REPORT TO STADIUM AUTHORITY BOARD
SUBJECT
Title
Report from the Stadium Authority for Action Regarding Stadium Manager’s Request to Award Agreement to Devcon Construction, Inc. to Remove and Replace Existing Padded Club Seats in Levi’s Stadium (New Seating - Bowl Padded Seats Replacement Project - Lower and Mid Level Club Seating Bowl CapEx Project)
Report
BOARD PILLAR
Ensure Compliance with Measure J and Manage Levi’s Stadium
BACKGROUND
On October 8, 2019, the Stadium Authority Board (Board) approved Ordinance No. 2005 amending Chapter 17.30 of the City Code (Stadium Authority Procurement Policy), which rescinded the delegation to the Executive Director to enter into agreements without prior Board approval. As result of Ordinance No. 2005, the Stadium Manager is also required to request Board approval before entering into agreements on behalf of the Stadium Authority. As of the effective date of the Ordinance (November 8, 2019), all Stadium Authority agreements for services, supplies, materials, and equipment require the approval of the Stadium Authority Board.
As the Stadium Manager, Forty Niners Stadium Management Company, LLC is responsible for maintaining “the Stadium in the Required Condition and operate the Stadium as a quality NFL and multi-purpose public sports, public assembly, exhibit and entertainment facility” as required by the Management Agreement between the Stadium Authority and ManCo.
The Stadium Manager is requesting approval for the following actions related to the New Seating - Bowl Padded Seats Replacement Project - Lower and Mid Level Club Seating Bowl Capital Expense (CapEx) Project:
1. Award a one-time agreement to Devcon Construction, Inc. in the amount of $3,094,392 to remove and replace the existing padded club seats in Levi’s Stadium;
2. Authorize the Stadium Manager to execute any and all documents associated with, and necessary for the award, completion, and acceptance of the project; and
3. Authorize the Stadium Manager to execute change orders up to 10% of the project cost ($309,438), for a total not to exceed construction agreement amount of $3,403,820.
The Stadium Authority Fiscal Year (FY) 2022/23 CapEx Budget includes $3,538,500 for the New Seating - Bowl Padded Seats Replacement Project - Lower and Mid Level Club Seating Bowl line item.
DISCUSSION
Stadium Authority staff reviewed the Stadium Manager’s Recommendation for Award memo, supporting procurement documents, and the draft agreement with Devcon Construction, Inc. (these documents are attached to corresponding report #22-1540) for consistency against the Stadium Authority Procurement Policy and the City’s public works bidding practices (City Charter Section 1310). The Stadium Manager’s Request for Bids (RFB) received two responses and the Stadium Manager is recommending award to the lowest bidder.
Based on the documentation and provided information, staff recommends approval of the Stadium Manager’s request to award a one-time agreement to Devcon Construction, Inc. for the described project.
In regard to the Stadium Manager’s request for authority to execute any and all documents related to the project and issue change orders up to 10% of the construction agreement amount, staff recommends that this authority be delegated instead to the Executive Director. Currently, the Executive Director has no procurement delegated authority under the Stadium Authority Procurement Policy. Approving staff’s recommendation to provide the Executive Director with such authority to approve the execution of documents related to the project and the execution of change orders up to 10% of the construction agreement amount accomplishes the expediency that the Stadium Manager seeks.
The Stadium Authority Counsel’s Office has reviewed the requested agreement for comparison to the Stadium Authority’s customary language. While there are some differences in the language, including portions covering compliance with laws such as prevailing wage, the agreement submitted here for approval contains the necessary language which identifies these legal obligations to the vendor. The vendor expressly agrees to adhere to such obligations upon its execution of the agreement. Nothing in the proposed agreement changes the Stadium Authority’s rights under the Management Agreement and specifically with respect to any dispute that may arise from the Stadium Manager’s obligations under the Management Agreement.
In addition, per paragraph 4(b) of the Settlement Agreement, the Stadium Authority reserves all rights to confirm and dispute charges by and payments to the Stadium Manager during a fiscal year-end reconciliation/true-up, including but not limited to changes based on improper allocation, calculation, lack of support, or failure to comply with the Parties’ contracts or California law. The Stadium Authority may raise related questions before the fiscal year-end reconciliation/true-up, which the Stadium Manager agrees to assess and respond to in good faith.
ENVIRONMENTAL REVIEW
The actions being considered do not constitute a “project” within the meaning of the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines section 15378(a) as it has no potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment.
FISCAL IMPACT
As noted above, the Stadium Authority FY 2022/23 CapEx Budget includes $3,538,500 for the New Seating - Bowl Padded Seats Replacement Project - Lower and Mid Level Club Seating Bowl CapEx Project. There are sufficient funds to cover the one-time agreement ($3,094,382), the 10% contingency to the agreement ($309,438), and a San Jose Mercury News publication that was used to advertise the RFB ($177).
In July 2021, the Stadium Authority Board approved purchase orders for the publication of legal notices in the San Jose Mercury News and Santa Clara Weekly for various solicitations. As such, the San Jose Mercury News publication doesn’t require further Board approval.
COORDINATION
This report has been coordinated with the City’s Purchasing Manager and the Treasurer’s and Stadium Authority Counsel’s Offices.
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 <mailto:clerk@santaclaraca.gov> or at the public information desk at any City of Santa Clara public library.
RECOMMENDATION
Recommendation:
1. Approve the Stadium Manager’s request to award a one-time agreement to Devcon Construction, Inc. to remove and replace the existing padded club seats in Levi’s Stadium (New Seating - Bowl Padded Seats Replacement Project - Lower and Mid Level Club Seating Bowl CapEx Project) in the amount of $3,094,382;
2. Authorize the Executive Director to approve the Stadium Manager’s execution of any and all documents associated with, and necessary for the award, completion, and acceptance of the project; and
3. Authorize the Executive Director to approve the Stadium Manager’s execution of change orders up to 10% of the contract cost ($309,438), for a total not to exceed construction agreement amount of $3,403,820.
Staff
Prepared by: Christine Jung, Assistant to the Executive Director
Approved by: Rajeev Batra, Executive Director