The “Shovel Ready” water project was awarded to J&H Services for nearly $5.7 million at the Oct. 22 meeting by city commissioners.
The project actually came in under the city’s engineer firm’s estimate, which was about $6.3 million. With money already spent, City Manager Gary Whitehead estimates the total project will cost about $8.4 million–about $800,000 less than the prior $9.2 million estimate.
Whitehead has been city manager about eight months, but he has already reduced the city’s many capital projects’ cost by strategizing and switching up procurement methods.
He switched to the “design-build” procurement method for the Foch Street sidewalk and road project, the Ralph Edwards Park skateboard park and the Animal Shelter’s expansion. All three have grant funding in hand, but proposals from contractors were much higher. Examining the contractors’ pricing, Whitehead felt they were too high. Design-build lets the city negotiate directly with contractors to narrow its choice to the best fit and price, based on the state’s rationale as laid out in its procurement code that specialized construction projects require such collaboration and deliberation.
Whitehead’s knowledgeable questioning of engineers’ and contractors’ designs and pricing undoubtedly let them know that the city had an alert watchdog.
The “Shovel Ready” water project is actually finishing up three projects for which Wilson & Company engineered and designed and authored “request for proposals” or RFP documents.The resulting responses were way above Wilson & Co.’s estimates and had to be cut down. Whitehead, knowing the governor, legislators and state and federal agencies favor “shovel-ready” projects, convinced the city commission shortly after he was hired to pay even more engineering fees to combine the three-project left overs. He knew the city could probably get capital outlay money if they had the engineering plan. See:
https://sierracountycitizen.org/whitehead-brings-transparency-to-9-7-million-water-project/
Whitehead took funding already in hand and combined it with capital outlay money.
The city received a grant/loan from the New Mexico Finance Authority’s Colonias Infrastructure Fund in 2024. The grant portion was $3.96 million, the loan $440,000, and the city’s cash match another $440,000, which total $4.84 million.The loan will be paid off from water utility fees. The match will come from the $3 million general obligation bond the city’s citizens approved at the November 2022 polls–$2 million for water and sewer projects and $1 million for roads, since road tear-up is inevitable in fixing water and sewer pipes.
The city asked for capital outlay grants from Governor Michelle Lujan Grisham and local state Senator Crystal Brantley, Representative Gail Armstrong and then-Representative Tara Jaramillo, who lost her reelection bid to Rebecca Dow. They gave the city $4.4 million.
Instead of putting the project out to RFP, in which the best company and not the best price are awarded a contract, Whitehead used a straight “lowest bid” procurement method. He told city commissioners at yesterday’s meeting that the city should have about $800,000 left over from the $9.2 million it has from the two funding sources.
Smithco, located in nearby Caballo, has been awarded many city projects, but not this time. The lowest bid was J & H Services located in Albuquerque. Mayor Pro Tem Amanda Forrister and City Commissioner Merry Jo Fahl needed assurance that the firm had been fully vetted, Forrister suggesting that the city might be better off paying more to Smithco, since it has proven its worth and is familiar with the city’s water infrastructure. Whitehead and Assistant City Manager Traci Alvarez said the bidders had all been thoroughly checked out and that procurement code didn’t allow awarding the job to a higher bid without finding cause to disqualify the lowest bidder.
Whitehead told commissioners that the fact that Smithco’s and J&H’s bids were so close meant that their pricing was accurate and not inflated–a concern Whitehead expressed to the Citizen about prior RFPs. If contractors thought the city was easy to rook in the past, they now know Whitehead’s too savvy to miss a trick.
The three projects the Shovel Ready project will finish up follow.
- Cost overruns from the Main Street District or MSD or “downtown” water project that will be completed by the Shovel-ready project:
–New and bigger and redundant water tank at the Cook Street Station, where all well water is pumped to be chlorinated before transmission throughout the city
–840 LF of waterline replacement starting on Broadway and continuing along Riverside Drive.
–LF not given; waterline replacement under McAdoo Street near the current police building.
–Five of the city’s six wells (one is not working) to be hooked into a SCADA or supervisory control and data acquisition computer system.
2. Cost overruns from WSPI 1 that will be addressed by the Shovel-ready project:
–5,900 LF of 12-inch waterline from the Cook Street Booster Station to the Morgan Street water tank
–(LF not given) Several blocks of waterline replacement with 10-inch pipe along 8th and 9th avenues
3. Cost overruns from a state-funded project, NMFA’s Drinking Water State Revolving Loan Fund that will be completed by Shovel-ready:
–2,600 LF of eight-inch waterline along 2nd Avenue between Ash and Silver streets
Please find the link to the city’s web page that contains maps and more information about the Shovel Ready project:
https://www.torcnm.org/city_blueprint/shovel_ready/index.php#prettyPhoto
Whitehead said the city will contact the people street by street who will be affected, giving them warning when and how long repairs and water shut-offs will occur. “We’re trying to get better at doing that,” he said.