Part one of two.
The council on Monday, Sept. 22, voted unanimously to continue a discussion about options for the planned Lampson water well treatment project. The matter will return to the next City Council meeting. This was the next-to-last item on the agenda of a roughly two-hour and 48-minute meeting.
Due to space limits, the Sun will go into details of the discussion in next week’s issue.
The staff report originally recommended that the council reject all bids for the planned Lampson water well treatment project.
In related news, staff reported that the second bid on the project had expired. (For more on the bids, see Well project returns to Council Sept. 22.)
During the meeting, Kathryne Cho, deputy director of Public Works/City Engineer, brought up an alternative. The alternative, which was not mentioned in the staff report, Cho suggested having Butier Engineering, Inc., conduct an independent review of the project. Butier was the company that staff originally proposed as the construction manager for the water well project.
Cho explained why the project cost increased. She said labor costs are high. She material costs, especially steel, had increased due to tariffs. Cho said the project required a lot of steel.
Cho also addressed a question from the previous council meeting: Why couldn’t staff manage the project. Cho said Seal Beach does not have enough people to manage the project on a daily basis.
She argued in favor of hiring a dedicated construction manager to keep the project on time and on budget.
Cho said staff would like direction from the council on the project.
The resolution before the council this week would have deferred approving a contract with Butier to manage the well construction project.
District Three Councilwoman Patty Senecal her concern was that the first Prop. 218 project was 50% over budget. “Do we have a really good handle on the full costs?” Senecal said.
“What the heck is the cost of all these projects?” she asked.
She said this was the first of 11 projects.
Senecal recommended that the city’s strategic workshop, which the city manager said was scheduled for November, have an emphasis on city projects.
Senecal was concerned about whether Seal Beach could afford the projects.
“We’re looking at a generation of debt load,” she said.
Senecal also repeated her surprise at the increased costs of the project.
During the public comment part of the meeting, resident James Jensen said there was a lack of transparency in the process. Although he was critical of this issue, he said he believed the council members had the city’s best interests at heart.
Background
“On June 3, 2025, the City solicited public bids for the Lampson Well Treatment System (Project), CIP WT1902, and subsequently issued three (3) official addenda,” according to the staff report prepared by Cho.
“The original Notice Inviting Bids, Instructions to Bidders and Bid Specifications, Addendum No. 1, Addendum No. 2 and Addendum No. 3 (collectively “Bid Documents”) may be reviewed in the Public Works Department and are not included with this staff report due to their length,” Cho wrote.
The city received six bids on July 16, according to the staff report.
The bid by Re Chaffe Construction, Inc., was for more than $6.4 million. The next bid by Covenant Technical Solutions, Inc., was for more than $6.6 million.
“On September 8, 2025, staff recommended that the City Council find that the Chaffee bid was non-responsive, and award the construction contract to CTS. At that meeting, the City Council continued the item and directed staff to contact and request CTS to extend their bid pricing beyond the original 60-day validity period,” Cho wrote.
As previously reported, one of the issues that concerned the council on Sept. 8 was that the cost estimate for the project had increased from $4.45 million to about $7 million.
“While CTS [Covenant Technical Solutions, Inc.] expressed a willingness to honor their bid pricing, they informed staff that their suppliers were unable to extend pricing commitments due to current market volatility and tariffs affecting material costs. Consequently, the bid validity period formally expired on September 14, 2025,” Cho wrote.
“Staff recommends that the City Council reject all bids in accordance with Section 1010 of the Seal Beach Charter, which provides that the legislative body may reject any bids presented and re-advertise a project at its discretion,” Cho wrote.
“Throughout the design process, staff worked with Pacific Advanced Civil Engineering, Inc. (PACE)—the Project’s design engineer—to conduct value engineering exercises aimed at identifying cost-effective solutions. Despite these efforts, the bids received exceeded the original engineer’s cost estimate. Given this, one option is to engage a third party, such as the proposed construction management firm, to work alongside PACE to explore alternative design solutions that maintain the Project’s quality while addressing current market challenges, fluctuating material costs, and tariffs,” Cho wrote.
Staff asked the council for direction on how to proceed.
“On September 8, 2025, staff recommended approval of Amendment 3 to the Professional Services Agreement (PSA) with PACE, which proposed an increase in compensation by $144,870, resulting in a revised not-to-exceed amount of $586,475, and an extension of the agreement term through June 30, 2028. At that meeting, the City Council chose to continue the item for further consideration,” Cho wrote.
“At the same meeting, staff recommended approval of a PSA with Butier [Engineering, Inc.] for Construction Management and Inspection Services in the amount of $494,722, and authorization for the City Manager to approve additional construction management services up to $50,000 in connection with the Project,” Cho wrote.
Staff recommended deferring the project both the PACE amendment and the Butier contract pending council direction on how to proceed.
“On September 8, 2025, City Council directed staff to proceed with a new OCWD loan agreement reflecting the new anticipated loan amount of $7 million. Due to CTS’s inability to extend their bid pricing beyond the September 14, 2025, expiration date, the loan request has been delayed until Project costs and funding requirements are finalized,” Cho wrote.
