FROM: Robert Thompson, General Manager
Originator: Mike Dorman, Director of Engineering
SUBJECT:
title
NEW LABORATORY FACILITY, PROJECT NO. J-133
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GENERAL MANAGER'S RECOMMENDATION
recommendation
RECOMMENDATION: Recommend to the Board of Directors to:
A. Award a Progressive Design-Build Contract with Sundt Construction, Inc., to provide Phase 1 progressive design-build services for the New Laboratory Facility, Project No. J-133, for an amount not to exceed $8,496,991; and
B. Approve an upper limit for this Contract of $9,346,690, which includes a 10% contingency for Phase 1 services.
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BACKGROUND
Orange County Sanitation District (OC San) operates the existing Water Quality Testing Laboratory at Plant No. 1, which supports regulatory compliance and environmental testing activities. In 2021, OC San initiated a study comparing rehabilitation of the existing laboratory with construction of a new facility. The study was completed in 2023 and concluded that construction of a new laboratory was the more efficient and cost-effective long-term approach.
The evaluation considered the additional space needed to support increased regulatory testing requirements, need for seismic upgrades, replacement of aging building systems, and the impacts of renovation during ongoing laboratory operations. The existing laboratory is approximately 36,000 square feet, while the proposed replacement facility is approximately 56,000 square feet.
RELEVANT STANDARDS
• Comply with environmental permit requirements
• Ensure the public’s money is wisely spent
• Protect public safety
• Maintain a culture of improving efficiency to reduce the cost to provide the current service level or standard
PROBLEM
The existing Water Quality Testing Laboratory at Plant No. 1 was constructed in 1991 and has numerous building code and seismic deficiencies. Major building and utility systems are also approaching the end of their useful lives and require significant rehabilitation or replacement. The existing laboratory also lacks sufficient space to accommodate increased regulatory testing requirements.
Renovation of the existing laboratory would require building certification and permitting, require an additional building to meet the additional laboratory testing requirements, and significantly disrupt ongoing laboratory operations. Laboratory testing would need to be temporarily relocated or outsourced during portions of the work.
PROPOSED SOLUTION
Award the Progressive Design-Build contract to advance the New Laboratory Facility through Phase 1 design, preconstruction, cost development, and preparation of the Guaranteed Maximum Price. The Phase 1 award authorizes design and preconstruction services. The upper limit for this Contract will be further developed during Phase 1 to determine the maximum amount for the overall Progressive Design-Build contract and recommended to the Board before proceeding to construction. The planned facility is an approximately 56,000-square-foot Water Quality Testing Laboratory at 18350 Mt. Langley Street to support OC San’s regulatory compliance and environmental testing activities.
The existing Mt. Langley Office Building will be demolished to accommodate the new laboratory. Demolition or rehabilitation of the existing laboratory at Plant No. 1 is not included in this contract.
TIMING CONCERNS
Delaying Phase 1 would postpone design and cost development for the replacement laboratory. Further delay could require interim investment in the existing facility or outsourcing of regulatory testing to maintain compliance. Delay would also expose the project to additional construction cost escalation.
RAMIFICATIONS OF NOT TAKING ACTION
If the Phase 1 contract award is not approved, OC San would be unable to advance design and development of the Guaranteed Maximum Price with the selected Design-Builder.
PRIOR COMMITTEE/BOARD ACTIONS
November 2025 - Adopted Resolution No. OC SAN 25-19 titled: “A Resolution of the Board of Directors of the Orange County Sanitation District delegating authority to the General Manager to execute amendments to Progressive Design-Build Contracts.”
November 2024 - Approved a Professional Services Agreement with Hazen and Sawyer to provide engineering services for Progressive Design-Build Owner Advisor, Program Management, and Professional Engineering Support Services, Project No. PDB24-00, for an amount not to exceed $19,340,000; and approved a contingency of $1,934,000 (10%); found approval of the Professional Services Agreement with Hazen and Sawyer is not a project subject to the California Environmental Quality Act.
ADDITIONAL INFORMATION
Design-Builder Selection:
On October 20, 2025, OC San hosted an Industry Forum to assess industry interest before issuing the Request for Proposals (RFP). More than 30 industry representatives attended.
OC San subsequently held one-on-one meetings with eight interested firms from November 12 through December 4, 2025. The meetings focused on project risks and requirements that could affect competition.
On April 13, 2026, OC San issued the RFP for the Project. The RFP was publicly advertised in the Orange County Register, and electronic notification was provided through OC San’s Vendor Portal in OpenGov.
The RFP established the following evaluation criteria:
|
Description |
Points |
|
Technical Proposal Evaluation Criteria |
|
Proposer Profile and Minimum Requirements |
Responsive or Non-Responsive |
|
Project Understanding and Key Issues |
25 |
|
Project Team and Key Personnel |
20 |
|
Project Experience and References |
20 |
|
Project Delivery and Management Approach |
15 |
|
Cost Development and Procurement Approach |
10 |
|
Technical Proposal Maximum Score |
90 |
|
Price Proposal Evaluation Criteria |
|
Phase 1 Preconstruction and Design Services Cost |
5 |
|
Phase 2 Design-Builder’s Fee Percentage |
5 |
|
Price Proposal Maximum Score |
10 |
|
TOTAL PROPOSAL MAXIMUM SCORE |
100 |
The procurement was conducted as a one-step Progressive Design-Build selection with assistance from OC San’s Owner-Advisor (OA).
Eight optional proprietary meetings were held from May 7, through May 14, 2026, to discuss technical requirements, proposed project approaches, and contract terms.
Eight proposals were received on June 30, 2026, and evaluated in accordance with the RFP and OC San’s Purchasing Ordinance. The Evaluation Committee consisted of six OC San staff members.
On July 27, 2026, the Evaluation Committee scored the technical proposals based on the weighted evaluation criteria established in the RFP.
The initial technical proposal scores were:
|
Proposer |
Hensel Phelps Const, Co |
Sundt Const, Inc. |
Charles Pankow Builders Ltd. |
BN Builders, Inc. |
Hathaway Dinwiddie Const. |
McCarthy, Bldg. Companies |
Clark Const. Group |
Swinerton Builder |
|
Project Understanding & Key Issues (Max. 25 Points) |
22.50 |
20.42 |
19.17 |
20.00 |
15.83 |
16.25 |
15.42 |
11.67 |
|
Project Team & Key Personnel (Max. 20 Points) |
16.67 |
15.33 |
15.00 |
15.00 |
12.67 |
13.67 |
12.67 |
11.33 |
|
Project Experience & References (Max. 20 Points |
17.67 |
15.00 |
14.00 |
13.67 |
14.67 |
13.00 |
12.33 |
13.00 |
|
Project Delivery & Management Approach (Max. 15 Points) |
13.25 |
10.50 |
12.50 |
11.25 |
10.00 |
10.75 |
10.25 |
9.25 |
|
Cost Development & Procurement Approach (Max. 10 Points) |
8.00 |
7.33 |
7.67 |
7.33 |
7.50 |
6.67 |
6.67 |
5.83 |
|
Total Score (Max. 90 Points) |
78.09 |
68.58 |
68.34 |
67.25 |
60.67 |
60.34 |
57.34 |
51.08 |
Based on the initial technical proposal scores, the four highest-scoring proposers were invited to participate in oral interviews.
Interviews were conducted on August 11 and August 12, 2026. Following the interviews, the Evaluation Committee re-scored the four highest-scoring proposers based on their technical proposals and interviews.
The final technical scores were:
|
Proposer |
Sundt Const. Inc. |
BN Builders, Inc. |
Hensel Phelps Const. Co. |
Charles Pankow Builders, Inc. |
|
Project Understanding & Key Issues (Max. 25 Points) |
23.33 |
21.67 |
20.83 |
16.25 |
|
Project Team & Key Personnel (Max. 20 Points) |
18.00 |
17.67 |
14.67 |
13.00 |
|
Project Experience & References (Max. 20 Points) |
17.33 |
15.67 |
16.67 |
13.00 |
|
Project Delivery & Management Approach (Max. 15 Points) |
13.25 |
13.00 |
11.50 |
9.75 |
|
Cost Development & Procurement Approach (Max. 10 Points) |
8.83 |
8.17 |
7.33 |
6.50 |
|
Total Score (Max. 90 Points) |
80.74 |
76.18 |
71.00 |
58.50 |
The Price Proposals remained confidential and were not disclosed to the Evaluation Committee until the technical scores were finalized. On August 12, 2026, Contracts Administration staff opened the price proposals submitted by the four highest-scoring firms and reviewed them for responsiveness. All four price proposals were determined to be responsive.
Price proposals were scored using the formula established in the RFP:
Cost Criterion Score = (Lowest Value Proposed / Proposer’s Proposed Value) × Maximum Possible Points.
The price proposal scores were:
|
Proposer |
BNBuilders, Inc. |
Sundt Const. Inc. |
Hensel Phelps Const. Co. |
Charles Pankow Builders |
|
Phase 1 Preconstruction and Design Services Cost (Max. 5 Points) |
5.00 |
4.21 |
4.23 |
3.22 |
|
Phase 2 Design-Builder's Fee Percentage (Max. 5 Points) |
5.00 |
4.01 |
2.91 |
3.56 |
|
Total Score (Max. 10 Points) |
10.00 |
8.22 |
7.14 |
6.78 |
The price proposal scores were added to the final technical scores to determine the overall rankings.
The final scores were:
.
|
Proposer |
Sundt Construction, Inc. |
BNBuilders, Inc. |
Hensel Phelps Construction Co. |
Charles Pankow Builders, Ltd. |
|
Project Understanding & Key Issues (Max. 25 Points) |
23.33 |
21.67 |
20.83 |
16.25 |
|
Project Team & Key Personnel (Max. 20 Points) |
18.00 |
17.67 |
14.67 |
13.00 |
|
Project Experience & References (Max. 20 Points) |
17.33 |
15.67 |
16.67 |
13.00 |
|
Project Delivery & Management Approach (Max. 15 Points) |
13.25 |
13.00 |
11.50 |
9.75 |
|
Cost Development & Procurement Approach (Max. 10 Points) |
8.83 |
8.17 |
7.33 |
6.50 |
|
Phase 1 Preconstruction & Design Services Cost (Max. 5 Points) |
4.21 |
5.00 |
4.23 |
3.22 |
|
Phase 2 Design-Builder's Fee Percentage (Max. 5 Points) |
4.01 |
5.00 |
2.91 |
3.56 |
|
Total Score (Max. 100 Points) |
88.96 |
86.18 |
78.14 |
65.28 |
Sundt Construction, Inc. received the highest overall score. Its proposal and interviews demonstrated a strong understanding of the Project, technical capabilities, Progressive Design-Build experience, and knowledge of laboratory equipment procurement and installation. The Evaluation Committee determined that Sundt Construction, Inc. was the highest-ranked proposer.
Negotiations:
Based on the Evaluation Committee’s recommendation, OC San began negotiations with the highest-ranked proposer, Sundt Construction, Inc., on August 27, 2026.
Staff negotiated the scope of work, contract requirements, key assumptions, and proposed project delivery approach.
Contract exceptions concerning standard of care, dismissal of subcontractors, and failure to execute a Guaranteed Maximum Price (GMP) amendment were reviewed, revised, and approved by legal counsel for both OC San and Sundt Construction, Inc. during negotiations.
As part of the Progressive Design-Build negotiations, OC San requested that Sundt Construction, Inc. prepare a preliminary conceptual construction cost estimate for the Project. Sundt Construction, Inc.’s estimate was approximately $10 million higher than the amount currently included in OC San’s project budget for construction. The primary cost differences involved electrical and low-voltage systems, laboratory equipment, an increased construction cost escalation allowance, and higher seismic design requirements resulting from an increased seismic risk category, partially offset by decreases in other estimated costs.
During Phase 1, OC San will work with the Design-Builder to identify opportunities to reduce construction costs and develop the GMP. No project budget increase is requested at this time. Staff will go to the Board to request a revised upper limit during Phase 1, before proceeding with construction.
Based on the negotiations, staff determined that the negotiated Phase 1 services fee is fair and reasonable and recommends awarding the Progressive Design-Build Contract to Sundt Construction, Inc.
CEQA
CEQA compliance will be determined during design and will evaluate whether it can be covered by the Fountain Valley Crossings EIR involving a CEQA Section 15162 analysis. The project scope includes an addendum to the Fountain Valley Crossings EIR if appropriate, or a future amendment will be required if a MND or full EIR is necessary.
FINANCIAL CONSIDERATIONS
This request complies with the authority levels of OC San’s Purchasing Ordinance. This item has been budgeted (Budget FY 2026-27 and FY 2027-28, Section 8, Page 40, New Laboratory Facility, Project No. J-133), and the budget is sufficient for the recommended action.
ATTACHMENT
The following attachment(s) may be viewed on-line at the OC San website (www.ocsan.gov) with the complete agenda package:
• Draft Progressive Design-Build Contract
• Presentation
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