Approve the Minutes of the Following Meetings:

a.  Transportation Committee/Committee of the Whole of June 7, 2007;
b.  Finance-Auditing Committee/Committee of the Whole of June 7, 2007;
c.  Rules, Policy and Industrial Relations Committee/Committee of the Whole of June 8, 2007; and,
d.  Regular Meeting of the Board of Directors of June 8, 2007.

Carried

Claim of Gregory C. Brown

Carried

Claim of Ralf Medloff

Carried

Subrogation Claim of Geico General Insurance Company
(Insured: Jason Goldheim)

Carried

Claim of Sven Zabelin

Carried

Amended Claim of Frantz Benoit

Carried

Application for Leave to Present Late Claim of Tracie Brooks

Carried

Claim of Velvelon Walker

Carried

Insufficient Claim of Beth Greenberg

Carried

Presentation of Five-Year Service Award to Director Mike Kerns

President Moylan presented a Five-Year Service Award to Director Mike Kerns and expressed congratulations on behalf of the Board of Directors for his service as a member of the Board of Directors. Director Kerns stated that it is a pleasure working with the Board and staff and that he has enjoyed serving on the Board for the last five years.

Presentation of Twenty-Five-Year Service Award to Elizabeth (Betti) C. Conder, Benefits Administrator, District Division

President Moylan presented a Twenty-Five-Year Service Award to Elizabeth (Betti) C. Conder, Benefits Administrator, District Division, and expressed his congratulations on behalf of the Board of Directors.

Presentation of Certificates of Recognition to Ferry Division Employees: Captain Peter Carrick, Captain Enid Marcus, Deckhand James Garrison, Deckhand William Safina and Deckhand Eugene Tracy

President Moylan presented Certificates of Recognition to Ferry Division Employees: Captain Peter Carrick, Captain Enid Marcus, Deckhand James Garrison, Deckhand William Safina and Deckhand Eugene Tracy, for their performance and outstanding display of professionalism during and following the rescue of a solo fisherman in the Larkspur Channel, and expressed his congratulations on behalf of the Board of Directors.

ENGINEER’S REPORT

Authorize Rejection of All Bids for Contract No. 2006-B-1, Golden Gate Bridge Seismic Retrofit Phase IIIA North Anchorage Housing/North Pylon

Directors EDDIE/STROEH
Resolution No. 2007-056 authorizes rejection of all bids for Contract No. 2006-B-1, Golden Gate Bridge Seismic Retrofit Phase IIIA, North Anchorage Housing/North Pylon.

Adopted

AYES (13): Directors Cochran, Eddie, Grosboll, Hernández, Kerns, Martini, McGoldrick, Middlebrook, Newhouse Segal, Reilly and Stroeh; Second Vice President Ammiano; President Moylan
NOES (0): None
ABSENT (6): Directors Brown, Dufty, McGlashan, Pahre and Sandoval; First Vice President Boro

Directors EDDIE/STROEH
Resolution No. 2007-057 approves actions relative to the Professional Services Agreement with HDR Engineering, Inc., regarding Contract No. 2004-B-6, Design and Prepare Bid Documents for Golden Gate Bridge Seismic Retrofit Phase IIIA, North Anchorage Housing/North Pylon:

with the understanding that requisite funds are available in the FY 06/07 Bridge Division Capital Budget.

Adopted

AYES (13): Directors Cochran, Eddie, Grosboll, Hernández, Kerns, Martini, McGoldrick, Middlebrook, Newhouse Segal, Reilly and Stroeh; Second Vice President Ammiano; President Moylan
NOES (0): None
ABSENT (6): Directors Brown, Dufty, McGlashan, Pahre and Sandoval; First Vice President Boro

Authorize Rejection of All Bids for Contract No. 2007-FT-3, Larkspur Ferry Terminal Administration Building Improvements

Directors EDDIE/HERNÁNDEZ
Resolution No. 2007-058 authorizes rejection of all bids for Contract No. 2007-FT-3, Larkspur Ferry Terminal Administration Building Improvements.

Failed

AYES (8): Directors Grosboll, Hernández, McGoldrick, Newhouse Segal Reilly, Sandoval; Second Vice President Ammiano; President Moylan
NOES (6): Directors Cochran, Eddie, Kerns, Martini Middlebrook and Stroeh
ABSENT (5): Directors Brown, Dufty, McGlashan and Pahre; First Vice President Boro

Discussion Ensued

In response to Acting General Manager Denis J. Mulligan’s question on how the Board of Directors wishes the staff to proceed on this matter, Director McGoldrick made a motion to reintroduce the matter and asked the Attorney if this motion is proper.

In response, Attorney Patrick Miyaki, referring to the Rules of the Board (Rules), stated that a matter may not be reintroduced for consideration by the Board or any Committee thereof for a period of six months but that there is an exception to the Rules if the Board, by unanimous consent at a duly noticed meeting with the subject matter properly agendized, authorizes reintroduction of the matter. Mr. Miyaki advised that, because this matter is properly agendized for this meeting, the Board by unanimous consent could reintroduce it.

Discussion Ensued

Mr. Mulligan provided a summary of the proceedings of the Thursday, June 21, 2007 meeting of the Building and Operating Committee stating that at the conclusion of the discussion held at this meeting, the Committee recommended that the Board of Directors reject all bids for Contract No. 2007-FT-3, Larkspur Ferry Terminal Administration Building Improvements.

In response to Mr. Mulligan’s comments, the Directors made the following comments and inquiries:

• Director Hernández made the following comments and inquiries:

  • She commented that, as a member of the Building and Operating Committee, she often independently reviews the contractors and subcontractors prior to the recommendation of award. In her review of the documents for Contract No. 2007-FT-3, she found that one of the subcontractors for the recommended contractor, KCK, is subject to license suspension if its workers’ compensation insurance is not filed by July 11, 2007, and, in addition, the subcontractor has outstanding tax liens. Director Hernández stated that, in her opinion, the parameters that determine that a bidder is responsive and responsible are narrow. She acknowledged that the legal requirements technically have been complied with for this contract, but stated that, due to the concerns regarding the electrical subcontractor, she could not support award of this contract to KCK. In response, Mr. Mulligan stated that the process to evaluate bids includes the careful review of all documents that are submitted, including checking all licenses, to determine whether the lowest bidder is responsive and responsible. Mr. Mulligan also stated that the List of Subcontractors for KCK shows a subcontractor that presently has several allegations and assertions against them; however in review of its history, most of this company’s past liens have been cleared. He noted that the District is in the public sector and operates on a low bid environment and staff has determined that the lowest bidder, KCK, is responsive and responsible. He also noted that the District will monitor compliance with all prevailing wage laws and ensure the quality of work pursuant to the contract plans and specifications.
  • She commended staff for providing all the bid information that she requested and she commended the Board for providing comments regarding the Board’s fiduciary responsibility to protect the District. She stated that it is very apparent that with the candid discussion that the District is interested in maintaining the highest integrity with regard to its contracting opportunities.

• Director Stroeh inquired as to whether the subcontractor must supply all documentation in regards to the workers’ compensation insurance before award of contract to KCK. In response, Mr. Mulligan stated no contractor is allowed to perform work for the District unless they have the required insurance in place.

• In response to an inquiry from Director Middlebrook, Mr. Mulligan stated that if the Board approves rejection of all bids for Contract No. 2007 FT 3, staff will prepare plans and specifications and the District will re-advertise for bids. Mr. Mulligan also stated that, in this instance, staff will not propose to redesign the project to reduce the scope of work associated with this contract but will simply re-advertise the same contract. He noted that as a public agency, any company that has requisite licenses and bonding capacities is eligible to bid.

• Director Newhouse Segal inquired as to what happens if the Board does not reject the bids. In response, Mr. Mulligan stated that presently no action has been taken by the Board regarding the award of contract or rejection of bids. He also stated that staff is seeking direction from the Board in connection with this Contract No. 2007-FT-3.

• Director Grosboll commented that the members of the Board expressed concerns regarding awarding a contract to KCK, who has a subcontractor with a history of problems. Director Grosboll also stated that, in his opinion, the Board can as a policy matter consider a subcontractor’s history when considering whether to award a contract.

• Director Eddie made the following comments and inquiries:

  • He inquired as to whether the bidders were informed that the Building and Operating Committee recommended rejection of bids for Contract No. 2007-FT-3. In response, Mr. Mulligan stated that the bidders were informed about the recommendation presented to the Board and staff will also inform bidders about any action taken by the Board at the meeting today.
  • He commented that, given that it is KCK’s responsibility to ensure that all documentation is in place for the project and that District staff will also follow-up to ensure that the subcontractor is compliant, he would support award of a contract to KCK.
  • He expressed his concerns that if the Board rejects all bids for this contract and re-advertise this contract at a later date; the District is at risk for receiving bids that are higher.

• Director Kerns made the following comments and inquiries:

  • He inquired as to whether KCK would be allowed to substitute the subcontractor in question if its electrical subcontractor was unable to obtain the required insurance. In response, Mr. Mulligan stated that, in accordance with Public Contract Code, if the subcontractor for KCK cannot perform the work because it does not have the requisite license or insurance, KCK must go through an administrative process to substitute a different subcontractor.
  • He inquired as to which company the District will execute a contract with. In response, Mr. Mulligan stated that the District will execute a contract for this project with KCK. He noted that the District does not have a contractual relationship with the subcontractors; however, the District holds all subcontractors accountable to the same standards of the prime contractor for compliance with licensing and labor code requirements.
  • He inquired as to whether staff is satisfied with the bid from KCK. In response, Mr. Mulligan stated that staff has reviewed the bid submitted by KCK, and determined that KCK has the requisite licenses and the requisite ability to do the work associated with this contract.

• Director Martini made the following comments and inquiries:

  • He inquired as to whether there was an Engineer’s estimate for the project. In response, Mr. Mulligan stated that there was an Engineer’s estimate for the project and that the bids came in higher than the estimated amount.
  • He echoed the same concerns as Director Eddie in that the marketplace will dictate how high the bids will come in if the project is re-advertised. Director Martini expressed his concerns that the bidders will know the amount of funding that is available for this project and will bid accordingly and that it is possible the project will be more costly to the District.

• President Moylan inquired as to whether the bidders could withdraw submission of their respective bids. In response, Mr. Miyaki stated that the bidders are bound to the bid they submitted for the timeframe established in the bid specifications, which in this case is 90 days. Mr. Mulligan noted that, in accordance with the bid specifications, if the bidder does not honor its bid, the District can proceed against the Bidder’s Bond that was submitted with the bid.

• Director Cochran stated that the subcontractor’s outstanding tax liens and the workers’ compensation insurance policy issues are not relevant to whether or not KCK can perform the work. Director Cochran also stated that before the work commences, the District will hold KCK responsible for obtaining all necessary paperwork, and furthermore, staff will ensure that all documentation is in place before issuing the Notice to Proceed.

• Director McGoldrick expressed his concerns regarding the possibility that the District would be held liable for having prior knowledge of workers’ compensation issues if an incident occurred. In response, Mr. Mulligan stated that, for the record, staff checks all Certificates of Insurance to ensure compliance with bid specifications before any work begins.

Approve Renewal of the Liability Insurance Program

Directors PAHRE/COCHRAN
Resolution No. 2007-058 approves the Liability Insurance Program, as follows:

with the understanding that requisite funds are available in the FY 07/08 Operating Budgets for the Bridge, Bus, Ferry and District divisions.

Adopted

AYES (14): Directors Cochran, Eddie, Grosboll, Hernández, Kerns, Martini, McGoldrick, Middlebrook, Newhouse Segal, Reilly, Sandoval and Stroeh; Second Vice President Ammiano; President Moylan
NOES (0): None
ABSENT (5): Directors Brown, Dufty, McGlashan and Pahre; First Vice President Boro

Approve Renewal of the Health and Benefit Insurance Plans

Directors PAHRE/MIDDLEBROOK
Resolution No. 2007-059 approves the renewal of the Health and Benefit Plans, for a one-year term, effective July 1, 2007, through June 30, 2008, as follows:

with the understanding that requisite funds in the amount of $20,328,000 are available in the FY 07/08 Operating Budget.

Adopted

AYES (14): Directors Cochran, Eddie, Grosboll, Hernández, Kerns, Martini, McGoldrick, Middlebrook, Newhouse Segal, Reilly, Sandoval and Stroeh; Second Vice President Ammiano; President Moylan
NOES (0): None
ABSENT (5): Directors Brown, Dufty, McGlashan and Pahre; First Vice President Boro