REPORT TO COUNCIL
SUBJECT
Title
Action on Award of a Public Works Contract for the Laurelwood Junction Transmission Line Extension Project to Henkels & McCoy West, LLC, for a Not-to-Exceed Amount of $883,183, Inclusive of a 15% Contingency, Funded by the Laurelwood Substation Capital Improvement Project (CIP No. 2443) Budget
Report
BACKGROUND
The City of Santa Clara’s electric utility, Silicon Valley Power (SVP), issued a public works bid packet for the Laurelwood Way Junction Transmission Line Extension Project (Project). The Project will extend approximately 0.3 miles of an existing 60-kilovolt (kV) overhead transmission line to deliver high voltage power to the Laurelwood Junction Substation (Laurelwood Substation), which is located approximately 0.25 miles east of the intersection of Lafayette Street and Walsh Avenue.
The Laurelwood Substation will serve a Digital Realty data center pursuant to a Substation Agreement between the City and 651 Walsh Partners, LLC. On March 22, 2022, the City Council authorized the City Manager to negotiate and execute a Substation Agreement with 651 Walsh Partners, LLC (RTC #22-1704). Walsh Partners is a Digital Realty Trust data center. The data center consists of a 435,050-square-foot, four-story facility that will house servers and associated electrical equipment, along with an attached three-story power base building fronting Walsh Avenue.
Project work includes installation of two new transmission structures to connect the Laurelwood Substation to the existing SVP transmission line, rebuilding of four existing transmission spans, and installation of two custom tubular steel monopoles supported on drilled concrete piers.
DISCUSSION
On November 24, 2025, in accordance with Section 1310 of City of Santa Clara Charter, which governs the competitive bidding for public works, a competitive Request for Bids (RFB) for the Project was published on the City’s e-procurement system.
On January 8, 2026, bids for the Project were opened at the City Clerk’s office. The City received four bids, as summarized in Table 1 below.
Table 1 - Bid Results
|
Bidder |
Total Bid Amount (Rounded to the Nearest Dollar) |
|
Henkels & McCoy West, LLC |
$767,985 |
|
Michels Pacific Energy |
$911,993 |
|
Hot Line Construction Inc |
$951,883 |
|
PAR Western Line Contractors, LLC |
$1,009,890 |
The total bid amount includes all labor, materials, and equipment, and services to complete construction of the Project. The Project work includes site preparation, environmental and traffic control measures, construction of new structure foundations and steel transmission structures, installation of conductors, and allowances for standby time and potential archaeological support.
At the bid opening, Henkels & McCoy West, LLC was identified as the lowest apparent bidder, with a submitted bid in the amount of $767,985. This amount is approximately 45 percent lower than the Engineer’s Estimate of $1,383,231, which was prepared using conservative assumptions for higher-risk work elements associated with the site-specific constraints.
Staff reviewed the bid for compliance with the terms and conditions of the bid documents and determined that Henkels & McCoy West, LLC is the lowest responsive and responsible bidder. Accordingly, staff recommend awarding a contract to Henkels & McCoy West, LLC.
The recommended contract includes a maximum compensation of $767,985, plus a 15% contingency for any potential change orders. The total not-to-exceed contract amount, including contingency, is $883,183.
Approval of the contract award will authorize the City Manager to execute the public works contract for the Project in substantially the same form as attached to this Report to Council (Attachment 1). Upon City Council approval, Henkels & McCoy West, LLC will be required to provide performance and payment bonds. The contract includes prevailing wage requirements.
ENVIRONMENTAL REVIEW
Staff recommends that the City Council determine that the Project and associated actions being considered are exempt from the California Environmental Quality Act (“CEQA”) pursuant to sections 15302 (Class 2 - Replacement or Reconstruction) and 15303 (Class 3 - New Construction) of Title 14 of the California Code of Regulations as they involve the reconductoring of existing electric lines with a negligible expansion of capacity and the installation of limited electric facilities to connect Laurelwood Substation.
FISCAL IMPACT
The cost of the contract is $767,985, plus a 15%contingency, or $115,198, for any potential change orders, for a total not-to-exceed contract amount of $883,183. Sufficient funding for the contract is available in the Electric Utility Capital Fund in the Laurelwood Substation Capital Improvement Project (CIP No. 2443) budget which is funded by contributions from the customer.
COORDINATION
This report has been coordinated with the Finance Department and the City Attorney’s Office.
PUBLIC CONTACT
Public contact was made by posting the Council agenda on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any agenda report may be requested by contacting the City Clerk’s Office at (408) 615-2220, email clerk@santaclaraca.gov or at the public information desk at any City of Santa Clara public library.
RECOMMENDATION
Recommendation
1. Determine the proposed actions are exempt from CEQA pursuant to sections 15302 15302 (Class2 - Replacement or Reconstruction) and 15303 (Class 3 - New Construction) of Title 14 of the California Code of Regulations;
2. Award the Public Works Contract for the Laurelwood Substation Capital Improvement Project (CIP No. 2443) to the lowest responsive and responsible bidder, Henkels & McCoy West, LLC, in the amount of $767,985, and authorize the City Manager or designee to execute a public works contract (Contract) in substantially the form attached to this Report to Council, subject to the review and final approval as to form by the City Attorney; and
3. Authorize the City Manager or designee to take any actions necessary to implement and administer the Contract including executing any and all documents in furtherance of the award, completion, and acceptance of the Project and approval of any necessary change orders not to exceed 15%of the original contract price, or $115,198, for a total contract amount not-to-exceed $883,183, funded by the Electric Utility Capital Fund.
Staff
Reviewed by: Nico Procos, Director of Silicon Valley Power
Approved by: Jovan D. Grogan, City Manager
ATTACHMENTS
1. Public Works Contract for the Laurelwood Junction Transmission Line Extension Project