City Commissioners will be asked to rescind a construction contract during their Jan. 7 meeting and approve a revised version due to errors in the version they approved in December.

In December, staff presented a version of the general manager contractor construction manager contract from Prospect Construction at a guaranteed maximum price of $7,456,692 for the lift station and supplemental force main improvements project.

According to city staff, Prospect submitted the original agreement in November that didn’t include builder’s risk as required by the city’s legal department, or an owner’s contingency as allowed under the general contractor construction manager process.

City Commission approves $8.1 million in lift station, force main improvement contracts

City staff and TD&H, the city’s consultant on the project, requested that Prospect revise the agreement to include those items, which it submitted on Nov. 20 and city staff submitted that version for the Dec. 3 commission meeting.

But, that version wasn’t updated from the original amount to the new amount of $7,793,175.39.

The revised documents from Prospect included the updated amount but staff used the original amount when writing their agenda report for the commission meeting, according to staff.

On Dec. 19, Prospect officials emailed city staff alerting them that an old version of the agreement had been signed and sent to the city for the commission meeting, nor did that version include the general conditions, which allow the city to charge liquidated damages of $500 per day if the contractor doesn’t substantially complete the project on time.

Staff are asking commissioners to rescind the agreement they approved in December to then vote on the correct, updated version during their Jan. 7 meeting.

Commissioners to consider $8.1 million in lift station, force main improvement contracts

“It was an unfortunate oversight that the contractor did not update the GMP amount and that city staff did not notice it when drafting the original agenda report. Taking advantage of this honest mistake would not be dealing in good faith,” staff wrote in their agenda report.

The project is being funded with $3,854,585 of state minimum allocation ARPA funds; $2 million of competitive state ARPA grants; and the remaining $1,938,590.39, including the additional $336,483.39 in the updated contract, are being funded through the city’s sewer treatment fund.

Under the contract, TD&H will continue coordinating the general contractor construction manager process, bid package review, general construction management and inspection, as-built and operations and maintenance plan development and archaeological monitoring service for the project, according to city public works staff.

Commissioners approve $1.6 million in contracts for lift station upgrades [2024]

In 2021, the city conducted a feasibility study for the project, then applied for and was awarded American Rescue Plan Act, or federal COVID relief funds, for the project.

Design began in 2022 and they had 30 percent designs in October 2022, at which point, the cost estimate was $7.8 million.

Commissioners voted in April 2023 to use the general contractor construction management process, which is allowed under Montana law, for alternative project delivery methods for complex projects under certain criteria, which city staff determined were met in this case.

The general contractor construction management process includes phases of preconstruction and construction, according to staff.

City approves contract for lift station project [2023]

It’s the second project for which the city is using the GCCM process.

In September 2023, the city awarded the contractor manager contract and were at 60 percent designs in December 2023, at which point, the cost estimate had ballooned to $16.7 million, city staff said during an April 2024 work session, for an increase of $8.9 million.

City staff told commissioners in April that much of the initial cost estimates were based on the city’s 2021 river crossing project, but many of those costs had since doubled and inflation had risen.

During an April 2024 commission work session, staff discussed a $9 million budget shortfall that was discovered during the design phase of the project.

City adjusting plan for Lift Station No. 1 project due to cost increases [2024]

Due to the cost increase, city staff said in April that they adjusted the project scope to focus on Lift Station No. 1 improvements in the first phase and shift forcemain repairs to a future second phase.

In November, commissioners approved two contracts for pre-procurement of long lead time equipment needed for the project.

Lift Station No. 1 was constructed in 1976 and is the city’s second largest pumping station which pumps about 40 to 45 percent of all raw wastewater throughout the city to the wastewater treatment plant.

According to city staff, the current stormwater pumps and associated ball valves are deteriorating and parts are no longer available for repairs.

City Commission approves contract process for lift station project [2023]

The bar screen, which was installed in 1986, has difficulty screening rags/debris during high flows due to its large five-eighth-inch screen openings, while modern screens are either a quarter inch or three-eighths of an inch, according to staff.

The exhaust fan, which is necessary for removing hydrogen sulfide from the building, is currently at the end of its life; and the wet well repairs and replacement of six sluice gates are required since two gates no longer operate due to corrosion and the other four gates are approaching the same condition, according to staff.

“The renovation of Lift Station No. 1 provides future reliability of pumping of raw wastewater to the [wastewater treatment plant], minimizing the risk of service interruption, wastewater bypassing to the Missouri River, regulatory exposure, and environmental damage associated with aging equipment,” according to public works staff.

City considering contract for sewer crossing, lift station project [2023]

The project is the first phase, with the second phase anticipated in the future to construct a redundant river crossing.

“Completing these projects will reduce the severity of an S.O.S. due to extreme rain events and/or the older 1979 forcemain breaking,” according to public works.

The Lift Station No. 1 project was selected and prioritized under the public works capital improvements program.

If the ARPA funds aren’t spent by Dec. 31, 2025, the city risks losing those funds and having to fund the project through other sources.

If commissioners delayed the project, city staff wrote in their staff report that it would push lead time for equipment and have scheduling impacts and an estimated $420,000 increase in overhead costs.

Construction completion is estimated for the fall of 2026.