St. John Indiana - Founded 1837
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October 11, 2012 Board of WaterWorks Minutes

Michael Forbes PresidentAttorney David Austgen
Ken Gembala, Vice-PresidentSherry Sury, Clerk-Treasurer
Gregory VolkSteve Kil, Town Manager

Mr. Forbes called to order the special meeting of the Board of Waterworks on October 11, 2012, at 7:00 p.m.

Roll call was taken by Clerk-Treasurer, Sherry Sury, with the follow members present: Mike Forbes, Ken Gembala and Greg Volk. Staff members: Steve Kil was absent. Attorney Austgen was present. Recording Secretary, Susan E. Wright, was present.


Mr. Forbes asked Mr. Ken Krauss to update the Board on the bids. Mr. Krauss stated that he reviewed the bids with his colleague, Mr. Jim Maurer, who would present the information to the Board.

Mr. Maurer stated he is the engineer for the Well house #3 and Well House #5 improvement project. He informed the Board that the IDEM construction permit has been received via e-mail on this date. Mr.Maurer submitted a memorandum to the Board which summarized two separate e-mails previously sent to the Town.

Mr. Maurer explained that the October 3, 2012, e-mail forwarded to the Town contained a bid tabulation sheet. In addition, the e-mail mentioned that the low bidder, Group Construction, had written themselves into the bid as the well contractor. He explained that Addendum No. 1 to the project included that the qualifications of the well contractor was required in the list of determinants for the successful bidder.

Mr. Maurer stated that this was an important issue and Gariup Construction was contacted. Mr. Maurer stated that Gariup responded by saying they made an error, and their well contractor would be Peerless Midwest.

Mr. Maurer stated that the last e-mail attached to his submission to the Board puts to rest the request for special price consideration that was added to Gariup’s bid. He stated that this request would only apply if they were not low bidder and the low bidder was not local. The request asked for special price consideration to receive the award if they were within so many percentage points of the low bidder. The last e-mail received from Gariup confirmed the aforementioned was not applicable to their bid.

Mr. Maurer stated that Gariup Construction’s work history has been investigated. He stated that Gariup Construction has never constructed a project designed by Haas & Associates. He stated that he inspected a project that Gariup Construction did in Michigan City, Indiana, and it was successful. Mr. Maurer stated that he has found Gariup Construction to have a very good work history.

Mr. Maurer stated that the second low bidder, Gaskill & Walton, has performed satisfactorily in and for the Town of St. John.

Mr. Maurer stated that he contacted both Gariup Construction and Gaskill & Walton for information on which subcontractors would be used for this project. He stated he was informed by Gariup Construction that they did not have enough time left today to make the decisions on subcontractors, other than Peerless Midwest as the well contractor. He stated that as far as the electrical, masonry and excavation contractors Gariup claimed they needed more time to make that decision. Mr. Maurer stated that Gaskill & Walton informed him that their subcontractors would be Sweeny for electrical, Kwiatkowski for masonry and possibly D&M Excavation.

Mr. Maurer opined that the Board has two options. The first option would be to consider waiving the bid error that Gariup made and accept their bid of in the total amount of $267,400 subject to their designation of acceptable subcontractors for the project. He stated Gariup Construction has seven days to provide this information. He stated that the Board could also reject Gariup’s erroneous bid and accept Gaskill & Walton’s bid in the total amount of $338,000.

Mr. Maurer stated that they wanted to present this information to the Board for their consideration. He stated he hoped that one of the bids could be accepted tonight so that Notice of Award can be forwarded to one of the bidders along with a Construction Agreement. He stated that a Notice to Proceed should be forwarded as soon as possible as Derwin has indicated that the water use is declining to the point that he feels confident that the two wells can be taken out of service and there will still be enough water to meet the demand. Mr. Maurer stated he would be happy to answer any questions from the Board.

Mr. Gembala asked if there was anything in the bid proposals that required subcontractors to be listed. Mr. Maurer stated that the bid proposal required that only the well contractor be listed. Mr. Gembala asked if that meant they bid the job without knowing what subcontractors they were using. Mr. Maurer stated Gariup added their own name in and claimed it was an error. He stated that they may not have read what the signature was for.

(General discussion ensued.)

Mr. Volk noted the $71,000 difference in the bids. Mr. Forbes asked Attorney Austgen for his thoughts on the “so called error.” Attorney Austgen stated he did not believe this to be an error. He stated that Gariup has been in business for a long time, have performed thousands of projects, and have tens of millions of dollars in construction projects at the present time. He stated that this does not surprise him at all. He stated that the well is the specialty item on this project.

Attorney Austgen informed the Board that they, as the policy making body, are responsible for awarding the bid to the lowest responsive and responsible bidder. He stated that if the Board finds material errors, as have been identified, they can be considered as to whether or not the bid is responsive, or they can also waive the irregularity. He stated that that this is a significant amount of money in savings for the Town.

Attorney Austen noted that the recommendation of the Board waiving Gariup Construction’s error and awarding the bid seems to be the better alternative. He stated that the bid seems to comply with the law provided the Board is willing to waive the irregularities.

Mr. Volk noted that Gariup Construction is an old company. He asked if it was relevant if the Board knew what subcontractors they used. Attorney Austgen noted that their choice of subcontractors verifies the quality of work.

(General discussion ensued.)

The timeframe of the project was discussed. Mr. Maurer stated there are several milestones with final completion at 210 calendar days. Mr. Forbes asked Mr. Maurer to beef up his recommendation. Mr. Maurer stated, if pressed for his recommendation to the Board it would be Gariup Construction, the low bidder. He stated Derwin’s recommendation would be Gaskill & Walton. He stated that Derwin has worked with Gaskill & Walton before and is comfortable with them. He also stated that Gariup Construction was given a good recommendation by many people.

Mr. Gembala noted that $71,000 was a lot of money to justify spending if it was just a typographical error on a bid form. Mr. Volk stated that he is comfortable with Gariup Construction. Mr. Forbes noted that Gariup Construction is reputable, and he is comfortable with waiving the bid error. Mr. Gembala stated that his company has previously worked with Gariup Construction.

Mr. Forbes stated he would entertain a motion on the improvement project for Well #3 and Well #5. Mr. Volk made a motion to waive the bid error made by Gariup Construction and award the bid in the amount of $267,400 to Gariup Construction. The motion was seconded by Mr. Gembala. The motion was unanimously carried by voice vote (3/0).

Mr. Volk made a motion to authorize signature on the Notice of Award and Contract Agreement subject to Attorney Austgen’s review, and request Gariup Construction provide a list of subcontractors. The motion was seconded by Mr. Gembala. The motion was unanimously carried by voice vote (3/0).

Mr. Gembala thanked Mr. Maurer for keeping the Board updated on the project.

There were no reports or correspondence.

Mr. Gembala remarked that slowly but surely the hydrant painting is getting done and looking very good.

(General discussion ensued.)

Mr. Gembala made a motion to adjourn the meeting; Mr. Volk seconded the motion. The motion was unanimously carried by voice vote (3/0). (The meeting was adjourned at 7:25 p.m.)


Susan E. Wright
St. John Board of WaterWorks, Recording Secretary