THE PORT EVERGLADES DEPARTMENT RECOMMENDS APPROVAL.
This action supports Broward County Board of County Commissioners' Value of "Ensuring economic opportunities for Broward's diverse population and businesses" and Goal to "Increase the economic strength and impact of revenue-generating County enterprises balancing economic, environmental, and community needs."
The Office of Economic and Small Business Development (OESBD) did not establish a County Business Enterprise (CBE) program goal for this project since it is anticipated that Federal funding will be used for a portion of the project. This project is designated as a small business participation component project under 49 CFR Section 26.39, and the Broward County Disadvantaged Business Enterprise Program Plan. Per 49 CFR Part 80 and implementing guidance, the requirements of 49 CFR Part 26 apply to this project. Moss/Kiewit, a Joint Venture, has committed to meeting the OESBD requirements (see Exhibit 2).
On May 23, 2017 (Item No. 66), the Board approved the Managing General Contractor (MGC) Agreement between Broward County and Moss and Associates, LLC and Kiewit Infrastructure South Co., d/b/a Moss/Kiewit, a Joint Venture (MKJV), for a total estimated guaranteed maximum price (EGMP) of $437,493,624. The Agreement engaged MKJV to serve as the MGC to provide preconstruction and construction services for the Southport Turning Notch Expansion and the Southport Crane Rail Infrastructure Improvements Project.
Since MKJV received the Notice to Proceed for Preconstruction Services on July 5, 2017, several project-related activities have been accomplished, including:
- Providing Project constructibility review comments for the turning notch design
- Prequalifying a series of subcontractors for the Project
- Developing in-house cost estimates for the Project
- Developing Bid Packages and soliciting bids from the prequalified subcontractors
- Obtaining local building permits
- Developing a final Project schedule
- Providing a reconciled guaranteed maximum price for the Project
- Beginning construction activities for the Project
In order to expedite the crane rail infrastructure (crane rail) portion of the Project schedule, bids for the auger cast pile project element were solicited and awarded in September 2017, ahead of the other trades, and test piles were installed. On November 9, 2017, sealed bids were received for the remaining crane rail infrastructure trades. The bids were analyzed by MKJV and scope review meetings were held with the various subcontractors. The subcontractor bid award recommendations for the crane rail were submitted to the County in early January 2018 along with a partial reconciled guaranteed maximum price (RGMP) for the crane rail scope of work. Formal negotiation meetings between County staff and MKJV were held on February 13, 2018 and February 20, 2018, resulting in a negotiated RGMP for the crane rail scope of work in the amount of $78,543,335. The Notice to Proceed for the crane rail scope of work was issued on March 12, 2018, with the construction work currently underway and on schedule for completion in time to receive the delivery of three new ZPMC super post-Panamax cranes in early 2020.
The Turning Notch Expansion scope of work included the relocation of corals from the existing rip rap bulkhead system on the north and west sides of the existing turning notch to an artificial reef off Dania Beach. This work was required in advance of any demolition or construction activities to comply with the environmental permits for the Project. To advance this work, bids were solicited and received for the coral relocation work on December 13, 2017. This work was funded out of the Preconstruction Services budget, and is currently nearing completion.
The Turning Notch Expansion scope of work was divided in two main construction groups, civil and marine structural. The sealed bids for the civil portion were received and opened on April 27, 2018. The sealed bids for the marine structural portion were received and opened on May 5, 2018. MKJV provided the RGMP Package for the balance of the Project on June 22, 2018. Several fact-finding meetings were conducted by Port staff in advance of the formal negotiations meetings involving representatives from MKJV, Port Everglades, the County Auditor's Office, and County Attorney's Office that were held on July 23, 2018; August 7, 2018; and August 28, 2018. These meetings resulted in a negotiated final RGMP for the Turning Notch Expansion scope of work in the amount of $391,449,674. A Notice to Proceed was issued on August 31, 2018, and construction activities are currently underway.
During the Preconstruction Services Phase, it was determined that the schedule for construction that was initially negotiated for the EGMP was insufficient to accomplish the crane rail portion of the Project. This was discussed during the Turning Notch Expansion RGMP negotiations, and additional funding for General Conditions and staffing in the amount of $1,038,579 for additional crane rail work was negotiated by staff.
During the prequalification of subcontractors, MKJV also prequalified Kiewit Infrastructure South Company (Kiewit), as a subcontractor. Kiewit submitted bids on several of the construction packages. While all the Direct Construction Costs were competitively bid, Kiewit was the low bidder on three individual bid packages: paving, rip rap removal, and cathodic protection. The cost savings associated with allowing Kiewit to self-perform this work resulted in a net savings to the County of $7,764,826 compared to the next lowest bidders. Given the projected cost savings to the Project, County staff agreed to allow Kiewit to self-perform the paving, rip-rap removal, and cathodic protection portion of the work.
The final RGMP of $471,031,588 recommended for approval by County staff breaks down as follows:
| Crane Rail Infrastructure |
$ 78,543,335 |
| Additional General Conditions and Staff |
$ 1,038,579 |
| Turning Notch Expansion |
$391,449,674 |
The final RGMP is comprised of the following reconciled pricing elements:
| Preconstruction Services |
$ 4,113,765 |
| Direct Construction Costs |
$334,701,524 |
| Direct General Conditions |
$ 59,874,259 |
| Fixed Fee |
$ 17,941,030 |
| Owners Allowance Account |
$ 54,401,010 |
The increase in Project Cost of $33,537,964 from the EGMP of $437,493,624 was due to a number of factors as described below:
During the negotiations of the RGMP, the decision was made by Port staff in consultation with the County's Chief Financial Officer to source the steel for the Project from a manufacturer in the United States in order to comply with Federal "Buy American Act" provisions. Using U.S. manufactured steel allows the County to be eligible for federal financing under the U.S. Department of Transportation's (USDOT) Transportation Infrastructure Finance and Innovation Act (TIFIA) loan program, and to compete for other future federal grants. The Board previously approved the submission of a TIFIA credit assistance Letter of Interest to USDOT on June 12, 2017 (Item No. 12), and County staff is continuing to work with USDOT on this federal financing. This option also offered the fastest production time and a much more reliable source of the steel material. Because the pricing in the EGMP had used lower cost foreign-sourced steel, this resulted in an additional cost of $10,239,000. The use of the federal TIFIA financing program is expected to provide an estimated net savings of $6,800,000 in interest costs compared to traditional bond financing.
During the development of the final design of the Turning Notch, it was determined that the existing bulkhead wall of Berth 30 could not maintain an adequate safety factor when the east end of the Turning Notch is deepened to 50 feet in depth as part of the U.S. Army Corps of Engineers Port Everglades Navigation Improvements Project. Certain design changes were required to include the installation of a concrete relieving platform at Berth 30 to address this issue, with an additional cost of $4.4 million.
The constructibility review of the Turning Notch during the preconstruction services phase evaluated a variety of methods for excavation of the estimated 2.75 million cubic yards of material, including environmentally sensitive means and methods. The review resulted in the recommendation to install a temporary sheet pile bulkhead across the west end of the existing turning notch at an additional cost of $7.5 million. This sheet pile bulkhead will act as a barrier between the Intracoastal Waterway and the excavation area, and will ultimately provide better protection for water quality and the environmentally sensitive adjacent wetland areas.
The EGMP for the Turning Notch component was based upon 60% design plans, while the RGMP was developed based on the 90% design plans. During the Preconstruction Services Phase, MKJV worked through the design changes that occurred, and the final Direct Construction Cost pricing reflects these various Project design changes.
Finally, the General Conditions costs were significantly increased to cover the longer duration of construction phases and night work that was not originally contemplated when the EGMP was negotiated. General Conditions are costs that include personnel, insurance, bonds, office space, equipment, etc. that support the Project. The General Conditions estimate included in the EGMP was based on 8.25% of the Direct Construction Costs, a metric commonly used in construction projects. The sequence and duration of construction was not fully recognized until the Preconstruction Services were performed by MKJV. Given the extensive coordination and scheduling of construction activities between the contractors, port tenants, Florida Power and Light, and other Project stakeholders that will be required to meet port operational requirements and minimize the impact to Southport container terminal operators, additional MKJV staff were added to manage the project.
With the scope of work for the auger cast piling and relieving platform added after the EGMP was negotiated and the detailed project timelines developed during the Preconstruction Services phase of work, it was determined that additional time was needed to complete the Project. This resulted in a net increase of 654 calendar days, revising the total contract period of performance to 2,193 calendar days. The following are the negotiated substantial completion dates for the Project:
Project Substantial Completion Schedule
| Crane Rail Phase l - Berth 31/32 |
01/10/2020 |
| Crane Rail Phase ll - Berth 30 Extension |
04/27/2022 |
| Southport Turning Notch Expansion |
10/25/2022 |
| Crane Rail Phase lll- Berth 30 Existing |
07/07/2023 |
| Entire Project Substantial Completion Date |
07/07/2023 |
This proposed Change Order (see Exhibit 1) will authorize additional funding for the Project in the amount of $33,537,964, providing for a final Reconciled Guaranteed Maximum Price of $471,031,588.
The Change Order has been reviewed and approved as to form by the Office of the County Attorney. Signature pages are still being finalized and will be provided prior to the Commission meeting.
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