HONOLULU AUTHORITY tor RAPID TRANSPORTATION

July 18, 2019

MEMORANDUM

TO: ,,..

THROUGH: Andrew S. Robbi a,h .. <lfl/J Executive Direct a CEO ~ tJP/1-Charles S. Carn ggiolf f.~~~ Project Director an~~oharge

THROUGH:

THROUGH: ~

FROM: )&ln o / East:; ea Construction Manager

/C I Request for Change Order Approval

;

/S'himmick/Traylor/Granite Joint-Venture Airport Guideway and Stations Design-Build Contract

SUBJECT:

IN REPLY REFER TO:

CMS-AP00-03534

Andrew S. Robbins

EXECUTIVE DIRECTOR AND CEO

BOARD OF DIRECTORS

Damien T.K. Kim CHAIR

Terrence M. Lee VICE CHAIR

Michele Chun Brunngraber

Jade Butay John Henry Felix

Wes Frysztacki Kamani Kuala'au

Wesley K. Machida Tobias Martyn

Glenn M . Nohara Ember Shinn

Kathy Sokugawa Hoyt H. Zia

Contract Change Order - Contaminated Water at HOOT-Airport Lots A and J Contract No. CT-HRT-1600385

Overview HART staff is requesting this Amendment to the AGS contract for the additional cost the Contractor has incurred as a result of the discovery of contaminated groundwater within the Project site on HOOT-Airport property.

As a result of the discovery, the Contractor is experiencing additional costs for equipment delays, additional on-site mobilizations and storage, handling, and treatment and disposal of water found to be above HDOH Environmental Action Levels for commercial or industrial properties.

The final scope and cost of this Amendment are dependent upon the various levels of contamination encountered during the Contractor's shaft construction operations. Because the level of contamination is unknown and not quantifiable at this time, the proposed methodology for compensation will be through a Provisional Sum based on actual supported incurred costs.

This will be a Provisional Sum with a Not-to-Exceed value of $10,000,000.00

Justification • On December 10, 2018, HART was notified that Contractor's laboratory analysis identified elevated

concentrations of potentially hazardous substances in the groundwater within HDOT-A property (specifically the solvent trichloroethylene TCE and TCE byproducts.)

• HDOH, HDOT-A, HART, and STG JV worked together on a solution and on April 22, 2019, HDOH accepted the Site-Specific EHE-EHMP allowing HART and STG JV to begin implementation and resume construction activities.

CITY AND COUNTY OF HONOLULU , Al ii Place, Suite 1700, 1099 Alakea Street. Honolulu, Hawaii 96813

Phone: (808)768-6159 Fax: (808)768-5110 www.honolulutransit.org

HART Board of Directors Page 2 July 18, 2019

• This Amendment will: - Keep Project Moving: Allows the Contractor to receive reimbursement for costs associated with

the impacts associated with the work stoppage and eventual remediation cost due to the encountering contaminated water. The Contractor was able to resume work incrementally in Airport Lots A and J as discussed.

- Reduces Risk: The Site-Specific EHE-EHMP was developed to provide the Contractor with instruction of the proper handling, treatment, and disposal of contaminated water and soil encountered during their construction operations at this site. The plan allows work to continue with the proper procedures in place, to expand the AGS project scope to meet the environmental requirements and to mitigate further delays due to contamination conditions.

- Preserves Schedule: Project Critical Path Schedule impacts are yet to be determined and will be available when the Contractor submits the Time Impact Analysis (TIA).

Recommendation As a result of the discovery of TCE groundwater contamination within the Project site:

• HART staff recommends that the Board approve the Amendment for the Provisional Sum to cover the costs the Contractor has experiences in equipment delays and additional on-site mobilizations, storage, handling, treatment and disposal of water, found to be above HDOH Environmental Action Levels (EALs) for commercial or industrial properties.

• This Amendment will have a Not-to-Exceed value of $10,000,000

• This Amendment will be funded from the AGS contract allocated contingency.

Honolulu Authority for Rapid Transportation

STAFF SUMMARY TITLE: STAFF CONT ACT: DATE: CT-HRT-1600385, Airport Guideway and Stations DB; Contract Change Order

John Moore July 18, 2019 for Contaminated Groundwater at HOOT-Airport Lots A & J Area Manager East

Type: Goal Focus Area Reference Notes

[8J Action/Approval [8J Project Delivery D Livability/Land Use

D Information D Service Delivery D Partnerships

D Follow-up D Resource Stewardship D Agency Admin.

1. Purpose:

• HART staff is requesting this Amendment to the AGS contract for the additional cost the Contractor has incurred as a result of the discovery of contaminated groundwater within the Project site on HOOT ·Airport property.

• As a result of the discovery, the Contractor is experiencing additional costs for equipment delays, additional on-site mobilizations and storage, handling, and treatment and disposal of water found to be above HDOH Environmental Action Levels for commercial or industrial properties.

• The final scope and cost of th is Amendment are dependent upon the various levels of contamination encountered during the Contractor's shaft construction operations. Because the level of contamination is unknown and not quantifiable at this time, the proposed methodology for compensation will be through a Provisional Sum based on actual supported incurred costs.

• This will be a Provisional Sum with a Not-to-Exceed value of $10,000,000.00

2. Background/Justification

• On December 10, 2018, HART was notified that Contractor's laboratory analysis identified elevated concentrations of potentially hazardous substances in the groundwater within HOOT-A property (specifically the solvent trichloroethylene TCE and TCE byproducts.)

• HDOH, HOOT-A, HART, and STG JV worked together on a solution and on April 22, 2019, HDOH accepted the Site-Specific EHE· EHMP allowing HART and STG JV to begin implementation and resume construction activities.

• This Amendment will: . Keep Project Moving: Allows the Contractor to receive reimbursement for costs associated with the impacts associated with the

work stoppage and eventual remediation cost due to the encountering contaminated water. The Contractor was able to resume work incrementally in Airport Lots A and J as discussed.

. Reduces Risk: The Site-Specific EHE-EHMP was developed to provide the Contractor with instruction of the proper handling, treatment, and disposal of contaminated water and soil encountered during their construction operations at this site. The plan allows work to continue with the proper procedures in place, to expand the AGS project scope to meet the environmental requirements and to mitigate further delays due to contamination conditions.

. Preserves Schedule: Project Critical Path Schedule impacts are yet to be determined and will be available when the Contractor submits the Time Impact Analysis (TIA).

3. Board Authority

HART Board is required to approve all Change Order/Contract Amendment over an absolute value of $1 M. The absolute value of this Change Order exceeds $1M.

4. Procurement Background

This CCO has been processed in accordance with Contract terms and Construction Change Order Procedures.

5. Financial/Budget Impact

This CCO will have a Not-to-Exceed value of $10,000,000 and funded from the AGS contract allocated contingency.

6. Pol icy Impact

Not Applicable

7. Public Involvement

Not Applicable

8. Alternatives

Not Applicable

9. Exhibits

PowerPoint Presentation

Contaminated Water HDOT-Airport Lots A and J

Airport Guideway and Stations Design-Build

Contract CT-HRT-1600385

Board of Directors Meeting July 18, 2019 Honolulu, Hawaiʻi

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Purpose

To seek Board approval of an amendment to the AGS contract for the additional cost theContractor has incurred as a result of the discovery of contaminated groundwater withinthe Project site on HDOT-Airport property.

The final scope and cost of this Amendment is dependent upon the various levels ofcontamination encountered during the Contractor’s shaft construction operations.Because the level of contamination is unknown and not quantifiable at this time, theproposed methodology for compensation will be through a Provisional Sum based onactual supported incurred costs.

This change order will have a Not-to-Exceed value of $10,000,000.00

3

Background

On December 10, 2018, HART was notified that the Contractor’s laboratory analysisidentified elevated concentrations of potentially hazardous substances in thegroundwater within HDOT-A property (specifically the solvent trichloroethylene TCEand TCE byproducts.)

On December 15, 2018, as a result of these findings and as a potential generator ofthe contamination, HDOT-A issued a directive to suspend work at HDOT-A Lots Aand J.

On December 19, 2018, the Contractor provided notice to HART that it would besuspending work in Lot A and Lot J in compliance with the HDOT-A directive.

4 Background (Continued)

On December 27, 2018, HART received a letter from the State of Hawaii Departmentof Health (HDOH) requiring additional environmental sampling and development ofa Site-Specific Environmental Hazard Evaluation and Environmental HazardManagement Plan (EHE-EHMP), prior to resuming construction in the area of themonitoring well.

On January 10, 2019, HART, STG JV, HDOT-A, and HDOH met to discuss previous dataand options to expedite both sampling and the review/approval of the Site-SpecificEHE-EHMP.

On January 15, 2019, HART responded to HDOH’s letter citing HART’s willingness andability to undertake appropriate response actions within a reasonable period of timewith the intention of enabling STG JV to continue work.

5 Background (Continued)

Through the HART Hazardous Material Contract, fourteen additional groundwater monitoringwells were installed and sampled to characterize the plume of contamination within theconstruction area, as required by HDOH. The sampling results allowed HART to develop theSite-Specific EHE-EHMP, initially submitted to HDOH in February 2019. The Site-Specific EHE-EHMP dictates storage, treatment, and sampling requirements for water. The most practicaland cost-effective method for treating water found to be above HDOH Environmental ActionLevels (EALs) for commercial or industrial properties is with an on-site activated carbonfiltration system, which is being implemented under the scope of this change.

HDOH, HDOT-A, HART, and STG JV worked together on a solution and on April 22, 2019,HDOH accepted the Site-Specific EHE-EHMP allowing HART and STG JV to beginimplementation and resume construction activities.

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Opportunities with this Strategy

Keep Project Moving Allows the Contractor to receive reimbursement for costs associated with the impacts

associated with the work stoppage and eventual remediation cost due to the encountering contaminated water. The Contractor was able to resume work incrementally in Airport Lots A and J as discussed above.

Reduces Risk The Site -Specific EHE-EHMP was developed to provide the Contractor with instruction of the

proper handling, treatment and disposal of contaminated water and soil encountered during their construction operations at this site. The plan allows work to continue with the proper procedures in place, to expand the AGS project scope to meet the environmental requirements, and to mitigate further delays due to contamination conditions.

Preserves Schedule Project Critical Path Schedule impacts are yet to be determined and will be available when

the Contractor submits the Time Impact Analysis (TIA).

7

Cost Overview

Awarded Value of Contract $ 874,750,000.00

Previously Authorized Changes $ (13,242,671.09)

Contract Value Prior to this CCO $ 861,507,328.91

Proposed Amendment * $ 10,000,000.00

Total Contract Value $ 871,507,328.91

*Funded from the AGS contract allocated contingency.

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Recommendation

As a result of the discovery of TCE groundwater contamination within the Project site:

Approve the Amendment for the Provisional Sum of $10,000,000 to cover the costs the Contractor has experiences for equipment delays, additional on-site mobilizations and storage, handling, and treatment and disposal of water found to be above HDOH Environmental Action Levels for commercial or industrial properties.

This Amendment will have a Not-to-Exceed value of $10,000,000

This Amendment will be funded from the AGS contract allocated contingency.

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Questions?

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