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HomeMy WebLinkAboutA036 - Resolution declaring Jordison Construction, Inc., of Urbandale, IA, to be a nonresponsible contractor for the purpose of bidding on City projects (tabled from March 10, 2026 meeting)ITEM #:38 DATE:03-24-26 DEPT:ADMIN SUBJECT:DETERMINATION OF NON-RESPONSIBLE CONTRACTOR FOR THE PURPOSE OF BIDDING ON CITY PROJECTS COUNCIL ACTION FORM BACKGROUND: The City Council agenda for March 10, 2026 contained an item asking the City Council to determine whether Jordison Construction, Urbandale, IA should be declared to be non- responsible for the purpose of bidding on City of Ames construction contracts. The original report to the City Council is attached. At that time, the discussion was tabled to the March 24, 2026 meeting. The reason for the tabling related to an objection from an attorney representing Jordison Construction regarding the amount of notice provided to Jordison prior to the March 10 Council meeting. The City Attorney has since had conversations with Jordison's attorney. A memo has been prepared by the City Attorney recommending an alternative course of action to those presented in the March 10 Council Action Form. The City Attorney's recommendation is to accept Jordison Construction's offer to withdraw its pending bid for the Resource Recovery and Recycling Campus project, and not proceeding with a determination on whether Jordison is a non-responsible bidder. The memo is attached. ALTERNATIVES: 1. Accept Jordison Construction's bid withdrawal for the Resource Recovery and Recycling Campus project, and address Jordison's status as a responsible bidder on a case-by- case basis for future bids. 2. Do not accept Jordison Construction's bid withdrawal. 3. Refer this item to staff for further information. CITY MANAGER'S RECOMMENDED ACTION: The City is dependent on contractors to perform construction work on City infrastructure. State law requires contracts to be awarded to the lowest responsive, responsible bidder. Following further analysis, the City Attorney recommends that the City Council permit Jordison to withdraw its pending bid with the City for the Resource Recovery and Recycling Campus project, and that the City Council evaluate whether Jordison is a responsible bidder on a case- by-case basis when considering the award of future bids. Therefore, it is the recommendation of the City Manager that the City Council follow the City 1 Attorney's recommendation and adopt Alternative No. 1, as described above. ATTACHMENT(S): March 10 Council Action Form Mallory Law Letter.pdf Memo from City Attorney 2 ITEM #:37 DATE:03-10-26 DEPT:ADMIN SUBJECT:DETERMINATION OF NON-RESPONSIBLE CONTRACTOR FOR THE PURPOSE OF BIDDING ON CITY PROJECTS COUNCIL ACTION FORM BACKGROUND: Chapter 26 of Iowa Code outlines the requirements for bidding on construction contracts undertaken by the City. According to Section 26.9, the City is obligated to award a contract for a public improvement to the lowest responsive, responsible bidder. SCHAINKER PLAZA CONCRETE WORK In 2022, the City awarded a contract for the construction of the Steven L. Schainker Plaza, located across the street from City Hall. The awarded contractor retained a sub-contractor to handle the construction of the ice-making components of the plaza. This sub-contractor subsequently retained a concrete contractor, Jordison Construction, Inc., Urbandale, Iowa, to install the concrete for the ice ribbon, a major feature of the plaza. The ice ribbon work involved the placement of concrete over refrigerant piping, wire mesh, and insulation. The concrete was placed on December 15, 2023, and in February 2024, there were apparent defects with the work. Reports documenting the pour, provided by the City's consultant, also indicated several deviations occurred during the pour from the agreed-upon installation practices and tolerances. The work performed by Jordison Construction, in the view of the City and our outside concrete expert, resulted in an unsafe, unacceptable concrete surface. On February 27, 2026, the City reached a settlement with the prime contractor on the Plaza project to remove and replace the defective work. However, as a result of the original, deficient work performed by Jordison, the City has expended an inordinate amount of time during the past two years working to remediate the unacceptable concrete surface. The completion of the plaza project has been delayed denying the public the use of this space for several years. Further, the City has had to expend additional funds to retain outside legal services and concrete diagnostic consultants to address the concrete pour. As of February 10, 2026, the costs billed for these services have totaled $156,040.56, of which $74,234.51 is for professional concrete expert services. FITCH FAMILY INDOOR AQUATIC CENTER BIDS Separately, Jordison Construction was a bidder on the Paving & Sidewalk Work bid package for the Fitch Family Indoor Aquatic Center. Jordison's bid, including alternates, was $280,300, while the second low bid was $351,588. Following the opening of bids, the City received a letter from Jordison Construction requesting to withdraw its bid (attached). The letter cited that Jordison had "[...] discovered the omission of providing and installing all of the granular paving sub-base beneath the paving and walks. By performing this work at our bid amount, it would 13 negatively effect [sic] our business." As a result of the withdrawal of Jordison's bid, the City awarded the bid to the second lowest bidder, at an increased cost of $71,288. STAFF ANALYSIS Based on the issues described above in the City's previous experience with Jordison Construction, City staff does not have confidence that Jordison is capable of providing construction services for the City in a responsible manner in the future . According to advice from the City Attorney, only the City Council can make a determination as to whether a contractor is non-responsible. If the City Council does make such a determination, then Jordison Construction would be unable to be awarded a contract for a project bid by the City of Ames. The Purchasing Manager has advised that a period of time be established during which a non- responsible bidder would be unable to be awarded a contract. For comparison purposes, in instances where Iowa State University makes such a declaration, the contractor may not be awarded a bid for a period of at least three years. After the three-year period, the contractor may then provide information to the City demonstrating the changes it has made to its practices, capabilities, organization, or other pertinent areas in order to prevent problems like those that have resulted in a declaration that they are not responsible. The City Council could at that time determine whether those changes are sufficient to authorize the contractor to be able to be awarded a contract with the City in the future. ALTERNATIVES: 1. Approve a resolution determining Jordison Construction, Urbandale, Iowa to be a non- responsible bidder for the purpose of bidding on City projects, based on the findings identified above. Jordison would be eligible to return to good standing after three years by providing information to the satisfaction of the City Council that the issues the City has encountered with Jordison will not be repeated. 2. Do not determine that Jordison Construction is non-responsible, and allow Jordison Construction to remain eligible to bid on public improvement contracts for the City of Ames. CITY MANAGER'S RECOMMENDED ACTION: The City is dependent on contractors to perform construction work on City infrastructure. State law requires contracts to be awarded to the lowest responsive, responsible bidder. The City's experience with Jordison Construction placing the concrete at Schainker Plaza has been extremely challenging. The concrete work was deficient and the City has expended considerable time and money pursuing a resolution to work performed by Jordison, delaying the opening of the plaza by several years. 24 This experience has not proven to be a value to the community taxpayers, and therefore staff believes it is in the City's best interest to take steps to declare Jordison Construction to be a non-responsible bidder. Jordison would be eligible to return to good standing after three years by providing information to the satisfaction of the City Council that the issues the City has encountered with Jordison will not be repeated. Therefore, it is the recommendation of the City Manager that the City Council adopt Alternative #1, as described above. ATTACHMENT(S): Jordison_Withdrawal_Letter.pdf 35 46 1 MALLORY LAW 12012 Ridgemont Dr. Urbandale, Iowa 50323 T: 515-207-2365 F: 515-608-4638 BILLY J. MALLORY March 20, 2026 Via Email only. Mark Lambert Ames City Attorney mark.lambert@cityofames.org Dear Mr. Lambert: Thank you again for your time and for the discussions we have had since my prior letter. As a follow-up to those discussions, I write to confirm that Jordison’s goal remains to avoid unnecessary conflict with the City of Ames and to identify a practical path forward. We understand the frustration surrounding the Schainker Plaza Ice Rink project and the pressure the Council has faced in addressing that situation. Our objective is not to escalate this matter, but to find a resolution that avoids a broader dispute and allows the City to move forward promptly with the Resource Recovery and Recycling Campus project without delay, distraction, or dispute. If the City is agreeable, Jordison is willing to withdraw its bid for the Resource Recovery and Recycling Campus project, without penalty to Jordison, provided the City does not proceed with Monday night’s hearing or other action directed toward any broader non-responsibility, disqualification, or similar determination. Jordison continues to have concerns regarding the legality and fairness of proceeding on that broader issue under the current circumstances, but offers this proposal in an effort to take those issues off the table and allow the City to proceed with the Resource Recovery and Recycling Campus project without further delay or dispute. Jordison remains committed to maintaining a constructive relationship with the City of Ames and hopes this proposal will provide a straightforward and amicable resolution of the current matter. It would allow the Resource Recovery and Recycling Campus project to proceed without distraction, avoid the need to address any broader designation in this setting, and preserve the possibility that Jordison and the City may, under appropriate circumstances in the future, work together constructively. Thank you again for your time, attention, and willingness to discuss this matter. Sincerely, BILLY J. MALLORY 7 Caring People  Quality Programs  Exceptional Service 515.239.5146 main 515.239.5142 fax 515 Clark Ave. Ames, IA 50010 www.CityofAmes.org Legal Department MEMO Legal Department To: Mayor Haila, Ames City Council From: Mark O. Lambert, City Attorney Date: March 24, 2026 Subject: “Non-responsible bidder” determination This agenda item is for the Council to consider whether to make a determination that Jordison Construction, Inc. was a “non-responsible bidder” for purposes of bidding on City projects. The Iowa Public Bidding Law (Chapter 26, Iowa Code) requires that contracts be awarded to the “lowest responsive, responsible bidder.” Since the last Council meeting, Jordison’s attorney has called me to discuss the matter. His opinion is that while the City could determine that Jordison was a non-responsible bidder, the proposed prohibition on Jordison bidding on City projects for three years was, in his opinion, in violation of Iowa law. His position is that a bidder can only be determined non-responsible on a bid-by-bid basis. Iowa Code section 26.16 states: “A governmental entity shall not by ordinance, rule, or any other action relating to contracts for public improvements for which competitive bids are required by this chapter impose any requirement that directly or indirectly, restricts potential bidders to any predetermined class of bidders to any predetermined class of bidders defined by experience on similar projects, size of company, union membership, or any other criteria.” I am not fully convinced this statute would mean that the City could not prohibit a firm determined to be non-responsible from bidding on City projects for a period of time, but the Iowa Code language certainly could be read that way. Our understanding is that Iowa State University does so, but there are different Iowa Code provisions for contracts at a regents institution that may apply and would require further research to evaluate. Therefore, my recommendation would be for the Council not to adopt a 3-year prohibition, to avoid potential litigation, and the Council Action Form has been amended removing the potential 3-year ban on bidding. 8 Meanwhile, Jordison has sent a letter stating that it wishes to withdraw its bid on the Resource Recovery concrete work. This addresses the immediate concern. Therefore, I recommend that the Council adopt a motion allowing Jordison to withdraw its bid on the Resource Recovery project and not proceed with a determination on whether Jordison is a non-responsible bidder. 9