2017 - A letter was received by the City from the Surety acknowledging that liquidated damages were being assessed. The Surety also noted that the remaining work required sod and proposed a stay on the liquidated damages until such time that sod field conditions improved (lack of rain). The Surety's letter also stated that the Surety nor its consultants were qualified to certify the project in accordance with the City's FDOT LAP Agreement. 121 S.W. Port St. Lucie Boulevard Port St. Lucie, FL 34984-5099 772/871-5177 Fax 772/871-5289 TDD Line 772/344-4222

MEMORANDUM Page 2 of 2 May 31, 2017 Cameo Boulevard Sidewalk Project Milestone Construction Group, Inc. Contract No. 20160089 / Change Order No. 1 Additional Information with Respect to the Contractor's Surety and Liquidated Damages May 3, 2017 - City staff met and requested a price quote from Milestone Construction Group to complete the certification process and close out the project per the FDOT LAP requirements. Milestone Construction Group provided a price quote of $8,000 to complete the certification process and close out the project. The $8,000 to complete the certification will be addressed under a separate change order as this work has not been completed to date. May 5, 2017 - The City responded to the Surety's request and approved the stay on liquidated damages; however, notified them that the cost of $8,000.00 to certify the project will not be waived as part of the agreed upon abatement/stay of the accrual of liquidated damages. Liquidated damages will be assessed to the Contractor for a total of seventy-two calendar days, January 15 th to March 27 th, at a rate of $1,584.00 per calendar day. This totals $114,048.00 which will be deducted from the Contractor's payments. Because this project is through the FDOT LAP, the City will only receive reimbursement from the LAP for funds payed to the Contractor. Specifically, the LAP will not pay damages to the City; however, the work will be provided to the City at a discount. After the termination of the contract with the Contractor on March 27 th, the Surety became the responsible party. For the period from March 28 th to May5 th, thirty-nine calendar days, the Surety is responsible for payment of the liquidated damages and, for that period, the damages total $61,776.00. This payment, $61,776.00, will cover the total CEI services of $48,741.25 ($40,741.25+$8,000.00) needed to complete the project in accordance with the City's LAP Agreement. The Legal Department will continue to take all necessary actions to ensure the City recovers damages from the Contractor's failure to complete the project on time. s:aprojects\sidewalks\lap sidewalks\433195-1 cameo boulevard - psl - crosstown\cameo blvd. memo to omb change order 1 for milestone- 5-31-17.doc

CITY PORT SL LUCIE Procurement Management Department January 27, 2017 American Southern Insurance Company 365 Northridge Road, Suite 400 Atlanta, GA 30350 RE: Marquee Development, Inc. Bond Number: 64860 Contract #20150059 - Cameo Blvd Sidewalk Construction Project This notice is to inform American Southern Insurance Company that Marquee Development, Inc. will be assessed liquidated damages in the amount of $1,584.00 per day beginning January 15, 2017. The project is behind schedule and was to be completed on January 14, 2017. Per Section XVI - Termination, Delays and Liquidated Damages (B): B. Liquidated Damages for Delays. If material is not provided or work is not completed within the time stipulated in this Contract, including any extensions of time for excusable delays as herein provided, (it being impossible to determine the actual damages occasioned by the delay) the Contractor shall provide to the City one thousand five hundred eighty four ($1,584.00) dollars as fixed, agreed and liquidated damages for each calendar day of delay until the work is completed. The Contractor and his sureties shall be jointly and severally liable to the City for the amount thereof The Contractor has been informed at the bi-weekly progress meetings and again via email on 1/17/2017 that liquidated damages will start accruing beginning 1/15/2017. The City is also concerned about the timely completion of Contract #20150021 for the Del Rio Blvd Sidewalk Construction project that is bonded with Fair American Insurance & Reinsurance Company, Bond #1005605-00. This project is also behind schedule. The Contractor has been notified at various progress meetings and in writing on 1/17/2017. Sincerely, Robyn Holder 121 S.W. Port St. Lucie Boulevard, Port St. Lucie, FL 34984-5099 (772) 871-5223 Fax (772) 871-7337

Page 2 Robyn Holder, CPPB Procurement Management Department Attachments: Bond #64860, notification to the Contract, Contract #20150059 Bond #1005605-00 & notification to the Contractor cc: Garnet Craig, Marquee Development, Inc. 0. Reginald Osenton, City Attorney 121 S.W. Port St. Lucie Boulevard, Port St. Lucie, FL 34984-5099 (772) 871-5223 Fax (772) 871-7337

CITY OF PORT ST. LUCIE CITY ATTORNEY'S OFFICE March 24, 2017 VIA FEDEX 8033 9440 9402 American Southern Insurance Company 365 Northridge Road, Suite 400 Atlanta, GA 30350 VIA FEDEX 8033 9440 9398 Marquee Development, Inc. Attn: Garnett Craig, President 4801 Troydale Road Tampa, FL 33615 RE: Marquee Development, Inc. Bond No.: 64860 Contract No.: 20150059 - Cameo Blvd. Sidewalk Const. Project NOTICE OF TERMINATION OF CONTRACTOR AND DEMAND /CLAIM ON SURETY FOR PERFORMANCE UNDER BOND Dear Sir or Madam: Please let this serve as formal notice that pursuant to Section XVI - TERMINATION, DELAYS AND LIQUIDATED DAMAGES, p. 32/37 of the above referenced contract, that the Contractor, Marquee Development, Inc.'s right to proceed under the subject contract is hereby terminated effective immediately. Additionally, please let this serve as notice to you, as surety, pursuant to Section 3.2 and 3.3 of the subject bond of such termination and that as Owner, the City of Port St. Lucie, agrees to pay the balance of the contract price in accordance with the terms of the contract. Further, please let this serve as additional notice of our intention to claim liquidated damages for delay up to, and including the completion date of the project, consistent with our prior January 27, 2017 and March 21, 2017 letters to you regarding same. 121 S.W. Port St. Lucie Boulevard Port St. Lucie, Florida 34984-5099 (772) 871-5294 Fax: (772) 344-4298 TDD: (772) 873-6339

American Southern Insurance Company Marquee Development, Inc. March 24, 2017 Page 2 PM/bb cc: O. Reginald Osenton, City Attorney Cheryl Shanaberger, MPA, CPPO, Director, Procurement Robyn Holder, CPPB, Manager, Procurement Roxanne Chesser, P.E., Asst. Director, Public Works 121 S.W. Port St. Lucie Boulevard Port St. Lucie, Florida 34984-5099 (772) 871-5294 Fax: (772) 344-4298 TDD: (772) 873-6339

Robyn Holder From: John Northrop <JNorthrop@natlclaim.com > Sent: Monday, March 27, 2017 11:36 AM To: Robyn Holder Cc: 'Vernon Hackett'; 'marqueedev@aol.com ' Subject: FW: Marquee Development...Bond #64860 Cameo Blvd Attachments: scans_20170327100047. pdf Robyn, Please allow this e-mail to acknowledge the City's attached Notice of Termination of Contractor on the Cameo Blvd project. (I don't believe I have the Sr Asst City Attorney Mr. Mugavero's e-mail address otherwise I would have included him) Although I am in the office today, I will be out the rest of this week, scheduled to return Monday April 3rd and will be able to respond further next week. After our conference call on March 9th, I anticipated receiving a complete list of incomplete and/or defective work on Monday 13 th the City asserts to be done along with a complete accounting of the contract. To date, neither of these updated items has been provided. Due to this notice, Marquee will not be on site at the Cameo Blvd project this week and will be focusing its efforts on the Del Rio Blvd project. Kindly understand the surety reserves all rights and defenses. Best regards, John Northrop Manager - Surety Claims and Recovery N ati l Cairn Services 16118 N Florida Ave Lutz, FL 33549 813/963-1201 877/871-8781 Toll-free 813/264-2870 Fax jnorthrop@nat1claim.com From: Bill Hattings Sent: Monday, March 27, 2017 10:03 AM To: John Northrop Cc: Tip Carroll Subject: Marquee Development John, please see attached letter we received this morning.

Bill Hattings, Vice President Surety Claims National Claim Services 365 Northridge Road, Suite 400 Atlanta, GA 30350 p 678-832-2154 f 404-892-0186 2

O _F CITY OF PORT ST. L UCIE Procurement Management Department Out LNOIN, Acr,cv.. ravnir+ii.,n Ac.:i.::azr. Nr NIGP "A City for All Ages" April 11, 2017 American Southern Insurance Company 365 Northridge Road, Suite 400 Atlanta, GA 30350 RE: Marquee Development, Inc. Bond Number: 64860 Contract #20150059 - Cameo Blvd Sidewalk Construction Project This project is funded by the Florida Department of Transportation (FDOT) through a Local Agency Program (LAP) Grant Agreement FM #433195-1-58-01. It is the City's understanding that the Surety has authorized Marquee Development to complete work on this project. This requires project oversight to certify and closeout the project by completing the required FDOT LAP forms and certifying that the entire project was built according to all plans, specifications and FDOT LAP criteria. The City would like to know what steps will be taken to ensure this project is completed as per FDOT LAP criteria. Sincerely, Robyn Holder Robyn Holder, CPPB Procurement Management Department Attachments: LAP Agreement FM #433195-1-58-01 cc: Phil Mugavero, Sr. Assistant City Attorney O. Reginald Osenton, City Attorney pi il 2015 1)A ani inner 121 S.W. Port St. Lucie Boulevard, Port St. Lucie, FL 34984-5099 (772) 871-5223 Fax (772) 871-7337

Surety Construction Consultants, Inc. Atlanta Dallas Tampa 1000 N. Ashley Drive, Suite 604 Tampa, FL 33602 813-229-3000 813-229-0102 Fax April 27. 2107 Robyn I-Iolder Procurement Management Department 121 S.W. Port St Lucie Blvd Port St Lucie. FI -. 34984-5099 Atlanta Don Cooke -70-335-3091 JO Kidwell 77 u-335-4064 Dallas Jim Hancock 214. 263-2079 Tampa Ed Hancock 813-382-1 169 Bob Golden S 13-390-7369 13111 Craft 813-390-5399 Project: Cameo Blvd Sidewalk Renovation Port St Lucie. FL Principal: Marquee Development Inc. Bond Nos.: 64860 SCC No.: 1701.01 Dear Ms. Holder: The Surety has been monitoring the work by Marquee Development Inc. (Marquee) on the punch list dated March 27.2107 as per agreement. After observation of the work being performed against the punch list and discussion with Marquee, the Surety is requesting a final walk through on the items associated with the concrete and sod placement on the project. We recently identified areas along the complete project that required some sod replacement and tie in along both sections. After removing the dying sod along the north section (park to Crosstown Pkwy) and getting the replacement. the replacement sod was as poor as the sod removed. In discussions with our sod subcontractor and other sod providers in the region. the current quality of sod is very poor due to the recent drou ght. It is anticipated that the quality of sod v ill not rebound until late June or Jul.). when the rainy season returns. Based on the above information. the surety is proposing that a stay on liquidated damages be imposed until a such time. In conjunction. the Surety is also proposin g that a second w alkthrou gh be conducted in late June or July to address the areas where the sod has died and needs to be replaced. During the stay. Marquee will continue watering as required to protect the existing sod in place. Lastly. in response to your letter of April 11. 2017. the Surety nor its consultants are qualified to certify the project for FDOT LAP grant. The Surety also does not consider that as part of its contract obligations. It is the Surety's understanding that the CFI is responsible for such certification. Please have the CLI provide the proper documentation. Cc: John Northrop. National Claims Services File

CITY OF PORT ST. LUCIE CITY ATTORNEY'S OFFICE May 5, 2017 William E. Craft, Jr. Surety & Construction Consultants, Inc. 1000 N. Ashley Drive Suite 604 Tampa, FL 33602 Dear Mr. Craft: RE: Project: Cameo Blvd. Sidewalk Renovation Port St. Lucie, FL Principal: Marquee Development, Inc. Bond No.: 64860 SCC No. 1701.01 NOTICE OF TERMINATION OF CONTRACTOR AND DEMAND/CLAIM ON SURETY FOR PERFORMANCE UNDER BOND In response to your letter dated April 27, 2017, the City of Port St. Lucie's position is as follows: 1. We will abate/stay the accrual of liquidated damages until the installation of adequate sod along the "north section (park to Crosstown Parkway"); and However, since you have confirmed that "[t]he surety also does not consider that (certification of the Project for FDOT LAP grant) as part of its contract obligations.", we need to extend the work of the City's CEI (outside consultant) through this period so that he may certify the Project as part of the FDOT LAP grant. The City's consultant has confirmed that this cost, through certification, will not exceed 88,000.00. This additional cost will not be waived by the City as part of the agreed upon abatement/stay of the accrual of liquidated damages set forth above. 121 S.W. Port St. Lucie Boulevard Port St. Lucie. Florida 34984-5099 (772) 871-5294 Fax: (772) 344-4298 TDD: (772) 873-6339

William E. Craft, Jr. May 5, 2017 Page 2 I hope this addresses the concerns set forth in your April 27, 2017 letter regarding same. This agreement will be effective upon your written confirmation/acceptance of same. If there are any questions, please feel free to contact me. PM/cs cc: O. Reginald Osenton, Esq. Cheryl Shanaberger, MPA, CPPO Robyn Holder, CPPB James E. Angstadt, P.E. 121 S.W. Port St. Lucie Boulevard Port St. Lucie. Florida 34984-5099 (772) 871-5294 Fax: (772) 344-4298 TDD: (772) 873-6339