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AWARD OF THE FIRE STATION NO. 2 RECONSTRUCTION PROJECT, CITY PROJECT NO. 26-05
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DEPARTMENT: PUBLIC WORKS DEPARTMENT/GENERAL SERVICES DIVISION
PRESENTED BY: RAJA SETHURAMAN, PUBLIC WORKS DIRECTOR
CONTACT INFORMATION: PATRICK BAUER, DEPUTY PUBLIC WORKS DIRECTOR, (714) 754-5029
RECOMMENDATION:
recommendation
Staff recommends the City Council:
1. Adopt plans, specifications, and working details for the Fire Station No. 2 Reconstruction Project, City Project No. 26-05.
2. Authorize the City Attorney to prepare and the City Manager and City Clerk to execute a Public Works Agreement (PWA) for construction with AMG & Associates, Inc., 26535 Summit Circle, Santa Clarita, CA 91350, in the amount of $14,821,000, plus a ten percent (10%) contingency for the PWA in the amount of $1,482,100, contingent upon the approval and completion of bond financing.
3. Approve Amendment No.1 to the Professional Services Agreement (PSA) with PBK-WLC Architects for professional architectural and engineering support services, extending the term of the agreement for a period of three (3) years through February of 2030.
4. Approve Amendment No. 2 to the Professional Services Agreement (PSA) with TSG Enterprises, Inc. dba The Solis Group for the administration of Community Workforce Agreement (CWA), extending the term of the agreement for a period of two (2) years through April of 2030.
5. Authorize the City Manager or designee and City Clerk to execute the agreements, amendments, and any future amendments to the agreements, including increases to the not-to-exceed amount within City Council authority.
ENVIRONMENTAL DETERMINATION:
The project was presented to the Planning Commission on October 14, 2024, for environmental and Minor Conditional Use Permit (CUP) approvals. The project was determined to be categorically exempt from the provisions of the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Section 15302 (Class 2), Replacement or Reconstruction. Under Class 2, a project consisting of the replacement or reconstruction of existing structures and facilities where the new structure will be located on the same site as the structure replaced and will have substantially the same purpose and capacity as the structure replaced is eligible for the exemption. Since the project is replacing the existing fire station with a new fire station with the same purpose and substantially the same capacity, the proposed development project meets all criteria for a Class 2 Categorical Exemption pursuant to CEQA Guidelines Section 15302.
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BACKGROUND:
Fire Station No. 2, located at 800 Baker Street, provides essential fire protection and emergency response services to the Costa Mesa community. The Fire and Rescue Department's mission is to prevent the loss of life and property. In addition to fire suppression, the station responds to medical emergencies, motor vehicle accidents, rescue operations, and hazardous materials incidents.
The station, built in 1966, has exceeded its useful life and now faces significant operational, maintenance and service challenges that necessitate a complete overhaul and reconstruction. Needed improvements include modernized, gender-neutral living quarters; upgraded electrical, mechanical, and heating, ventilation, and air conditioning improvements; modernization of life-safety fire and communications equipment; structural and architectural updates to meet current building codes and regulations; and improved parking facilities and landscaping.
On February 15, 2022, City Council awarded a PSA to PBK-WLC Architects in the amount of $730,000 for architectural and engineering design services. The scope of work includes the preparation of complete construction documents for the new LEED Gold facility, including conceptual and final design, interior programming, site improvements, soil testing, a geotechnical study, hazardous materials testing, architectural, structural, electrical, mechanical, plumbing, and grading design, as well as all necessary calculations and technical support needed during construction. Additionally, services include the design of temporary operational and living quarters for fire personnel during construction.
A community meeting was held on August 27, 2024, to present conceptual alternatives, and staff received positive feedback on the proposed plans. The conceptual renderings and plans were subsequently presented to the City Council on October 15, 2024. The Council was supportive of the proposed concept plans for the project.
Subsequently, the designer proceeded with the final design of the Fire Station No. 2 project. The proposed design for Fire Station No. 2 features a 9,445 square foot facility targeting Leadership in Energy and Environmental Design (LEED) Gold certification, including expanded gender-neutral living quarters; an enlarged apparatus bay; utility, dining, medical, and storage rooms; improved site circulation; and new mechanical, electrical, and plumbing systems.
The selected contractor is required to complete all tasks necessary to perform the scope of work as outlined in the contract documents, plans, and specifications. A copy of the specifications and working details is available at the office of the City Clerk.
PBK Architects Contract Extension: The services of the project designer are required during construction to address contractor’s Requests for Information (RFI), project submittals and design-related issues. At this time, there is no adjustment needed to the compensation amount. However, staff is requesting approval for extension of the term of the PSA for an additional three (3) years through February of 2030 to fulfill the commitment of technical support during construction.
The Solis Group Contract Extension: The project is subject to the City’s Community Workforce Agreement (CWA). The City Council approved the CWA on February 1, 2022, to promote efforts to increase employment opportunities for residents of Costa Mesa and to facilitate training and employment for the City’s students and veterans in construction trades through apprenticeships and to encourage efficiency in construction operations. On March 7, 2023, the City Council awarded a PSA to The Solis Group for administration of the City’s CWA provisions for various projects. The total cost for CWA administration for this project is anticipated to be $91,800. Staff is requesting approval for extension of the term of the PSA for The Solis Group for an additional two (2) years through April of 2030 to fulfill the commitment of CWA administration during construction.
ANALYSIS:
The project was advertised to receive construction bids through PlanetBids on August 6, 2026. The City received and opened ten (10) bids for this project on September 23, 2026. AMG & Associates, Inc., the apparent lowest bidder, submitted a bid proposal in the amount of $14,821,000. This amount is approximately 17% under the Engineer’s estimate of $18,000,000. The average of the ten (10) bids received amounted to $17,967,019. The bid results are included as Attachment 1.
The license and references of AMG & Associates, Inc. have been checked, and staff have found them to be in good standing.
On September 28, 2026, bidding contractor PCN3 submitted a bid protest noting concerns with the bid submitted by AMG & Associates, Inc. On September 30, 2026, AMG & Associates, Inc. submitted a response to PCN3’s bid protest addressing the concerns noted. Staff have reviewed the various items, conferred with the City Attorney’s Office, and deemed the items minor in nature or not applicable, and AMG & Associates, Inc.’s proposal in the amount of $14,821,000 should be considered for approval. Staff provided PCN3 with a denial letter to their bid protest (Attachment 2) on October 7, 2026.
On September 28, 2026 and September 30, 2026, bidding contractor Builders United submitted a bid protest and supplemental protest noting concerns with the bid submitted by AMG & Associates, Inc. Staff has reviewed the various items, conferred with the City Attorney’s Office, and deemed the items not applicable, and AMG & Associates, Inc.’s proposal in the amount of $14,821,000 should be considered for approval. Staff provided Builders United with a denial letter to their bid protest (Attachment 3) on October 7, 2026.
Upon City Council award of the Project, contingent upon bond financing and execution of the PWA, AMG & Associates, Inc., will furnish the necessary bonds and insurance, which will be approved as to form by Risk Management. The PWA will be drafted by the City Attorney’s office after City Council award. Subsequent to the execution of the agreement, a “Notice to Proceed” will be issued.
ALTERNATIVES:
The City Council may decide not to authorize the project; however, staff do not recommend this action. Not proceeding with this project will adversely affect the Fire Department’s daily operations.
Another alternative to this Council action would be to reject all bids, re-advertise, and re-bid the construction project. Staff have determined that re-advertising and re-bidding the project will not result in lower bids and will further delay the project.
FISCAL REVIEW:
Funding for project-related soft costs has been accounted for and is budgeted within the Capital Improvement Program Fund (Fund 401). The construction costs for the Fire Station No. 2 Reconstruction Project, inclusive of contingency, total $16,303,100. The total project cost will be funded through a combination of sources: $14.0 million via long-term debt specifically from the issuance of 2026 Lease Revenue Bonds, available cash (approximately $1.0 million) set aside from the CAN in the Capital Improvement Program Fund, and an additional approximate $1.4 million through the upcoming FY 2027-28 budget development process.
The long-term financing plan articulates the issuance of the Lease Revenue Bonds in the principal amount of approximately $14.0 million with a 20-year term at a true interest cost of approximately 5% (preliminary and subject to change depending on the actual rates at Bond pricing). City Council approval of issuance of the bonds will be sought at the October 20, 2026, City Council meeting. If approved, the bond repayment plan is structured with level annual debt service, with the annual debt service payment estimated at $1.13 million per year. Interest payment on the 2026 Lease Revenue Bonds begins April 1, 2027, while principal payment begins October 1, 2027.
The City will budget for the bond repayments annually in the General Fund (Fund 101) Non Departmental and deduct such funds (the debt service amount) from the annual allocable funds (5%) due for transfer to the Capital Asset Need (Fund 401).
LEGAL REVIEW:
The City Attorney’s Office has reviewed this staff report and approved it as to form.
CITY COUNCIL GOALS AND PRIORITIES:
This project works toward achieving the following City Council Goals:
• Strengthen the Public’s Safety and Improve the Quality of Life
• Maintain and Enhance the City’s Infrastructure, Facilities, Equipment and Technology
CONCLUSION:
Staff recommends the City Council:
1. Adopt plans, specifications, and working details for the Fire Station No. 2 Reconstruction Project, City Project No. 26-05.
2. Authorize the City Attorney to prepare and City Manager and City Clerk to execute a Public Works Agreement (PWA) for construction with AMG & Associates, Inc., 26535 Summit Circle, Santa Clarita, CA 91350, in the amount of $14,821,000, plus a ten percent (10%) contingency for the PWA in the amount of $1,482,100, contingent upon the approval and completion of bond financing.
3. Approve Amendment No.1 to the Professional Services Agreement (PSA) with PBK-WLC Architects for professional architectural and engineering support services, extending the term of the agreement for a period of three (3) years through February of 2030.
4. Approve Amendment No. 2 to the Professional Services Agreement (PSA) with TSG Enterprises, Inc. dba The Solis Group for the administration of Community Workforce Agreement (CWA), extending the term of the agreement for a period of two (2) years through April of 2030.
5. Authorize the City Manager or designee and City Clerk to execute the agreements, amendments, and any future amendments to the agreements, including increases to the not-to-exceed amount within City Council authority.