Resolution No. 80511 RESOLUTION NO. 8051
2
3 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
VERNON APPROVING AND AUTHORIZING THE EXECUTION OF A
4 CONTRACT FOR DETAILED ENGINEERING, PROCUREMENT,
5 CONSTRUCTION AND STARTUP FOR THE MALBURG GENERATING
STATION PROJECT BY AND BETWEEN THE CITY OF VERNON
6 AND SCOTT COMPANY
7
8 WHEREAS, the City of Vernon ("City") is proceeding at this
9 time to develop a 134 MW Combined Cycle Power Plant officially named
1.0 the Malburg Generating Station (the "Malburg Project") for the purpose
11 of installing additional generating capacity that will yield an
12 efficient, cost-effective, and reliable source of electric generation
13 to the City of Vernon's constituents; and
14 WHEREAS, City staff has determined that it needs the services
15 of a consultant to provide detailed engineering, procurement,
16 construction ("EPC") and startup services for the Malburg Project; and
17 WHEREAS, between June 21, 2001 and November 14, 2001, the
18 Utilities Department sent out questionnaires to potential bidders, in
ig order to ascertain their interest in the EPC contract,' and to pre-
20 qualify a certain pool of prospective bidders; and
21 WHEREAS, the Utilities Department received nine (9)
22 responses; and
23 WHEREAS, on February 15, 2002, the Utilities Department sent
24 out a Request for Proposals ("RFP") for the EPC contract; and
25 WHEREAS, responses to the RFP were received from the
26 following entities: Scott Co., University Marelich Mechanical,
27 ARB/Black & Veatch, and TIC/BiBB/Kiewitt; and
28 WHEREAS, the City's Project Engineer, Carter -Burgess, had
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lestimated the cost of the EPC to be significantly less than any of the
Jbids received; and
WHEREAS, the Utilities Department rejected all bids and
contacted all of the responders to inquire about their willingness to
enter into negotiations regarding the EPC contract price; and
WHEREAS, thereafter, the Utilities Department was authorized
to enter into exclusive negotiations with Scott Co., the lowest
responsible bidder, in order to lower the bid price; and
WHEREAS, on July 24, 2002, the .City Council of the City of
Vernon adopted Resolution No. 8032 approving an interim Letter
Agreement with Scott Co. to proceed with the development and completion
of the engineering design and drawings for the Malburg Project while
the EPC contract was being negotiated, so that there would be as little
confusion as possible regarding the interpretation of the contract
specifications; and
WHEREAS, Scott Co. and Vernon entered into negotiations
between July 24, 2002 and August 14, 2002 regarding the EPC contract;
and
WHEREAS, the Utilities Department has determined that the
Scott Company, also known as Scott Co. Industrial Contractors, the
Scott Companies, Inc. and Scott Co. of California (collectively
"Scott"), a firm specializing in Industrial Construction Services,
could provide the lowest overall package price meeting the Department's
specifications and requirements; and
WHEREAS, the Utilities Department has prepared and submitted
on August 14, 2002, a Staff Report detailing the services that will be
provided by Scott under the EPC contract and the costs of these
services; and
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WHEREAS, by letter dated August 14, 2002, Bruce V.
Malkenhorst, City Administrator/City Clerk, recommended that the
contract with Scott be approved and executed; and
WHEREAS, Scott was the lowest responsible bidder who bid on
the EPC RFP, and has lowered its original price; and
WHEREAS, the City Council of the City of Vernon has
determined that, pursuant to the provisions of subsection (a) of
Section 2.27 of the Vernon City Code, it is in the public interest and
necessity to enter into an EPC contract with Scott setting forth the
terms and conditions of the services to be performed for the Malburg
project to enhance services provided to the Vernon community.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF VERNON AS FOLLOWS:
SECTION 1: The City Council of the City of Vernon hereby
finds and determines that the recitals contained hereinabove are true
and correct.
SECTION 2: The City Council of the City of Vernon hereby
approves the EPC Contract with Scott, a copy of which is attached
hereto as Exhibit "A" and made a part hereof.
SECTION 3: The City Council of the City of Vernon hereby
authorizes the Mayor and the City Clerk to execute said Contract for,
and on behalf of, the City of Vernon.
SECTION 4: The City Council of the City of Vernon hereby
directs the City Clerk, or his designee, to send one fully executed
Agreement to:
Scott Company
Attn. Steve Klaus, Project Manager
14920 S. San Pedro St.
Gardena, CA 90248
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SECTION 5: The City Clerk of the City of Vernon shall
certify to the passage of this resolution, and thereupon and
thereafter the same shall be in full force and effect.
APPROVED AND ADOPTED this 4th day of September, 2002.
ATTEST:
BRUCE V. MALKENHORST, City Clerk
EONIS C. BUR Mayor
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STATE OF CALIFORNIA )
ss
COUNTY OF LOS ANGELES )
I, BRUCE V. MALKENHORST, City Clerk of the City of Vernon, do
hereby certify that the foregoing Resolution, being Resolution No.
8051, was duly adopted by the City Council of the City of Vernon at a
regular meeting of the City Council duly held on Wednesday,
September 4, 2002, and thereafter was duly signed by the Mayor of the
City of Vernon.
(SEAL)
BRUCE V. MALKENHORST, City Clerk
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SUPPORTING
DOCUMENTS
EXHIBIT
AM"
SEE BINDER FOR COMPLETE CONTRACT WITH APPENDICES
CONTRACT
FOR
DETAILED ENGINEERING, PROCUREMENT, CONSTRUCTION,
and STARTUP
FOR THE
MALBURG GENERATING STATION PROJECT
VERNON, CALIFORNIA
August 14, 2002
EPCContract 0_8_14.doc
CONTRACT
Table Of Contents
Page
1.
GENERAL
2
A
Scope of Work
2
B
Definitions.........................................................
2
2.
RISK OF LOSS .......................................................
8
3.
CONTRACT PRICE AND PAYMENTS .................
8
A.
Contract Price
8
B.
Payment Schedule
8
C.
Invoices
9
D
Form and Content
10
E.
Payment
10
F.
Failure to Achieve Progress
10
G.
Payments Withheld
10
H.
Retainage
11
1.
Payments Not Acceptance of Work
11
4
NOTICE TO PROCEED
11
5.
CHANGE ORDERS ................................
1 I
A.
General
I
B.
Change Work Authorization
12
C.
Unauthorized Changes
12
D.
Effect on Schedule and Warranties and Guarantees
12
E.
Payment Procedure
12
6.
BONDING REQUIREMENTS
13
7.
PRE-EXISTING SITE CONDITIONS .....................
13
8.
LAWS AND REGULATIONS ...................
13
9.
INSPECTION.......................................................
14
10.
FORCE MAJEURE.................................................
14
it.
DELAYS/SUSPENSION..........................................
14
12.
WARRANTIES......................................................
15
A.
General
15
B.
Warranty Period
15
C.
Remedy of Defects
15
D.
Survival of Warranties
16
E.
Extent of Warranties and Guarantees
16
F.
Prevention
16
G.
Assignment of Warranties and Guarantees
16
13.
INFORMATION FURNISHED TO AND BY THE CITY
16
14.
INFORMATION FURNISHED TO CONTRACTOR
16
A.
Access to Confidential Information
16
B.
No Disclosure
17
C.
Court Ordered Disclosure
17
D.
Remedies
17
15.
TECHNICAL DATA ................................................
17
16.
PATENTS.............................................................
17
17.
CANCELLATION/DEFAULT......................................
18
A.
Termination
18
B.
Contractor's Breach
18
C.
City's Breach
18
18.
ASSIGNMENT.......................................................
18
19.
PARTIAL INVALIDITY ............................................
19
20.
CHOICE OF LAW ...................................................
19
21.
INSTALLATION/FIELD SERVICES ...........................
19
22.
INDEMNIFICATION AND INSURANCE .....................
19
EPCContract_0_8_ 14.doc it
A.
Indemnity
19
B.
Insurance
19
23.
NON -WAIVER ......................... ......... .............---
20
24-
AMENDMENTS.....................................................
20
25.
ENTIRE AGREEMENT .............................................
20
26.
BENEFIT OF AGREEMENT ......................................
20
27.
FORUM SELECTION ...............................................
20
28.
COUNTERPARTS...................................................
20
29.
NOTICES..............................................................
21
30.
INDEPENDENT CONTRACTOR ................................
21
31.
CONTRACTOR NOT AGENT ....................................
21
32.
REVIEW OF EXISTING CONDITIONS ......................
22
A.
Premises
22
B.
Verification of Existing Conditions
22
C.
Statement of Fact
22
33.
SUPERVISION BY CONTRACTOR ............................
22
A
Management of Work
22
B.
Control of Work
23
34.
GOVERNMENTAL REGULATIONS AND TAXES ......
23
A.
Permits and Licenses
23
B.
Laws and Regulations
23
35.
LIQUIDATED DAMAGES .........................................
24
A.
Delays
24
B.
HP Steam Loss
24
C.
Liquidated Damage Payment
24
D.
Sole Remedy
24
36.
MAXIMUM AGGREGATE LIQUIDATED DAMAGES
24
37.
PERFORMANCE GUARANTEES ................................
24
A.
Performance Guarantees
24
B.
Noise Emissions
25
C.
Auxiliary Power Limit
25
D.
HP and LP Steam line Pressure Loss
25
E.
Obligations of the Contractor
25
F.
Corrective Action
25
G.
Standards for Plan of Corrective Action
25
38.
LIMITATION OF LIABILITY ....................................
25
A.
25
B.
26
39.
DISPUTE RESOLUTION ....................................
26
40.
ENVIRONMENTAL PROTECTION ............................
26
A.
Qualified Personnel
26
B.
Material
26
C.
Compliance with Laws
26
D.
Hazardous Materials Removal
27
E.
Environmental Indemnity
27
F.
Material Safety Data Sheets
27
G.
Suspension and Notification
27
41.
LABOR AND MATERIALS .......................................
28
A.
General
28
B.
Employment of Licensed Personnel
28
C.
Assignment of Individuals
28
D.
Material
28
E.
Start up Spare Parts and Special Tools
28
F.
Quality Control Program
29
G.
Testing
29
H.
City's Right to Inspect
29
EPCContract_0_8_ 14.doc i i i
APPENDIX
Page
Appendix 1 Specification for Combined Cycle Power Plant 31
Appendix 2 Project Control Requirements for Contract 32
Appendix 3 Unconditional Waiver & Release Upon Final Payment 36
Appendix 4 Insurance Schedule 40
Appendix S Miscellaneous 42
EPCContract_0_8_ 14.doc iv
CONTRACT
THIS CONTRACT is made, entered into and executed in duplicate originals, either
copy of which may be considered and used as the original hereof for all purposes, as of this
, 2002, in the City of Vernon, County of Los Angeles,
BY AND BETWEEN THE CITY OF VERNON
4305 Santa Fe Avenue
Vernon, CA 90058
AND
Contractor SCOTT COMPANY
14290 South Pedro
Gardena, CA 90248
RECITALS
WHEREAS, the City of Vernon ("City") has completed the development of a
Combined Cycle Power Plant (hereinafter, the "Project") for purposes of installing additional
generating capacity within the City that is capable of yielding cost effective, efficient and reliable
electricity to meet its goals, while meeting Federal, State and local environmental and siting
requirements; and
. WHEREAS, City has sought proposals for the detailed engineering, procurement,
construction and startup of a combined cycle power plant to create the Project; and
WHEREAS, Contractor submitted a proposal to City dated April 29, 2002 for the
equipment and services defined herein; and
WHEREAS, City's Utilities Department has determined that the construction of the
Project and the purchase of the equipment and services from the Contractor will assist City in
meeting its electricity goals and is in the public interest; and
WHEREAS, Contractor has advised City that it is qualified to perform such services
under this Contract
NOW, THEREFORE, THE PARTIES HERETO DO MUTUALLY AGREE AS SET FORTH
HEREIN:
EPCContract_0_8_ 14.doc I
1. GENERAL
The Contract shall consist of the following:
Purchase Order
The terms and conditions as set forth in this Contract
Appendix "1" Specification for Combined Cycle Power Plant
Appendix "2" Project Control Requirements for Contract
Appendix "3" Unconditional Waiver & Release Upon Final Payment
Appendix "4" Insurance Schedule
Appendix "5" Miscellaneous
All Appendices are attached hereto and incorporated by reference as though fully set forth
herein. To the extent that there are any conflicts between the terms of the Appendices and the
teens and conditions set forth below, the terms and conditions set forth herein shall prevail.
The above order of precedence shall prevail in the event that there is a conflict or
inconsistency among the documents that comprise the Contract.
A. Scope of Work
The Project shall consist of the detailed design and engineering, balance of plant equipment
supply, and installation of a "two on one" natural gas fired combined cycle power plant as
defined in Appendix 1.
B. Definitions
AFC
Application for Certification to the California Energy Commission
AQMD
Shall mean the South Coast Air Quality Management District.
Beneficial Use
Shall mean that the Contractor has completed the Work (including
commissioning requirements) and the plant is ready for the
Stability and Performance Testing by the City and the City has
provided a Notice of Acceptance.
Best Efforts
Shall mean those efforts which a skilled, competent, experienced,
prudent contractor would use to perform the requirements of the
Contract in a timely manner exercising the degree of professional
skill, care, competence, and prudence customarily imposed on a
contractor performing similar services for similar electric utility
projects. For the purposes of the Contract, a timely manner shall
mean strict adherence to the milestone schedule dates.
Business Day
Shall refer to normal business days at the City of Vernon, Monday
through Thursday, excluding legal holidays.
Bid Shall mean the offer or proposal of the Bidder submitted on the
prescribed forms setting forth the price or prices for the Work to be
performed.
EPCContract_0_8_ 14.doc 2
Bidder Shall mean all Parties approved to bid on the RFQ Package as
determined by the City.
Change Order Shall mean a design or field Change Order or Amendment to this
Contract, signed by City's Representative, authorizing an addition,
deletion or revision in the Work or an adjustment in the Schedule or
any change to the Contract Price resulting therefrom.
City Shall mean the City of Vernon, a California Municipal Corporation.
City or Owner's Shall mean that individual designated by City, who shall have the
Representative responsibility and authority specifically delegated to such
individual by City and made known in writing to Contractor.
Combined Cycle Power Shall mean the complete Malburg Generating Station units 1,2 & 3
Plant generating units and the auxiliaries and controls as required to
produce a complete and operable power station as defined by the
Specification, Appendix 1.
Contract Shall mean this Contract and all of the Appendices, as such
Contract and Appendices now exist and as they may be hereafter
amended from time to time.
Contract Price Shall mean that price specified in Section 3 of the Contract that is
the total amount payable by City to Contractor for the Work to be
performed hereunder.
Contractor's Project Shall mean that individual designated by Contractor who shall be
Manager responsible for the performance of the Work, be authorized to
execute Change Orders and to act on behalf of Contractor and its
Subcontractors.
Commercial Operation Shall mean the successful completion of all Emissions Tests and
Performance Tests and acceptance of the Combined Cycle Power
Plant for dispatch by the City.
Commissioning Shall mean the services and craft work required to check out all
mechanical, electrical and control systems and subsystems and
declare the System ready for its Stability Test after Mechanical
Completion.
Contract Documents Shall mean the Purchase Order, the terms and conditions asset forth
in this Contract, Appendix 1 Specification for Combined Cycle
Power Plant, Appendix 2 Project Control Requirements for
Contract, Appendix 3 Unconditional Wavier & Release Upon Final
Payment, Appendix 4 Insurance Schedule, and Appendix 5, the
Proposal Farm
EPCContract 0 8 14.doc
3
Contract Time Schedule Shall mean the period during which Contractor will be required to
deliver, erect, commission, and startup the System under this
Contract.
Contractor Shall mean Scott Company, (Scott), its legal representatives,
successors, and assigns.
Contract Drawings Shall mean all drawings, diagrams, illustrations, schedules, and other
data which are specifically prepared by or for the Contractor to
illustrate some portion of the Work and all illustrations, brochures,
standard schedules, prepared by a supplier and submitted by the
Contractor to illustrate material or equipment for some portion of the
Work.
Day Shall mean a calendar day and shall include Saturdays, Sundays
and holidays, except that, in the event that an obligation to be
performed under this Contract falls due on a Saturday, Sunday or
legal holiday in the State of California, the obligation shall be
deemed due on the next business day.
Defects or Deficiencies Shall mean materials and workmanship that do not conform to
Contract Drawings and/or specifications, are of inferior
workmanship, or will materially and adversely affect the performance
of the Work.
Defective Work Shall mean work that is unsatisfactory, damaged, faulty, deficient,
does not conform to the Contract, or does not meet the requirements
of any inspection, reference standard, test or approval referred to in
the Contract.
Delaying Event
Emissions Test
Engineer or City's
Engineer
Equal
Shall mean a delay in the performance of the Work caused by City
or an event of Force Majeure.
The purpose of the Emissions Tests will be to demonstrate that the
unit meets the emissions guarantees for the specified fuel, i.e. natural
gas. The Emissions Tests will also serve as a compliance test to
demonstrate that the Combined Cycle Power Plant complies with all
guaranteed emissions limits as specified in the HRSG Contract
between the City of Vernon and Alstom Power.
Shall mean Carter & Burgess, Inc.
Shall mean equal as determined by the City.
EPCContract 0 8 14.doc
4
Environmental Law Shall mean any federal, state, regional or local law, regulation,
decision of the courts, ordinance, rule, code, order, directive,
guidelines, permit or permit condition, currently existing or as
amended, enacted, issued or adopted in the future, which relates in
any way to worker or workplace safety, environmental conditions,
environmental quality or policy, health and/or safety issues or
concerns (including product safety). Environmental Law includes,
without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended (42 USC,
Section 9601 et. seq.), the Resource Conservation and Recovery
Act (42 USC, Section 6901 et. seq.), the Carpenter -Presley -Tanner
Hazardous Substance Account Act (California Health & Safety
Code, -Section 25300 et. seq.), the California Hazardous Waste
Control Law (California Health & Safety Code, Section 25100 et.
seq.), the Occupational Safety and Health Act (29 USC § 651 et.
seq.), the California Occupational Safety and Health Act
(California Labor Code § 6300 et. seq.), and any regulations or
rules promulgated thereunder.
Final Payment Shall mean the last payment of the remaining Retainage after the
Contractor has fulfilled all the obligations defined in this Contract.
FOB Jobsite Shall mean when the conveyance has stopped next to the off-loading
area at the Jobsite.
Force Majeure Shall have the meaning set forth in Section 10 herein.
Jobsite Shall mean the location of Station A at 2715 East 50th Street,
Vernon, CA 90058.
Generating Hours Shall mean operating the Combined Cycle Power Planttogenerate
electricity electrical grid from minimum to maximum load as
defined in Appendix 1, Part 1.
Government Agency Shall mean any federal, state or local government agency or other
public body having the mandate, authority or power to implement,
coordinate, administer or enforce an Environmental Law.
Governmental Rules Shall mean all laws, regulations, orders, decrees, conditions of any
franchise, license, permit or other authorization issued by a
governmental authority, and decisions of courts and governmental
agencies.
EPCContract 0 8 14.doc
Hazardous Materials Shall mean any chemical, substance, material, controlled substance,
object, conditions, solid or hazardous waste or combination thereof
which is or may be, hazardous to human health or safety or the
environment due to its radioactivity, ignitability, corrosivity,
reactivity, toxicity, or other harmful or potentially harmful
properties or effects. Hazardous Material include, without
limitation, oil or petroleum and petroleum products, asbestos and
any asbestos containing materials, radon, polychlorinated biphenyls
(PCBs), urea formaldehyde insulation, lead paints and coatings, and
all of those chemicals, substances, materials, controlled substances,
objects, conditions and waste or combinations thereof which are
now or become in the future listed, defined or regulated in any
manner by any federal, state or local Environmental Law.
Laws and Regulations; Shall mean laws, rules, regulations, ordinances, codes, and/or
Laws or Regulations orders defined in the AFC.
Material Shall mean all materials, machinery, equipment, construction
equipment, supplies, and items, as described in the Contract and
necessary to successfully complete the Work described in the
Contract Documents.
Mechanical Completion Shall mean the date defined in Section 3 when the Contractor has
completed the installation and the System is ready for
Commissioning.
Mobilization Shall mean the date defined in the Contract that the Contractor can
commence Work on the Jobsite.
Notice to Proceed Shall mean the written notice to be issued by City to Contractor,
directing the commencement of the Work or portion of the Work.
Notice of Acceptance Shall mean written notification provided by the City defining the
completion of the Work or portion of the Work
Owner Shall mean the City of Vernon..
Parties Shall mean Contractor and City collectively. The Parties may at times
herein be referred to individually as Party.
Payment Application Shall mean the written explanation of the Contractor's request for
monthly payment for reimbursement based on quantities installed
multiplied by the unit installation prices plus material quantities and
equipment delivered to the Jobsite or adjacent laydown area.
Performance Test Shall mean the testing of the Combined Cycle Power Plant to verify
that the guaranteed performance values are met as defined in the
Specification.
EPCContract_0_8_ 14.doc 6
Performance Guarantees Shall mean the Performance Guarantees set forth in Section 37 of
this Contract.
Purchase Order Shall mean the standard purchase order that is issued by the City.
Retainage Shall mean the withholding of payment by City as set forth in
Section 3H of this Contract.
RFQ Package Shall mean the City furnished bid documents, including applicable
specifications, drawings, data sheets, and sample contract.
Schedule Shall mean the Construction Execution Plan Schedule of key dates
and milestones for the timely completion of the Work.
Services Shall mean all related work to be supplied by Contractor, including
furnishing of necessary equipment, craft labor, supervision, startup
labor, vendor technical support (for Contractor furnished equipment)
and required management, as described in the Contract and necessary
to successfully complete the Work described in the Contract.
Specification Shall mean the scope of work and the documents included and
referenced in Appendix 1 to this Contract including Part 1-Technical
Specification, Part 2-Erection Requirements and Part 3-Technical
Attachments.
Stability Test Shall mean a test that is conducted after Commissioning is completed
in order to verify that the Combined Cycle Power Plant can operate in
a stable condition at various loads within the conditions specified in
the operating manuals over a 24 hour period. When the Stability Test
has been completed successfully, the plant shall be deemed ready for
Performance Testing.
Subcontractor Shall mean any person, firm, or corporation that provides under
contract with Contractor the design engineering, construction,
equipment, labor and materials for some part of Contractor's
obligation under the terms of this Contract.
System Shall mean the Combined Cycle Power Plant.
Underground Facilities Shall mean all pipeline, conduits, ducts, cables, wires, manholes,
vaults, tanks, or other such facilities or attachments, and any
encasements containing such facilities that have been installed or are
existing underground to furnish any of the following services or
materials: electricity, gases, steam, liquid petroleum products,
telephone, cable television, computer or control data, sewage,
drainage, traffic, control systems, or water.
EPCContract_0_8_ 14.doc 7
Witness Points Shall mean a test or inspection point during manufacturing for which
City indicates a desire to witness.
Work The Work shall include all of the home -office, on -site related
engineering, design, supervision, labor, Contractor equipment,
construction equipment, tools, fabrication, materials, startup,
Commissioning as required in the Contract and required to provide
City with a functioning System.
2. RISK OF LOSS
Title and risk of loss or damage shall pass to the City and shall be deemed to be complete
upon Beneficial Use.
3. CONTRACT PRICE AND PAYMENTS
A. Contract Price
City shall pay Contractor the Contract Price of Forty Three Million Nine Hundred Thousand
and 00/100 Dollars ($43,900,000.00) for the Work to be performed by Contractor under this -
Contract. Contractor shall not be entitled to payment exceeding the Contract Price, except to
the extent that the Contract Price may be changed in accordance with the terms of this
Contract. Prices shall not include sales, or use taxes, special financing fees or value-added
taxes, the City shall either pay any and all such applicable charges or provide Contractor with
acceptable exemption certificates.
B. Payment Schedule
Contractor and City shall mutually agree to an earned installed quantity Payment
Application. Payment will be made in accordance with the agreed -upon monthly -earned
progress less five percent (5%) retention (the "Retainage") until Commercial Operation and
receipt of as -built data. Payments will also be paid in accordance with the Payment
Application in Appendix 2 Commencement and Completion of Workset forth below. The
Engineer will perform a quantity validation to approve the Pay ApplicationPayment
Application. Neither the final certificate nor final payment shall relieve the Contractor from
responsibility for defects in design, materials and workmanship. Five percent (5%) retention
will be withheld until the progress or the project reaches fifty percent (50%) complete. All
subsequent invoices rendered shall be paid net with no retention.
EPCContract_0_8_ 14.doc 8
SCHEDULE DATES SUBJECT TO AFC APPROVAL
Estimated Award Date
August 21, 2002
Mobilization
October 15, 2002
Estimated Contractor to Start Onsite Construction
December 3, 2002
Estimated Combustion Turbine Unit 1 Mechanical Installation
Complete
July 20, 2003
Estimated Steam Turbine Unit 3 mechanically Complete
August 8, 2003
Estimated Combustion Turbine Unit 2 Mechanical Installation
Complete
August 15, 2003
Estimated HRSG Unit 1 Hydrostatic test Complete
September 8, 2003
*Estimated HRSG Unit 2 Hydrostatic Test Complete
October 8, 2003
Mechanical Completion
November 30, 2003
Beneficial Use
March 26 2004
Completion of the Performance Test
Aril 2, 2004
Commercial Operation
Aril 12, 2004
Payment Application
Date
Milestone Description
1.
8/21/02
Contract Award
2.
12/03/02
On Site Mobilization
3.
12/31/02
Engineering, Submittals, Procurement of
balance of Plant
4.
08/01/03
Erection of HRSG #1 Modules
5.
09/15/03
Erection of HRSG #2 Modules
6.
07/20/03
Erection of CTG #1
7.
8/15/03
Erection of CTG #2
8.
8/08/03
Erection of ST #3
9.
11/08/03
Hydrotest of Power Train #1
10.11/22/03
Hydrotest of Power Train #2
11.
11/30/03
Completion of Mechanical Work
12.03/26/04
Beneficial Use
Contract Percentage
10%*
10%*
10%
15%
15%
All payments except those identified with an asterisk will be reviewed and approved
by the City based on quantities installed and or deliveries as defined in the Schedule.
C. Invoices
Contractor shall submit an invoice to City on a monthly basis based on progress agreed to
herein. Contractor shall not include progress payments made to Subcontractors of material or
equipment during its manufacture thereof. The adjacent laydown area and Contractor's
Gardena facility can be. considered part of the project site for partial payments for delivery;
however, the risk of loss shall be determined by Section 2 of this Contract.
EPCContract 0 8 14.doc
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D. Form and Content
Contractor shall provide adequate documentation to City's Representative to support its
invoice for purposes of confirming the accuracy of the invoice.
E. Payment
Payment will be due net 30 days after City's receipt of Contractor's invoice.
F. Failure to Achieve Progress
In the event City, in its sole discretion, elects to pay all or any portion of any such payment,
notwithstanding Contractor's failure to make progress pursuant to Schedule, such payment
shall not be deemed a waiver by City of the requirement for timely completion of said
progress, or of City's right to withhold future progress payments pending completion of the
progress required.
G. Payments Withheld
City may withhold payment and shall withhold payment to the extent indicated by the
City's Representative to be necessary to protect City from loss because of -
(a) any defective Work not remedied whether or not payment has been made
therefore;
(b) any claim of lien or stop notice has been filed or recorded, or City has received
notice that a claim of lien or stop notice may be filed or recorded, regarding;
(c) any damage caused by the Contractor, its Subcontractors or agents to the City, its
employees, officers or agents while Contractor is performing its duties under this
Contract;
(d) any claim by a Subcontractor that it has not been paid any amount due and owing
from Contractor
(e) Contractor fails to pay, when due, any amount of principal or interest or is
otherwise in breach of any agreement in respect to any of its indebtedness or
guarantee of indebtedness; fails to pay its debts as they come due; becomes insolvent;
makes an assignment for the benefit of creditors; files a petition, or becomes the
subject of a petition filed against it, in any bankruptcy, insolvency or similar
proceeding; or one or more final judgments are entered against it in the aggregate
amount in excess of Ten Million Dollars and 00/100 ($10,000,000.00) and the same
shall remain un-discharged and un-stayed for sixty (60) days;
(f) reasonable evidence that the Work cannot be completed as required by the
Contract;
(g) failure to carry out the Work in accordance with the Contract; or
(h) the amount of any exception taken by the City as a result of a progress quantity
audit.
EPCContract_0_8_ 14.doc 10
H. Retainage
City may apply the Retainage and other amounts withheld against amounts owed to City by
Contractor under this Contract, or payable by the City to third Parties by reason of the
Contractor's breach of any of its obligations under this Contract, and shall pay the remainder
with the Final Payment.
Payment shall be made in accordance with the agreed upon progress less five percent (5%)
retention of the gross billing each month until the progress or the project reaches fifty percent
(50%) completion which amount shall be due and payable to Contractor upon the successful
completion of the Performance Test and delivery to City of the as -built data and drawings
required by the Contract. All subsequent invoices rendered shall be paid net with no
retention.
Upon successful completion of the Performance Test, or in the event the Performance Test
has not been conducted within the time period set forth herein, or in the event City elects not
to run the Performance Test for causes not due to Contractor, Contractor shall submit the
following: (1) the as -built drawings and other documents required under Appendix 1,
Specification and (ii) data establishing payment or satisfaction of all obligations, including
without limitation, releases and waivers of liens and assignment of warranties and consents to
assignment of warranties, arising out of this Contract.
I. Payments not Acceptance of Work
No payment made hereunder shall be considered as approval or acceptance of any Work by
City. Payment of Applications for Payment shall be subject to correction or adjustment by
City in subsequent payments of invoices submitted by Contractor.
4. NOTICE TO PROCEED
The City shall provide written notice to the Contractor, directing the commencement of the
engineering and or construction of the Work or portion of the Work as necessary. Contractor
shall not perform any portion of the requirements of this Contract without written Notice to
Proceed from City.
5. CHANGE ORDERS
A. General
Only City may issue a request for Change Order under this Contract. Such request shall be
by written notification to Contractor. As soon as practicable after receipt of the notice,
Contractor shall prepare and forward to City, in writing, the price for the change or extra
Work in accordance with the requirements of this Section and any required adjustment to the
Schedule. Except for minor modifications to the Work, not involving extra cost and
consistent with the purposes of the Work, and except in an emergency endangering life or
property, no extra work or change shall be performed unless a written Change Order from the
City authorizes the extra work or change.
EPCContract_0_8_ 14.doc I 1 }
B. Change Work Authorization
Should the City authorize a Change Order, Contractor shall furnish the necessary labor with
requisite equipment and small tools, and/or materials required for performing such additional
work. All authorized changes and the agreed to price shall be confirmed and directed through
a Change Order. The price shall include all costs associated with performing the Change
Order, including the impact on the Schedule for the original Work, inefficiencies and
overhead created by the Change Order. All Change Orders shall be performed under the
terms and conditions of this Contract. All Change Orders shall be signed by both City's
Representative and Contractor's Representative before Contractor begins work on the
Change Order. The total dollar value for any individual Change Order shall not exceed
Twenty Thousand Dollars and 00/100 ($20,000.00) under any condition. This dollar
limitation shall not be circumvented by the issuance of more than one Change Order for a
specified change or extra work. Any changes that may exceed this amount, if any, must be
agreed to by an Amendment to this Contract.
C. Unauthorized Changes
Contractor hereby expressly waives any compensation for any changes to the Work or any
extra work that is performed by Contractor if such changes or extra work is unauthorized by
an executed Change Order. No compensation for labor or schedule impacts from such
unauthorized work shall be considered.
D. Effect on Schedule and Warranties and Guarantees
Contractor shall have seven (7) days after receipt of a Change Order request to notify City in
writing that the change requested will have an adverse effect on Contractor's ability to meet
the scheduled date for Beneficial Use, or upon any of Contractor's warranties or guarantees
under this Contract. Such notice shall provide a detailed statement of the reasons for and the
extent of any such effect. City shall have seven (7) days in which to respond to such notice.
If City agrees with the representations in Contractor's notice, the date of Beneficial Use and/
or the warranties or guarantees shall be changed as appropriate. Unless directed otherwise by
City, Contractor shall proceed with the Work during the exchange of notices described in this
Section.
E. Payment Procedure
As a condition precedent to the right to receive any compensation for changes or extra work
pursuant to a Change Order, Contractor shall famish to the City an itemized bill of the cost of
such work and, unless it is so received, the claim for said additional work shall be deemed
waived by Contractor. The total of the itemized Change Order shall be entered on
Contractor's monthly invoice, properly identified under the designated numbered Change
Order, and payment shall be made in accordance with this Contract.
EPCContract_0_8_ 14.doc 12 V
6. BONDING REQUIREMENTS
Contractor shall, upon execution of the Contract and before beginning Work, furnish an
executed Performance Bond and a Labor and Materials Payment Bond each for one hundred
percent (100%) of the Contract Price with a corporate surety, guaranteeing the Work will be
done according to the Work and Specifications, and further, that Contractor will rebuild,
repair, or replace any or all items which have proven defective due to unsatisfactory material
and/or workmanship; or due to failure to meet the conditions, requirements and/or specific
guarantees noted in the referenced Specifications. Such bonds shall be written with a
qualified surety company licensed to do business in California and listed in current U.S.
Treasury Form 370 and with Best Rating of "A" or better. Such bonds shall be effective for a
period extending to one (1) year from the date of acceptance of the Work by City. Contractor
will supply a bond on and subject to the terms and conditions of Standard A 1 A Form 312.
Contractors Bond excludes any liability by Surety for Performance Guarantees.
7. PRE-EXISTING JOBSITE CONDITIONS
Nothing herein shall be interpreted as placing any responsibility or liability on:
(a) Contractor for pre-existing Jobsite conditions related to pollution, contamination,
hazardous waste, asbestos or toxic materials or for the generation, emission or disposal of
such substances; or
(b) City for pollution, contamination, hazardous waste, asbestos or toxic material
introduced to the Jobsite by Contractor including the generation, emission, or disposal of
such Contractor introduced substances.
City shall indemnify, defend and hold harmless Contractor against any and all claims or
liabilities based on the conditions identified in paragraph (a) above. Contractor shall indemnify,
defend and hold harmless City, its officers, employees and agents against any and all claims or
liabilities based on the conditions identified in paragraph b. above.
8. LAWS AND REGULATIONS
Contractor agrees to comply with all federal, state and local laws that apply to Contractor as a
supplier to City under this Contract.
All laws, regulations and design codes expressly incorporated herein shall be those in effect on
the effective date of this Contract. In the event of any subsequent revisions or changes thereto,
except in connection with the business activities of Contractor or its Subcontractors or agents,
Contractor assumes no responsibility for compliance therewith unless an appropriate Change
Order is issued.
Nothing contained herein shall be construed as imposing responsibility or liability upon
Contractor for the obtaining of permits, licenses or approvals from any environmental, siting or
public utility authority or other agency required in connection with the supply, erection or
operation of the System, except business licenses, building permits, transit waivers, and/or
contractor's licenses as may be required in the name of Contractor or its Subcontractors to
support its business activities.
EPCContract_0_8_ 14.doc 13
9. INSPECTION
Contractor shall provide City reasonable escorted access to Contractor's manufacturing
facilities, after receipt of reasonable notice, for the purposes of inspecting the Work and
witnessing any tests prearranged to be witnessed and required by this Contract. Neither
completion of manufacturing nor shipment of any part will be delayed to accommodate such
inspection or witnessing. For agreed Witness Points, Contractor will provide at least twenty-one
(21) days advance notice. If Contractor does not receive written confirmation that City will
attend, or if City fails to appear at the time of the test/inspection mentioned in the notification,
Contractor shall proceed with the Work.
Contractor shall provide City a schedule of potential Witness Points within thirty days of
execution of this Contract. Within two weeks of receipt of the schedule, City will provide
Contractor with an initial indication of potential Witness Points it may wish to witness.
10. FORCE MAJEURE
Neither Contractor nor City shall be considered to be in default with respect to any of their
obligations under this Contract when a failure of performance shall be due to an
uncontrollable force. The term "uncontrollable force" shall mean any cause beyond the
control of the Party affected, including, but not restricted to, flood, earthquake, storm, fire,
lightning, epidemic, war, terrorist action, riot, civil disturbance or disobedience, sabotage,
federal, state, or municipal action, statute, ordinance, or regulation, embargoes of the United
States Government or any other government, which by exercise of due diligence such Party
could not reasonably have been expected to avoid and by exercise of due diligence has been
unable to overcome. Either Party rendered unable to fulfill any of its obligations under this
Contract by reason of an uncontrollable force, shall give written notice within five Business
Days of such fact to the other Party and shall exercise due diligence to remove such inability
with all reasonable,dispatch. The City shall pay the Contractor for earned progress up to the
force majeure event.
11. DELAYS/SUSPENSION
In the event of any delay attributable to City, its subcontractors or agents that negatively affects
the Contract Time Schedule, Contractor shall be entitled to an equitable adjustment of the
Schedule dates defined in Section 3B and the consequences thereof and reimbursement of all
impact costs.
EPCContract_0_8_ 14.doc 14 1\�—
12. WARRANTIES
A. General
Contractor represents and warrants that:
(a) Contractor is fully experienced and properly licensed, equipped, organized,
financed and qualified to perform the Work pursuant to this Contract.
(b) Contractor will design, engineer, construct, install, equip, start-up, and complete
the Work in accordance with the requirements of this Contract, including the
requirements, codes, standards and regulations specified in the Specification.
the Work will be designed, engineered, constructed, installed, equipped, started up,
and completed in accordance with sound, generally accepted and the best trade
engineering and construction practices and in compliance with all applicable
requirements of federal, state or local laws, codes and regulations governing the
construction and operation of the Work. The Work will be uniformly new, of good
quality and free from fault or defects in material, workmanship or performance, and
all Work, including substitutions not so conforming to these standards may, at the
option of City be considered defective and the Material and Work shall be fit for its
intended purposes as exhibited by the Performance Guarantees and shall conform to
the requirements of this Contract.
B. Warranty Period
The warranty period shall be eighteen (18) months from the date of Beneficial Use by the
City or eight thousand (8,000) station Generating Hours which ever comes first. The
warranty period for deficiencies under paragraph A above, shall be one (1) year from the date
of correction of the deficiency or eighteen (18) months after Beneficial Use by City,
whichever occurs first. Contractor procured equipment will carry a one year warranty from
date of Beneficial Use by City or eighteen (18) months from date of shipment, documented
by formal shipping documents, whichever comes first.
C. Remedy of Defects
If City or City's Representative notifies Contractor of any deficiencies under this Section
discovered in the Work during the warranty period as defined herein, whether such Work has
been performed, fabricated, installed, tested, completed or accepted, Contractor shall
promptly replace, repair or re -perform the Work to conform to the requirements of this
Contract, all at Contractor's expense, including repairs to other parts of the Work, or other
property damaged as a result of such deficiencies or corrective actions, and including the
costs of City's Representative or any outside consulting services thereby made necessary.
Contractor shall also perform such tests as City may reasonably request to verify that such
correction, replacement, repair, re -performance or rework complies with the requirements of
this Contract. Contractor shall perform its warranty obligations hereunder as expeditiously as
possible and shall in every case commence the necessary corrections, repairs, replacements,
performance and tests within seven days of written notice to Contractor. In the event
Contractor fails to commence such performance within such seven (7) day period, City may
perform or cause to be performed the same, all at Contractor's expense.
EPCContract_0_8_ 14.doc 15
D. Survival of Warranties
All representations, covenants, and warranties in this Section shall:
(a) survive any inspection and acceptance of the Work and continue for the warranty
period in Section 1213;
(b) be extended for one (1) day for each day that Contractor is unable to achieve
Beneficial Use in accordance with the Specification due to a breach of
Contractor's warranties; and
(c) shall continue in respect of any defect notice of which has been given by the City
to Contractor prior to the date on which the warranty period in Section 12B would
have expired but for this provision for the extension thereof in respect of such
defects.
E. Extent of Warranties and Guarantees
Contractor's warranties and guarantees under this Section do not extend to any repairs,
adjustments, alterations, replacements or maintenance which may be required to the Work as
a result of normal corrosion, normal erosion or normal wear -and -tear in the operation of the
Work.
F. Prevention
Contractor agrees not to file or otherwise assert, suffer or permit a mechanic's lien to be filed
or continued against any property of City for services or Work performed or Material,
furnished in connection with the Work by Contractor.
G. Assignment of Warranties and Guarantees
On the date of the Notice of Acceptance of the Work after Commercial Operation, Contractor
shall assign, by executing a document or documents, all warranties and guarantees that it
procures from third parties on product incorporated into its Work, which, upon such
assignment shall be valid, and Contractor shall obtain from all such third parties consents to
such assignment. Contractor shall enforce all such warranties and guarantees on behalf of
City during the warranty period and shall provide City with all reasonable assistance in the
enforcement of such warranties and guarantees whether or not such enforcement occurs
during the warranty period.
13. INFORMATION FURNISHED TO AND BY CITY
Not used
14. INFORMATION FURNISHED TO CONTRACTOR
A. Access to Confidential Information.
City may provide Contractor with, or allow Contractor access to certain information not
available to the public concerning City, or businesses located in the City or City's vendors.
The information may include company information, taxes, sales, value of assets, or other
such information. All such information shall be known as "Confidential Information" and
shall be marked clearly as "Confidential Information".
EPCContract_0_8_ 14.doc 16
B. No Disclosure.
Except as expressly permitted, Contractor shall not disclose, permit the disclosure of, release,
disseminate, or transfer, whether orally or by any other means, any part of such confidential
information to any other person or entity, whether corporate, governmental, or individual,
without the express prior written consent of an authorized representative of City. Contractor
shall return any written Confidential Information and all copies made of such items to City
upon City's written request, but in any event not later than the date that Contractor has
performed all services to be performed pursuant to this Contract. Contractor hereby agrees
that such confidential information and any documents provided may be used by Contractor
only as authorized by City. Contractor shall take reasonable measures to avoid any disclosure
of any such confidential information to any unauthorized person.
C. Court Ordered Disclosure.
Contractor shall immediately notify City of any court order or subpoena requiring disclosure
of confidential information, and shall cooperate with the City's legal counsel in the appeal or
challenge of any such order or subpoena. Recipient may only disclose confidential
information required to be disclosed pursuant to court order or subpoena after legal counsel
has exhausted any lawful and timely appeal or challenge.
D. Remedies.
In addition to any other remedies that it may have at law or in equity, City shall be entitled to
a temporary and permanent injunction by a court of competent jurisdiction against any
breach or threatened breach of the confidential information provisions of this Contract.
Contractor acknowledges that in case of such breach or threatened breach of said provisions,
City would have no adequate remedy at law.
15. TECHNICAL DATA
All operating or other performance information and data under this Contract are based on the
conditions specified in the attached Appendices. Contractor's sole liability in respect to
performance of the Work shall be only as expressly stated in the attached Appendices, or as set
forth herein.
16. PATENTS
Contractor shall defend, indemnify and hold City and its officers, employees and agents free and
harmless from any claim, litigation or other judicial or administrative proceeding the basis of
which is that the Work supplied hereunder infringes on a U.S. apparatus patent issued prior to
the date of this Contract other than those arising out of (a) Material supplied according to City's
detailed design; (b) modifications, alterations, additions or changes made by City to the Work or
to Material supplied by Contractor, (c) the use of -the Work or Material supplied hereunder in
conjunction with any other process or Material not supplied by Contractor, or (d) claims
covering a process performed or a product produced by said Work. City will notify Contractor
in writing within a reasonable period of time of such claim. Contractor shall have control over
the defense and/or settlement of such claim and reasonably required assistance in said defense.
EPCContract_0_8_ 14.doc 17
If the Work is determined to infringe on a patent, or in Contractor's reasonable opinion may
infringe on a patent, Contractor will, at its option and expense, either (1) procure for City the
right to continue using said Work or part thereof, (ii) modify it so it becomes non -infringing
Work, (iii) replace it with substantially equivalent non -infringing Work.
17. CANCELLATION/ DEFAULT
A. Termination
Any order or contract maybe terminated by City for its convenience upon fifteen (15) days
prior written notice and upon payment of reasonable and proper termination charges, including,
but not limited to, all costs incurred or committed prior to the effective date of notice of
termination and all charges incurred by Contractor in connection with the termination, plus
reasonable overhead and profit.
B. Contractor's Breach
In the event Contractor commits a breach of a material condition of this Contract, City shall
notify the Contractor in writing of said breach and if Contractor has not cured or begun
reasonable efforts to cure after 15 working days of receipt of said notice, and fails to
diligently pursue corrective action, then City shall have the right to cancel this Contract, The
City may: 1) proceed against the Contractor's Bond in accordance with the terms and
conditions of the Bond or, 2) deviate from the terms and conditions of the Bond, thereby
waiving its right to make claim against the Contractor's Bond; the City may then pursue
whatever other remedies it may have under the law against Contractor.. Contractor shall be
responsible for any direct costs due to City's re -procurement of the equivalent of the Work or
services cancelled from Contractor. Among other things, Contractor shall be deemed to be
in default under this Contract if Contractor files for bankruptcy or another person or entity
institutes against Contractor a bankruptcy, reorganization, moratorium, liquidation or similar
insolvency proceeding or other relief under any bankruptcy or insolvency law affecting
creditor's rights or a petition is presented or instituted for its winding -up or liquidation.
C. City's Breach
If City fails to make any contractual payment to Contractor when due under the provisions of
this Contract, and such failure is not remedied within fifteen (15) days of City's receipt of
written notice of such default, then Contractor will notify City. if such failure is not
remedied within "seven (7) days of City's receipt of the second notice then Contractor may
terminate this Contract for City's default.
18. ASSIGNMENT
Contractor may not directly or indirectly sell, assign, transfer, pledge, mortgage or encumber
(each, a "Transfer") any of its interest in any of its rights or obligations under this Contract,
without the prior written consent of City. Any Transfer that is made without the prior written
consent of City shall be void.
EPCContract_0_8_ 14.doc 18
19. PARTIAL INVALIDITY
Wherever possible, each provision hereof will be interpreted in such manner as to be effective
and valid under applicable law, but in case any one or more of the provisions contained herein
will, for any reason, be held to be invalid, illegal or unenforceable in any respect, such provision
will be ineffective to the extent, but only to the extent, of such invalidity, illegality or
unenforceability without invalidating the remainder of such invalid provision or provisions or
any other provisionhereof, unless such a construction would be unreasonable or contrary to the
intent of the Parties as expressed in this Contract.
20. CHOICE OF LAW
The rights and remedies of the Parties hereunder shall be governed by the laws of the State of
California.
21. INSTALLATION/FIELD SERVICES
Unless specifically excluded, all field services required by the Work shall be completed by the
Contractor.
22. INDEMNIFICATION AND INSURANCE
A. Indemnity
Contractor shall indemnify, hold harmless and defend City, its officers, employees and agents
from and against any claims, demands, suits, proceedings, liabilities, judgments, awards, losses,
damages, costs or expenses (including reasonable attorney's) whatsoever arising out of and
caused or occasioned by any negligent act or omission of Contractor, or any of its officers,
directors, agents or employees, contractors or Subcontractors in connection with the per-
formance of the Work under or in connection with this Contract.
In the event that any losses arise, directly or indirectly, in whole or in part, out of the joint or
concurrent negligence of both Parties and their respective representatives, each Party's liability
therefore shall be limited to such Party's proportionate degree of fault.
B. Insurance
Prior to commencing Work hereunder, Contractor shall provide City with proof of insurance
providing and maintaining the coverage's and endorsements set forth in the Insurance
Schedule attached hereto as Appendix 4, Insurance Schedule, and made a part hereof by
reference. Said proof of insurance shall also provide that said policy or policies shall not be
canceled or materially reduced in coverage without giving at least 30 days prior written
notice to City. Contractor shall not permit a Subcontractor or vendor to perform work on
City premises unless and until proof of insurance is obtained showing that such
Subcontractor or vendor has worker's compensation coverage.
If Contractor employs Subcontractors as part of the services rendered, Contractor's protective
coverage is required. Contractor may include all Subcontractors as insureds under its own
EPCContract_0_8_ 14.doc 19
policy or shall furnish separate insurance for each Subcontractor, meeting the requirements
set forth herein.
23. NON -WAIVER
The failure of either Party to insist upon or enforce, in any instance, strict performance by the
other Party of any provision of this Contract or to exercise any right herein conferred shall not
be construed as a waiver or relinquishment to any extent of its right to assert or rely upon any
such provision or rights on any future occasion.
24. AMENDMENTS
This Contract may be modified or amended only by a written document executed by both
Contractor and City.
25. ENTIRE AGREEMENT
This Contract is the entire agreement of the Parties. Contractor represents that in entering
into this Contract, it has not relied on any previous representations or understandings of any
kind or nature.
26. BENEFIT OF AGREEMENT
This Contract shall bind and benefit the Parties hereto and their heirs, successors, and
permitted assigns.
27. FORUM SELECTION
Any action brought -relating to this Contract shall be brought and held exclusively in a State
Court in the County of Los Angeles, California.
28. COUNTERPARTS
This Contract may be executed simultaneously in two or more counterparts, each of which
shall be deemed to be an original, but all of which together shall constitute one and the same
instrument.
EPCContract_0_8_ 14.doc 20
29. NOTICES
Notices to the Parties, unless otherwise requested in writing, shall be sent to:
City: THE CITY OF VERNON
ATTN: BRUCE V. MALKENHORST
CITY ADMINISTRATOR
4305 SANTA FE AVENUE
VERNON, CA 90058-0805
CONTRACTOR:
SCOTTCOMPANY
ATTN: STEVE KLAUS
14920 SOUTH PEDRO
GARDENA CA, 90248-2036
Notices shall be deemed to have been received by the close of Business Day two days after the
date on which it was mailed.
30. INDEPENDENT CONTRACTOR.
At all times during the tern of this Contract, Contractor shall be an independent contractor
and shall not be an employee of City. City shall have the right to control Contractor only
insofar as the results of Contractor's services rendered pursuant to this Contract; however,
City shall not have the right to control the means by which Contractor accomplishes services
rendered pursuant to the Contract except to the extent that such services involve the use of
City property or Confidential Information.
31. CONTRACTOR NOT AGENT
Except as City may specify in writing, Contractor shall have no authority, express or implied,
to act on behalf of City in any capacity whatsoever as an agent. _ Contractor shall have no
authority, expressed or implied, pursuant to this Contract to bind City to any obligation
whatsoever.
EPCContract_0_8_14.doc 21
32. REVIEW OF EXISTING CONDITIONS
A. Premises
Contractor represents that (i) it has relied upon its own examination of the area on which the
Work is to be performed, the adjacent premises and the site, (ii) it knows the applicable
federal, state and local laws, ordinances and regulations in existence as of the effective date
of this Contract, and (iii) it assumes responsibility therefore. Contractor knows, or shall be
deemed to have known, the facilities or lack thereof for delivering, handling and storing
materials, equipment on and near the site and the applicable labor conditions. Contractor
represents and warrants that all such matters are acceptable and will not interfere with the
timely performance of its Work under this Contract.
B. Verification of Existing Conditions
Contractor represents that (i) it has reviewed the site survey and site proposal drawings and
other data concerning the Work included in the Specification, (ii) Contractor has determined
and verified all materials, field measurements and field construction criteria related thereto,
and it has checked and coordinated the information contained within such submittals with the
requirements of the Work and this Contract. To the extent that such drawings and data are
made available to Contractor and Contractor is provided an opportunity to determine and
verify such information, Contractor shall be responsible for all defects and discrepancies in
such drawings and data as if Contractor itself had prepared such drawings and data. The
Contractor may rely on information supplied by the City to the extent that it cannot be
verified by reasonable survey and inspection.
C. Statements of Fact
Contractor statements of fact contained in Contractor's submissions in response to, and reply
to inquiries made in connection with the Specification are true, correct and complete. No
submission or reply made by or on behalf of Contractor in connection therewith contains any
material misstatement of fact or omits to state any material fact necessary to make the
statements made in connection therewith, in light of the circumstances in which they were
made.
33. SUPERVISION BY CONTRACTOR
A. Management of Work
Contractor shall assign each key officer and employee named on its Management Plan (the
"Plan") per the Specification to be responsible for the Material, and construction tasks for
which the Plan indicates that such key officer and employee will be responsible. No key
officer or employer will be permitted to delegate or transfer its responsibility for any task for
which the Plan indicates he or she is responsible without cause or the prior consent of City.
The Plan shall be submitted to City thirty (30) days following the Contract award. The Plan
will consist of a detailed construction execution write-up of all major schedule activities,
rigging requirements, working hours and days, means and methods of erection and
EPCContract_0_8_ 14.doc 22
installation, and a discussion of how the critical path items will be achieved and maintained.
The Plan will include a detailed Primavera CPM schedule which will be manpower loaded by
craft and also cost loaded with Contractor's budget to produce craft and total job manpower
curves, overall project progress curve, and a total project cash flow curve. The Plan must
include sample reports showing an itemized schedule of commodity units, estimated hours of
installation, a column for actual manhours for monthly reports, estimated and actual cost of
installation by each unit category, earned value percent complete column for the period and
cumulative column, plus bottom line percent complete for the total job. The percent
complete will be based on quantities installed in place, which will be included in the monthly
Payment Application. The Plan must show how the bulk materials and process equipment
will be tracked from shop to site with expected and actual delivery dates by purchase order
number and quantities. All data will become the baseline plan to which weekly progress
will be measured against the Plan. A daily inspection form will be completed by Contractor
and submitted daily to City's Representative.
B. Control of the Work
The methods, sequences, procedures and techniques by which Contractor shall administer
and execute the Work shall be consistent with the Plan and the construction execution plan,
delivered by Contractor pursuant to the Specification. Contractor shall remain solely
responsible for all construction means, methods, techniques, sequences, procedures and
safety programs in connection with the performance of the Work.
34. GOVERNMENTAL REGULATIONS AND TAXES
A. Permits and Licenses
Contractor shall have responsibility for and shall bear the cost of obtaining all necessary
permits and licenses from all authorities required for Contractor's performance of the Work.
Contractor shall assist City as necessary in obtaining environmental permits such as the
Permit to Construct, California Environmental Quality Act, South Coast Air Quality, etc..
Throughout the performance of the Work, Contractor shall comply with Laws and
Regulations. Compliance by Contractor with Laws and Regulations applicable to the Work
that become effective or are changed after the effective date of this Contract, shall be handled
in accordance with the procedures established in Appendix 4, Changes and Extra Work.
B. Laws and Regulations
Contractor shall conform with Laws and Regulations.
EPCContract_0_8_ 14.doc 23 ^�
35. LIQUIDATED DAMAGES
A. Delays
If Contractor fails to complete erection or fails meet the performance deadline by the dates
agreed upon in Section 313, , the Parties agree that City shall be damaged. The actual
damages that would be suffered by City would be impossible to ascertain precisely.
Therefore, the Parties agree that Contractor shall pay City liquidated damages (but not as a
penalty) pursuant to the following schedule:
Beneficial Use: Fifteen Thousand Dollars and 00/100 ($15,000) for every day with a
Five Hundred Thousand and 00/100 ($500,000.00) maximum following the
Beneficial Use milestone.
B. HP Steam Pressure Loss
The Contractor agrees to a liquidated damage of $1,250/psid for every psid over the
guarantee point of 40 psid as measured between the HRSG/bidder interface and the steam
turbine/bidder piping interface. Note the above is based on a calculation that indicates for
every 1 psig loss in HP steam pressure to the turbine there is 3KW drop in steam turbine
output. The $1,250/psid was determined based on lost revenue of 3 kw valued at $.05/kwhr
for one year at 95% availability.
C. Liquidated Damage Payment
Liquidated damages owed by Contractor to City will be deducted from Contractor's monthly
Payment Application, as such damages are accrued.
D. Sole Remedy
It is understood and agreed that payment of the damages specified in this Section shall be the
sole and exclusive remedy of the City against the Contractor for the failure of Contractor to
meet timely the dates of delivery of Mechanical Completion, and Commercial Operation.
36. MAXIMUM AGGREGATE LIQUIDATED DAMAGES
The maximum aggregate liquidated damages payable under this Contract shall not exceed
$500,000 maximum.
37. PERFORMANCE GUARANTEES
A. Performance Guarantees
Contractor warrants and guarantees that the Work supplied and installed pursuant to this
Contract shall conform to the requirements and specifications set forth in the Specification,
including without limitation, the noise emission and auxiliary power guarantees specified in
the Specification.
EPCContract_0_8_ 14.doc 24
B. Noise Emissions Limits
The Contractor's guarantees covers equipment procured by the Contractor, only. Contractor's
guarantees concerning noise are specifically stated in Appendix 1. In the event that the
Contractor's equipment is proven to have failed the noise guarantees as stated, Contractor
shall be granted access to the Contractor's equipment at time or times acceptable to City to
repair or replace the defective component that has been duly demonstrated to be deficient.
C. HP Steam Line Pressure Loss
Contractor shall guarantee that the pressure loss through the HP steam piping, valves, etc.
shall be less than the pressure loss allowed in the Specification when the Combined Cycle
Power Plant is operating at the Guarantee Conditions as defined by the Specification.
D. Obligations of the Contractor
If the Work, as demonstrated by the Performance Tests, fails to achieve the Performance
Guarantees, Contractor shall have the obligations set forth below. Contractor shall not claim
as a defense or excuse for the failure of the Work to achieve the Performance Guarantees that
the achievement of such Performance Guarantees was technologically impossible or
impracticable.
E. Corrective Action
Contractor shall, within ten (10) days after the date of a notice of unsuccessful Performance
Test, submit to City a plan of corrective action (Corrective Action Plan), specifying in
reasonable detail the actions Contractor proposes to take to cause the Work to achieve the
Performance Guarantees, and the period of time in which it proposes to complete the
corrective action; the Parties must mutually agree upon the period of time for such corrective
action. Contractor will not be liable for deficiencies caused by the City or it's other
Subcontractors or suppliers. Contractor will not be liable for any deviation from any
Corrective Action Plan where the deviation is caused by acts, omissions or requirements of
the City or its other Subcontractors or suppliers.
F. Standards for Plan of Corrective Action
When implementing the Corrective Action Plan, Contractor shall (i) timely and diligently
exercise its best efforts to repair and modify the Work to meet the Performance Guarantees,
including but not limited to redesign, re -engineering, research, testing and associated
construction work, (ii) consider and apply available know -.how and technology, including
consultation with City and experts in the field, and (iii) consult with City with respect to
City's concerns and preferences under the circumstances.
38. LIMITATION OF LIABILITY
A. Contractor's aggregate liability for all claims of any kind, whether based on contract,
warranty, tort, strict liability or otherwise, for all losses or damages arising out of, connected
with or resulting from this Contract, its performance or breach shall not exceed the Contract
Price.
EPCContract_0_8_ 14.doc 25
B. In no event, whether as a result of breach of contract, warranty, indemnity, tort, or
otherwise, shall Contractor be liable for indirect, special, incidental, or consequential damages
including but not limited to loss of profits or revenue loss of data; loss of use of equipment; cost
of capital; cost of substitute equipment, services or facilities; downtime costs or claims of third
parties or customers for service interruptions.
39. DISPUTE RESOLUTION
In the event that any dispute arises under this Contract, the Parties will in good faith attempt
to informally resolve such dispute. Such attempts shall include at least one fact -to -fact
meeting with the representatives of City and Contractor.
40. ENVIRONMENTAL PROTECTION
A. Qualified Personnel
Contractor agrees to use, and agrees that it shall require each of its Subcontractors, if any, to
use only personnel who are qualified and properly trained and who possess every license,
permit, registration, certificate or other approval required by any applicable Environmental
Law or Government Agency for the performance of Contractor's obligations under this
Contract.
B. Material
Contractor agrees that all Material to be supplied or used by Contractor, its Subcontractors, if
any, in the performance of this Contract, including, but not limited to, vehicles, loading
equipment, and containers, shall be in good condition and fit for the use(s) for which they are
employed by Contractor or its Subcontractor. Such Material shall at all times be maintained,
inspected and operated as required by applicable Environmental Law. Contractor further.
agrees that all licenses, permits, registrations and certificates or other approvals required by
any Environmental Law or Government Agency will be procured and maintained for such
Material at all times during the use of the same by Contractor or its Subcontractors in the
performance of any of its obligations under this Contract.
C. Compliance with Laws
Contractor agrees that in the performance of its obligations under this Contract, Contractor
shall at all times fully comply with, and shall require all Subcontractors to comply with, all
applicable Environmental Laws. Contractor further agrees that at all times during its
performance under this Contract it, and any Subcontractors, shall have and keep in effect all
licenses, pernlits, registrations, certificates, and approvals required by any Environmental
Law or by any Governmental Agency for the performance of its obligations under this
Contract.
EPCContract_0_8_ 14.doc 26
D. Hazardous Materials Removal
In the event Contractor or its Subcontractors are required to remove any Hazardous Material
from the work area during the performance of the Work contemplated by this Contract,
Contractor shall notify City of such fact promptly after discovering such requirement.
Contractor shall appropriately remove such Hazardous Materials and deliver the same to City
for proper handling and management. However, in the event any such Hazardous Materials
are asbestos or asbestos containing materials, City will remove the same promptly after
receiving Contractor's notice, as necessary for Contractor's performance of the Work, in
compliance with applicable Environmental Law.
E. Environmental Indemnity ,
Contractor hereby specifically agrees to indemnify, defend and hold harmless the City, its
officials, officers, employees, agents, successors and assigns, herein collectively called the
"Indemnitees," harmless from and against any and all losses, liabilities, claims demands,
damages, causes of action, judgments, fines, penalties, costs and expenses (including but not
limited to all reasonable consulting, engineering, attorneys' or other professional fees) which
indemnitees, or any of them, may incur or suffer by reason of
(a) any unauthorized release of a Hazardous Material by Contractor;
(b) any enforcement or compliance proceeding commenced by or in the name of any
Government Agency because of an alleged, threatened or actual violation of any
Environmental Law by Contractor;
(c) Contractor shall have no obligation to abate or remove any hazardous material
and will have no liability for damages caused by any hazardous material unless
the hazardous material is placed on the site by Contractor or released as a result of
negligence by Contractor. Each Party will provide environmental indemnity to
the other.
F. Material Safety Data Sheets
Contractor shall submit the current Material Safety Data Sheet, (MSDS) to City's
Representative upon request, for each Hazardous Material used by Contractor, or any
Subcontractor on City premises during the performance of the Work.
G. Suspension and Notification
Contractor shall immediately suspend all operations and immediately notify City's
Representative if any violation or alleged violation of Environmental Law is encountered
during performance of the Work.
EPCContract_0_8_ 14.doc 27
41. LABOR AND MATERIAL
A. General
Contractor shall provide and pay for all labor, supervision, inspection and testing as may be
necessary to complete performance of the Work, whether by the Contractor or its
Subcontractors, except for inspection and testing included within the Work as defined in
Appendix 1, Specification. To the extent permitted by law, any Work to be performed by
Contractor hereunder which City would normally undertake with its regular work force and
work that would otherwise fall within the terms and conditions contained in an existing
agreement shall be performed by employees and Subcontractors who are members of a trade
union, bona fide labor organization affiliated with the Building Trades of the AFL-CIO, or by
employees and Subcontractors working under a Work specific union agreement.
B. Employment of Licensed Personnel
Whenever required by law, regulation or code, Contractor agrees to employ only licensed
personnel to perform engineering, design, architectural or other professional service in the
performance of the Work. All such professional services shall be performed with the degree
of care, skill and responsibility customary among such licensed personnel. Contractor shall
immediately remove from the site any employee or agent of Contractor or any Subcontractor
as to whom City objects in writing.
C. Assignment of Individuals
Individuals assigned to this Work at a level of responsibility of technical discipline review
and above cannot be assigned or reassigned or removed from this Work without approval of
City.
D. Material
Contractor shall, provide and pay for all Material and other services as may be necessary to
complete the performance of the Work, whether by Contractor or its Subcontractors, except
for material and services included within City's scope of work as defined in Appendix 1.
E. Start Up Spare Parts and Special Tools
Contractor shall deliver and store where directed by City, prior to Mechanical Completion,
the special tools and spare parts required, including without limitation those special tools and
spare parts listed in the Specification.
EPCContract_0_8_ 14.doc
28
F. Quality Control Program
Contractor shall establish, implement and maintain a quality assurance and control program
in accordance with the provisions of the Specification. The program shall be designed to
meet the following objectives:
(a) purchased items and documentation to meet specified requirements of this
Contract;
(b) the quality of items to be part of permanent installation not be degraded during
receiving, storing, transporting„ handling, erection, installation, inspection and
testing;
(c) systems, equipment and structures are provided and installed in strict compliance
with the manufacturers' instructions and this Contract; and
(d) components meet performance and functional requirements of this Contract.
G. Testing
Contractor shall provide all specially trained or supervisory personnel for the Work.
Contractor shall perform or cause to be performed all factory, laboratory and other tests
together with all testing procedures described in the Specification and submit to City
Monthly Reports (as defined in Appendix 3) of the results thereof, indicating whether such
results warrant acceptance or rejection of any materials so tested or performance of such
tests.
H. City's Right to Inspect
City shall have the right at all reasonable times to inspect the Work and to observe the tests
relating to the Work that are conducted by Contractor. Contractor shall make arrangements
and provide facilities and access for such inspection and observation of such tests at the
Jobsite or at the facilities of any Subcontractor where any part of the Work is being
fabricated or manufactured. Contractor shall give ample notice as to the time and place when
each part of the Work will be ready for such inspection. City may reject any part of the Work
found to be defective or not in accordance with this Contract, regardless of the stage of its
completion or the time or place of discovery of such errors, and regardless of whether City
has previously accepted it through oversight or otherwise. Such inspection by City shall in no
way relieve Contractor from its obligations under this Contract.
EPCContract_0_8_ 14.doc 29
IN WITNESS WHEREOF, the Parties have caused this Contract to be executed by and through
their authorized officers on the date, month and year first written above.
ATTEST:
BRUCE V. MALKENHORST, City Clerk
APPROVED AS TO FORM:
EDUARDO OLIVO, City Attorney
CITY OF VERNON
By:
LEONIS C. MALBURG, Mayor
CONTRACTOR
Date: , ` 2� - 0 2
Af
N me —Title
Title T , j�9D 4-1
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Date: U -Z (1.�
Name%VLi9L1s
Title
EPCContract_0_8_14.doc 30�
APPENDIX 1
SPECIFICATION
FOR
DETAILED ENGINEERING, PROCUREMENT,
CONSTRUCTION, and STARTUP
FOR THE
MALBURG GENERATING STATION PROJECT
VERNON, CALIFORNIA
Prepared by.
Carter:: Burgess
216 16t' Street Suite 1700
Denver, Colorado 80202
C&B No, 070734
Specification No.: D-99 REV 0
JULY 25, 2002
SPECIFICATION
PART 1 TECHNICAL SPECIFICATION
PART 2 ERECTION SPECIFICATION
PART 3 TECHNICAL ATTACHMENTS
ELECTRONIC INDEX
DISK 1 Contract, Part 1, Part 2, and EPC Data List
DISK 2 C-B and Vendor Drawings
DISK 3 Application for Certification, (AFC) and SCAQMD Permit Application
PART 1 TECHNICAL SPECIFICATION
FOR
DETAILED ENGINEERING, PROCUREMENT,
CONSTRUCTION, and STARTUP
FOR THE
MALBURG GENERATING STATION PROJECT
VERNON, CALIFORNIA
Prepared by.,
CarterBurgess
216 16`" Street Suite 1700
Denver, Colorado 80202
C&B No. 070734
Specification No.: D-99 REV 0
JULY 25, 2002
D_99Prt1_0.doc 1
TECHNICAL SPECIFICATION
Table of Contents
1.0 SCOPE OF SUPPLY
1.1 General
1.2 Project Description
2.0 DEFINITIONS
3.0 SUPPLEMENTS
3.1 Discipline Design Basis Document
3.2 Engineering Standards
3.3 Owner Furnished Drawings and Data
3.4 Carter & Burgess Supplied Drawings
3.5 Owner Furnished Equipment Information
3.6 Owner Furnished Equipment and Delivery Information
4.0 EQUIPMENT AND SERVICES TO BE PROVIDED BY THE CONTRACTOR
4.1 Equipment to be provided by the Contractor
4.1.1 Detailed Contractor Furnished Equipment
4.2 Engineering Services to be provided by the Contractor
4.3 Construction Services to be provided by the Contractor
5.0 EQUIPMENT AND SERVICES TO BE PROVIDED BY OTHERS
6.0 DESIGN CONDITIONS
7.0 TERMINAL POINTS
8.0 DESIGN AND CONSTRUCTION
8.1 General
8.2 Codes, Standards and Regulations
9.0 COMPONENT AND SYSTEM DETAILS
9.1 Combustion Turbine
9.2 Heat Recovery Steam Generator
9.3 Steam Turbine
9.4 Main Steam System
9.5 Condensate System
9.6 Condensate Storage & Transfer
9.7 Circulating Water System
9.8 Fuel Gas System
9.9 Plant Raw Water
9.10 Potable Water
9.11 Plant Drain System
Wastewater System
Oil/Water Waste
Sanitary Waste
Chemical Feed Drainage
9.12 Water Treatment
HRSG Chemical Treatment
Cooling Tower Chemical Treatment
9.13 Fire Protection
Underground Piping
Fire Hydrants
Fire Hose Station
Wet Pipe and Waterspray Systems
Wet Pipe Sprinklers
Detection System
Fire Protection Supervisory Panel
Portable Fire Extinguishers
9.14 Instrument and Service Air
9.15 Not Used
9.16 HVAC
D_99Prt1_O.doc i
Page
1
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2
2
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3
4
5
5
5
6
7
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9.17 Plumbing
9.18 Insulation & Lagging
9.19 Continuous Emissions Monitoring
10.0 ENGINEERING SERVICES
10.1 System Design Criteria
10.2 Equipment List
10.3 Piping Line List
10.4 System Descriptions
10.5 Operations and Maintenance Manuals
10.6 Operator Training
11.0 CIVIL STRUCTURAL
11.1 General
11.2 Earthwork
11.3 Structural
11.4 Inspection
11.5 Architectural Work
12.0 ELECTRICAL
12.1 General
12.2 Switchgear
12.3 NEMA Frame Motors
12.4 Medium Voltage Motors
12.5 Station Service Transformers
12.6 129 Vdc Station Battery
12.7 120 Vac UPS System
12.8 Switchgear Building
12.9 Electrical Equipment for Packaged Mechanical Equipment
12.10 69 KV Line Terminations
12.11 Plant Lighting
12.12 Electrical Commodities
13.0 INSTRUMENTATION & CONTROLS
13.1 DCS
13.2 Packaged Equipment and Field Instrumentation
14.0 PIPING
15.0 PERFORMANCE
16.0 PERFORMANCE TESTING
16.1 Auxiliary Power
16.2 Noise Emissions Tests
16.3 High Pressure Steam and Low Pressure Steam Pressure Drop
17.0 MATERIALS AND WORKMANSHIP
18.0 NOISE EMISSIONS
19.0 SHOP ASSEMBLY
20.0 CLEANING, FINISHING AND PAINTING
20.1 Prime Painting
20.2 Finish Painting
21.0 SPECIAL TOOLS AND DEVICES
22.0 SPARE PARTS
23.0 TECHNICAL DIRECTION OF INSTALLATION
24.0 DOCUMENTATION
25.0 QUALITY ASSURANCE
26.0 GUARANTEES
26.1 Equipment
26.2 Auxiliary Power
26.3 Noise
26.4 HP and LP Steam Pressure Loss
27.0 BID DATA
32
33
33
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33
33
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35
35
37
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D_99Prt1_0.doc
APPENDIX 1
PART 2 ERECTION AND STARTUP
FOR THE
MALBURG GENERATING STATION PROJECT
VERNON, CALIFORNIA
Prepared by:
Carter:: Burgess
216 16'hStreet Suite 1700
Denver, Colorado 80202
C&S No. 070734
Specification No.: D-99Erect
July 26, 2002 Rev 0
EPCD_99Part2_O.doc 0
PART 2 ERECTION SPECIFICATION
Page
1.0
SCOPE
4
2.0
MECHANICAL EQUIPMENT REQUIREMENTS
6
2.1
General
6
2.2
Process Equipment Erection Requirements
6
2.3
Insulation Installation
6
2.4
Piping Systems
7
3.0
STRUCTURAL STEEL
8
4.0
GROUTING
9
5.0
FOUNDATIONS AND EARTHWORK
9
6.0
LUBRICATION
9
7.0
ELECTRICAL WORK REQUIREMENTS
9
7.1
General
9
7.2
Handling Transportation, and Storage of Equipment
10
7.3
Temporary and Construction Power
10
7.4
Equipment Installation
11
7.4.1 Cable Requirements and Installation
11
7.4.2 Cable Tray and Raceway
11
7.4.3 Locally Mounted Equipment
12
7.4.4 Miscellaneous
12
8.0
INSTRUMENTATION AND CONTROL ERECTION REQUIREMENTS
13
9.0
FIELD WELDING
13
9.1
General
13
9.2
Filler Metals
14
9.3
Filler Metal Control
14
10.0
QUALITY ASSURANCE DURING CONSTRUCTION
14
10.1
General
14
10.2
Welding Qualifications and Procedures
16
11.0
FIELD TESTS
16
11.1
Weld Acceptance Criteria
16
11.2
Weld Examination
16
11.3
Nondestruction Tests
16
11.4
Inspection of Ductwork
16
12.0
START-UP, TESTING & CHECKOUT
17
12.1
General
17
12.2
Electrical Test
18
12.3
Instruments and Control Calibration
18
12.4
Ready for commissioning
20
13.0
COOPERATION WITH OTHERS
21
14.0
PREMOBILIZATION
22
15.0
CONSTRUCTION SCHEDULE AND OBLIGATIONS
22
16.0
CONSTRUCTION EXECUTION PLAN
23
17.0
CONSTRUCTION DATA TO BE CHECKED
23
18.0
CHANGES IN WORK
23
19.0
CLAIMS FOR EXTRAS
24
20.0
OVERTIME OR SHIFT WORK
24
21.0
TEMPORARY BUILDINGS
24
22.0
JOB HEALTH AND SAFETY
24
TABLE OF CONTENTS (continued)
23.0
SECURITY REQUIREMENTS
23.1
Parking
23.2
Personnel Access
23.3
Personnel Identification
23.4
Tool Registration - Contractor Employee's Personal Tools
23.5
Tool/Material Pass — Contractor Employees
23.6
Contractor's Tools & Equipment - Control, Regulation, Security
23.7
Operating Plant Tools and Facility
24.0
DRUG & ALCOHOL ABUSE POLICY
25.0
CORRECTON OF WORK
26.0
RECORD DRAWINGS
27.0
SITE REGULATIONS & FACILITIES
28.0
FIRE PROTECTION
29.0
FLAMMABLE STORAGE
30.0
BUILDING PERMITS & CONSTRUCTIN LICENSES
31.0
SHIPPING INSTRUCTIONS & DELIVERY OF MATERIAL AND EQUIPMENT
32.0
HAZARD COMMUNICATION
33.0
LIENS
33.1
Prevention
33.2
Satisfaction
33.3
Releases
34.0
SITE MATERIAL PRACTICES
35.0
PROJECT CLOSEOUT
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34
APPENDIX 1
PART 3 TECHNICAL ATTACHMENTS
DETAILED ENGINEERING, PROCUREMENT,
CONSTRUCTION, and STARTUP
FOR THE
MALBURG GENERATING STATION PROJECT
VERNON, CALIFORNIA
Prepared by:
216 161h Street Suite 1700
Denver, Colorado 80202
C&S No. 070734
Specification No.: D-99 REV 0
July 24, 2002
Table of Contents
1 List of Vendor and City Furnished Data and Drawings
2 Engineering, Specifications, and Data Sheets
LIST OF VENDOR AND CITY FURNISHED DATA AND
DRAWINGS
(EPC DATA LIST)
ENGINEERINGf SPECIFICATIONSf AND DATA
SHEETS
Number Description
Earthwork and Concrete
A-1 Site Preparation and Earthwork
A-2 Concrete Construction
A-3 Sampling Testing & Construction Control of Concrete, Earthwork, and
Structural Steel
A-4 Equipment Grouting
Structural
B-1 Prefabricated Buildings
B-2 Supply of Structural and Miscellaneous Steel
B-3 Erection of Structural and Miscellaneous Steel
Piping
C-1 Piping Specifications
C-2 Piping Insulation
Mechanical
D-1 Installation of Mechanical Equipment
D-2 Specification for Startup Activities
D-3 Specification for Service and Instrument Air
D-4.1 Specification for Vertical Condensate Pumps
D-4.2 Specification for Vertical Circulating Water Pumps
D-4.3 Specification for Vertical Fire Pump Equipment
D-4.4 Data Sheet for Miscellaneous Pumps
D-S Specification for Field Fabricated Tanks
D-6 Not Used
D-7 Specification for Water Treatment Equipment
D-8 Data Sheet for Fuel Gas Heater
D-9 Auxiliary Cooling Water Heat Exchanger
D10 Oil Water Separator Information
D-11 Parshall Flume
Electrical
E-1 Specification for 129 Volt Battery and Charger
E-2 Specification for 6900 Volt Metal Clad Switch Gear and 480 Volt Motor
Control Centers
E-3.1 Specification for NEMA Frame Motors
E-3.2 Specification for Medium Voltage Motors
E-4 Specification for Station Service Transformers
E-S Specification for Electrical Requirements for Packaged Mechanical
Equipment
E-6 Specification for UPS
Instrumentation and Controls
E-20.1 Specification for Central Plant Distributed Control System
E-20.2 Specification for Instrumentation for Packaged Equipment
Miscellaneous
F-1 Field Painting
I-1 Specification for Vendor Documentation
NA Discipline Design Basis
CITY COUNCIL
LEONI9+C. MALBURG
Mayor
THOMAS A. YBARRA
Mayor Pro-Tem
WM. "BILL" DAVIS
Councilman
H. "LARRY" GONZALES
Councilman
W. MICHAEL MCCORMICK
Councilman
BRUCE V. MALKENHORST
City Administrator/City Clerk
FAX (323) 826-1438
CITY HALL
4305 SANTA FE AVENUE, VERNON, CALIFORNIA 90058
TELEPHONE (323) 583-8811
August 6, 2002
Scott Co. Industrial Contractors
Attn: Steve Klaus, Project Manager
14920 S. San Pedro St.
Gardena, CA 90248
Re: Letter Agreement
Dear Mr. Klaus:
EDUARDO OLIVO
City Attorney
FAX: (562) 869-1883
KEVIN WILSON
Director of Community Services & Water
FAX: (323) 826-1435
KENNETH J. DeDARIO
Director of Municipal Utilities
FAX: (323) 826-1425
STEVEN E. PARKER
Fire Chief
FAX: (323) 826-1407
BRUCE W. OLSON
Police Chief
FAX: (323) 826-1481
Transmitted herewith is a duplicate original copy of the above
referenced approved by the Vernon City Council on July 24, 2002..
If you have any questions regarding this matter, please call Mr.
Kenneth DeDario at (323) 583-8811 ext. 211.
ery truly yours,
Nel e54
Gi n
Assistant to the
Chief Deputy City Clerk
NG/gm
CC: Kenneth DeDario
Dolores Fonseca
Resolution No. 8032
Agreement No. 02-047
CITY COUNCIL
4
LEONIS C. MALBURG
Mayor
THOMAS A. YBARRA
Mayor Pro-Tem
WM. 'BILL" DAVIS
Councilman
H. "LARRY" GONZALES
Councilman
W. MICHAEL MCCORMICK
Councilman
BRUCE V. MALKENHORST
City Administrator/City Clerk
FAX (323) 826-1438
Finance Committee
City of Vernon
Honorable Members:
CITY HALL
4305 SANTA FE AVENUE, VERNON, CALIFORNIA 90058
TELEPHONE (323) 583-8811
July 18, 2002
EDUARDO OLIVO
City Attorney
FAX: (562) 869-1883
KEVIN WILSON
Director of Community Services & Water
FAX: (323) 826-1435
KENNETH J. DeDARIO
Director of Municipal Utilities
FAX: (323) 826-1425
STEVEN E. PARKER
Fire Chief
FAX: (323) 826-1407
BRUCE W. OLSON
Police Chief
FAX: (323) 826-1481
The Malburg Generation Station Project is undergoing a six-month
expedited permit process with California Energy Commission (CEC) and
they are requesting that the City provides engineering design and
drawings to support the expedited permitting process. This has been
reviewed by the Director of Utilities and the City Attorney and it is
hereby recommended that an Interim Letter Agreement with The Scott
Company be approved and executed to provide the necessary engineering
design and drawings at a cost not to exceed $150,000.00.
Very truly yours,
Bruce V. Malkenhorst
Director of Finance
BVM/gm
Ju y 18, 2002
TO: Bruce V. Malkenhorst, City Administrator
FROM: Kenneth J. DeDario, Director of Utilities
SUBJECT: Malburg Generating Station Project Letter Agreement
I recommend approval of the attached Letter Agreement between the City of Vernon and
The Scott Company (Scott) to provide for needed engineering design and drawings to
support the California Energy Commission (CEC) permitting process. Since Vernon is in
the six-month expedited permit process the CEC is requiring this additional information.
This Letter Agreement will authorize Scott to complete the required drawings at a cost
not to exceed $150,000. This cost will be offset against the Detailed Engineering,
Procurement, Construction, and Startup (EPC) contract between the City and Scott, if one
is approved by the City Council. This Letter Agreement has been reviewed by the City
Attorney.
If you have any questions or comments, please contact me. Thank you for your
consideration.
KJD:dm
Attachment
DD R-, Z� p W.
LETTER AGREEMENT
Scott Company
14920 S. San Pedro St.
Gardena, CA 90248
Attention: Mr. Steve Klaus
Re: Malburg Generating Station Project: City of Vernon
The City of Vernon (the "City") has received a proposal dated
April 29, 2002, from Scott Company ("Scott") for the
engineering, procurement and construction ("EPC") of the Malburg
Generating Station ("MGS") Project. The parties have not yet
negotiated a contract for the EPC. However, in order for the
City to comply with the informational needs of the California
Energy Commission ("CEC") as required by the six-month expedited
license process and complete the required attachments for the
EPC contract, the City needs Scott to develop and complete
engineering design and drawings.
This Letter Agreement shall be subject to the following terms
and conditions:
1. The parties intend to proceed with the negotiation of an
EPC contract with a fixed and a firm price that shall not
exceed US$43,900,000 (forty-three million nine hundred
thousand dollars).
2. Payment terms shall be mutually agreed upon.
3. The scope of services shall be as provided in Scott's EPC
proposal dated April 29, 2002.
Scott Company Letter Agreement
Page 2
4. The effective date for this Letter Agreement shall be
July 24, 2002. Based upon this Letter Agreement, Scott
shall proceed to complete the engineering design and
drawings to support the CEC permitting process and complete
the required attachments for the EPC contract.
5. The City shall pay Scott an amount not to exceed one
hundred fifty thousand dollars ($150,000), which sum shall
be billed by Scott on a time and materials basis.
6. The parties intend to enter into negotiations as soon as
practical and to complete such negotiations no later than
August 24, 2002.
7. This Letter Agreement shall be governed by the laws of the
State of California.
8. In no event shall Scott be liable to the City of Vernon for
any special, incidental or consequential damages of any
kind or nature.
9. The City of Vernon shall not be obligated or bound by any
contract until and unless the negotiations result in a
contract acceptable to both parties and the contract is
approved by the Vernon City. Council or executed by the
Vernon City Administrator and the Vernon City Attorney.
10. The City of Vernon may terminate this Letter Agreement at
any time, without cause.
11. If the parties agree upon a contract that is approved by
the City as set forth in paragraph 9 above, the Contract
will replace this Letter Agreement.
12. If the parties are able to agree upon a contract, all sums
paid under this Letter Agreement shall be treated as a
credit to the City which shall be applied to the first
payment to be paid by the City under the contract.
Scott Company
Page 3
Letter Agreement
Please confirm your acceptance of this Letter Agreement by
return.
Sincerely,
.CITY OF VERNON
Bruce V. Malkenhorst
Title: City Administrator
Date:
ACCEPTED BY SCOTT COMPANY
Name
Title
Date
CITY ADMINISTRATOR/CITY CLERK'S
INTER -OFFICE MEMORANDUM
DATE: July 30, 2002
TO: Cindy Calzada, Secretary
FROM: Nelly Giron
Assistant to the Chief Deputy City Clerk
RE Resolution Nos. 8024, 8025, and 8032
Per your request, transmitted herewith are copies of the above
referenced, approved on July 24, 2002.
:gm
CITY ADMINISTRATOR/CITY CLERK'S
INTER -OFFICE MEMORANDUM
DATE: September 17, 2002
TO: Karina Rueda, Personnel Clerk
FROM: Nelly Giron
Assistant to the Chief Deputy City Clerk
RE: Scott Company Agreement and Insurance Schedule
Per your request, transmitted herewith is a copy of the Scott Company
Agreement, approved on September 4, 2002 and the Insurance Schedule.
:gm
CC: Agreement 02-065
Resolution 8051
a
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RESOLUTION NO. 8032
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
VERNON APPROVING AND AUTHORIZING THE EXECUTION OF
AN INTERIM LETTER AGREEMENT BY AND BETWEEN THE CITY
OF VERNON AND SCOTT CO. INDUSTRIAL CONTRACTORS, A
SUBSIDIARY OF THE SCOTT COMPANIES, INC.
WHEREAS, the City of Vernon ("City") is proceeding at this
time to develop a 134 MW Combined Cycle Power Plant officially named
the Malburg Generating Station (the "Malburg Project") for the purpose
of installing additional generating capacity that will yield an
efficient, cost-effective, and reliable source of electric generation
to the City of Vernon; and
WHEREAS, City staff has determined that it needs the services
of a consultant to provide consulting services respecting a detailed
engineering, procurement and construction ("EPC") contract for the
Malburg Project; and
WHEREAS, in order for the City to provide the California
Energy Commission ("CEC") with information that it requires under its
six-month expedited license process and complete the design
requirements for the EPC contract, the City staff needs to proceed with
the development and completion of the engineering design and drawings
for the Malburg Project; and
WHEREAS, Scott Co. Industrial Contractors, a subsidiary of
The Scott Companies, Inc. ("Scott"), a firm specializing in Industrial
Construction Services, is willing to provide such services to the City
while the EPC is still being negotiated; and
WHEREAS, City staff has determined that Scott possesses the
technical knowledge and expertise to provide the necessary
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engineering design and drawings to support the CEC permitting process
and complete the required attachments for the EPC contract for the
Malburg Project; and
WHEREAS, during the negotiations for the EPC contract, the
City and Scott desire to enter into an interim letter agreement setting
forth the terms and conditions of providing the engineering design and
drawing services to support the CEC permitting process and EPC contract
for an amount not to exceed $150,000.00; and
WHEREAS, in the event an EPC contract is finalized with
Scott, any amount paid pursuant to this interim letter agreement shall
be treated as a credit to the City to be applied to the City's first
payment under the EPC contract; and
WHEREAS, on July 23, 2002, the Finance Committee recommended
that the City Council approve the recommendation of Bruce V.
Malkenhorst, Director of Finance, dated July 18, 2002, that an interim
Letter Agreement be approved and executed with Scott; and
WHEREAS, the City Council of the City of Vernon has
determined that, pursuant to the provisions of subsection (a) of
Section 2.27 of the Vernon City Code, it is in the public interest and
necessity to enter into an interim Letter Agreement with Scott setting
forth the terms and conditions of the services to be performed for the
Malburg project to enhance services provided to the Vernon community.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF VERNON AS FOLLOWS:
SECTION 1: The City Council of the City of Vernon hereby
finds and determines that the recitals contained hereinabove are true
and correct.
- 2 -
1 SECTION 2: The City Council of the City of Vernon hereby
2 approves the Letter Agreement with Scott, a copy of which is attached
3 hereto as Exhibit "A" and made a part hereof.
4 SECTION 3: The City Council of the City of Vernon hereby
5 authorizes the Mayor and the City Clerk to execute said Letter
6 Agreement for, and on behalf of, the City of Vernon.
7 SECTION 4: The City Council of the City of Vernon hereby
8- directs the City Clerk, or his designee, to send one fully executed
9 Agreement to:
10 Scott Co. Industrial Contractors
Attn. Steve Klaus, Project Manager
11 14920 S. San Pedro St.
12, Gardena, CA 90248
13 SECTION 5: The City Clerk of the City of Vernon shall
14 certify to the passage of this resolution, and thereupon and
15 thereafter the same shall be in full force and effect.
16 APPROVED AND ADOPTED this 24th day of July, 2002.
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EONIS C. MA URG, M yor
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20 ATTEST:
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23 BRUCE V. MALKENHORST, City Clerk
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3 -
STATE OF CALIFORNIA )
) ss
COUNTY OF LOS ANGELES )
I, BRUCE V. MALKENHORST, City Clerk of the City of Vernon, do
hereby certify that the foregoing Resolution, being Resolution No.
8032, was duly adopted by the City Council of the City of Vernon at an
adjourned regular meeting of the City Council duly held on Wednesday,
July 24, 2002, and thereafter was duly signed by the Mayor of the City
of Vernon.
(SEAL)
BRUCE V. MALKENHORST, City Clerk
- 4 -
CITY COUNCIL
LEONIS C. MALBURG
Mayor
THOMAS A. YBARRA
Mayor Pro-Tem
WM. 'BILL" DAVIS
Councilman
H. "LARRY" GONZALES
Councilman
W. MICHAEL MCCORMICK
Councilman
BRUCE V. MALKENHORST
City Administrator/City Clerk
FAX (323) 826-1438
CITY HALL
4305 SANTA FE AVENUE, VERNON, CALIFORNIA 90058
TELEPHONE (323) 583-8811
July 24, 2002
LETTER AGREEMENT
Scott Co. Industrial Contractors
Attention: Mr. Steve Klaus
14920 S. San Pedro Street
Gardena, CA 90248
EDUARDO OLIVO
City Attorney
FAX: (562) 869-1883
KEVIN WILSON
Director of Community Services & Water
FAX: (323) 826-1435
KENNETH J. DeDARIO
Director of Municipal Utilities
FAX: (323) 826-1425
STEVEN E. PARKER
Fire Chief
FAX: (323) 826-1407
BRUCE W. OLSON
Police Chief
FAX: (323) 826-1481
Re: Malburg Generating Station Project: City of Vernon
Gentlemen:
The City of Vernon (the "City") has received a
proposal dated April 29, 2002, from Scott Co. Industrial
Contractors, a subsidiary of The Scott Companies, Inc. ("Scott")
for the engineering, procurement and construction ("EPC") of the
Malburg Generating Station ("MGS") Project. A contract for the
EPC has not yet been fully negotiated. However, in order for
the City to provide the California Energy Commission ("CEC")
with information it requires under its six-month expedited
license process and complete the design requirements for the EPC
contract, the City must proceed with the development and
completion of the engineering design and drawings. Scott has
indicated a willingness to provide such services to the City.
However, Scott is concerned that it will incur costs associated
with the completion of the engineering design and development
while the EPC is being negotiated.
Scott Co. Industrial Contractor Letter Agreement
Page 2
July 24, 2002
The City and Scott (hereinafter referred to as "the
Parties") intend to proceed with the negotiation of an EPC
contract as soon as practical. The Parties also intend to
complete such negotiations no later than August 14, 2002. The
City shall not be obligated or bound by any EPC contract until
and unless the negotiations result in a EPC contract acceptable
to both parties and approved by the Vernon City Council.
The Parties hereto do mutually agree to this Letter
Agreement subject to the following terms and conditions:
1. The effective date for this Letter Agreement shall be July
24, 2002.
2. Scott shall proceed to complete the engineering design and
drawings to support the CEC permitting process and complete
the EPC contract.
3. The City shall pay Scott on a time and material basis. The
total amount to be paid to Scott under this Letter
Agreement shall not to exceed one hundred fifty thousand
dollars ($150,000.00).
4. Scott shall submit an invoice to the City within thirty
(30) days of the end of any month in which services have
been performed or costs incurred by Scott. The invoice
shall state the amount due to Scott and itemize the
services performed.
5. The City of Vernon may terminate this Letter Agreement at
any time, without cause.
6. If the parties are able to agree upon an EPC contract, all
sums paid under this Letter Agreement shall be treated as a
credit to the City which shall be applied to the first
payment to be paid by the City under the EPC contract.
Scott Co. Industrial Contractor Letter Agreement
Page 3
July 24, 2002
7. This Letter Agreement shall be governed by the laws of the
State of California.
Please confirm your acceptance of this Letter
Agreement by return.
Sincerely,
CITY OF VERNON
ATTEST:
By:
Bruce V. Malkenhorst, City Clerk
APPROVED AS TO FORM:
By:
Eduardo Olivo, City Attorney
ACCEPTED BY SCOTA
Adiax'�i o T
Name
Title
Leonis C. Malburg, Mayor
INDUSTRIAL CONTRACTORS,
Scl,et Companies, Inc.
J 1 P(
5 c 09
Staff Report
co
?00�
Date: August 22, 2002 lRgj0RsO
g F,cjCF
To: Bruce V. Malkenhorst, City Administrator
From: Kenneth J. DeDario, Director of Utilities K4A—
Ramon Z. Abueg, Assistant Director of Engineering & Operations 49.0—
RE: Malburg Generating Station Project: EPC Contract
The Utilities Department recommends approval of the EPC contract with Scott Company
(Scott) for the detailed Engineering, Procurement of the balance of plant materials, and
Construction (EPC) of the Malburg Generating Station (MGS) Project for the contract price of
Forty -Three Million Nine Hundred Thousand Dollars ($43,900,000).
Scott is a well -established mechanical contractor in Southern California and will serve as the
prime contractor for the consortium for the MGS Project. The consortium consists of Scott
and Power Engineers. The Scott consortium is experienced at power plant construction,
particularly the Alstom generator based plants. Although Scott is regarded principally as a
mechanical contractor, the MGS Project construction will be heavily weighted toward
mechanical work. Scott has provided construction services widely in California and will use
specialty subcontractors for work in those areas that are outside of its principal areas of
expertise. Scott's use of Power Engineers to develop the detailed design for the MGS
Project is positive, since Power Engineers was involved in the detailed design of the Redding,
California and Chaska, Minnesota Alstom generator based plants.
BACKGROUND
Carter -Burgess, the City's design engineer, originally estimated the MGS Project Cost at
Ninety Million Four Hundred Sixty -Five Thousand Three Hundred Ten Dollars ($90,465,310);
see Attachment 1.
The Carter -Burgess Original EPC Cost Estimate was established by subtracting the non-EPC
related activities from the Original Cost Estimate as follows:
Original Cost Estimate 90,465,310
- Owner's Design Engineer (950,000)
- Program Management (3,250,000)
- Equipment Purchased by City (54,562,329)
Original EPC Cost Estimate 31,702,981
August 22, 2002
Staff Report: Malburg Generating Station Project: EPC Contract
EPC SELECTION PROCESS
On the City's behalf, Carter -Burgess sent out Contractor Questionnaire packages to
established EPC contractors in the industry. The purpose of the Contractor
Questionnaire was to pre -qualify the top five EPC contract bidders for further
consideration. Due to the extensive volume of documents that needed to be reviewed,
the City and Carter -Burgess determined that the final EPC bid packages would only be
sent to the top five qualified EPC contractors.
The Contractor Questionnaire was sent to the following:
Item
Bidder
Response
1
ARB
Yes
2
Black and Veatch
Yes
3
TIC
Yes
4
Alstom Power, Prenco
Yes
5
University Marelich Mechanical
Yes
6
Irwin Industries
Yes
7
Swingerton
Yes
8
FHI Plant Services
Yes
9
Cherne Construction
Yes
10
B I BB/Kiewitt
No
11
Brinderson E&C
No
12
CRC
No
13
Dillingham
No
14
Fluor
No
15
Johnson -Peltier
No
16
Nepco
No
17
Pacific Western
No
18
Parsons
No
19
Thomason Mechanical
No
20
Turner Construction
No
21
Turner Industries (Harmony)
No
August 22, 2002 2
Staff Report: Malburg Generating Station Project: EPC Contract
Nine bidders responded to the Contractor Questionnaire and were evaluated on a
weighted qualitative basis using the following factors:
1. Quality and Experience of the On -Site General Contractor Staff Proposed 20%
2. Previous Demonstrated Experience in the Construction of Similar 120
MW CC Power Plants 20%
3. Quality and Experience of the General Contractor's Home Office Support
Staff 10%
4. Ability of the General Contractor to Support Construction Start &
Completion Dates 10%
5. Quality of the General Contractor's and Designer's Project Management
System 10%
6. Ability of the General Contractor to Provide Required Skilled Union
Personnel 5%
7. Quality & Experience of the General Contractor's Designer of Similar 120
MW Power Plants 10%
8. General Contractor's Financial and Bonding Strength. 15%
100%
Each category was given 5 points. Each category was then weighted as noted in the
table above. A perfect score for item one would be 5 times 20% or a value of 1. A perfect
score for the sum of all the categories would be 5. Carter -Burgess verified the information
furnished in the responses including bank references, D&B rating, company's net worth,
bonding capacity, insurance company, and credit references.
ARB and Black & Veatch decided to team up during the evaluation process. TIC, BIBB,
and Kiewit also formed a consortium. The evaluation process resulted in four qualified
bidders with a fifth as an alternate.
Resulting from the pre -qualification process, bid packages were sent to the following pre -
qualified bidders:
1. ARB/Black & Veatch,
2. TIC/BiBB/Kiewitt,
3. Alstom Power (Prenco) & Power Engineers,
4. University Marelich Mechanical,
5. Irwin Industries
August 22, 2002 3
Staff Report: Malburg Generating Station Project: EPC Contract
During the bid process, Alstom Power (Prenco) contacted the City and Carter -Burgess.
Prenco requested that the City consider a new consortium of Scott/Prenco/Power Engineers
because Prenco would not be able to take a general contractor position because of a policy
change in the Alstom Corporation. It was determined that this was satisfactory as long as
Scott met the pre -qualification requirements. Scott submitted the requisite documents and
referrals, which Carter -Burgess verified, to qualify Scott as a bidder for this project.
Four of the five bidders submitted a proposal:
• Scott/Prenco/Power Engineers $ 48,762,600
• University Marelich Mechanical $ 50,870,200
• ARB/Black & Veatch $ 63,000,622
• TIC/BiBB/Kiewitt $ 69,300,200
ADDITIONAL COSTS FOR EPC
The prices provided by the bidders were significantly higher than the Carter -Burgess Original
EPC Cost Estimate. Therefore, the Utilities Department instructed Carter -Burgess to re-
evaluate the project cost estimate analyzing the factors that may have accounted for the
difference between the Carter -Burgess Original EPC Cost Estimate and the bid prices. The
following items were identified as the contributing factors to the variance in costs.
CEC Licensing Process: During the Application for Certification (AFC) process with
the California Energy Commission (CEC) for the construction and operation of the
MGS, substantial modifications were made to the project design basis. The CEC
required that the seismic design basis be changed due to the possible damaging
effects of newly discovered earthquake faults, not shown in geographic maps, known
as blind thrust faults. This additional cost for the changes in engineering design,
additional equipment, and increased earthwork/foundation is estimated at
$3,000.000, and was not included in the Carter -Burgess Original EPC Cost Estimate.
2. Site and Laydown Areas: The EPC bidders had concerns about the small area, tight
space and availability of laydown areas at the project site. The project site is much
smaller than the normal project site for this size of plant to accommodate construction
offices, and parking, laydown, staging and storage areas. The EPC bidders,
particularly Scott, expressed concerns regarding the risk due to congestion and the
impact on productivity due to the size of the project site. The increased cost
attributable to this risk is estimated to be $5,000,000, which consists of higher direct
labor, overhead and equipment utilization.
3. Labor Cost: Carter -Burgess estimated the labor hours and rate based on a similar
project that it had worked on previously in the Denver area. Carter -Burgess
mistakenly failed to utilize the labor rates that applied in the Los Angeles area for
skilled labor. Carter -Burgess also significantly underestimated the total labor man-
hours required for this project. This results in a cost difference of approximately
$2,945,000 in the labor component.
August 22, 2002 4
Staff Report: Malburg Generating Station Project: EPC Contract
4. Contractor Supplied Equipment: There also has been some increase in the contractor
furnished equipment cost. The water treatment system has been modified to process
the reclaimed water that will be used for cooling. This results in an increase of
$413,800.
Below is Carter -Burgess' Adjusted EPC Cost Estimate which includes the changes due
to the above items:
Original EPC Cost Estimate
Seismic Requirement
Site and Laydown Risks
Labor Costs
Equipment Change
Adjusted EPC Cost Estimate
INDEPENDENT CONSULTANT REVIEW
31,702,981
3,000,000
5,000,000
2,945,000
413,800
$43,061,781
Since the proposals received from the four bidders came in higher than Carter -Burgess'
Adjusted EPC Cost Estimate, the Utilities Department requested Navigant Consulting, Inc.
(Navigant) to provide an independent review of the bid proposals, specifically Scott's proposal.
Navigant compared the MGS Project data to recently published data for installation of a similar
plant using the traditional EPC concept. Unlike the MGS Project, the traditional EPC concept
would include procurement of all equipment. Navigant determined that the EPC cost should
be on the order of $600/KW or approximately $80,000,000. This estimate was then adjusted
for site location & conditions and required emissions equipment for an additional cost of
$10,000,000 and $5,000,000, respectively. Navigant also noted that there is an unusual
amount of concrete needed because of the additional seismic requirements for the MGS
Project which adds approximately $4,000,000. Navigant's estimate for the MGS Project EPC
cost, using the traditional EPC concept, (as noted above, this includes the purchase of all
equipment) was approximately $100,000,000 excluding site costs, transmission, taxes, permits
and interconnections.
Navigant then estimated the EPC cost for the MGS Project by subtracting the cost of the
equipment the City had already committed to purchase, approximately $58,000,000, from
Navigant's total estimated cost of $100,000,000. This resulted in Navigant's EPC cost
estimate of $42,000,000. However, the $58,000,000 equipment cost used by Navigant
included approximately $4,000,000 of owner's engineer work which is being provided by
Carter -Burgess. Therefore, Navigant's EPC cost estimate should have been $4,000,000
higher or approximately $46,000,000. Please see Attachment 4 for details.
August 22, 2002 5
Staff Report: Malburg Generating Station Project: EPC Contract
REJECTION OF BIDS
All bids were rejected because the prices were higher than the Carter -Burgess Original EPC
Cost Estimate of $31,702,981 and the Carter -Burgess Adjusted EPC Cost Estimate of
$43,061,781. Staff contacted all bidders to ask them if they would be willing to negotiate their
prices down to below $45,000,000. Two bidders, ARB/Black & Veatch and TIC/BiBB/Kiewitt,
were not willing to drop their prices. University Marelich Mechanical did not respond. Only
Scott was willing to negotiate. The Utilities Department then sought and received approval
from the City Council to have an exclusive discussion with Scott Company, the lowest bidder,
to attempt to negotiate a contract price close to the Carter -Burgess Adjusted EPC Cost
Estimate of $43,061,781.
NEGOTIATIONS and RESULT
After several discussions with Scott, it offered a reduced price of $44,985,000. The Utilities
Department continued to pursue Scott for additional price reduction. Scott indicated that it
could reduce it's price further, if the City would allow Scott to change its consortium of Scott,
Prenco (Alstom) and Power Engineers to Scott and Power Engineers, citing that only Prenco
was unwilling to reduce its price. Prenco's role in the consortium was to specify and purchase
the balance of plant equipment. However, since Power Engineers had worked on the Alstom
power plant projects in Redding, California and Chaska, Minnesota, similar to the MGS
Project, Power Engineers was well qualified to perform these activities.
All the bidders rejected the liquidated damages requirements of the Sample EPC Contract
Document provided in the Request for Proposals. Both the City and Carter -Burgess decided
that it was economical to reduce the liquidated damages requirements in consideration for a
reduction in the bid price. After further discussions with Scott the final negotiated EPC cost is
$43,900,000, which is only approximately two percent (2%) higher than the Carter -Burgess
Adjusted EPC Cost Estimate of $43,061,781. This negotiated price is a reduction of
$4,862,600, approximately ten percent (10%) lower than Scott's original bid of $48,762,600.
The Utilities Department, Carter -Burgess, Scott and Power Engineers have reviewed and
conformed the EPC specifications, site conditions, schedule and engineering drawings as part
of the EPC contract. As part of the negotiation the Utilities Department required Scott to
produce detailed drawings to ensure that Scott had a good understanding of the specifications.
The City Council authorized, through a Letter Agreement, to pay up to $150,000 for the cost of
these drawings which shall be deducted from the final negotiated EPC cost of $43,900,000.
Staff believes that because the detailed drawings are part of the EPC Contract, this price is
firm and that the need for future change orders will be minimal.
CONCLUSION
Based on the above information, the Utilities Department has concluded that the EPC price of
$43,900,000 is reasonable for the MGS Project. Therefore, this affirms our recommendation
of approval of the EPC contract with Scott Company.
RZA:dm
Attachments
August 22, 2002
Staff Report: Malburg Generating Station Project: EPC Contract
Attachment 1. Original Project Cost Schedule
Attachment 2. Carter -Burgess EPC Bid Analysis
Attachment 3. Project Capital Cost vs EPC Bid
Attachment 4. Navigant's Assessment of EPC Proposal
August 22, 2002 7
ATTACHMENT 1
Original Project Cost Schedule
Carter & Burgess, Inc. ESTIMATE SUMMARY
Customer City of Vernon Proposal Number
Location Vernon, CA Job Number 070734.400
Project Name 135 MW Combined Cycle Power Plant Date 12/17/2001
A/stom - GTX100 Estimated By Dan Heilig
Revision Number 1 Estimated By
Rev Date 12/17/2001
Craft Craft Labor Material Other Total % %
Acct Description Hours Rate Dollars Dollars Dollars Dollars TEFC DFL
A
Earthwork & Concrete
27,000
$18.70
505,000
625,000
1,130,000
0.014
B
Structural Steel/Buildings/Plant Items
3,500
$21.43
75,000
300,000
220,000
595,000
0.007
C
Piping Systems
46,000
$25.00
1,150,000
1,875,000
3,025,000
0.038
D
Process Equipment *
51,000
$25.00
1,275,000
54,056,500
200,000
65,531,500
0.689
E
1 Electrical Systems/instrument & Controls
82,000
$25.00
2,050,000
4,365,000
6,415,000
0.080
F
I Painting & Insulation
400,000
400,000
0.005
Total Direct Field Cost
209,500
$24.13
5,055,000
61,221,500
820,000
67,096,500
0.83
G01
Field Staff & Office Expense
1,668,150
0.330
G02
Payroll Taxes & Insurance
925,065
0.183
G03
Const Expendables & Supplies
288,135
0.057
G04
Temporary Facilities
434,730
0.086
G05
Const Equipment & Tools
1.668,150
0.330
G06
Craft Benefits & Construction Camp
1,258,695
0.249
G07
Startup of Facilities
232,530
0.046
6,475,455
Total Indirect Field Cost
707,7001
640,3321
5,127.423
6,475,455
0.08
1.281
H
Contractor Final Design less OFE foundations
2,850,000
0.04
H
Owners Engineer 30% Design)
950,000
0.01
H
Owners PM/CM/Startup/Long Lead Procure/Contract(plus OFE foundations $650K
3,250,000
0.04
turbine foundations design included in the $2,600,000
Total Field & Office Cost
80,621,955
1.0
J01
Sales & Use Tax 0.00%
J02
Craft Premium Pa - 5%
252,750
J03
Contingency
5,769,500
7.16%
Subtotal
86,644,205
J04
Contractors Fee - 5%
3,821,105
Jos
0.00%
90.465,310
Total Project Cost 135000
$ 670
/Per Kw
90,465,310
Note: Emission offsets, IDC, demolition, switchyard modifications, gas and
water supply line, taxes forequipment and material and permits are not included.
Note: This estimate is based upon Carter & Burgess' experience with projects of similar scope and size.
The estimate utilizes actual equipment supplier quotes and budget estimates. This information
is used to factor the total estimate based on historical data. The probability of maintaining
the projects installed cost basis is -5% to + 20%.
Note: * Includes price for combined catalyst system.
ATTACHMENT 2
Carter -Burgess EPC Bid Analysis
Carter Surgess
May 28, 2002
City of Vernon
Attn. Mr. Ramon Abueg
4305 Santa Fe Avenue
Vernon, CA 90058
Reference: MALBURG GENERATING STATION
EPC Bid Evaluation
Dear Mr. Abueg;
Summary
LTR-143
216 Sixteenth Street Mall
Suite 1700
Denier, Colorado 80202-5131
Phone: 303.820.5202
Fax: 303.595.0833
The bids from all four bidders was much higher than the value remaining in the original budget.
Some of the items that impact the budget value have been discussed in letter 144. However,
even taking these items into account all four bids were still high. We have recommended and
the City concurred to essentially reject all bids and bring in the first lowest evaluated bidder,
Scott, for detailed discussion as outlined in Itr 142 and Scott Itr 2. If Scott can not come to
resolution with the City, the next step would be to bring in either ARB or University Marelich.
Currently ARB has been told there is a possibility that they will be contacted.
As discussed below ARB has good construction experience, however, there cost is much higher
and their engineer has taken many significant exceptions to the RFQ.
The University Marelich proposal is much closer the Scott bid in price. However, they do not
show significant experience with this type of project and they have also taken significant
exceptions to the RFQ.
Bid Evaluation
Technically acceptable bids were received from teams lead by TIC, Scott Co, University Marelich
Mechanical, and ARB Inc. The quantitative, and qualitative bid comparison is in the attached
excel spread sheet, (prop bid form). Table 1 includes the capital cost comparison. Table 2
includes the detailed manhours and cost estimates that were requested from the bidders. Table
3 includes the qualitative evaluation parameters.
r�
The adjusted bid price for each bidder is shown on Table 1. Several minor adjustments were
required to bring the bids to a similar basis. The total costs identified have been adjusted as
best as possible to allow all four bids to be compared directly. However, as noted below the
Bidders have excluded some of the requirements of the RFQ. The bidders were requested to
Carter & Bin-gess. Inc. Carter & Burgess Consultants, Inc. Nixon & Laird Architects -`Engineers. P.C. :Nixon & Laird Architects"Engineers. Inc.
C&B : evada. Inc.
CarternBurgess_
supply the estimated costs for the major equipment that they offered as well as the installation
manhour for the major equipment. These items are shown in Table 2.
Qualitative
A simple matrix was included in the RFQ describing how the bidders non -cost issues would be
evaluated. A summary of these items as well as C-B evaluation is included in the attached
Table 3.
Recent team or company experience with similar sized projects
The TIC and ARB Company experience identified were very good. They were rated high. The
University Marelich team had poor experience identified. They were rated 0 for this category..
Scott Co by itself does not show a great deal of large of project or scope. However, they are
teamed with Alstom Power which has installed the only GTX100 machines in the US. They were
given medium marks.
Experience of the engineering team
All four bidders have selected companies experienced in engineering combined cycle power
projects with good experience. It also appears that the individuals assigned have good
experience for all four teams. All four teams were given high marks in this category.
Experience of Construction Team
The TIC and ARB teams have much recent combined cycle experience. They were given high
marks for this category. University Marelich proposed team, has very little combined cycle
power plant construction experience as identified in their proposal. They were given low marks
for this category. Scotts team also does not show much experience in larger combined cycle
projects. It is assumed that Alstom Power would provide the needed experience. However, this
needs to be discussed with them in detail. They were given medium marks in this category.
Completeness and content of the technical proposal
The Scott proposal was the most complete proposal. It was given high marks. The University
Marelich was the least complete technical presentation. However, they took very few
exceptions. It is unclear from the their proposal whether they understood the scope
requirements. The University Marlich bid was given medium marks. The TIC and ARB bids had
many technical exceptions and ignored significant items that really can't be changed. These
two bidders were given very low marks for this category.
Compliance with General Terms & Conditions
University Marelich had very few quoted exceptions to the bid. They were given high marks.
TIC, Scott and ARB had significant exceptions. They were given medium marks in this category.
Carter & Burp
ess. Inc. Carter & Burgess Consultants. Inc. Nikon & Laird ArchitectsTrigincers. P.C. Nixon & Laird Architects' Engineers. Inc. C&B N'ecada. Inc.
Carter=Burgess
Responsiveness to required schedule
Scott and ARB both complied with the required schedule. Neither offered shorter schedules.
The TIC and University schedules were very generic and did not indicate a clear understanding
of the project. They were given medium marks
Ability to of Contractor to Post bid bond
All four bidders demonstrated the ability to adequately post the performance bond. All four wer
given high marks.
Financial stability of prime contractor
All four bidders appear to be financially sound and capable of executing this project. All four
were given high marks in this category.
The total weighted result of the qualitative evaluation is shown at the bottom of the qualitative
bid tab table. As can be seen C-B ranked the bidders in the following order:.
Best evaluation
1
Scott
2
ARB
3
Marelich
4
TIC
Lowest evaluation
Detailed Bid Discussion
• • •
Scotts proposal included the lowest base bid taking into account any exceptions clarifications,
etc. Scott's proposal was detailed and provided good technical information. It is clear that they
understand the overall project.
Specific Comments
Scott's proposed project managers do not indicate a great deal of experience with this type of
work and this size of project. This would need to be discussed in detail before proceeding.
Scott has taken exception to the noise guarantee as have the other three bidders.
Scott has taken exception to the auxiliary power requirement due to their concern about
measuring the total. This item needs to be addressed.
Carter & Burgess. Inc. Carter & Burgess Consultants. Inc. Nixon & Laird architects `Engineers. P.C. Nixon & Laird architects/Engineers. Inc. C&B Nevada. Inc.
Carter -.:Burgess
Scott has identified a long list of clarifications and exceptions. These have been addressed
individually in letter 142 and Scottltr 2. These items will be reviewed with the bidder during the
May 30, 2002 meeting.
University Marelich Bid
The University Marelich proposal was the second lowest in base cost. However, their technical
proposal was very brief, incomplete, and did not allow C-B to realistically access their proposal.
Their cost and manhour breakdown were similar to Scott's with some exceptions.
Specific comments
University Marelich's chose to modify the balance of plant equipment layout. It is not clear at
this time whether the changes proposed offer a net benefit or not. If they were to be
considered, substantial review would be required.
U_M did offer a deduct for the site security of $120,000
U_M did not include any specific vendor information for any of the equipment they may offer.
This makes a technical evaluation very difficult.
U_M did not include any manhours for plant commissioning.
U_M did not provide a noise guarantee. They did include an allowance of $750,000 for noise
related efforts. Since none of the other bidders offered a noise guarantee. This value was
deducted from their bid.
U_M did not supply a management plan. It would be provided after award. This does not allow
C-B to evaluate their approach.
U_M has identified that all cables listed in the Alstom equipment are to be provided by Alstom.
As clearly stated in the Alstom Contracts, which are part of the RFQ not all of the cables are
provided.
U_M has not included transportation to the site and unloading. As clearly identified in the
Alstom Contracts, Alstom will deliver to the site all equipment. Unloading is not part of Alstom's
Contract.
U_M did not understand the auxiliary power request. They have estimated the entire aux
power demand, most of which is not in the Contractors scope. Their aux power guarantee is
not what was requested. U_M also prepared a GTPro heat balance model using the generic
Alsto9m data. This balance is not very relevant and was un-necessary effort on their part.
U_M did agree to the Alstom pressure limitations on HP and LP steam lines.
Carter & Burgess. Inc. Carter & Burgess Considtanis. Inc. Nixon & I .tird Arciiit ctsiEiigineers. P.C. Dixon & Laird Architects'Enpineers. Inc. C&B Nevada. Inc.
Carter=Burgess
The U-M schedule does not reflect the revised start date and includes engineering functions for
the equipment already completed. It is difficult to review the schedule in detail
U_M did provide a manloading curve. However, the loading details do not appear logical and
appear somewhat arbitrarily defined.
U_M did provide an equipment list, but it appears there is some duplication and confusion
within the Fist.
Other than a single general arrangement the bid, contains very little technical information.
ARB
The ARB evaluated proposal was the third highest by a wide margin, approximately 30% higher
than the low bidder. However, their technical proposal was well organized and provided a good
description of their bid. Their engineering approach appears to be based on designing the
plant from scratch and does not appear to take into account the work that has already been
completed. There are several significant items in the ARB bid that would require detailed
discussion.
Specific comments
The construction HRSG manhours do not appear to take into account the modular basis of the
Alstom design.
ARB offered a deduct of $72,000 if it does not include site security. This is a much lower
deduct than the other bidders.
ARB also offered a deduct of $150,000 if does not have to rent warehouse space. (CONFIRM)
The equipment cost information requested is consistent with the project estimates.
The direct manhours identified in the ARB proposal are approximately 20% higher than the low
bidder and the engineers factored estimate. It is unclear if the field supervision in this number
is on an equivalent basis with the other bidders and the engineers estimate.
ARB has identified a 90 day delay on receiving equipment. This would have to be discussed, as
there would be substantial cost involved in this arrangement.
The schedule provided appears to be based on another project and is somewhat generic in
nature.
ARS did offer a-aux power and steamline pressure drop guarantee. The steamline pressure
drop guarantees are lower than the value required by Alstom. This would offer a small benefit
to the total plant operating costs. This would not be a large savings.
Carter & Burgess, Inc. Carter & Burgess Consultants. Inc. Nixon & Laird .%reliitects,'Engitteers. P.C. Nixon & Laird Architects/Engineers. Inc. C&B Nevada. Inc.
Carter -.:Burgess
ARB did not include a noise guarantee.
ARB offers a lower retention and a lower LD for schedule than requested.
ARB identified that the plant will be engineered to their engineer's standards and essentially
takes exception to the RFQ technical requirements. This is not an acceptable approach.
ARB has decided that it needs 5 acres of laydown area and has not included this in their cost.
This response is unacceptable.
ARB has not included startup spares, an estimate for these has been added to the ARB proposal
price.
ARB has excluded any special tools or rigging. This item would have to be reviewed in detail.
ARB has taken numerous exceptions to the technical details of the RFQ. Some of the items are
worthy of review and comment. However, many of the items have been addressed in the
details of the RFQ. If ARB is to be considered all of these items need to be addressed.
ARB did not include technical information as requested. This makes an evaluation of the
technical merits of their proposal difficult.
TIC
The TIC bid is the highest bid by over 40% of the low bid. In addition, TIC refused to provide
any of the, manhour or cost breakdown information requested in the RFP proposal form. TIC
did indicate the direct field mahours in their schedule. This value is actually close to the direct
mahour estimate from C-B and the Scott bid.
TIC took significant technical and commercial exceptions. Since their price was excessively
higher than the other bidders and as noted excessively higher than the remaining budget.
Further review was not conducted at this time.
trte
13ui ess, Inc.
Moore
Project Engineer
CC: File
Carter & Burgess, Inc. Carter & Burgess Consultants. Inc. Nixon &P.C. Nixon & Laird Architectsll ngineers, Inc. C&B Nevada- Inc.
CITYOF VERNON MALBURG STATION EPC BID EVALUATION
TABLE 1
BIDDER
TIC
SCOTT
ARB
UNIVERSITY MARELICH
Home Office En ineering
Material
$0
$78,000
$0
$0
Labor
896 000
10 900 527
700 000
Total
3 974 000
10 900 527
7 000
Earthwork and Concrete
Material
$0
$3,545,000
$1,340,489
$956,200
Labor
4 675 000
$4.323.605
$1.434.300
Total
$0
$8,220,000
$5,664,094
2 390 500
Widinp and Enclosures
Material
$0
$429,000
$254,650
$475,400
Labor
351 000
$352.268
$713,100
Total
780 000
918
1 188 500
Structural Steel Pipe Rack
Material
$0
$117,000
$456,720
$155,200
Labor
95,000
$187,184
700
Total
312 000
$643.904
$387,900
Structural Steel, Other
Material
$0
$55,000
$119,470
$291,800
Labor
2 000
$130.487
38 800
Total
117 000
$249,957
730 600
Process Sptems
Material
$0
$5,454,000
$2,957,915
$2,096,700
Labor
$0
$4,675,000
$8,587,51S
$11,012,100
Total
10 129 000
$11,545,43D
$13,108,800
Piping System
Material
$0
$935,000
$3,022,779
$3,167,400
Labor
1091000
$4,669,950
$3,676,200
Total
2 026 000
$7,692,729
$6,843,600
Electrical
Material
$0
$3,081,000
$2,745,493
$3,129,400
Labor
7 791000
$7.127,003
3 019 400
Total
10 872 000
$9,872,496
148 800
Instrumentation & Controls
Material
$0
$312,000
$1,678,985
$2,569,200
Labor
31 000
715 888
587 000
Total
24 000
2 394 873
156 200
Paintingand Insulation
Material
$0
$358,000
$0
$455,400
Labor
390 000
34 413
13 100
Total
748 000
34 413
1268 500
Indirect Field Costs
Material
$0
$1,558,000
$0
$1,433,300
Labor
0
454 000
295 279
1413 500
Total
7 012,000
295 279
2 846 800
Contractor Conlin
$0
$766,000
$350,000
$1,700,000
Contractor Fee
$0
$3,132,400
$5,950,000
$3,000,000
Craft Premium Pa
$0
$50,000
$0
$500,000
Firm LumpSum Price
$0
$48,762,400
$63,000,620
$49,970,200
STARTUP SPARES
Noise alkwvance excluded
Engineering work station
HRS System
Plant commissioning
No site security
TOTAL
Builders Risk for City Equip
$69,300,2
?
$0
inc
inc
inc
NA
$69,300,2
?
1 $48,762,600
INC
$0
$253,000
$338,100
inc
-120,000
$49,233,700
$382,140
$63,000,622
$125,000
$0
$0
$0
472,800
$63,052,822
1 ?
$50,870,000
?
-$750,000
$500,000
4120,000
$50,500,000
?
8119/200211:58 AMProp FormCity.)ds
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ATTACHMENT 3
Project Capital Cost vs EPC Bid
Carter Surgess
May 23, 2002
City of Vernon
Attn. Mr. Ramon Abueg
4305 Santa Fe Avenue
Vernon, CA 90058
Reference: MALBURG GENERATING STATION
Project Capital Cost vs. EPC Bid
Dear Mr. Abueg;
LTR-144
216 Sixteenth Street Mail
Suite 1700
Denver, Colorado 80202-5131
Phone: 303.820.5202
Fax: 303.595.0833
Since November of last year the project team has been concentrating on supporting the City in
its efforts to get the appropriate permits. This effort has required some decisions that have
affected the capital cost of this project. C-B has looked at the factors that have contributed to
a higher project cost. They are discussed in detail below.
The attached table summarizes these additions:
Project Cost, December estimate 2001
$90 465 310
Additional Items
ApproArnate Cost
1
Seismic Criteria Change, engineering, concrete,
earthwork, etc
$3,000,000
Added Equipment Costs
2
Cooling Tower Adder, complete
$236 000
3
Condenser Adder, complete
$133,000
4
ALSTOM-equipment added, Complete
$625 000
5
Water Treatment System, In EPC Scope)
413 800
6
Noise Mitigation Allowance
$750,000
Construction Impacts
7 1
Added cost for congestion and lack of la down
$5 000 000
8
Contractor's Risk
$1,000 000
9
Direct Contract Labor Increase approx. 20%
$1,300,000
10
Indirect Craft labor based on direct increase
$585,000
TOTAL REVISED PROJECT COST ESTIMATE
$103 508 110
Item 1
Carter & Burgess, Inc. Carter & Burgess Consultants. Inc. Nixon & laird Architects/Engineers. P.C. Nixon & Laird Architects/Engineers-_ Inc.
C&B Nevada. Inc.
Carter Burgess
The revised seismic criteria required by the CEC has had a significant impact on the
installation cost. Primarily due to the large increase in foundation size and earthwork
required.
Items 2, 3, 4, & 5
Since the early estimates we have seen an increase in the process equipment cost.
Additionally several other challenges have surfaced, mostly with respect to the permit
application. All of these items have had an impact not only in the capital cost but
indirectly the installation cost. We have estimated the impacts of these changes. These
items include, the Alstom change orders, cooling tower added costs, condenser added
costs, and the water treatment system that was initially based on a potable water supply
instead of the reclaimed water which is currently being used.
Item 6
The noise mitigation requirements were increased between when the estimate was
prepared and the present. The exact value is unknown until negotiations can be
completed with the Contractor. However, one of the bidders assigned a value of
$750,000 for this effort. This was included to account for this effort.
Item 7 & 8
We have also re -looked at the possible impacts of the limited laydown area available,
site congestion, productivity, and Contractors risk and have assigned the a value to
them.
Item 9&10
As a comparison the following table indicates the estimated direct manhours that the
bidders proposed as compared to the revised factored estimate. As can be seen from
the table the factored estimate direct manhour estimate is essentially equal to the low
bidder and close to the others.
Original Est
I Revised Estimate
Scott Co
I ARB
1209,500
1260,750
1263,963.
284116
312 962*
* This value may contain some supervision hours.
However, it appears that the EPC bidders are using a higher direct manhour rate than C-
B used last April for the average direct labor rate. As can be seen from the estimate
sheets we utilized a direct labor rate of $24.13/hr. It appears that a current union value
should be higher Based on rough order of magnitude of current labor rates we revised
the estimate using an average rate of $28.10/hr. This results in a cost increase of
$1,300,000 for direct labor and $585,000 for the indirect labor portion. We included the
impacts of this labor change in the revised estimate of 5/22/02
Carter & Burgess. Inc. Carter R Burgess Consultants. Inc. Nixon & Laird Architects -Engineers. P.C. Nixon & Laird ArchitectsiEngineers. Inc. C&B Nevada. Inc.
Carter: -Burgess
These additions and changes have been incorporated into a revised factored cost estimated
dated 5/22/02, which is attached together with the original estimate.
To see the impact of these changes and to compare EPC Bids with these estimates Table 1 was
prepared. This table also shows the equivalent cost of the EPC bid price for the original project
estimate, the original project estimate plus 20%, the 5/22/02 and the three bidders that
supplied detailed information.
This effort was completed to provide a basis for further discussions with prospective bidders.
Please call if you have questions or comments.
Sincerely,
rter urgers, Inc.
Kelvin Moore
Project Engineer
CC: File
Carter & Burgess, Ine. Carter & Burgess Consultants. Inc. Nixon & i,aird Architects'Isn;gineers, P.C. Nixon & Laird ArchitectsTrigineers, Inc. C&B Nevada; Inc.
Carter & Burgess, Inc. ESTIMATE SUMMARY
Customer City of Vernon Proposal Number
Location Vernon, CA Job Number 070734.400
Project Name 135 MW Combined Cycle Power Plant Date 12/17/2001
Alstom - G7X100 Estimated By Dan Heilig
Revision Number 1 Estimated By
Rev Date 12/17/2001
Craft Craft Labor Material Other Total 1 °A °A
Acct Description Hours Rate Dollars Dollars Dollars Dollars TEFC DFL
A
Earthwork & Concrete
27,000
$18.70
505,000
625,000
1,130,0001
0..014
B
Structural Steel /Buitdin s/Plant Items
3,500
$21.43
75,000
300,000
220,000
596,000
0.007
C
Pi in Systems
46,000
$25.00
1,150,000
1,875,000
3,025,000
0.038
D
Process Equipment
51,000
$25.001
1,275,000
54,056,500
200,000
55,531,500
0.689
E
Electrical S stemstinstrument & Controls
82,000
$25.00
2,050,000
4,365,000
6,415,000
0.080
F
Painting & Insulation
400,000
400,000
0.005
Total Direct Field Cost
209,500
$24.13
5,055,000
61,221,500
820,000
67,096,5001
0.83
G01
Field Staff & Office Expense
1,668,150
0.330
G02
Payroll Taxes & Insurance
925,065
0.183
G03
Const Expendables & Supplies
288,135
0.057
G04
Temporary Facilities
434,730
0.086
G05
Const Equipment & Tools
1,668,150
0.330
G06
Craft Benefits & Construction Camp
1,258,695
0.249
G07
Startup of Facilities
232,530
0.046
6,475,455
Total Indirect Field Cost
707,7001
640,332
5,127,423
6,475,455
0.08
1.281
H
Contractor Final Design (less O FE foundations)
2,850,000
0.04
H
Owners Engineer 30°A Design)
950,000
0.01
H
Owners PM/CM/Startup/Lon Lead Procure/Contract(plus OFE foundations $650K
3,250,000
0.04
turbine foundations design included in the $2,600,00 0
Total Field & Office Cost
80,621,955
1.0
J01
Sales & Use Tax 0.00%
J02
Craft Premium Pa - 5°A
252,750
J03
Contingency
5,769,500
7.16%
Subtotal
86,644,205
J04
Contractors Fee - 5%
3,821,105
J05
0.00%
90,465,310
-
Total Project Cost 135000
$ 670
/Per Kw.
90,465,310
Note: Emission offsets, IDC , demolition, switchyard modifications, gas and
water supply line, taxes forequipment and material and permits ar a not included.
Note: This estimate is based upon Carter & Burgess' experience w ith projects of similar scope and size.
The estimate utilizes actual equipment supplier q uotes and budget estimates. This information
is used to factor the total estimate based on histor ical data. The probability of maintaining
the projects installed cost basis is -5% to + 20%.
Note:' Includes price for combined catalyst system.
Carter & Burgess, Inc. PESTIMATE SUMMARY
Customer City of Vernon Proposal Num bar
Location Vernon, CA Job Number 070734.400
Project Name 135 MW Combined Cycle Power Plant Date 5/22/2002
Alstom-GTX100 Estimated By DanHeilig
Revision Number 2 Estimated By Jerry Gotlieb
Rev Date 5122/2002 5/22/2002
Craft
Hours
Craft
Rate
Labor
Dollars
Material
Dollars
Sic
Dollars
Total
Dollars
%
TEFC
04
DFL
Acct
Description
A
Earthwork & Concrete"
66,988
$22.44
1,503,510
1,283,051
2,786,561
0.031
B
Structural Steel /Buiklin s/Plant Items"'
21,400
$25.71
550,286
2,300,000
440,000
3,290,286
0.036
C
Piping Systems
59,048
$30.00
1,771,440
1,875,000
3,646,440
0.040
D
Process Equipment •
52,000
$30.00
1,560,000
54,310,815
55,870,816
0.616
E
Electrical Systems/instrument & Controls
61,314
$30.00
1,839,432
4,839,314
300,000
6,978,746
0.077
F
Painting & Insulation
450,000
450,000
0.005
Total Direct Field Cost
260,750
$28.10
7,224,6681
64,608,180
1,190,000
73,022,848
0.81
G01
Field Staff & Office Expense
2,384,140
0.330
G02
Payroll Taxes & Insurance
1,322,114
0.183
G03
Const Expendab les & Sup lie s
411,806
0.057
G04
Temporary Facilities
621,321
0.086
GOS
Const Equipme nt & Tools
2,420,264
0.335
G06
Craft Benefits & Construction Camp
3,251,101
0.450
G07
Startup of Facilities
332,335
0.046
$ 68.91
Total indirect Field Cost
10,743,081
0.12
1.487
H
Contractor Final Design less O FE foundations
2,850,000
0.03
H
Owners Engineer 30% Design)
950,000
0.01
H
Owners PWCM/Startu /Lon Lead Procure/Contract plus OFE foundations $650K
3,100,000
0.03
turbine foundations design included in the $3.MM
Total Field & Office Cost
90,665,929
1.0
J01
Noise requirements
Sales & Use Tax, Exempt 0.00%
750,000
-
J02
Craft Premium Pa - 10 Hours Per Week
732,740
J03
Contingency.
7,183,935
7.86%
Subtotal
99,332,605
J04 lContractors
Fee - .035%
3,476,641
J05
Subtotal
Risk for Owner's Terms & Schedule UD's $ 60,000.00 per day
102,809,246
350,000
Total Project Cost 1350001
$ 767
/Per Kw
103,509,246
Note: Emission offsets, IDC , demolition, switchyard modifications, gas and
water supply line, taxes for equipment and material and permits ar a not included.
Note: This estimate is based upon Carter & Burgess' experience with projects of similar scope and size.
The estimate utilizes actual equipment supplier q uotes and budget estimates. This information
is used to factor the total estimate based on histor ical data. The probability of maintaining
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ATTACHMENT 4
Navigant's Assessment of EPC Proposal
gant�
CONSULTING, INC.
MEMORANDUM
DATE: June 18, 2002
TO: Ramon Abueg
City of Vernon, California
FROM: Max Walenciak
SUBJECT: Assessment of EPC Proposal from Scott Co. for the Malburg
Generating Project
I have completed a preliminary assessment of the Scott Proposal to provide EPC services to
the City of Vernon (COV) for the Malburg Generating Station (Project). This assessment was
based on a review of their proposal dated April 29, 2002 and as updated with the pricing
proposal that reduced the overall cost to $44,985,000. I have not had the opportunity to visit
the site, review purchase documents for equipment that COV is supplying or design
drawings that Carter -Burgess has developed.
In summary it is my opinion that the revised cost offered by Scott is still high by at least $3M,
and that this excessive cost is primarily in the areas of "Earthwork and Concrete and
"Electrical/I&C". My assessment, at this point in the process, is that it is worth the effort to
negotiate with Scott to further reduce the cost.
Recently published data for installation of a similar facility indicated that the EPC cost
(including major equipment) should be on the order of $600/KW or approximately $80M.
This figure would need to be adjusted for site location and conditions, which I estimate at
25% on half of the EPC cost or $10M. Emissions equipment or equipment options could add
an additional $5M. In addition, there is a unusual amount of concrete (5600 cy) required for
this project that adds an additional $4+M Therefore, my estimate for total project EPC cost
for this site would be approximately $100M excluding site cost, transmission, taxes, permits
and interconnections. Based on COV equipment purchases of $58M, I estimate that the EPC
price would be approximately $42M.
The difference between my estimate and Scott's price is small in comparison to total project
cost and I would anticipate that Scott would be willing to concede some or all of this price
difference. If COV would decide to re -bid the contract, there is no guarantee that the prices
would be lower, although the current depressed market could result in a lower price.
As mention above, one area of concern is the "Earthwork and Concrete" cost, which Scott
estimated at $8.22M, representing 179/6 percent of their total project cost. Their revised price
reduces this cost down to close to $7M (assumes $800K of contingency plus $300K for Misc.
Sub Work), but this is still very high. This cost is more that double the industry average for
this type of work because of the small project site size, location and the seismic requirement
that resulting in a large foundation. The "Contractor Contingency" line item seems low,
which would indicate that each item in their cost breakdown has contingency. For
Earthwork and Concrete, Scott may have assigned higher that normal risk factors (and thus
contingency) to account for site conditions. This contingency adder should be negotiable,
especially if it was developed early in the design process. I feel that the price savings
(through additional negotiations) for this line item should be $1-2M.
The Electrical/I&C costs as proposed were $11,496,000 or almost 24% of the proposed total
cost. The revised figure would be approximately $10M (reduce by $525K plus contingency of
$768K), which is still approximately 20% higher than expected. This added cost could be due
to selecting Alstom Power (not competitively bid) to supply the controls or due to a premium
from the electric sub (Morrow Meadows), which is a certified as a WBE business or
associated with a high contingency. I feel that the price savings (through additional
negotiations) for this line item should be $1-2M.
As we discussed on Wednesday, having Carter -Burgess do a large amount of engineering
followed by a separate EPC contractor can lead to excessive costs due to re -engineering and
additional administration. These excessive costs could be on the order of $1-2M.
I have not used Scott for services in the past but I have considered them for mechanical work
on a large project in Arizona. They have a good reputation for supplying mechanical
services. A review of their experience indicates that taking the lead for all trades, as
proposed, is not their normal line of business. Scott does not have any recent experience as a
lead contractor although they have performed a limited amount in the past. Scott's focus on
being a mechanical contractor may be a reason for excessive cost in the "Earthwork and
Concrete" and "Electrical/I&C" areas of their proposal.
In further discussions with Scott, other than the above economic discussions, I recommend
focusing on the control system (setup, checkout, training, service), redundancy, owner
approvals, equipment access and isolation, system turn over, steam blows, testing and
startup responsibility as these are areas where cost savings might be achieved and also
reduce the potential for change orders.
It should be noted that the current market for EPC work has fallen off dramatically and this
should give COV an advantage with Scott negotiations.
We hope this assessment is useful to you. Please contact us with any questions or comments
you may have.
Cc: Paul Maxwell
v •.
t
Total
Total
Equipment/Service
Supplier/Contractor
Oty
Committed
Expended
W
W
Combustion Gas Turbine
ALSTOM Power Inc.
2
27,938,950'
27,921,150
Heat Recovery Steam Generator
ALSTOM Power Inc.
2
15,487,660"
9,332,750
Steam Turbine Generator
ALSTOM Power Inc.
1
5,842,100"'
959,000
Performance Guarantee for power
ALSTOM Power Inc.
1
1,363,000
204,450
output and emission of power block
Owner's Engineer for 30% Design
Carter & Burgess
1
809,000
809,000
and support of AFC
CTG Step Up Transformers
Delta Star
2
735,720
729,720'"
STG Step Up Transformer and
Delta Star
2
828,920
0
Spare
Fuel Gas Compressors
Gas Packagers
3
526,875
421,500
Continuous Emissions Monitoring
CISCO
2
354,100
0
Systems
Cooling Tower
Marley
1
711,000
112,665"
Steam Surface Condenser
Holtec
1
624,000vl
243,200
Generator Breakers
General Electric
3
113,574
Owners' Engineer for Program and
Carter & Burgess
1
3,100,000
870,545
Construction Management
Total Committed as of 06/13/02
58,434,899 41,603,980
'Original contract price of $28,200,000 reduced by $278,850 pursuant to change orders. Additional change orders of
§15,000 issued for delayed delivery and $2,800 for the seismic redesign. New contract price is $27,938,950.
" Additional change orders issued: 1) Spare CO catalyst during commissioning, $308,000; 2) engineering for seismic 4
zoning, $56,750; and 3) additional materials for structures for seismic improvements, $187,910. New total is $15,487,660.
iii Change order of $2,100 for seismic redesign increased price to $5,842,100.
" 8% tax paid on invoice. Tax not included in the $735,720 price, $6,000 credit applied for early delivery.
8.25% tax included. Cal Board of Equalization # is SRZOHA 30-646-826.
V' A change order of $16,000 issued for modifications to meet seismic requirements.
CITY COUNCIL
LEONIS C. MALBURG
Mayor
THOMAS A. YBARRA
Mayor Pro-Tem
WM. 'BILL" DAVIS
Councilman
H. "LARRY" GONZALES
Councilman
W. MICHAEL MCCORMICK
Councilman
BRUCE V. MALKENHORST
City Administrator/City Clerk
FAX (323) 826-1438
City Council
City of Vernon
Honorable Members:
CITY HALL
4305 SANTA FE AVENUE, VERNON, CALIFORNIA 90058
TELEPHONE (323) 583-8811
August 14, 2002
EDUARDO OLIVO
City Attorney
FAX: (562) 869-1883
KEVIN WILSON
Director of Community Services & Water
FAX: (323) 826-1435
KENNETH J. DeDARIO
Director of Municipal Utilities
FAX: (323) 826-1425
STEVEN E. PARKER
Fire Chief
FAX: (323) 826-1407
BRUCE W. OLSON
Police Chief
FAX: (323) 826-1481 h\
�C7
�v.
The Director of Utilities is requesting that a contract for Detailed
Engineering, Procurement, Construction, and Startup be entered with
Scott Company to provide engineering services, equipment purchases,
and construction of the Malburg Generating Station Project (MGSP) at
an approximate cost of $43.9 million. On July 24, 2002, this
legislative body approved the execution of an Interim Letter Agreement
to provide engineering design and drawings to support the expedited
permitting process at a cost not to exceed $150,000.00 that will be
offset against the detailed engineering cost. This has been reviewed
by the City Attorney and it is hereby recommended that the contract
with Scott Company be approved and executed.
Very truly yours,
Bruce V. Malkenhorst
City Administrator/City Clerk
BVM/gm
August 14, 2002
TO: Bruce V. Malkenhorst, City Administrator FROM: Kenneth J. DeDario, Director of Utilities Kx9d-
SUBJECT: Malburg Generating Station Project
I recommend approval of the attached Contract For Detailed Engineering, Procurement,
Construction and Startup By And Between The City of Vernon And Scott Company for the
Malburg Generating Station Project (MGSP). This Contract provides for engineering services,
equipment purchases and construction of the MGSP. The Contract price is $43.9 million. The
City Attorney has reviewed the Contract.
If you have any questions or comments, please contact me. Thank you or your consideration.
KJD:ah
Attachment
CONTRACT
FOR
DETAILED ENGINEERING, PROCUREMENT, CONSTRUCTION,
and STARTUP
FOR THE
MALBURG GENERATING STATION PROJECT
VERNON, CALIFORNIA
August 14, 2002
I
EPC Contract_0_8_ 14. doc
CONTRACT
Table Of Contents
Page
1.
GENERAL
2
A
Scope of Work
2
BDefinitions
.........................................................
2
2.
RISK OF LOSS .......................................................
8
3.
CONTRACT PRICE AND PAYMENTS .................
8
A.
Contract Price
8
B.
Payment Schedule
8
C.
Invoices
9
D
Form and Content
10
E.
Payment
10
F.
Failure to Achieve Progress
10
G.
Payments Withheld
10
H.
Retainage
11
I.
Payments Not Acceptance of Work
11
4
NOTICE TO PROCEED
11
5.
CHANGE ORDERS ................................
11
A.
General
11
B.
Change Work Authorization
12
C.
Unauthorized Changes
12
D.
Effect on Schedule and Warranties and Guarantees
12
E.
Payment Procedure
12
6.
BONDING REQUIREMENTS
13
7.
PRE-EXISTING SITE CONDITIONS .....................
13
8.
LAWS AND REGULATIONS ...................
13
9.
INSPECTION.......................................................
14
10.
FORCE MAJEURE.................................................
14
11.
DELAYS/SUSPENSION..........................................
14
12.
WARRANTIES......................................................
15
A.
General
15
B.
Warranty Period
15
C.
Remedy of Defects
15
D.
Survival of Warranties
16
E.
Extent of Warranties and Guarantees
16
F.
Prevention
16
G.
Assignment of Warranties and Guarantees
16
13.
INFORMATION FURNISHED TO AND BY THE CITY
16
14.
INFORMATION FURNISHED TO CONTRACTOR
16
A.
Access to Confidential Information
16
B.
No Disclosure
17
C.
Court Ordered Disclosure
17
D.
Remedies
17
15.
TECHNICAL DATA ................................................
17
16.
PATENTS.............................................................
17
17.
CANCELLATION/DEFAULT......................................
18
A.
Termination
18
B.
Contractor's Breach
18
C.
City's Breach
18
18.
ASSIGNMENT.......................................................
18
19.
PARTIAL INVALIDITY ............................................
19
20.
CHOICE OF LAW ...................................................
19
21.
INSTALLATION/FIELD SERVICES ...........................
19
22.
INDEMNIFICATION AND INSURANCE .....................
19
EPCContract 0 8 l4.docEPGGen4r- et 0 8 14. diie PGG ntfae+ n u i doe
A. Indemnity
B. Insurance
23. NON -WAIVER .......................................................
24. AMENDMENTS .............................................
25. ENTIRE AGREEMENT .............................................
26. BENEFIT OF AGREEMENT ......................................
27. FORUM SELECTION ...............................................
28. COUNTERPARTS...................................................
29. NOTICES..............................................................
30. INDEPENDENT CONTRACTOR ................................
31. CONTRACTOR NOT AGENT ....................................
32. REVIEW OF EXISTING CONDITIONS ......................
A. Premises
B. Verification of Existing Conditions
C. Statement of Fact
33. SUPERVISION BY CONTRACTOR ............................
A Management of Work
B. Control of Work
34. GOVERNMENTAL REGULATIONS AND TAXES ......
A. Permits and Licenses
B. Laws and Regulations
35. LIQUIDATED DAMAGES .........................................
A. Delays
B. HP Steam Loss
C. Liquidated Damage Payment
D. Sole Remedy
36. MAXIMUM AGGREGATE LIQUIDATED DAMAGES
37. PERFORMANCE GUARANTEES ...............................
A. Performance Guarantees
B. Noise Emissions
C. Auxiliary Power Limit
D. HP and LP Steam line Pressure Loss
E. Obligations of the Contractor
F. Corrective Action
G. Standards for Plan of Corrective Action
38. LIMITATION OF LIABILITY ....................................
A.
B.
39. DISPUTE RESOLUTION ....................................
40. ENVIRONMENTAL PROTECTION ............................
A. Qualified Personnel
B. Material
C. Compliance with Laws
D. Hazardous Materials Removal
E. Environmental Indemnity
F. Material Safety Data Sheets
G. Suspension and Notification
41. LABOR AND MATERIALS .......................................
A. General
B. Employment of Licensed Personnel
C. Assignment of Individuals
D. Material
E. Start up Spare Parts and Special Tools
F. Quality Control Program
G. Testing
H. City's Right to Inspect
19
19
20
20
20
20
20
20
21
21
21
22
22
22
22
22
22
23
23
23
23
24
24
24
24
24
24
24
24
25
25
25
25
25
25
25
25
26
26
26
26
26
26
27
27
27
27
28
28
28
28
28
28
29
29
29
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k
APPENDIX
Page
Appendix 1 Specification for Combined Cycle Power Plant 31
Appendix 2 Project Control Requirements for Contract 32
Appendix 3 Unconditional Waiver & Release Upon Final Payment 36
Appendix 4 Insurance Schedule 40
Appendix 5 Miscellaneous 42
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l
CONTRACT
THIS CONTRACT is made, entered into and executed in duplicate originals, either
copy of which may be considered and used as the original hereof for all purposes, as of this -th
2002, in the City of Vernon, County of Los Angeles,
BY AND BETWEEN
. 101 1
Contractor
RECITALS
THE CITY OF VERNON
4305 Santa Fe Avenue
Vernon, CA 90058
SCOTT COMPANY
14290 South Pedro
Gardena, CA 90248
WHEREAS, the City of Vernon ("City") has completed the development of a
Combined Cycle Power Plant (hereinafter, the "Project") for purposes of installing additional
generating capacity within the City that is capable of yielding cost effective, efficient and reliable
electricity to meet its goals, while meeting Federal, State and local environmental and siting
requirements; and
WHEREAS, City has sought proposals for the detailed engineering, procurement,
construction and startup of a combined cycle power plant to create the Project; and
WHEREAS, Contractor submitted a proposal to City dated _, _ 2002 for the
equipment and services defined herein; and
WHEREAS, City's Utilities Department has determined that the construction of the
Project and the purchase of the equipment and services from the Contractor will assist City in
meeting its electricity goals and is in the public interest; and
WHEREAS, Contractor has advised City that it is qualified to perform such services
under this Contract
NOW, THEREFORE, THE PARTIES HERETO DO MUTUALLY AGREE AS SET FORTH
HEREIN:
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1. GENERAL
The Contract shall consist of the following:
Purchase Order
The terms and conditions as set forth in this Contract
Appendix "1" Specification for Combined Cycle Power Plant
Appendix "2" Project Control Requirements for Contract
Appendix "3" Unconditional Waiver & Release Upon Final Payment
Appendix "4" Insurance Schedule
Appendix " 5" Miscellaneous
All Appendices are attached hereto and incorporated by reference as though fully set forth
herein. To the extent that there are any conflicts between the terms of the Appendices and the
terms and conditions set forth below, the terms and conditions set forth herein shall prevail.
The above order of precedence shall prevail in the event that there is a conflict or
inconsistency among the documents that comprise the Contract.
A. Scope of Work
The Project shall consist of the detailed design and engineering, balance of plant equipment
supply, and installation of a "two on one" natural gas fired combined cycle power plant as
defined in Appendix 1.
B. Definitions
AFC Application for Certification to the California Energy Commission
AQMD Shall mean the South Coast Air Quality Management District.
Beneficial Use Shall mean that the Contractor has completed the Work (including
commissioning requirements) and the plant is ready for the
Stability and Performance Testing by the City and the City has
provided a Notice of Acceptance.
Best Efforts Shall mean those efforts which a skilled, competent, experienced,
prudent contractor would use to perform the requirements of the
Contract in a timely manner exercising the degree of professional
skill, care, competence, and prudence customarily imposed on a
contractor performing similar services for similar electric utility
projects. For the purposes of the Contract, a timely manner shall
mean strict adherence to the milestone schedule dates.
Business Day Shall refer to normal business days at the City of Vernon, Monday
through Thursday, excluding legal holidays.
Bid Shall mean the offer or proposal of the Bidder submitted on the
prescribed forms setting forth the price or prices for the Work to be
performed.
EPCContract 0 8 l4.docEPGGePAfaet 0 8 i n d3 EPCG + n 4 i ,a
Bidder Shall mean all Parties approved to bid on the RFQ Package as
determined by the City.
Change Order Shall mean a design or field Change Order or Amendment to this
Contract, signed by City's Representative, authorizing an addition,
deletion or revision in the Work or an adjustment in the Schedule or
any change to the Contract Price resulting therefrom.
City Shall mean the City of Vernon, a California Municipal Corporation.
City or Owner's Shall mean that individual designated by City, who shall have the
Representative responsibility and authority specifically delegated to such
individual by City and made known in writing to Contractor.
Combined Cycle Power Shall mean the complete Malburg Generating Station units 1,2 & 3
Plant generating units and the auxiliaries and controls as required to
produce a complete and operable power station as defined by the
Specification, Appendix 1.
Contract Shall mean this Contract and all of the Appendices, as such
Contract and Appendices now exist and as they may be hereafter
amended from time to time.
Contract Price Shall mean that price specified in Section 3 of the Contract that is
the total amount payable by City to Contractor for the Work to be
performed hereunder.
Contractor's Project Shall mean that individual designated by Contractor who shall be
Manager responsible for the performance of the Work, be authorized to
execute Change Orders and to act on behalf of Contractor and its
Subcontractors.
Commercial Operation Shall mean the successful completion of all Emissions Tests and
Performance Tests and acceptance of the Combined Cycle Power
Plant for dispatch by the City.
Commissioning Shall mean the services and craft work required to check out all
mechanical, electrical and control systems and subsystems and
declare the System ready for its Stability Test after Mechanical
Completion.
Contract Documents Shall mean the Purchase Order, the terms and conditions as set forth
in this Contract, Appendix 1 Specification for Combined Cycle
Power Plant, Appendix 2 Project Control Requirements for
Contract, Appendix 3 Unconditional Wavier & Release Upon Final
Payment, Appendix 4 Insurance Schedule, and Appendix 5, the
Proposal Form
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Contract Time Schedule Shall mean the period during which Contractor will be required to
deliver, erect, commission, and startup the System under this
Contract.
Contractor Shall mean Scott Company, (Scott), its legal representatives,
successors, and assigns.
Contract Drawings Shall mean all drawings, diagrams, illustrations, schedules, and other
data which are specifically prepared by or for the Contractor to
illustrate some portion of the Work and all illustrations, brochures,
standard schedules, prepared by a supplier and submitted by the
Contractor to illustrate material or equipment for some portion of the
Work.
Day Shall mean a calendar day and shall include Saturdays, Sundays
and holidays, except that, in the event that an obligation to be
performed under this Contract falls due on a Saturday, Sunday or
legal holiday in the State of California, the obligation shall be
deemed due on the next business day.
Defects or Deficiencies Shall mean materials and workmanship that do not conform to
Contract Drawings and/or specifications, are of inferior
workmanship, or will materially and adversely affect the performance
of the Work.
Defective Work Shall mean work that is unsatisfactory, damaged, faulty, deficient,
does not conform to the Contract, or does not meet the requirements
of any inspection, reference standard, test or approval referred to in
the Contract.
Delaying Event Shall mean a delay in the performance of the Work caused by City
or an event of Force Majeure.
Emissions Test The purpose of the Emissions Tests will be to demonstrate that the
unit meets the emissions guarantees for the specified fuel, i.e. natural
gas. The Emissions Tests will also serve as a compliance test to
demonstrate that the Combined Cycle Power Plant complies with all
guaranteed emissions limits as specified in the BRSG Contract
between the City of Vernon and Alstom Power.
Engineer or City's Shall mean Carter & Burgess, Inc.
Engineer
Equal Shall mean equal as determined by the City._
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Environmental Law Shall mean any federal, state, regional or local law, regulation,
decision of the courts, ordinance, rule, code, order, directive,
guidelines, permit or permit condition, currently existing or as
amended, enacted, issued or adopted in the future, which relates in
any way to worker or workplace safety, environmental conditions,
environmental quality or policy, health and/or safety issues or
concerns (including product safety). Environmental Law includes,
without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended (42 USC,
Section 9601 et. seq.), the Resource Conservation and Recovery
Act (42 USC, Section 6901 et. seq.), the Carpenter -Presley -Tanner
Hazardous Substance Account Act (California Health & Safety
Code, Section 25300 et. seq.), the California Hazardous Waste
Control Law (California Health & Safety Code, Section 25100 et.
seq.), the Occupational Safety and Health Act (29 USC § 651 et.
seq.), the California Occupational Safety and Health Act
(California Labor Code § 6300 et. seq.), and any regulations or
rules promulgated thereunder.
Final Payment Shall mean the last payment of the remaining Retainage after the
Contractor has fulfilled all the obligations defined in this Contract.
FOB Jobsite Shall mean when the conveyance has stopped next to the off-loading
area at the Jobsite.
Force Majeure Shall have the meaning set forth in Section 10 herein.
Jobsite Shall mean the location of Station A at 2715 East 50th Street,
Vernon, CA 90058.
Generating Hours Shall mean operating the Combined Cycle Power Plant to generate
electricity electrical grid from minimum to maximum load as
defined in Appendix 1, Part 1.
Government Agency Shall mean any federal, state or local government agency or other
public body having the mandate, authority or power to implement,
coordinate, administer or enforce an Environmental Law.
Governmental Rules Shall mean all laws, regulations, orders, decrees, conditions of any
franchise, license, permit or other authorization issued by a
governmental authority, and decisions of courts and governmental
agencies.
EPCContract 0 8 14.docEPCG + + 0 8 i n d6 UGG + + 0 Q 13 ,a
Hazardous Materials Shall mean any chemical, substance, material, controlled substance,
object, conditions, solid or hazardous waste or combination thereof
which is or may be, hazardous to human health or safety or the
environment due to its radioactivity, ignitability, corrosivity,
reactivity, toxicity, or other harmful or potentially harmful
properties or effects. Hazardous Material include, without
limitation, oil or petroleum and petroleum products, asbestos and
any asbestos containing materials, radon, polychlorinated biphenyls
(PCBs), urea formaldehyde insulation, lead paints and coatings, and
all of those chemicals, substances, materials, controlled substances,
objects, conditions and waste or combinations thereof which are
now or become in the future listed, defined or regulated in any
manner by any federal, state or local Environmental Law.
Laws and Regulations; Shall mean laws, rules, regulations, ordinances, codes, and/or
Laws or Regulations orders defined in the AFC.
Material Shall mean all materials, machinery, equipment, construction
equipment, supplies, and items, as described in the Contract and
necessary to successfully complete the Work described in the
Contract Documents.
Mechanical Completion Shall mean the date defined in Section 3 when the Contractor has
completed the installation and the System is ready for
Commissioning.
Mobilization Shall mean the date defined in the Contract that the Contractor can
commence Work on the Jobsite.
Notice to Proceed Shall mean the written notice to be issued by City to Contractor,
directing the commencement of the Work or portion of the Work.
Notice of Acceptance Shall mean written notification provided by the City defining the
completion of the Work or portion of the Work
Owner Shall mean the City of Vernon.
Parties Shall mean Contractor and City collectively. The Parties may at times
herein be referred to individually as Party.
Payment Application Shall mean the written explanation of the Contractor's request for
monthly payment for reimbursement based on quantities installed
multiplied by the unit installation prices plus material quantities and
equipment delivered to the Jobsite or adjacent laydown area.
Performance Test Shall mean the testing of the Combined Cycle Power Plant to verify
that the guaranteed performance values are met as defined in the
Specification.
EPCContract 0 8 14.docEPCGo~ r-aet 0 8 i n a6eEPGG r+Faet n 4 i doe
Performance Guarantees
Shall mean the Performance Guarantees set forth in Section 37 of
this Contract.
Purchase Order
Shall mean the standard purchase order that is issued by the City.
Retainage
Shall mean the withholding of payment by City as set forth in
Section 3H of this Contract.
RFQ Package
Shall mean the City furnished bid documents, including applicable
specifications, drawings, data sheets, and sample contract.
Schedule
Shall mean the Construction Execution Plan Schedule of key dates
and milestones for the timely completion of the Work.
Services
Shall mean all related work to be supplied by Contractor, including
furnishing of necessary equipment, craft labor, supervision, startup
labor, vendor technical support (for Contractor furnished equipment)
and required management, as described in the Contract and necessary
to successfully complete the Work described in the Contract.
Specification
Shall mean the scope of work and the documents included and
referenced in Appendix 1 to this Contract including Part IJechnical
Specification, Part 2-Erection Requirements and Part 3-Technical
Attachments.
Stability Test
Shall mean a test that is conducted after Commissioning is completed
in order to verify that the Combined Cycle Power Plant can operate in
a stable condition at various loads within the conditions specified in
the operating manuals over a 24 hour period. When the Stability Test
has been completed successfully, the plant shall be deemed ready for
Performance Testing.
Subcontractor
Shall mean any person, firm, or corporation that provides under
contract with Contractor the design engineering, construction,
equipment, labor and materials for some part of Contractor's
obligation under the terms of this Contract.
System Shall mean the Combined Cycle Power Plant.
Underground Facilities Shall mean all pipeline, conduits, ducts, cables, wires, manholes,
vaults, tanks, or other such facilities or attachments, and any
encasements containing such facilities that have been installed or are
existing underground to furnish any of the following services or
materials: electricity, gases, steam, liquid petroleum products,
telephone, cable television, computer or control data, sewage,
drainage, traffic, control systems, or water.
EPCContract 0 8 14.docEPCG t 0 8 i n d6I EPCG t n u i a
A
Witness Points Shall mean a test or inspection point during manufacturing for which
City indicates a desire to witness.
Work The Work shall include all of the home -office, on -site related
engineering, design, supervision, labor, Contractor equipment,
construction equipment, tools, fabrication, materials, startup,
Commissioning as required in the Contract and required to provide
City with a functioning System.
2. RISK OF LOSS
Title and risk of loss or damage shall pass to the City and shall be deemed to be complete
upon Beneficial Use.
3. CONTRACT PRICE AND PAYMENTS
A. Contract Price
City shall pay Contractor the Contract Price of Forty Three Million Nine Hundred Thousand
and 00/100 Dollars ($43,900,000.00) for the Work to be performed by Contractor under this
Contract. Contractor shall not be entitled to payment exceeding the Contract Price, except to
the extent that the Contract Price may be changed in accordance with the terms of this
Contract. Prices shall not include sales, or use taxes, special financing fees or value-added
taxes, the City shall either pay any and all such applicable charges or provide Contractor with
acceptable exemption certificates.
B. Payment Schedule
Contractor and City shall mutually agree to an earned installed quantity Payment
Application. Payment will be made in accordance with the agreed -upon monthly -earned
progress less five percent (5%) retention (the "Retainage") until Commercial Operation and
receipt of as -built data. Payments will also be paid in accordance with the Payment
Application in Appendix 2 Commencement and Completion of Workset forth below. The
Engineer will perform a quantity validation to approve the Pay ApplicationPayment
Application. Neither the final certificate nor final payment shall relieve the Contractor from
responsibility for defects in design, materials and workmanship. Five percent (5%) retention
will be withheld until the progress or the project reaches fifty percent (50%) complete. All
subsequent invoices rendered shall be paid net with no retention.
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• A
SCHEDULE DATES SUBJECT TO AFC APPROVAL
Estimated Award Date
August 21, 2002
Mobilization
October 15, 2002
Estimated Contractor to Start Onsite Construction
December 3, 2002
Estimated Combustion Turbine Unit 1 Mechanical Installation
Complete
July 20, 2003
Estimated Steam Turbine Unit 3 mechanically Complete
August 8, 2003
Estimated Combustion Turbine Unit 2 Mechanical Installation
Complete
August 15, 2003
Estimated HRSG Unit 1 Hydrostatic test Complete
September 8, 2003
Estimated HRSG Unit 2 Hydrostatic Test Complete
October 8, 2003
Mechanical Completion
November 30, 2003
Beneficial Use
March 26, 2004
Completion of the Performance Test
Aril 2, 2004
Commercial Operation
Aril 12, 2004
Payment Application
Date
Milestone Description
1.
8/21 /02
Contract Award
2.
12/03/02
On Site Mobilization
3.
12/31/02
Engineering, Submittals, Procurement of
balance of Plant
4.
08/01/03
Erection of HRSG #1 Modules
5.
09/15/03
Erection of HRSG #2 Modules
6.
07/20/03
Erection of CTG #1
7.
8/15/03
Erection of CTG #2
8.
8/08/03
Erection of ST #3
9.
11/08/03
Hydrotest of Power Train #1
10.
11/22/03
Hydrotest of Power Train #2
11.
11/30/03
Completion of Mechanical Work
12.
03/26/04
Beneficial Use
Contract Percentage
10%*
10%*
10%
15%
15%
10%
10%
8%
2%
3%
4%
3%*
All payments except those identified with an asterisk will be reviewed and approved
by the City based on quantities installed and or deliveries as defined in the Schedule.
C. Invoices
Contractor shall submit an invoice to City on a monthly basis based on progress agreed to
herein. Contractor shall not include progress payments made to Subcontractors of material or
equipment during its manufacture thereof. The adjacent laydown area and Contractor's
Gardena facility can be considered part of the project site for partial payments for delivery;
however, the risk of loss shall be determined by Section 2 of this Contract.
EPCContract 0 8 14.docEPGG + + 0 8 i n as EKG t + n Q i 3.d
r
D. Form and Content
Contractor shall provide adequate documentation to City's Representative to support its
invoice for purposes of confirming the accuracy of the invoice.
E. Payment
Payment will be due net 30 days after City's receipt of Contractor's invoice.
F. Failure to Achieve Progress
In the event City, in its sole discretion, elects to pay all or any portion of any such payment,
notwithstanding Contractor's failure to make progress pursuant to Schedule, such payment
shall not be deemed a waiver by City of the requirement for timely completion of said
progress, or of City's right to withhold future progress payments pending completion of the
progress required.
G. Payments Withheld
City may withhold payment and shall withhold payment to the extent indicated by the
City's Representative to be necessary to protect City from loss because of:
(a) any defective Work not remedied whether or not payment has been made
therefore;
(b) any claim of lien or stop notice has been filed or recorded, or City has received
notice that a claim of lien or stop notice maybe filed or recorded, regarding;
(c) any damage caused by the Contractor, its Subcontractors or agents to the City, its
employees, officers or agents while "Contractor is performing its duties under this
Contract;
(d) any claim by a Subcontractor that it has not been paid any amount due and owing
from Contractor
(e) Contractor fails to pay, when due, any amount of principal or interest or is
otherwise in breach of any agreement in respect to any of its indebtedness or
guarantee of indebtedness; fails to pay its debts as they come due; becomes insolvent;
makes an assignment for the benefit of creditors; files a petition, or becomes the
subject of a petition filed against it, in any bankruptcy, insolvency or similar
proceeding; or one or more final judgments are entered against it in the aggregate
amount in excess of Ten Million Dollars and 00/100 ($10,000,000.00) and the same
shall remain un-discharged and un-stayed for sixty (60) days;
(f) reasonable evidence that the Work cannot be completed as required by the
Contract;
(g) failure to carry out the Work in accordance with the Contract; or
(h) the amount of any exception taken by the City as a result of a progress quantity
audit.
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H. Retainage
City may apply the Retainage and other amounts withheld against amounts owed to City by
Contractor under this Contract, or payable by the City to third Parties by reason of the
Contractor's breach of any of its obligations under this Contract, and shall pay the remainder
with the Final Payment.
Payment shall be made in accordance with the agreed upon progress less five percent (5%)
retention of the gross billing each month until the progress or the project reaches fifty percent
(50%) completion which amount shall be due and payable to Contractor upon the successful
completion of the Performance Test and delivery to City of the as -built data and drawings
required by the Contract. All subsequent invoices rendered shall be paid net with no
retention.
Upon successful completion of the Performance Test, or in the event the Performance Test
has not been conducted within the time period set forth herein, or in the event City elects not
to run the Performance Test for causes not due to Contractor, Contractor shall submit the
following: (i) the as -built drawings and other documents required under Appendix 1,
Specification and (ii) data establishing payment or satisfaction of all obligations, including
without limitation, releases and waivers of liens and assignment of warranties and consents to
assignment of warranties, arising out of this Contract.
I. Payments not Acceptance of Work
No payment made hereunder shall be considered as approval or acceptance of any Work by
City. Payment of Applications for Payment shall be subject to correction or adjustment by
City in subsequent payments of invoices submitted by Contractor.
4. NOTICE TO PROCEED
The City shall provide written notice to the Contractor, directing the commencement of the
engineering and or construction of the Work or portion of the Work as necessary. Contractor
shall not perform any portion of the requirements of this Contract without written Notice to
Proceed from City.
5. CHANGE ORDERS
A. General
Only City may issue a request for Change Order under this Contract. Such request shall be
by written notification to Contractor. As soon as practicable after receipt of the notice,
Contractor shall prepare and forward to City, in writing, the price for the change or extra
Work in accordance with the requirements of this Section and any required adjustment to the
Schedule. Except for minor modifications to the Work, not involving extra cost and
consistent with the purposes of the Work, and except in an emergency endangering life or
property, no extra work or change shall be performed unless a written Change Order from the
City authorizes the extra work or change.
x
B. Change Work Authorization
Should the City authorize a Change Order, Contractor shall furnish the necessary labor with
requisite equipment and small tools, and/or materials required for performing such additional
work. All authorized changes and the agreed to price shall be confirmed and directed through
a Change Order. The price shall include all costs associated with performing the Change
Order, including the impact on the Schedule for the original Work, inefficiencies and
overhead created by the Change Order. All Change Orders shall be performed under the
terms and conditions of this Contract. All Change Orders shall be signed by both City's
Representative and Contractor's Representative before Contractor begins work on the
Change Order. The total dollar value for any individual Change Order shall not exceed
Twenty Thousand Dollars and 00/100 ($20,000.00) under any condition. This dollar
limitation shall not be circumvented by the issuance of more than one Change Order for a
specified change or extra work. Any changes that may exceed this amount, if any, must be
agreed to by an Amendment to this Contract.
C. Unauthorized Changes
Contractor hereby expressly waives any compensation for any changes to the Work or any
extra work that is performed by Contractor if such changes or extra work is unauthorized by
an executed Change Order. No compensation for labor or schedule impacts from such
unauthorized work shall be considered.
D. Effect on Schedule and Warranties and Guarantees
Contractor shall have seven (7) days after receipt of a Change Order request to notify City in
writing that the change requested will have an adverse effect on Contractor's ability to meet
the scheduled date for Beneficial Use, or upon any of Contractor's warranties or guarantees
under this Contract. Such notice shall provide a detailed statement of the reasons for and the
extent of any such effect. City shall have seven (7) days in which to respond to such notice.
If City agrees with the representations in Contractor's notice, the date of Beneficial Use and/
or the warranties or guarantees shall be changed as appropriate. Unless directed otherwise by
City, Contractor shall proceed with the Work during the exchange of notices described in this
Section.
E. Payment Procedure
As a condition precedent to the right to receive any compensation for changes or extra work
pursuant to a Change Order, Contractor shall furnish to the City an itemized bill of the cost of
such work and, unless it is so received, the claim for said additional work shall be deemed
waived by Contractor. The total of the itemized Change Order shall be entered on
Contractor's monthly invoice, properly identified under the designated numbered Change
Order, and payment shall be made in accordance with this Contract.
EPCContract 0 8 14.docCCent-r-aet 0 8 14.d&EPC 4:a�n8-1 ao�
6. BONDING REQUIREMENTS
Contractor shall, upon execution of the Contract and before beginning Work, furnish an
executed Performance Bond and a Labor and Materials Payment Bond each for one hundred
percent (100%) of the Contract Price with a corporate surety, guaranteeing the Work will be
done according to the Work and Specifications, and further, that Contractor will rebuild,
repair, or replace any or all items which have proven defective due to unsatisfactory material
and/or workmanship; or due to failure to meet the conditions, requirements and/or specific
guarantees noted in the referenced Specifications. Such bonds shall be written with a
qualified surety company licensed to do business in California and listed in current U.S.
Treasury Form 370 and with Best Rating of "A" or better. Such bonds shall be effective for a
period extending to one (1) year from the date of acceptance of the Work by City. Contractor
will supply a bond on and subject to the terms and conditions of Standard AIA Form 312.
Contractors Bond excludes any liability by Surety for Performance Guarantees.
7. PRE-EXISTING JOBSITE CONDITIONS
Nothing herein shall be interpreted as placing any responsibility or liability on:
(a) Contractor for pre-existing Jobsite conditions related to pollution, contamination,
hazardous waste, asbestos or toxic materials or for the generation, emission or disposal of
such substances; or
(b) City for pollution, contamination, hazardous waste, asbestos or toxic material
introduced to the Jobsite by Contractor including the generation, emission, or disposal of
such Contractor introduced substances.
City shall indemnify, defend and hold harmless Contractor against any and all claims or
liabilities based on the conditions identified in paragraph (a) above. Contractor shall indemnify,
defend and hold harmless City, its officers, employees and agents against any and all claims or
liabilities based on the conditions identified in paragraph b. above.
8. LAWS AND REGULATIONS
Contractor agrees to comply with all federal, state and local laws that apply to Contractor as a
supplier to City under this Contract.
All laws, regulations and design codes expressly incorporated herein shall be those in effect on
the effective date of this Contract. In the event of any subsequent revisions or changes thereto,
except in connection with the business activities of Contractor or its Subcontractors or agents,
Contractor assumes no responsibility for compliance therewith unless an appropriate Change
Order is issued.
Nothing contained herein shall be construed as imposing responsibility or liability upon
Contractor for the obtaining of permits, licenses or approvals from any environmental, siting or
public utility authority or other agency required in connection with the supply, erection or
operation of the System, except business licenses, building permits, transit waivers, and/or
contractor's licenses as may be required in the name of Contractor or its Subcontractors to
support its business activities.
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9. INSPECTION
Contractor shall provide City reasonable escorted access to Contractor's manufacturing
facilities, after receipt of reasonable notice, for the purposes of inspecting the Work and
witnessing any tests prearranged to be witnessed and required by this Contract. Neither
completion of manufacturing nor shipment of any part will be delayed to accommodate such
inspection or witnessing. For agreed Witness Points, Contractor will provide at least twenty-one
(21) days advance notice. If Contractor does not receive written confirmation that City will
attend, or if City fails to appear at the time of the test/inspection mentioned in the notification,
Contractor shall proceed with the Work.
Contractor shall provide City a schedule of potential Witness Points within thirty days of
execution of this Contract. Within two weeks of receipt of the schedule, City will provide
Contractor with an initial indication of potential Witness Points it may wish to witness.
10. FORCE MAJEURE
Neither Contractor nor City shall be considered to be in default with respect to any of their
obligations under this Contract when a failure of performance shall be due to an
uncontrollable force. The term "uncontrollable force" shall mean any cause beyond the
control of the Party affected, including, but not restricted to, flood, earthquake, storm, fire,
lightning, epidemic, war, terrorist action, riot, civil disturbance or disobedience, sabotage,
federal, state, or municipal action, statute, ordinance, or regulation, embargoes of the United
States Government or any other government, which by exercise of due diligence such Party
could not reasonably have been expected to avoid and by exercise of due diligence has been
unable to overcome. Either Party rendered unable to fulfill any of its obligations under this
Contract by reason of an uncontrollable force, shall give written notice within five Business
Days of such fact to the other Party and shall exercise due diligence to remove such inability
with all reasonable dispatch. The City shall pay the Contractor for earned progress up to the
force maj eure event.
11. DELAYS/SUSPENSION
In the event of any delay attributable to City, its subcontractors or agents that negatively affects
the Contract Time Schedule, Contractor shall be entitled to an equitable adjustment of the
Schedule dates defined in Section 3B and the consequences thereof and reimbursement of all
impact costs.
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12. WARRANTIES
A. General
Contractor represents and warrants that:
(a) Contractor is fully experienced and properly licensed, equipped, organized,
financed and qualified to perform the Work pursuant to this Contract.
(b) Contractor will design, engineer, construct, install, equip, start-up, and complete
the Work in accordance with the requirements of this Contract, including the
requirements, codes, standards and regulations specified in the Specification.
the Work will be designed, engineered, constructed, installed, equipped, started up,
and completed in accordance with sound, generally accepted and the best trade
engineering and construction practices and in compliance with all applicable
requirements of federal, state or local laws, codes and regulations governing the
construction and operation of the Work. The Work will be uniformly new, of good
quality and free from fault or defects in material, workmanship or performance, and
all Work, including substitutions not so conforming to these standards may, at the
option of City be considered defective and the Material and Work shall be fit for its
intended purposes as exhibited by the Performance Guarantees and shall conform to
the requirements of this Contract.
B. Warranty Period
The warranty period shall be eighteen (18) months from the date of Beneficial Use by the
City or eight thousand (8,000) station Generating Hours which ever comes first. The
warranty period for deficiencies under paragraph A above, shall be one (1) year from the date
of correction of the deficiency or eighteen (18) months after Beneficial Use by City,
whichever occurs first. Contractor procured equipment will carry a one year warranty from
date of Beneficial Use by City or eighteen (18) months from date of shipment, documented
by formal shipping documents, whichever comes first.
C. Remedy of Defects
If City or City's Representative notifies Contractor of any deficiencies under this Section
discovered in the Work during the warranty period as defined herein, whether such Work has
been performed, fabricated, installed, tested, completed or accepted, Contractor shall
promptly replace, repair or re -perform the Work to conform to the requirements of this
Contract, all at Contractor's expense, including repairs to other parts of the Work, or other
property damaged as a result of such deficiencies or corrective actions, and including the
costs of City's Representative or any outside consulting services thereby made necessary.
Contractor shall also perform such tests as City may reasonably request to verify that such
correction, replacement, repair, re -performance or rework complies with the requirements of
this Contract. Contractor shall perform its warranty obligations hereunder as expeditiously as
possible and shall in every case commence the necessary corrections, repairs, replacements,
performance and tests within seven days of written notice to Contractor. In the event
Contractor fails to commence such performance within such seven (7) day period, City may
perform or cause to be performed the same, all at Contractor's expense.
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D. Survival of Warranties
All representations, covenants, and warranties in this Section shall:
(a) survive any inspection and acceptance of the Work and continue for the warranty
period in Section 12B;
(b) be extended for one (1) day for each day that Contractor is unable to achieve
Beneficial Use in accordance with the Specification due to a breach of
Contractor's warranties; and
(c) shall continue in respect of any defect notice of which has been given by the City
to Contractor prior to the date on which the warranty period in Section 12B would
have expired but for this provision for the extension thereof in respect of such
defects.
E. Extent of Warranties and Guarantees
Contractor's warranties and guarantees under this Section do not extend to any repairs,
adjustments, alterations, replacements or maintenance which may be required to the Work as
a result of normal corrosion, normal erosion or normal wear -and- tear in the operation of the
Work.
F. Prevention
Contractor agrees not to file or otherwise assert, suffer or permit a mechanic's lien to be filed
or continued against any property of City for services or Work performed or Material,
furnished in connection with the Work by Contractor.
G. Assignment of Warranties and Guarantees
On the date of the Notice of Acceptance of the Work after Commercial Operation, Contractor
shall assign, by executing a document or documents, all warranties and guarantees that it
procures from third parties on product incorporated into its Work, which, upon such
assignment shall be valid, and Contractor shall obtain from all such third parties consents to
such assignment. Contractor shall enforce all such warranties and guarantees on behalf of
City during the warranty period and shall provide City with all reasonable assistance in the
enforcement of such warranties and guarantees whether or not such enforcement occurs
during the warranty period.
13. INFORMATION FURNISHED TO AND BY CITY
Not used
14. INFORMATION FURNISHED TO CONTRACTOR
A. Access to Confidential Information.
City may provide Contractor with, or allow Contractor access to certain information not
available to the public concerning City, or businesses located in the City or City's vendors.
The information may include company information, taxes, sales, value of assets, or other
such information. All such information shall be known as "Confidential Information" and
shall be marked clearly as "Confidential Information".
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B. No Disclosure.
Except as expressly permitted, Contractor shall not disclose, permit the disclosure of, release,
disseminate, or transfer, whether orally or by any other means, any part of such confidential
information to any other person or entity, whether corporate, governmental, or individual,
without the express prior written consent of an authorized representative of City. Contractor
shall return any written Confidential Information and all copies made of such items to City
upon City's written request, but in any event not later than the date that Contractor has
performed all services to be performed pursuant to this Contract. Contractor hereby agrees
that such confidential information and any documents provided may be used by Contractor
only as authorized by City. Contractor shall take reasonable measures to avoid any disclosure
of any such confidential information to any unauthorized person.
C. Court Ordered Disclosure.
Contractor shall immediately notify City of any court order or subpoena requiring disclosure
of confidential information, and shall cooperate with the City's legal counsel in the appeal or
challenge of any such order or subpoena. Recipient may only disclose confidential
information required to be disclosed pursuant to court order or subpoena after legal counsel
has exhausted any lawful and timely appeal or challenge.
D. Remedies.
In addition to any other remedies that it may have at law or in equity, City shall be entitled to
a temporary and permanent injunction by a court of competent jurisdiction against any
breach or threatened breach of the confidential information provisions of this Contract.
Contractor acknowledges that in case of such breach or threatened breach of said provisions,
City would have no adequate remedy at law.
15. TECHNICAL DATA
All operating or other performance information and data under this Contract are based on the
conditions specified in the attached Appendices. Contractor's sole liability in respect to
performance of the Work shall be only as expressly stated in the attached Appendices, or as set
forth herein.
16. PATENTS
Contractor shall defend, indemnify and hold City and its officers, employees and agents free and
harmless from any claim, litigation or other judicial or administrative proceeding the basis of
which is that the Work supplied hereunder infringes on a U.S. apparatus patent issued prior to
the date of this Contract other than those arising out of (a) Material supplied according to City's
detailed design; (b) modifications, alterations, additions or changes made by City to the Work or
to Material supplied by Contractor, (c) the use of the Work or Material supplied hereunder in
conjunction with any other process or Material not supplied by Contractor, or (d) claims
covering a process performed or a product produced by said Work. City will notify Contractor
in writing within a reasonable period of time of such claim. Contractor shall have control over
the defense and/or settlement of such claim and reasonably required assistance in said defense.
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If the Work is determined to infringe on a patent, or in Contractor's reasonable opinion may
infringe on a patent, Contractor will, at its option and expense, either (i) procure for City the
right to continue using said Work or part thereof, (ii) modify it so it becomes non -infringing
Work, (iii) replace it with substantially equivalent non -infringing Work.
17. CANCELLATION/ DEFAULT
A. Termination.
Any order or contract may be terminated by City for its convenience upon fifteen (15) days
prior written notice and upon payment of reasonable and proper termination charges, including,
but not limited to, all costs incurred or committed prior to the effective date of notice of
termination and all charges incurred by Contractor in connection with the termination, plus
reasonable overhead and profit.
B. Contractor's Breach
In the event Contractor commits a breach of a material condition of this Contract, City shall
notify the Contractor in writing of said breach and if Contractor has not cured or begun
reasonable efforts to cure after 15 working days of receipt of said notice, and fails to
diligently pursue corrective action, then City shall have the right to cancel this Contract. The
City may: 1) proceed against the Contractor's Bond in accordance with the terms and
conditions of the Bond or, 2) deviate from the terms and conditions of the Bond, thereby
waiving its right to make claim against the Contractor's Bond; the City may then pursue
whatever other remedies it may have under the law against Contractor.. Contractor shall be
responsible for any direct costs due to City's re -procurement of the equivalent of the Work or
services cancelled from Contractor. Among other things, Contractor shall be deemed to be
in default under this Contract if Contractor files for bankruptcy or another person or entity
institutes against Contractor a bankruptcy, reorganization, moratorium, liquidation or similar
insolvency proceeding or other relief under any bankruptcy or insolvency law affecting
creditor's rights or a petition is presented or instituted for its winding -up or liquidation.
C. City's Breach
If City fails to make any contractual payment to Contractor when due under the provisions of
this Contract, and such failure is not remedied within fifteen (15) days of City's receipt of
written notice of such default, then Contractor will notify City. If such failure is not
remedied within seven (7) days of City's receipt of the second notice then Contractor may
terminate this Contract for City's default.
18. ASSIGNMENT
Contractor may not directly or indirectly sell, assign, transfer, pledge, mortgage or encumber
(each, a "Transfer") any of its interest in any of its rights or obligations under this Contract,
without the prior written consent of City. Any Transfer that is made without the prior written
consent of City shall be void.
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19. PARTIAL INVALIDITY
Wherever possible, each provision hereof will be interpreted in such manner as to be effective
and valid under applicable law, but in case any one or more of the provisions contained herein
will, for any reason, be held to be invalid, illegal or unenforceable in any respect, such provision
will be ineffective to the extent, but only to the extent, of such invalidity, illegality or
unenforceability without invalidating the remainder of such invalid provision or provisions or
any other provision hereof, unless such a construction would be unreasonable or contrary to the
intent of the Parties as expressed in this Contract.
20. CHOICE OF LAW
The rights and remedies of the Parties hereunder shall be governed by the laws of the State of
California.
21. INSTALLATIONXIELD SERVICES
Unless specifically excluded, all field services required by the Work shall be completed by the
Contractor.
22. INDEMNIFICATION AND INSURANCE
A. Indemnity
Contractor shall indemnify, hold harmless and defend City, its officers, employees and agents
from and against any claims, demands, suits, proceedings, liabilities, judgments, awards, losses,
damages, costs or expenses (including reasonable attomey's) whatsoever arising out of and
caused or occasioned by any negligent act or omission of Contractor, or any of its officers,
directors, agents or employees, contractors or Subcontractors in connection with the per-
formance of the Work under or in connection with this Contract.
In the event that any losses arise, directly or indirectly, in whole or in part, out of the joint or
concurrent negligence of both Parties and their respective representatives, each Party's liability
therefore shall be limited to such Party's proportionate degree of fault.
B. Insurance
Prior to commencing Work hereunder, Contractor shall provide City with proof of insurance
providing and maintaining the coverage's and endorsements set forth in the Insurance
Schedule attached hereto as Appendix 4, Insurance Schedule, and made a part hereof by
reference. Said proof of insurance shall also provide that said policy or policies shall not be
canceled or materially reduced in coverage without giving at least 30 days prior written
notice to City. Contractor shall not permit a Subcontractor or vendor to perform work on
City premises unless and until proof of insurance is obtained showing that such
Subcontractor or vendor has worker's compensation coverage.
If Contractor employs Subcontractors as part of the services rendered, Contractor's protective
coverage is required. Contractor may include all Subcontractors as insureds under its own
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policy or shall furnish separate insurance for each Subcontractor, meeting the requirements
set forth herein.
23. NON -WAIVER
The failure of either Party to insist upon or enforce, in any instance, strict performance by the
other Party of any provision of this Contract or to exercise any right herein conferred shall not
be construed as a waiver or relinquishment to any extent of its right to assert or rely upon any
such provision or rights on any future occasion.
24. AMENDMENTS
This Contract may be modified or amended only by a written document executed by both
Contractor and City.
25. ENTIRE AGREEMENT
This Contract is the entire agreement of the Parties. Contractor represents that in entering
into this Contract, it has not relied on any previous representations or understandings of any
kind or nature.
26. BENEFIT OF AGREEMENT
This Contract shall bind and benefit the Parties hereto and their heirs, successors, and
permitted assigns.
27. FORUM SELECTION
Any action brought relating to this Contract shall be brought and held exclusively in a State
Court in the County of Los Angeles, California.
28. COUNTERPARTS
This Contract may be executed simultaneously in two or more counterparts, each of which
shall be deemed to be an original, but all of which together shall constitute one and the same
instrument.
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29. NOTICES
Notices to the Parties, unless otherwise requested in writing, shall be sent to:
City: THE CITY OF VERNON
ATTN: BRUCE V. MALKENHORST
CITY ADMMSTRATOR
4305 SANTA FE AVENUE
VERNON, CA 90058-0805
CONTRACTOR: SCOTT COMPANY
ATTN: STEVE KLAUS
14920 SOUTH PEDRO
GARDENA CA, 90248-2036
Notices shall be deemed to have been received by the close of Business Day two days after the
date on which it was mailed.
30. INDEPENDENT CONTRACTOR
At all times during the term of this Contract, Contractor shall be an independent contractor
and shall not be an employee of City. City shall have the right to control Contractor only
insofar as the results of Contractor's services rendered pursuant to this Contract; however,
City shall not have the right to control the means by which Contractor accomplishes services
rendered pursuant to the Contract except to the extent that such services involve the use of
City property or Confidential Information.
31. CONTRACTOR NOT AGENT
Except as City may specify in writing, Contractor shall have no authority, express or implied,
to act on behalf of City in any capacity whatsoever as an agent. Contractor shall have no
authority, expressed or implied, pursuant to this Contract to bind City to any obligation
whatsoever.
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32. REVIEW OF EXISTING CONDITIONS
A. Premises
Contractor represents that (i) it has relied upon its own examination of the area on which the
Work is to be performed, the adjacent premises and the site, (ii) it knows the applicable
federal, state and local laws, ordinances and regulations in existence as of the effective date
of this Contract, and (iii) it assumes responsibility therefore. Contractor knows, or shall be
deemed to have known, the facilities or lack thereof for delivering, handling and storing
materials, equipment on and near the site and the applicable labor conditions. Contractor
represents and warrants that all such matters are acceptable and will not interfere with the
timely performance of its Work under this Contract.
B. Verification of Existing Conditions
Contractor represents that (i) it has reviewed the site survey and site proposal drawings and
other data concerning the Work included in the Specification, (ii) Contractor has determined
and verified all materials, field measurements and field construction criteria related thereto,
and it has checked and coordinated the information contained within such submittals with the
requirements of the Work and this Contract. To the extent that such drawings and data are
made available to Contractor and Contractor is provided an opportunity to determine and
verify such information, Contractor shall be responsible for all defects and discrepancies in
such drawings and data as if Contractor itself had prepared such drawings and data. The
Contractor may rely on information supplied by the City to the extent that it cannot be
verified by reasonable survey and inspection.
C. Statements of Fact
Contractor statements of fact contained in Contractor's submissions in response to, and reply
to inquiries made in connection with the Specification are true, correct and complete. No
submission or reply made by or on behalf of Contractor in connection therewith contains any
material misstatement of fact or omits to state any material fact necessary to make the
statements made in connection therewith, in light of the circumstances in which they were
made.
33. SUPERVISION BY CONTRACTOR
A. Management of Work
Contractor shall assign each key officer and employee named on its Management Plan (the
"Plan") per the Specification to be responsible for the Material, and construction tasks for
which the Plan indicates that such key officer and employee will be responsible. No key
officer or employer will be permitted to delegate or transfer its responsibility for any task for
which the Plan indicates he or she is responsible without cause or the prior consent of City.
The Plan shall be submitted to City thirty (30) days following the Contract award. The Plan
will consist of a detailed construction execution write-up of all major schedule activities,
rigging requirements, working hours and days, means and methods of erection and
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installation, and a discussion of how the critical path items will be achieved and maintained.
The Plan will include a detailed Primavera CPM schedule which will be manpower loaded by
craft and also cost loaded with Contractor's budget to produce craft and total job manpower
curves, overall project progress curve, and a total project cash flow curve. The Plan must
include sample reports showing an itemized schedule of commodity units, estimated hours of
installation, a column for actual manhours for monthly reports, estimated and actual cost of
installation by each unit category, earned value percent complete column for the period and
cumulative column, plus bottom line percent complete for the total job. The percent
complete will be based on quantities installed in place, which will be included in the monthly
Payment Application. The Plan must show how the bulk materials and process equipment
will be tracked from shop to site with expected and actual delivery dates by purchase order
number and quantities. All data will become the baseline plan to which weekly progress
will be measured against the Plan. A daily inspection form will be completed by Contractor
and submitted daily to City's Representative.
B. Control of the Work
The methods, sequences, procedures and techniques by which Contractor shall administer
and execute the Work shall be consistent with the Plan and the construction execution plan,
delivered by Contractor pursuant to the Specification. Contractor shall remain solely
responsible for all construction means, methods, techniques, sequences, procedures and
safety programs in connection with the performance of the Work.
34. GOVERNMENTAL REGULATIONS AND TAXES
A. Permits and Licenses
Contractor shall have responsibility for and shall bear the cost of obtaining all necessary
permits and licenses from all authorities required for Contractor's performance of the Work.
Contractor shall assist City as necessary in obtaining environmental permits such as the
Permit to Construct, California Environmental Quality Act, South Coast Air Quality, etc..
Throughout the performance of the Work, Contractor shall comply with Laws and
Regulations. Compliance by Contractor with Laws and Regulations applicable to the Work
that become effective or are changed after the effective date of this Contract, shall be handled
in accordance with the procedures established in Appendix 4, Changes and Extra Work.
B. Laws and Regulations
Contractor shall conform with Laws and Regulations.
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r.
35. LIQUIDATED DAMAGES
A. Delays
If Contractor fails to complete erection or fails meet the performance deadline by the dates
agreed upon in Section 3B, , the Parties agree that City shall be damaged. The actual
damages that would be suffered by City would be impossible to ascertain precisely.
Therefore, the Parties agree that Contractor shall pay City liquidated damages (but not as a
penalty) pursuant to the following schedule:
Beneficial Use: Fifteen Thousand Dollars and 00/100 ($15,000) for every day with a
Five Hundred Thousand and 00/100 ($500,000.00) maximum following the
Beneficial Use milestone.
B. HP Steam Pressure Loss
The Contractor agrees to a liquidated damage of $1,250/psid for every psid over the
guarantee point of 40 psid as measured between the HRSG/bidder interface and the steam
turbine/bidder piping interface. Note the above is based on a calculation that indicates for
every 1 psig loss in HP steam pressure to the turbine there is 3KW drop in steam turbine
output. The $1,250/psid was determined based on lost revenue of 3 kw valued at $.05/kwhr
for one year at 95% availability.
C. Liquidated Damage Payment
Liquidated damages owed by Contractor to City will be deducted from Contractor's monthly
Payment Application, as such damages are accrued.
D. Sole Remedy
It is understood and agreed that payment of the damages specified in this Section shall be the
sole and exclusive remedy of the City against the Contractor for the failure of Contractor to
meet timely the dates of delivery of Mechanical Completion, and Commercial Operation.
36. MAXIMUM AGGREGATE LIQUIDATED DAMAGES
The maximum aggregate liquidated damages payable under this Contract shall not exceed
$500,000 maximum.
37. PERFORMANCE GUARANTEES
A. Performance Guarantees
Contractor warrants and guarantees that the Work supplied and installed pursuant to this
Contract shall conform to the requirements and specifications set forth in the Specification,
including without limitation, the noise emission and auxiliary power guarantees specified in
the Specification.
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B. Noise Emissions Limits
The Contractor's guarantees covers equipment procured by the Contractor, only. Contractor's
guarantees concerning noise are specifically stated in Appendix 1. In the event that the
Contractor's equipment is proven to have failed the noise guarantees as stated, Contractor
shall be granted access to the Contractor's equipment at time or times acceptable to City to
repair or replace the defective component that has been duly demonstrated to be deficient.
C. HP Steam Line Pressure Loss
Contractor shall guarantee that the pressure loss through the HP steam piping, valves, etc.
shall be less than the pressure loss allowed in the Specification when the Combined Cycle
Power Plant is operating at the Guarantee Conditions as defined by the Specification.
D. Obligations of the Contractor
If the Work, as demonstrated by the Performance Tests, fails to achieve the Performance
Guarantees, Contractor shall have the obligations set forth below. Contractor shall not claim
as a defense or excuse for the failure of the Work to achieve the Performance Guarantees that
the achievement of such Performance Guarantees was technologically impossible or
impracticable.
E. Corrective Action
Contractor shall, within ten (10) days after the date of a notice of unsuccessful Performance
Test, submit to City a plan of corrective action (Corrective Action Plan), specifying in
reasonable detail the actions Contractor proposes to take to cause the Work to achieve the
Performance Guarantees, and the period of time in which it proposes to complete the
corrective action; the Parties must mutually agree upon the period of time for such corrective
action. Contractor will not be liable for deficiencies caused by the City or it's other
Subcontractors or suppliers. Contractor will not be liable for any deviation from any
Corrective Action Plan where the deviation is caused by acts, omissions or requirements of
the City or its other Subcontractors or suppliers.
F. Standards for Plan of Corrective Action
When implementing the Corrective Action Plan, Contractor shall (i) timely and diligently
exercise its best efforts to repair and modify the Work to meet the Performance Guarantees,
including but not limited to redesign, re -engineering, research, testing and associated
construction work, (ii) consider and apply available know-how and technology, including
consultation with City and experts in the field, and (iii) consult with City with respect to
City's concerns and preferences under the circumstances.
38. LIMITATION OF LIABILITY
A. Contractor's aggregate liability for all claims of any kind, whether based on contract,
warranty, tort, strict liability or otherwise, for all losses or damages arising out of, connected
with or resulting from this Contract, its performance or breach shall not exceed the Contract
Price.
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B. In no event, whether as a result of breach of contract, warranty, indemnity, tort, or
otherwise, shall Contractor be liable for indirect, special, incidental, or consequential damages
including but not limited to loss of profits or revenue; loss of data; loss of use of equipment; cost
of capital; cost of substitute equipment, services or facilities; downtime costs or claims of third
parties or customers for service interruptions.
39. DISPUTE RESOLUTION
In the event that any dispute arises under this Contract, the Parties will in good faith attempt
to informally resolve such dispute. Such attempts shall include at least one fact -to -fact
meeting with the representatives of City and Contractor.
40. ENVIRONMENTAL PROTECTION
A. Qualified Personnel
Contractor agrees to use, and agrees that it shall require each of its Subcontractors, if any, to
use only personnel who are qualified and properly trained and who possess every license,
permit, registration, certificate or other approval required by any applicable Environmental
Law or Government Agency for the performance of Contractor's obligations under this
Contract.
B. Material
Contractor agrees that all Material to be supplied or used by Contractor, its Subcontractors, if
any, in the performance of this Contract, including, but not limited to, vehicles, loading
equipment, and containers, shall be in good condition and fit for the use(s) for which they are
employed by Contractor or its Subcontractor. Such Material shall at all times be maintained,
inspected and operated as required by applicable Environmental Law. Contractor further
agrees that all licenses, permits, registrations and certificates or other approvals required by
any Environmental Law or Government Agency will be procured and maintained for such
Material at all times during the use of the same by Contractor or its Subcontractors in the
performance of any of its obligations under this Contract.
C. Compliance with Laws
Contractor agrees that in the performance of its obligations under this Contract, Contractor
shall at all times fully comply with, and shall require all Subcontractors to comply with, all
applicable Environmental Laws. Contractor further agrees that at all times during its
performance under this Contract it, and any Subcontractors, shall have and keep in effect all
licenses, permits, registrations, certificates, and approvals required by any Environmental
Law or by any Governmental Agency for the performance of its obligations under this
Contract.
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D. Hazardous Materials Removal
In the event Contractor or its Subcontractors are required to remove any Hazardous Material
from the work area during the performance of the Work contemplated by this Contract,
Contractor shall notify City of such fact promptly after discovering such requirement.
Contractor shall appropriately remove such Hazardous Materials and deliver the same to City
for proper handling and management. However, in the event any such Hazardous Materials
are asbestos or asbestos containing materials, City will remove the same promptly after
receiving Contractor's notice, as necessary for Contractor's performance of the Work, in
compliance with applicable Environmental Law.
E. Environmental Indemnity
Contractor hereby specifically agrees to indemnify, defend and hold harmless the City, its
officials, officers, employees, agents, successors and assigns, herein collectively called the
"Indemnitees, harmless from and against any and all losses, liabilities, claims demands,
damages, causes of action, judgments, fines, penalties, costs and expenses (including but not
limited to all reasonable consulting, engineering, attorneys' or other professional fees) which
indemnitees, or any of them, may incur or suffer by reason of:
(a) any unauthorized release of a Hazardous Material by Contractor;
(b) any enforcement or compliance proceeding commenced by or in the name of any
Government Agency because of an alleged, threatened or actual violation of any
Environmental Law by Contractor;
(c) Contractor shall have no obligation to abate or remove any hazardous material
and will have no liability for damages caused by any hazardous material unless
the hazardous material is placed on the site by Contractor or released as a result of
negligence by Contractor. Each Party will provide environmental indemnity to
the other.
F. Material Safety Data Sheets
Contractor shall submit the current Material Safety Data Sheet, (MSDS) to City's
Representative upon request, for each Hazardous Material used by Contractor, or any
Subcontractor on City premises during the performance of the Work.
G. Suspension and Notification
Contractor shall immediately suspend all operations and immediately notify City's
Representative if any violation or alleged violation of Environmental Law is encountered
during performance of the Work.
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41. LABOR AND MATERIAL
A. General
Contractor shall provide and pay for all labor, supervision, inspection and testing as may be
necessary to complete performance of the Work, whether by the Contractor or its
Subcontractors, except for inspection and testing included within the Work as defined in
Appendix 1, Specification. To the extent permitted by law, any Work to be performed by
Contractor hereunder which City would normally undertake with its regular work force and
work that would otherwise fall within the terms and conditions contained in an existing
agreement shall be performed by employees and Subcontractors who are members of a trade
union, bona fide labor organization affiliated with the Building Trades of the AFL-CIO, or by
employees and Subcontractors working under a Work specific union agreement.
B. Employment of Licensed Personnel
Whenever required by law, regulation or code, Contractor agrees to employ only licensed
personnel to perform engineering, design, architectural or other professional service in the
performance of the Work. All such professional services shall be performed with the degree
of care, skill and responsibility customary among such licensed personnel. Contractor shall
immediately remove from the site any employee or agent of Contractor or any Subcontractor
as to whom City objects in writing.
C. Assignment of Individuals
Individuals assigned to this Work at a level of responsibility of technical discipline review
and above cannot be assigned or reassigned or removed from this Work without approval of
City.
D. Material
Contractor shall provide and pay for all Material and other services as may be necessary to
complete the performance of the Work, whether by Contractor or its Subcontractors, except
for material and services included within City's scope of work as defined in Appendix 1.
E. Start Up Spare Parts and Special Tools
Contractor shall deliver and store where directed by City, prior to Mechanical Completion,
the special tools and spare parts required, including without limitation those special tools and
spare parts listed in the Specification.
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F. Quality Control Program
Contractor shall establish, implement and maintain a quality assurance and control program
in accordance with the provisions of the Specification. The program shall be designed to
meet the following objectives:
(a) purchased items and documentation to meet specified requirements of this
Contract;
(b) the quality of items to be part of permanent installation not be degraded during
receiving, storing, transporting, handling, erection, installation, inspection and
testing;
(c) systems, equipment and structures are provided and installed in strict compliance
with the manufacturers' instructions and this Contract; and
(d) components meet performance and functional requirements of this Contract.
G. Testing
Contractor shall provide all specially trained or supervisory personnel for the Work.
Contractor shall perform or cause to be performed all factory, laboratory and other tests
together with all testing procedures described in the Specification and submit to City
Monthly Reports (as defined in Appendix 3) of the results thereof, indicating whether such
results warrant acceptance or rejection of any materials so tested or performance of such
tests.
H. City's Right to Inspect
City shall have the right at all reasonable times to inspect the Work and to observe the tests
relating to the Work that are conducted by Contractor. Contractor shall make arrangements
and provide facilities and access for such inspection and observation of such tests at the
Jobsite or at the facilities of any Subcontractor where any part of the Work is being
fabricated or manufactured. Contractor shall give ample notice as to the time and place when
each part of the Work will be ready for such inspection. City may reject any part of the Work
found to be defective or not in accordance with this Contract, regardless of the stage of its
completion or the time or place of discovery of such errors, and regardless of whether City
has previously accepted it through oversight or otherwise. Such inspection by City shall in no
way relieve Contractor from its obligations under this Contract.
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IN WITNESS WHEREOF, the Parties have caused this Contract to be executed by and through
their authorized officers on the date, month and year first written above.
ATTEST:
BRUCE V. MALKENHORST, City Clerk
APPROVED AS TO FORM:
EDUARDO OLIVO, City Attorney
CITY OF VERNON
LEONIS C. MALBURG, Mayor
CONTRACTOR
Date:
Name
Title
Date:
Name
Title
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APPENDIX 1
SPECIFICATION FOR COMBINED CYCLE POWER PLANT
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APPENDIX 2
PROJECT CONTROL REQUIREMENTS FOR CONTRACT
1. INTRODUCTION
This procedure defines the concepts that Contractor shall comply with during performance of
the Work. Precise reporting by Contractor is required and compliance with these
requirements will be directly related to the approval of Payment Application invoices.
Contractor shall implement his own unit manhour/earned value monitoring and controls
system to fulfill his contractual obligations and management needs based on commodity
quantities. The effort by City is not intended to duplicate Contractor's effort, but rather to
obtain an overview of his performance. City must be assured that Contractor's performance is
adequate relative to cost and schedule, there are no significant variances from established
baseline target goals, and whenever variances do occur they are quickly identified and
corrected so they do not impact the overall project completion.
2. PROJECT CONTROLS REQUIREMENTS FOR PRE -MOBILIZATION MEETING
2.1 Pre -Final Design Kickoff Meeting. Contractor and its major Subcontractors shall meet
with City at the time of the Pre -Final Design kickoff meeting to finalize the guidelines,
level of detail and summaries to be used in developing the design and construction
portion Project Controls program. Contractor shall prepare a Primavera Level I Summary
and Level 2 Detailed CPM Network Diagram and logic bar chart stamped "Preliminary"
for this meeting showing in detail the activities to be accomplished during the first sixty
(60) calendar days of the design work plus a summary of the construction site -work.
2.2 Schedule. Contractor shall submit for City's approval, within 30 calendar days after
award of Contract, a detailed Primavera critical path schedule for all Contractor's
activities including engineering, procurement, construction, testing and start-up, and
performance testing activities, identifying Contractor's plan of execution for the Contract
Scope of Work. This schedule shall incorporate and show the activities to accomplish the
major interfaces and milestones. This schedule shall identify the critical path(s), sub -
critical path(s) (10 days or less float), and provide sufficient logic/activities to
demonstrate Contractor's ability to achieve the schedule. The engineering and
construction activities will be man-hour loaded by engineering discipline and
construction craft man-hour including all subcontract man-hours. Manpower histograms
by engineering discipline and construction craft will be produced as a baseline target plan
to be measured against weekly with actual manpower spent. A total project progress
curve will be developed based on the resource loaded Primavera schedule. This baseline
target plan will also be measured against weekly with actual progress based on earned
value earned.
For the engineering phase of Work, the schedule shall be sufficiently detailed so that the
Contract deliverables and engineering milestones are identified.
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For the erection phase of the Work, Contractor's schedule shall be sufficiently detailed so
that milestones, all equipment and material deliveries, drawing requirements, submittals,
and other Subcontractor interfaces are clearly identified. If, in the opinion of City, it
becomes necessary to work after regular hours or on holidays in order to maintain the
schedule and to complete the Work within the time specified, Contractor, upon request by
City, shall do so forthwith. Unless failure to maintain schedule is due to causes beyond
the reasonable control of Contractor, such Work after regular hours or on holidays shall
be without additional cost to City.
2.3 Construction Execution Plan. The written Plan shall describe in detail the methods to be
employed, including planned overtime or shift work intended, equipment to be used and
associated duration, access routes and requirements, the sequencing and interfacing of
events, material control, any interface requirements and any specific requirements
necessary to support Contractor's methods and techniques. This execution plan shall be
consistent with Contractor's Schedule and must be submitted 30 days prior to
mobilization.
2.4 Material List. A purchase order register of equipment and materials supplied by
Contractor, including purchase order and delivery dates, shall be submitted with the
detailed Contract Schedule. This is to be submitted with the initial schedule submittal and
updated bi-monthly.
2.5 Submittal Compliance. Contractor's failure to submit any of the information outlined in
2.2, 2.3, 2.4 above with the timing, format and level of detail defined by City/Engineer,
will result in City withholding payment of all invoices until delivery of the information is
reviewed and accepted.
3. PROJECT CONTROLS REPORTING FOR CONTRACT EXECUTION AFTER
MOBILIZATION
3.1 Weekly Progress/Coordination Meeting. Meetings will be held in order to discuss job
progress, coordination and safety and Contractor and Subcontractors (if appropriate).
3.2 Two Week Look Ahead Schedule. Contractor shall submit to City a two week look ahead
schedule. This schedule shall identify all activities scheduled to be worked on in the next
two weeks and indicate manpower requirements by craft.
The two week look ahead schedule shall be based on Contractor's detailed project
schedule. However, when required by City, it shall show greater detail than Contractor's
project schedule. At a minimum, the two week look ahead schedule shall include all
activities and milestones identified on the detailed project schedule for the two week
period. The two week look ahead schedule shall be presented at the Weekly
Progress/Coordination Meeting.
3.3 Daily Force Report. The Contractor shall submit to City a daily force report which shall
include the following information:
3.3.1 Contractor's scheduled versus actual manpower by type and total;
3.3.2 Contractor's administrative total;
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3.3.3 Major construction equipment being utilized;
3.3.4 Description of Work being performed and location of Work on -site;
3.3.5 Other pertinent remarks, manpower shortages, visitors, material received, etc.; and
3.3.6 Purchase Order Register.
3.4 Weekly Quantity/ Manhour Report. Upon start of construction and each week thereafter,
Contractor shall submit a quantity/manhour report, indicating actual material quantities
installed and manhours expended. In addition, an updated quantity installation curve shall
be provided by commodity.
3 .5 Updated Detailed Project Schedule. Contractor shall update the detailed project CPM
schedule on a monthly basis (minimum) and be included with the monthly progress
report which must be submitted with proposed Payment Application. The physical
completion of each activity by percentage or remaining duration shall be included and a
description of all logic changes and a narrative report indicating the status of the project
shall accompany the updated schedule.
This report, at a minimum, shall list activities that are behind schedule, identify the
corrective action necessary to overcome these deficiencies, and identify required delivery
dates for material and equipment supplied by Contractor. This update shall be provided to
City within five working days following the close of the update period.
3.6 Updated Manpower Curves. The manpower curves shall be updated to reflect status per
the project schedule and are to be submitted with the updated schedule. If requested,
Contractor shall revise them and furnish City with three or more revised copies, as
required. The Engineer/City shall make periodic analysis of the manpower progress and
productivity and Contractor shall adjust the manpower to coincide with meeting activity
completion dates/requirements of the project schedule.
3. 7 Monthly Reports. At monthly intervals from the date of Contract award, Contractor shall
submit detailed factual progress reports to City for the entire duration of the Contract.
The progress reports shall show clearly and accurately the status of all activities including
the exact amount of time each activity is ahead of or behind the agreed Contract schedule.
The report shall detail the action being taken by Contractor to avoid possible delays in
his Work, and to expedite any aspects or progress which are behind schedule and shall
summarize any change in the critical activities since the date of issue of the previous
report. The format of the Monthly Report shall be approved by City and shall be
forwarded to City within seven days of report period close.
The report on City's material deliveries shall be included and shall give the date and
details of orders placed and indicate the delivery date quoted by the manufacturer or
supplier, in relation to the agreed Contract Schedule. If any delivery has an adverse effect
on the Contract Schedule, Contractor shall state the remedial action taken to ensure that
delays do not occur. Contractor shall be responsible for expediting the delivery of all
material and equipment to be provided by Contractor and its Subcontractors. The report
shall also show detailed progress towards awarding of any contracts by Contractor to its
Subcontractors.
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4 !
The report shall, for each section of Contractor's Work, give the percentage completion
and the projected completion date of each of the main items of Work in relation to the
agreed Contract Schedule.
Contractor shall report with respect to various sections of this Work, the erection
equipment in use or held in readiness, a summary of labor and supervisory staff and
details of any matters arising that may generally affect the progress of the Work.
Contractor shall be responsible for providing the evaluation methodology and systems
necessary to determine all progress measurement including, but not limited to, installed
quantities of Work. Contractor shall notify City prior to the time such evaluations are
made. City, at its discretion, may arrange to have City's Representative witness and
independently verify all quantity evaluations made by Contractor for determining
drawings completed, equipment and material deliveries, installed quantities of Work, etc.
for payment under the Contract. Copies of notes, computations and other records made
by Contractor for the purpose of determining progress/quantities installed shall be
furnished to City upon request. Contractor's measurement and computations shall be
made by methods considered appropriate by City for the class of Work measured. City
may also, at its option, independently verify by performing its own computations, the
quantities of Work to be paid for under the Contract.
3.8 Monthly Payment Applications will be broken down by WBS item number or schedule
ID number in the Primavera schedule. This Payment Application will show quantities,
unit of measure, price per unit, extended price and percent complete based on the
schedule value "earned", not spent.
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APPENDIX 3
Unconditional Waiver & Release Upon Final Payment
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i t 41
CONDITIONAL WAIVER AND RELEASE
UPON FINAL. PAYMENT
(CALIFORNIA CIVIL CODE SECTION 3 62 )
Upon receipt by the undersigned of a check from
( Maker of Check l
in the sum of $ payable to
(Arnold of Check) ( Payee of Payees of Check)
and when the check has been properly endorsed and has been paid by the bank
upon which it is drawn, this document shall become effective to release
any mechanic's lien, stop notice ° or band right the undersigned has on the job of
located at
Owner to the following extent .
( .tab oesaip�� )
This release covers the final payment to the undersigned for all labor, services,
equipment or material furnished on the job, except for disputed claims for additional
work in the amount of
Before any recipient of this document relies on it, said party should verify evidence
of payment to the -undersigned
Dated
(Oc-pany dame )
By
NOTE: THIS FORM' COMPLIES WITH THE REQUIREMENTS OF CIVIL CODE SECTION 3262(d){3).
IT IS TO BE USED BY A PARTY WHO APPLIES FOR A FINAL' PAYMENT WHEN THE FINAL
PAYMENT CHECK HAS NOT YET CLEARED THE BANK. THIS RELEASE ONLY BECOMES'
EFFECTIVE WHEN THE CHECK, PROPERLY ENDORSED, HAS CLEARED THE BANK.
EPCContract 0 8 14.docEPGC= „,.,-aet 0 8 i n ,ace EPCG r+,-aet—n_u_f -doe
CONDITIONAL WAIVER AND RELEASE
UPON PROGRESS PAYMENT
Civil Code 3262 (d) (t)
Upon the receipt by the undersigned of a check from
in the sum of payable to
or
and when the deck has been property endorsed and has been paid by the bank upon which it is
drawn, this document shall become effective to release any mechanic's lien, stop notice, or bond`
right the undersigned has on the job of
located at
- (Job Do=0-).
to the following extent. This release covers a progress payment for labor, services, equipment, or
material furnished to through
only and does not cover any retention`s retained before or after the
release date; extras furnished before the release date for which payment has not been received; extras or
items furnished after the release date. Rights based upon work performed or items furnished under a written
change order which has been full executed by the parties prior to the release date are covered by this
release unless specifically reserved by the claimant in this release. This release of any mechanic's lien,
stop notice, or bond right shall not otherwise affect the contract rights, including rights between parties to the
contract based upon a recission, abandonment, or bream of the contract, or the right of the undersigned to
recover compensation for fumished labor, servies, equipment, or material covered by this release if that
furnished labor, services, equipment, or material was not compensated by the progress payment.. Before any
recipient of this document relies on it, said party should verify evidence of payment to the undersigned.
Dated :
COMPA r
3Y
PLEM ? rRmrr NAM a TME
Where the claimant is required to execute a waiver and release in exchange for, or in
order to induce the payment of, a progress payment and the claimant is riot in fact, paid in
exchange for the waiver and release or a single payee check or joint payee check is
given in exchange for the waiver and release, the waiver and release shall follow
substantially the above form
EPCContract 0 8 14.docEPGG t 0 8 i n ,a&EPGr t + n kr i ,t
i 'k
CAUFORNIA PREUMINARY 20-DAY NOTICE (PRIVATE OR PUSUC WOW
RE NOTPMD W FULL POR THE LABOR. $ERVICS3, EQUIPMENT.OR WAISR"S PUUMSD OR TO BE:PURNWNED, A
"S LUM LEAOWG TO THE LOSS, TRRWCX COURT FORECLONyRE PR00E900" OF Au OR PART OF YOUR PROPERTY
W PRIMED BAY SE PLACED AGANIET THE PROPERTY EVEN THOUGH YOU WS PAID 'YOUR 'CONTRACTOR W PULL-. YOU:
TO PROTECTYOUN$EGP AGAINST THIS CONSEW)ENCR SY It)RHQUNWIG YOUR CONTRACTOR TO PUNWSN A: Sam
NY THE'. PERSON Oft FIRN GHVWG YOU TREE SOME BEFORE W WWG PAYWNETTO YOUR CONTRACTOR. R) REQUNtNIO
IMOTOR TO PUSNISN A RECENT TO ESTASL)"7"AT YOU PAM THE COKTKACM S l FULL A" ROOMING NO LATER
AYR Mtn& 0119 t1" fiF-TNT PRELRINIARY NOTICE AN AFFIDAVIT TIIATYOU PAID TNS:t OWAACTOR:Bill FULL. OR MANY
DATE:
YOU ARE'HEREBY WMIEDTHAT 7W UNDERSIGNED "AS RpMomED OR WILL FURNISH LABOR, SEWAGES. EQUIPMENT OR
MATERIAL OF THE PULOWMG DESCFtPTXW
PERSON FURNI.SHM LABOR. SERVK= BOUIPIAWT OR MATERIAL
CA
TO: OWNER. REPU7L°D OWNER, Olt PUBLICA43ENCY (SEE OVER)
WHOM
NOT) (STATE)
TO: PRW REPUTED,.OR OPX.K L CONTRACTM
fmyjWrAm tap)
� THIS BOX0C B KiW. 7NEHAIM3AND ADDI OF ANY
LASQRENS:TO WHOM EMPL.OYM PAYMBRSARE DIEA$OFTIM
OATS OF TNBIWTICE ARECCNTAMNEDON ATTAC HMINT'A`...
WBO"aI OORINNATMN6ISIN A34DYADEA P*WHIBOOF-
I=t ATUREj Ia+iU
DESCRP710H Of LABOR, SERVICES, EQUIPMENT OR MATERIAL
TQBE SUPPLED
7HE.NAME AND:ADDRESS OF PERSON COWMACTING
THE ABOVE CIOUR CIS.
I_.
JOS+STM ($TREET AND LEGAL DESCRU'WW F KNOWN)
F .....
AN ESTMA7E OF'RE TOTAL PRIM OF 7HE LABOR, SERVICE$.
EQUPMENiOR'MA7ERW.$fURNISHED OR TO BE FURNISHED 6'
TWWPLIIOB TO WWCH rJFPLIMENTAL PRIIMlVo nAREMYAItFr.
tON:Y swowRACTOR57HRE "Am v mwwf THL:TMWT Me"
INAHLLOP PFRaOHaW1aND) (MLE).
PRow OF.SERVIGEAFFOAVif(Gva. CCO mr.t)
. daClafa MHst l Ifay! l61YadHaPiM d YIa abaM PRELNIMiARY NOTICE (CFIM.'SI �fCgiMO �
a $YPWxmWIydNnstiA *0" to
LAeldroul an —
ism at tlala
L. FimClass CMWed or RepitlaHM-Maii sw**. p~ PHaPaid aft4sad lP Oath Of ft PaM" N Mae sdit" OwWn dww 00-
I derJarig.UW* 00AWly ofPWPO LmdW MW bws d tEW sMW dC4IBQMJa"WLMW*X*O V it VW ON Coff*a
(ATTACH RECEIPTS OF CERTFED Oft REL315TERED MAT. WHEN RETURNED)
SCGNAAM OF PERSON MAKING SERVICE
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APPENDIX 4
INSURANCE SCHEDULE
Contractor shall provide proof of insurance, within 30 days of the full execution of this Contract,
including a standard certificate of insurance, in at least the following amounts and coverage
(combined single limit permitted):
I. Coverage and Limits
Bodily Injury Property Damage
Hazards Each Person Each Accident Each Accident
Automobile Liability
$100,000
$300,000
$300,000
Owned Automobiles
$ 2,500,000
$5,000,000
$ 2,500,000
Hired Automobiles
$ 2,500,000
$5,000,000
$ 2,500,000
Non -Owned Automobiles
$ 2,500,000
$5,000,000
$ 2.500,000
Workers' Compensation
$ Statutory
Employers' Liability
$1,000,000 per employ
U. Comprehensive General Liability
General Liability
$5,000,000
$5,000,000
$5,000,000
Premises Operations
$5,000,000
$5,000,000
$5,000,000
Independent Contractors
$5,000,000
$5,000,000
$5,000,000
Products - Completed Operations
$5,000,000
$5,000,000
$5,000,000
Contract Liability
$5,000,000
$5,000,000
$5,000,000
a. The general liability policy shall contain the following special endorsements which shall be noted on
or attached to the standard certificate of insurance:
1. An endorsement naming the City of Vernon, its officers, and employees as additional insureds
under the policy only to the extent of Contractor's indemnity obligations assumed under the
Contract. The additional insured endorsement will be per standard CG20 10 1185.
2. An endorsement providing the City of Vernon 30 days notice of cancellation or material
reduction of coverage.
3. An endorsement providing coverage for all operations under this Contract.
4. Such other endorsement as may be required by addendum hereto.
b. In addition to the standard certificate of insurance, proof of general liability coverage shall be
furnished in the form checked below. Certification of the following proofs by the insurance agent
or broker will be accepted:
X For each policy, a notarized letter from the underwriter or carrier certifying that the coverage
and statements in the standard certificate of insurance (attached thereto) are true and correct
and that the signator is an officer authorized to so certify.
_ A copy of each policy certified by an officer of the underwriter or carrier and notarized.
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16, q a 4
(NOTARIZED INSURANCE CERTIFICATE TO BE INCLUDED BEFORE EXECUTION)
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APPENDIX 5
MISCELLANEOUS
1. SITE SAFETY PLAN
Attachment
To be added within 30 days of Contract signing via an addendum.
2. QUALITY CONTROL AND QUALITY ASSURANCE MANUAL
Attachment
To be added within 30 days of Contract signing via an addendum.
3. SITE LABOR AGREEMENT
Attachment
To be added within 30 days of Contract signing via an addendum.
SITE CONSTRUCTION PLAN DRAWING
Attachment
To be added within 30 days of Contract signing via an addendum.
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