Seal Beach delays Lampson well construction award after bids exceed early estimates

Council members delayed final approval of a construction contract for the Lampson Well treatment system on Sept. 8 after bids came in far higher than earlier cost estimates and a bid protest challenged the apparent low bidder. Deputy Public Works Director/City Engineer David Cho told the council the project will treat hydrogen sulfide at the Lampson Well so the well can be returned to regular use. The project is part of CIP WT 19‑02; Cho said the contaminant "H2S does not pose a health risk," but it produces "nuisance issues like odor and taste," and treating water at the source would strengthen the city's local supply. He said six bids were received and staff, in consultation with the city attorney, found the apparent low bid nonresponsive because it omitted key treatment tanks and filter media the specification required. Staff recommended awarding the contract to the next lowest responsive bidder, Covenant Technical Solutions Inc., for $5,649,257 and asked the council to authorize a 10% construction contingency and related professional services amendments and additions. Public commenters and several council members challenged the process and the size of the cost increase. Residents and speakers said the project cost shown to the public earlier this year — roughly $4.35 million in design and later documents — had grown to a project budget of about $7.43 million. Public speakers urged more time to review the contract terms, warranties and financing. Councilwoman Senecal said she was "dissatisfied with the rush" and did not support moving forward, citing contract deficiencies, unclear warranty and testing provisions, and the short time the packet was available to council and the public. City staff and the contractor-selection report defended the procurement process as following the bid specifications and called the higher bids reflective of a "volatile construction environment," especially for water-treatment projects. Staff also said the Orange County Water District (OCWD) had been asked to increase a previously approved producer-well construction loan — originally $4.45 million — and staff requested authorization to accept additional OCWD funds pending the OCWD board meeting scheduled Sept. 11. After floor debate, Councilwoman Senecal moved to reject and rebid the project. Mayor Landau offered a substitute motion directing staff to ask Covenant Technical Solutions to hold their bid through the Sept. 22 council meeting while OCWD proceeded with consideration of an amended loan; the substitute motion passed 4–1 with Senecal opposed. The substitute action preserves the city's ability to award later while giving the council additional time to review contracts, warranties and financing. City staff said rebidding could risk higher prices; staff also said professional construction management is needed because the city lacks in‑house bandwidth to administer a project of this scale. Staff recommended amending an engineering agreement with PACE (Pacific Advanced Civil Engineering Inc.) and awarding a separate construction‑management services contract, but the council deferred final contract approvals pending the follow-up review. The council also authorized staff to seek input from OCWD, the JPIA (the city's insurance pool) and other stakeholders during the 45‑day review window. The council's substitute motion does not bind it to a later award; it requests a price hold and returns the issue to the dais with more documentation and time for public review. If Covenant or other bidders decline to extend bid validity, staff said the city would need to rebid the project.