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 TORONTO TRANSIT COMMISSION

 REPORT NO.

 

 

 

MEETING DATE: JANUARY 25, 2006

 

 

SUBJECT:  PURCHASE ORDER AMENDMENT – SUPPLY OF PRE-CAST CONCRETE TRACK BEAMS

 

 

 

 

RECOMMENDATION

 

It is recommended that the Commission authorize an amendment to the Purchase Order with Pre‑Con Inc. for the supply of pre-cast concrete track beams for the Prince Edward Viaduct, increasing the total contract upset limit by $320,019.00 to cover the purchase of an additional 30 track beams for years 2006 and 2007.

 

 

FUNDING

 

Sufficient funds for this expenditure are included in Project 3.4 Bridges & Tunnels under the Prince Edward Viaduct Beam Replacement Program, as set out on pages 697 to 703, in the “State of Good Repair” category, of the 2006-2010 TTC Capital Program, as approved by City Council on December 12, 2005.

 

 

BACKGROUND

 

At its meeting of May 12, 2004, the Commission confirmed the approval of the Chair, Vice Chair, and Chief General Manager for award to Pre-Con Inc., in the total upset limit amount of $208,610.00, for the supply of pre-cast concrete track beams for the 2004 and 2005 Prince Edward Viaduct Beam Replacement Program.  Pre-Con Inc.’s pricing was approximately 38% lower than the second lowest bidder for the two year contract. 

 

After award, amendments to the contract for the supply of two additional beams not included in the original 2004 and 2005 contract were added, at a total cost of $29,258.00.

 

Pre‑Con Inc. has demonstrated acceptable performance and satisfactory quality.

 

Original Contract Amount  $208,610.00

Previous Amendments  $ 29,258.08

Proposed Amendment  $320,019.00

 

Revised Total Contract Amount $557,887.08.

 

Work on this amendment is 0% complete.

DISCUSSION

 

The original contract award to Pre-Con Inc., for the supply of pre-cast concrete track beams in the years 2004 and 2005 included an option for staff to negotiate pricing with the incumbent for future years 2006, 2007 and 2008.

 

At the time of award, pricing for the supply of 5 beams in 2004 was $58,218.75, and for 15 beams in 2005 was $150,391.25.  Negotiated pricing for the supply of 15 beams in 2006 is $157,675.00 and in 2007 for another 15 beams is $162,344.00.

 

Unit cost for the negotiated 2006 pricing is 9.72% lower than the 2004 tender pricing, and 4.84% higher than tender pricing for 2005.  Negotiated 2007 pricing is 2.96% higher than negotiated 2006 pricing.  At this time, the supplier declined to submit pricing for 2008. As a result, staff is recommending that a new tender request be issued for pre-cast concrete track beam requirements for 2008 and beyond.

 

The price increase for the beams is as a result of significant increases in the cost of steel (i.e. re-enforcing bar) and raw materials for the concrete (e.g. aggregate), increases in the cost of labour due to new collective agreement with Pre-Con’s unionized employees as well as significant increases in the cost of energy.

 

All of the terms and conditions for the contract extension are in accordance with the original contract and will remain in effect. The price increases for the beams for the contract extension appear to be fair and reasonable particularly since Pre-Con’s price on the current contract was 38% lower than the second lowest bidder on the original bid. Staff recommends extending the contract with Pre-Con for the period 2006 and 2007 for the supply of pre-cast concrete track beams.

 

 

JUSTIFICATION

 

It is necessary to proceed with this expenditure in order to accommodate the 2006 and 2007 replacement of pre-cast concrete track beams on the Prince Edward Viaduct.  This will permit scheduled work to proceed as planned to ensure the safety and integrity of the subway system on the bridge structure and the safety of pedestrian and vehicular traffic on the roadway and localized areas beneath.

 

 

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December 20, 2005

6-123-131