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February 12, 1999 Billy F. Wasson Counhouse Square. Manage~ Marion County Annex 3150 Lancaster Dr. NE ` ~ ' Salem, OR 97305-1398 Courthouse Square Urban Renewal Agency Participation Dear Mr. Wasson, CITY OF SALEM, OREGON City Hali / 555 Liberty St. S.E. Zip Cpde 973pt CITY MANAGER'S OFFICE Telephone (503) 588~255 The construction bid appendix sheets for the elements of Agency participation in the Courthouse Square project were received Friday, February 5, 1999. We have reviewed and compared the six bids and associated line item detail. While Pence/Kelly Construction, Inc. is the apparent low bidder for the total Courthouse Square project they are also the high bidder for the elements of Agency participation. Anticipating this condition could arise, our agreement, which remains to be signed and returned for my counter signature, provides the fotlowing: Prior to construction contract bid award for the items of Agency participation, the low bid recommended for award by the County and Transit District shall be submitted to the Agency. The Agency will designate in writing within five (5) days of submission, acceptance, rejection or designation of bid alternate for which the Agency will provide participation. Agency approval for participation will not be unreasonably withheld, however, reasons for withholding of such approval shall include but not be limited to bid irregularity or unreasonable unit cost. Agency acknowledges that the low bidder for the entire Project construction may not necessarily represent the lowest bid tendered for each of the specific areas of Agency participation designated in Section 1, however, in the event the Agency finds unit cost to be un~easonable, Agency may designate an acceptable level of participation for the respective item. After adjusting for the Agency maximum participation in weather protection of $160 per lineal foot, the base bid for all elements of Agency participation tendered by Pence/Kelly is $1,314,979. By comparison, the other five bids range from a low of $821,g10 to a high of $1,003,695. As you will recall in a meeting held with our staff on February 3,1998, this very condition was discussed. It was concluded, to determine an "acceptable level of participation" for the Agency, a comparison would be made to an amount of 120% of the median price of all bids. The attached schedules enumerate all bids, the median, and a value representing 120°/a of inedian. ~ - s.w~ a.o,~, - ~LL•~~K1YC~ CA~ i' ~~ • ATTACHMENT B ,..,.,..~ ~. -- AN EQUAL OPPORTUNITY EMP