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HomeMy WebLinkAboutOrdinance No. 3490-2025IV 700, JC11V KENAI CITY OF KENAI ORDINANCE NO. 3490-2025 Sponsored by: Administration AN ORDINANCE INCREASING ESTIMATED REVENUES AND APPROPRIATIONS IN THE WASTEWATER TREATMENT FACILITY IMPROVEMENT CAPITAL PROJECT FUND, ACCEPTING A GRANT FROM THE U.S. ENVIRONMENTAL PROTECTION AGENCY FOR THE KENAI WASTEWATER TREATMENT FACILITY DIGESTER BLOWERS UPGRADE PROJECT AND AWARDING THE CONSTRUCTION CONTRACT FOR THE PROJECT. WHEREAS, the City applied for and received a $2,900,000 grant from the U.S. Environmental Protection Agency for the Kenai Wastewater Treatment Facility Digester Blowers Upgrade Project; and, WHEREAS, this project will consist of installation of new high efficiency turbo blowers in a new building and associated construction to supply air to the digester including new stainless -steel air piping, disconnecting the old blowers and reconstruction of operational equipment for the digester; and, WHEREAS, the cost share requirements for the grant were waived; and, WHEREAS, the City has appropriated $750,000 in Water & Sewer funds to the project already and is requesting an additional appropriation of $750,000 to complete the project with a total budget of $4,400,000; and, WHEREAS, additional funding is needed to award the project and to complete additional associated work on the project consisting of draining and cleaning the digester, construction administration services, replacement of a standby generator and efficiency improvements to the existing blowers; and, WHEREAS, an Invitation to Bid was released on March 27, 2025 with bids due on April 29, 2025 for the project and only one bid was received by Blazy Construction Inc.; and, WHEREAS, the bid was determined to be responsive and responsible; and, WHEREAS, due to the time that occurred between bidding and award, the bid price was open for renegotiation; and, WHEREAS, the City negotiated the current cost of $3,280,258 to complete the project after value engineering the project and incorporating material and labor cost increases; and, WHEREAS, it is in the best interest of the City to award the construction contract to Blazy Construction Inc. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, AS FOLLOWS: Section 1. That the City Manager is authorized to accept a grant from the U.S. Environmental Protection Agency in the amount of $2,900,000 and expend the funds in accordance with the provisions of the grant. Section 2. That estimated revenues and expenditures be increased as follows: Water & Sewer Fund: New Text Underlined; [DELETED TEXT BRACKETED] Ordinance No. 3490-2025 Page 2 of 2 Increase Estimated Revenues - Appropriation of Fund Balance Increase Expenditures - Transfer to Water & Sewer Capital Project Fund $750,000 Section 3. That estimated revenues and expenditures be increased as follows: Water & Sewer Capital Projects Fund — Wastewater Treatment Facility Digester Blowers Upgrade Project: Increase Estimated Revenues - Federal Grants - Transfer from Water & Sewer Fund $2, 900, 000 750,000 3,650,000 Increase Appropriations - Construction $3;650,000 Section 4. That the City Manager is authorized to execute a contract with Blazy Construction Inc. in the amount of $3,280,258 for the Kenai Wastewater Treatment Facility Digester Blowers Upgrade Project. Section 5. Severability: That if any part or provision of this ordinance or application thereof to any person or circumstances is adjudged invalid by any court of competent jurisdiction, such judgment shall be confined in its operation to the part, provision, or application directly involved in all controversy in which this judgment shall have been rendered, and shall not affect or impair the validity of the remainder of this title or application thereof to other persons or circumstances. The City Council hereby declares that it would have enacted the remainder of this ordinance even without such part, provision, or application. Section 6. Effective Date: That pursuant to KMC 1.15.070(f), this ordinance shall take effect immediately upon enactment. ENACTED BY THE COUNCIL OF THE CITY OF KENAI 2025. 6Zell", City Clerk .--. Approved by Finance: _:-� Introduced: October 15, 2025 Enacted: November 5, 2025 Effective: November 5, 2025 New Text Underlined; [DELETED TEXT BRACKETED] ,0/ KENA City of Kenai 1 210 Fidalgo Ave, Kenai, AK 99611-7794 1907.283.7535 1 wwwlenai.city MEMORANDUM TO: Mayor Gabriel and Council Members THROUGH: Terry Eubank, City Manager FROM: Lee Frey, Public Works Director DATE: October 8, 2025 SUBJECT: Ordinance 3490-2025 - Increasing Estimated Revenues and Appropriations in the Wastewater Treatment Facility Improvement Capital Project Fund, Accepting a Grant from the U.S. Environmental Protection Agency for the Kenai Wastewater Treatment Facility Digester Blowers Upgrade Project and Awarding the Construction Contract for the Project. The memo requests Council's approval to accept a U.S. Environmental Protection Agency (EPA) grant for the Kenai Wastewater Treatment Facility Digester Blowers Upgrade project, appropriate additional funding to complete the project and award the project to Blazy Construction, Inc. The project will consist of installation of new high efficiency turbo blowers in a new building and associated construction to supply air to the digester including new stainless -steel air piping, disconnecting the old blowers and reconstruction of operational equipment for the digester. The grant from the EPA is in the amount of $2,900,000 and matching requirements were waived. $750,000 of local funds are already appropriated for the project and the Public Works Department requests an additional appropriation of $750,000 to award the project and complete other associated work and improvements. The Public Works Department requests award of the construction contract to Blazy Construction Inc. in the amount of $3,280,258. $464,950 of this cost is the negotiated cost for purchase of the blower units that was previously approved by EPA as a sole source purchase. Blazy construction was the only bidder on the project when it bid in April of 2025, and we negotiated the current cost to award since the timeline to hold the price expired. We also value engineered several items out of the scope of work to save funding where feasible. Remaining funding is expected to be used for emptying and cleaning the digester by the City, construction administration by our consultant and City staff, purchase and installation of a new generator to replace the failing unit at the treatment plant and additional work on the existing blowers to increase their efficiency. Work is expected to be completed by the end of 2026. Contingency funds have been included in this funding request for potential change orders encountered on the project. The main concern on this project is the condition of the existing digester structure. It was built in 1982 and the concrete will be evaluated when it is taken down. There is a potential that significant repairs could be required based on what is discovered and that supplemental appropriations could be necessary at that time. Thank you for your consideration.