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Finance committee recommends loan, approves appropriation for Tracy recycled water expansion after bid protest review
Summary
The Tracy Finance Committee recommended an $800,000 interfund loan and authorized a $2,247,804 appropriation to complete the Tracy Recycled Water System Expansion Project (CIP 74168). Staff reported a $800,000 shortfall after bids, and recommended awarding the construction contract to Cebu Inc. following a rejected bid protest.
The Tracy Finance Committee on May 27 recommended that the City Council approve a four-year interfund loan of $800,000 from General Fund reserves and authorized the appropriation of $2,247,804 from the Tracy Infrastructure Master Plan fund to CIP 74168, the Tracy Recycled Water System Expansion Project.
The item, presented by Stephanie Reyna Highstand, assistant director of utilities and public works, described CIP 74168 as a two-part project: extension of a recycled water pipeline on Lamers Road and construction of the Zone B recycled water pump station. Staff said the total projected cost is $26,872,332 and that the project is funded primarily by a $20 million Department of Water Resources grant. The project was originally budgeted at $24,624,528; after earlier adjustments the committee was told a remaining shortfall of $800,000 existed.
Staff told the committee it ran a competitive bid process: six bids were opened on April 15, 2025, and Cebu Inc. of Brentwood was the lowest responsive bidder. Mountain Cascade filed a bid protest on April 22; staff and the city attorney reviewed the protest and recommended rejecting it. Staff said the shortfall resulted from prolonged permitting delays with Union Pacific Railroad and rising material costs.
A member of the public, Maurice Francis, asked for follow-up detail on the bid protest and on construction-management costs; staff offered to provide additional follow-up and asked Mr. Francis to leave contact information with the city clerk.
The committee voted by roll call to recommend the loan and appropriation. Co-chairperson Abercrombie and Chairperson Evans each voted yes. The staff presentation noted the contract term in the bid package allows approximately 600 calendar days for construction.
What happens next: the committee’s recommendation will be forwarded to the full City Council for final approval, and staff said they will provide follow-up detail on the bid protest and construction-management costs on request.
