Bid error surfaces on wastewater project

A portion of the City of Custer’s wastewater treatment plant upgrades will be put back out to bid after an error on the bidding documents caused a last minute addendum and a questionable bidding process.
At the Aug. 15 meeting of the Custer City Council the council heard from Trent Bruce of DGR Engineering, the firm helping the city through the process of the wastewater plant upgrades. Bruce told the council that when it came to the bids for furnishing granular materials for the planned Submerged Attached Growth Reactor part of the system, an error was discovered on the bid form. Because of that, the only way the project could be bid that day was to issue an addendum with the correct bid forms. Potential bidders were notified of the error.
“One hundred percent on us. We did that,” Bruce said.
The addendum was issued an hour before the bids were to be let, and when it came time to open the bids at 10 a.m. that day, only one bid had been received.
Bruce said the addendum that was issued was substantial enough it could have caused the project to be interested in bidders that weren’t interested previously, and also made it unlikely many businesses could get their bids in on time.
The one received bid, from Black Hills Gravel, was opened, and at 10:08 a.m., eight minutes after the deadline, another bid was received from Simon Contractors in Rapid City. Bruce said the city’s contract documents don’t allow for a late bid to be opened, so it was returned unopened back to Simon.
“We received a call from Simon and multiple emails suggesting that was not the proper process, and we should open their bid and read it,” Bruce said.
Bruce said after discussion and another read of the contract documents, it was determined opening the late bid was not an option.
The contract allows the city to move forward in two ways, Bruce said. The city can award the bid to the lowest responsible responsive bidder, which in this case was Black Hills Gravel, or reject all bids and rebid the project.
“We felt the tardiness of the addendum did not provide adequate time for all potential bidders to submit a bid,” Bruce said. “We feel the city should reject all bids and bid it again versus awarding the bid to the lowest contractor that was received.”
Bruce said either choice is going to upset the other contractor, both of which had a representative speak about the issue.
Pat Zeimet of Black Hills Gravel said his business got the bid on time with the addendum, and said the only reason the addendum was there is because he started asking questions about the bid documents.
“We did our due diligence and got our bid in on time. It is not our fault the other company did not get their bid in on time,” he said.
Zeimet said he consulted with the company’s attorney and the attorney believes the city should accept the bid, as it is the only legal bid.
“If you rebid this and we don’t get this we would have legal repercussion for loss of income,” he said. “We did what was required.”
James Taylor of Simon Contractors was at the meeting via videoconferencing and said his company also raised concerns about the bidding documents two weeks before the bid.
“We were waiting for something to come out. We were still wondering what was going on with the project because the correct bid documents weren’t uploaded until 45 minutes (before the opening),” he said. “We did everything we could to get it there.”
Taylor said the only reason Simon was able to get the bid submitted, if late by eight minutes, was because Simon has an office in Custer. He said other out of town companies would have had no chance to get a bid in with the addendum on such short notice.
“You can hardly call that a public bid,” he said. “I understand (Zeimet’s) frustration. It’s not any of the bidders’ job to create the addenda. The job should be rebid.”
Taylor said every time an addendum comes in late on a bid, the date gets pushed back or the project is rebid. He added he didn’t have a representative present at the opening so he has no idea what Zeimet’s bid was. Simon will likely just send back the envelope it delivered late the day of the first bid, Taylor said.
City attorney Terri Williams said she was in favor of rejecting the bids and rebidding the project, and Bruce said the city is receiving federal and state funding for the project, which does not allow for pushing the bid back without readvertising.
“You would have had to go through the whole process again, anyway,” he said. He also recommended the council reject all bids and readvertise.
The council unanimously voted to reject the bids, and Bruce said the project could be readvertised and bids turned in by Aug. 31, with the opening completed by the council’s next meeting, Sept. 6.
Before the granular material discussion the council approved Core and Main LP’s bid of $1,425,704 for pipe, fittings and appurtenances for phase two and three of the wastewater treatment project. Core and Main was the only bidder on the project, but had a bid that came in 13 percent under engineer’s estimates.
The contractor was able to bid the project with both PVC pipe and High-Density Polyethylene Pipe (HDPE), which is thicker pipe with less inside diameter. HDPE pipe is fused together in a welding-type fashion, whereas PVC pipe is put together through a gasket system. It was determined the PVC system will be cheaper, ultimately costing around $70,000 less than HDPE pipe, which would require an upsize of pumps as well as the purchase of a fusing machine to put the pipe together.
“I don’t see a lot of issues with either one if they are installed right the first time,” Bruce said, saying there will be required testing as the pipe is installed to make sure it meets minimum requirements.

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