Rejecting outsized paving bids, council moves to scale back, rebid project

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Manatts Construction from Ames was one of the bidders on the hot mix asphalt (HMA) proposal, but an inconsistency in their paperwork disqualified them. The original project called for resurfacing about 60 block's worth of Perry streets this summer.

When the bids on Perry’s planned 60-block street resurfacing project exceeded both the engineer’s estimate of $810,000 and the money the city budgeted for the work, the Perry City Council voted Tuesday to scale back the project and immediately rebid it.

Bids on the hot mix asphalt (HMA) resurfacing job were received Feb. 24 from Grimes Asphalt and Paving at $878,027 and OMG Midwest-Des Moines Asphalt and Paving at $950,704. A third or “non-responsive” bid, from Ames-based Manatts Construction, was not considered due to faulty paperwork, according to Matt Ferrier, project manager with Bolton and Menk Inc., the city’s engineering consultant.

In light of the numbers, Ferrier recommended to the city council “a reduction in the scope of the project” and reletting of the bids. “We’re going to reject all bids,” Ferrier said. “That’s our recommendation.”

matt ferrier
Matt Ferrier

Comparisons with prices on similar jobs led the city to expect similar numbers, he said.

“The two bidders did have fairly high asphalt numbers compared to what we had budgeted for,” Ferrier said. “We had seen substantially lower bids at several other communities around Iowa. Some of the conversations we’ve had sound like the travel still impacts the cost of asphalt here.”

The bid prices for asphalt came in at $99 a ton from Grimes Asphalt and $105 a ton from Des Moines Asphalt, according to Ferrier. He said the per-ton prices “are similar bids to what we saw a year and a half ago, where we actually rejected the bids and bid it again, and it came in substantially less on the second time around.”

It is hoped a similar strategy produces a similar outcome this time.

“I do feel like those are excessive bid numbers,” Ferrier told the council. “The Iowa Asphalt Paving Association, the number they expected to see for this area was around $85 a ton. We historically have seen mid-$90s. Our budget estimate was $94 a ton, which we felt confident in and actually I still feel is where the bid numbers should be here.”

Reducing the scope of the project and changing some of the specifications could produce lower bids, he said.

“We did consider several bid alternatives,” Ferrier said. “This package that got bid, we only read the base bids. As a result, what we’re seeing in those pricings with the rebid process, we did remove those from the rebid package and actually reduce the scope in an effort to get it closer to where we’re hopefully going to see revised bid costs that second time around. So we simplified some of it, tried to get things that were a little closer if they were mobilization things that were impacting the bids. As of right now, we feel that we were successful.”

Council member Dr. Randy McCaulley asked whether the bid numbers were affected by the volume of work available to contractors, with demand driving up the cost. Ferrier said Perry’s distance from asphalt suppliers is the crucial condition.

“I feel like distance is something we still struggle with here in the asphalt market,” he said. “We even had asphalt bidders we don’t typically see here because of distance. They had bid some larger projects in the area for some of the counties around us and as a result provided bids here.”

Manatts is a paving company less often seen bidding on Perry-area projects, Ferrier said, but “unfortunately we were not able to read their bid.” He said rebidding would probably again attract bids from Grimes Asphalt and OMG Midwest but might include Manatts and possibly Iowa Asphalt Paving-Henningsen Contruction out of Atlantic.

“For this area, we typically end up with Grimes Paving and Des Moines Asphalt,” he said. “With asphalt suppliers, it gets a little tough to get more than about 60 miles. It’s hard to get the asphalt there and get it on at the right temperature and get it placed before it starts setting up.”

Ferrier said he also likes to “watch closely to see if there are counties or the DOT doing projects close by. We try to piggyback on that.”

The second round of bids will be due Thursday, March 17 at 2 p.m. The city council will hold a public hearing on the second set of bids at its next regular meeting, Monday, March 21 at 6 p.m. in the Clarion Room of the Security bank Building.

About 60 blocks of Perry's city streets will be resurfaced next summer with hot-mix asphalt is the $980,000 project is approved by the Perry City Council. Bidding on the project is open until Feb 24.
About 60 blocks of Perry’s city streets will be resurfaced next summer with hot-mix asphalt if a bid for the project is approved by the Perry City Council. The second round of bids are due March 17.

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