Joliet awards $41m water-storage tank contract after steel error drives estimate gap

Joliet awards $41m water-storage tank contract after steel error drives estimate gapJoliet City Council unanimously awarded Fisher Tank Company a $41.025 million contract to build four storage tanks for its alternative water supply programme. Officials said the higher-than-expected cost reflected an erroneous preliminary steel specification, 250,000 lb of unaccounted-for steel and a 25% increase in steel prices since January.

Council unanimously approved Contract No. 2939-0426 with Fisher Tank Company for the JOL-08-05 Water Storage Tanks Project, valued at $41,025,400.

The four tanks are required to provide two days of emergency water storage for the entire city when Joliet switches supply in 2030.

Officials said the initial estimate was based on a quote using the wrong tank standard and excluded about 250,000 lb of steel.

The two bids received were within 1.8% of one another; staff said this supported the conclusion that the awarded price was accurate and reasonable.

The council also approved a $1.243 million sewer-rehabilitation contract connected to the 2027 Watermain Replacement Programme.

Joliet City Council has approved a $41.025 million contract with Fisher Tank Company for four water-storage tanks central to the Illinois utility's alternative water supply programme, despite the price substantially exceeding an earlier estimate. The unanimous October 6 vote on Contract No. 2939-0426 authorises the JOL-08-05 Water Storage Tanks Project. The tanks are required to hold two days' worth of emergency water supply for the entire city when Joliet changes over in 2030, according to the council discussion. Councilman Larry E. Hugg said the storage requirement forms part of the agreement for Lake Michigan water. The principal issue before council was the divergence between the preliminary estimate, described during the meeting as about $20 million, and the contract award. A staff member said the work is specialised and that the city relies on manufacturers' quotes as a pricing basis. The original quote, however, was not in line with the final design specifications because it used the wrong tank standard. About 250,000 lb of steel had not been included in that quote, the staff member said. Steel prices have also risen 25% since January, while demand for tank construction is high among communities participating in the water project and other communities changing water sources. Council speakers said only a limited number of companies nationally can undertake the work. Rather than indicating a defective competitive process, officials characterised the discrepancy as a problem with the preliminary estimate. Two major tank companies submitted sealed bids, which were within 1.8% of each other. The city's consultant reviewed the pricing and advised that it appeared reasonable, staff told the council. Hugg said the city had engaged Burns & McDonnell as a consultant for the wider programme. He described the Joliet and Grand Prairie Water Commission scheme as a major project and said there was limited comparable work available for preparing the initial estimate. The water-storage award was one element of a wider package of utility approvals. Council also unanimously awarded Hoerr Construction Inc. a $1.243 million contract for sewer rehabilitation associated with the 2027 Watermain Replacement Programme, alongside a not-to-exceed $69,900 amendment for RJN Group Inc.'s professional services agreement. In its consent agenda, the council approved preliminary engineering for the 2028 Water System Rehabilitation Programme, valued at up to $959,600, as well as several water-main project change orders that reduced costs. The largest reduction was a $2.176 million deduction for the North Downtown Water Main Improvements Project.