Hilltop bids come in well below $31 million price tag
KINGMAN - Bidding for the most expensive project in Kingman's history officially closed at 3 p.m. Tuesday, with some of the biggest national names in contracting dropping by to submit bids for the expansion and renovation of the Hilltop Wastewater Treatment Plant.
But as City Clerk Debbie Francis opened each sealed envelope and read off each firm's estimated construction costs, it quickly became apparent that Kingman is likely to save millions of dollars on the project when it awards the bid March 2.
Of the ten bids received, nine came in well below the $31,716,192 construction cost estimated by the project's engineering firm, Brown and Caldwell.
The three lowest bids came from Montana-based Sletten Construction at $26,250,000; St. Louis-based McCarthy Building Companies at $26,625,000; and California-based J.R. Filanc Construction at $27,633,923. All three companies have local offices in Las Vegas, Phoenix or both cities.
The remaining bids varied from $27.9 million to $29.9 million, with Ames Construction's bid of $32,080,000 the only one to exceed the engineer's cost estimate. City engineer Greg Henry said the burgeoning economic recession has inadvertently aided the city in securing so many low bids.
"There's not a lot of work out there, so labor costs are down, material costs are down from what they had been in '05 and '06, and as it is, it's a good time to be bidding things," Henry said.
"Contractors are willing to take less of a profit just to keep their labor busy."
Even so, Henry said it was likely the city would award the bid to Sletten Construction, in keeping with standard protocol.
"At this point, Sletten Construction is the low bid, and according to statute, we have to go with the low bid so long as they're qualified," he said.
To determine that, Henry has requested Sletten submit at least five examples of similar projects it has worked on in the past.
"We don't anticipate any problem there with obtaining that," he added.
Kingman is paying for the project with a $35 million loan from the state Water Infrastructure and Finance Authority. Henry said the city has already spent about $4 million of the loan on the project's design and engineering, but with construction now expected to cost much less than previously anticipated, he said could pay the loan back faster, or use the remainder to finance some other crucial water project.
"There's $30.8 million left for construction, and it looks as if we'll be well below that," he said. "We'll be drawing less, and therefore paying less interest."
Once a general contractor is secured March 2, Henry said he expected construction on the treatment plant to begin by mid-April. From there, the contractor will have 548 days to bring the plant to "substantial completion," the point at which its water treatment capacity meets the standards of the Arizona Department of Environmental Quality.
Plant expansions will include an oxidation ditch to meet ADEQ's denitrifying requirements and will also increase the plant's refining capacity from 2.08 to 5.1 million gallons a day. ADEQ has warned that if the city does not take substantial action to get the plant into compliance, the city could face a moratorium on all new building and possible fines of up to $20,000 a day.