*Amend contract with Landis & Landis Construction, LLC for additional costs to meet project specifications for the SW Capitol Highway: SW Taylors Ferry Rd to SW Garden Home Rd Project for a total contract amount of $18,251,217 (amend Contract No. 30007726)

During construction, unforeseen field conditions, necessary design modifications, supply chain issues, and contract provisions related to inflation, have resulted in additional costs that are necessary to incur to successfully construct the project and meet the project specifications. To date, PBOT has executed 29 Construction Change Orders (CCOs) on the project. Examples of some of the higher value CCOs have included: Addition of the tree and shrub planting and establishment package, which had design plans intentionally completed after the beginning of construction to advance the remainder of the project in a timely fashion, and which came in significantly above the planting estimate. These trees and shrubs are necessary to adhere to Title 11 (Trees), to aid with erosion control, and to restore vegetation that was removed on private property and adjacent areas. Re-engineering and changing the construction type of the retaining walls on SW Capitol Highway between Alice and Primrose Streets from cast-in-place concrete walls to steel and concrete soldier pile walls due to stability concerns on the tallest slopes on the project, including protecting foundations of adjacent homes. Price escalation – allowed in the City Specifications and/or project Special Provisions – on fuel, asphalt, pipes, and other items, related to unprecedented inflation and supply chain issues worldwide, during a two-year construction project that was bid in March 2021. Removal of additional large trees that were thought to have been safe from disturbance. Discovery and removal of structures that were hidden in brush or thought to have been safe from disturbance, including old retaining walls, fences, and sheds. Contaminated media removal in SW Garden Home Road near a former gas station. Other necessary modifications to driveway connections, corner ramps, retaining walls, storm sewers, and sanitary sewers, to match unforeseen topographic and underground conditions.

The proposed amendment adds $4,296,151.60 to the construction contract, changing the contract amount from $13,955,065.20 to $18,251,216.80. The ordinance allows a contingency of an additional 10% of the new contract amount for unforeseen subsequent change orders, to be approved by the PBOT Director or delegate. Project staff do not intend to use this provision, but wish to have it included to avoid returning to Council for a small but compulsory additional change order. The Engineer’s Estimate for this project at time of bid in March 2021 was $18,500,000, therefore the proposed revised contract amount is still under the Engineer’s Estimate. The construction contract costs are shared by PBOT, the Bureau of Environmental Services, and Portland Water Bureau, at an initial ratio of approximately 43%, 48%, and 8%, respectively, based on bid items documented in a Memorandum of Understanding (MOU) between the three bureaus. The increased contract costs associated with this amendment are being shared by PBOT and BES, consistent with the MOU. Water Bureau work is complete. Of the proposed contract amendment to add $4,296,152.60, PBOT-attributed items total $2,574,960, representing approximately 60% of the change order value. The remaining 40% is attributable to BES, pursuant to the project MOU between the Bureaus. On October 25, 2022, after a presentation from project staff on October 20, 2022, PBOT’s internal Capital Investment Committee voted affirmatively to approve an additional $2,400,000 from eligible Bureau funding sources to cover overarching project overruns, including a portion of this contract amendment, as well as additional design and construction management costs.

The increased contract amount will allow PBOT, BES, and Water Bureau to maintain their shared commitment to providing community-supported facilities for walking, biking, transit, driving, stormwater management, and water service in southwest Portland. Portions of the increased contract amount can be attributed to unforeseen challenges at the right-of-way / private property interface, which must be addressed to provide corridor residents and property owners with safe, traversable connections to the transportation system, and safe, sanitary utility connections. The largest Construction Change Order associated with this contract amendment, for the tree and shrub planting and establishment contract, will result in $821,777 in subcontract work for a Disadvantaged and Woman-Owned Business Enterprise.