City officials may explore alternatives to awarding contracts to the lowest bidder, after it was forced to terminate a deal with a company hired to complete construction of Fire Station No. 3.

“I think we need to take a look at the way we award contracts to low bidders because it has frequently resulted in problems down the road,” said Councilman Scott Malsin. “And I know that there are other ways that cities determine who they are going to award a contract to. Sometimes they throw out the low bid … I think we ought to explore it, because this is something that comes up.”

The city is not obligated to choose the lowest bidder “if there are reasons why somebody else’s bid — which may be higher — is more responsible,” added Mayor Andrew Weissman. “I think we need to take a look at how we define responsible in terms of our contract evaluation.”

In June 2007, during a joint meeting of the council and redevelopment agency, the city awarded FEI Enterprises, Inc. a $5.1 million contract to complete construction of Fire Station No. 3. Now mostly complete, the 12,216-square-foot structure at 6030 Bristol Parkway will replace an aging station on Segrell Way.

The scope of the work included public art; architectural design; construction management; construction inspection for grading, concrete and steel; fiber optic installation; furniture, fixtures and equipment; radio communications equipment; telephone equipment; reprographics and a feasibility study.

Work on the project began in August 2007 with a contract duration of 345 days. Due mainly to weather delays, the contract was extended to September 2008. Then, between January and February 2009, the project was suspended following the death of the city’s construction manager. According to a March 1 city staff report, upon resuming work, FEI assured city officials that the project would completed by May 2009. Instead, said the report, the company continued to push the date back.

As a last-ditch effort, the city informed FEI that the project must be completed no later than December 2009, warning that the cost of any unfinished work would be deducted from their final payment and included in a deductive change order, which was issued by certified mail this February.

City staff has calculated that FEI owes the city $62,340.44, after the liquidation damages have been subtracted from the remaining contract balance of $296,519.77. But because “subsection 14.4.3 of the contract documents states that the contractor is entitled to reasonable overhead and profit on work not executed, applying a 15 percent rate on the estimated cost to complete the unfinished work ($94,250.00), the overhead and profit amount is determined to be $14,137.50. Subtracting that amount from the $62,340.44 that FEI owes the city, leaves a balance due to the city of $48,202.94,” said the staff report.

FEI has declined to agree to the deductive change order.

The estimated cost of work left to still be performed amounts to $94,250 and accounts for 23 items and their basic scope of work. They include, but are not limited to, installing electrical wiring; hardware and security wiring for key pad controls; television mounting; pedestrian gate lock protection and electrical interface with the swing gate; a non-wired irrigation system of the Calsense Flow Meter; internal and external stairway handrails; a wall at the top of the external stairway; furnishing and installing a counter mounted soap dispenser in one of the restrooms; purchasing and installing missing window latches; furnishing and installing new glass doors and door hardware; widening the south driveway curb opening; installing filter fabric and signage, as well as painting the storm drain cover located at the south driveway; installing three illuminated map cases; demolition of framing and drywall; relocation of light fixtures and fire sprinklers; replace stolen BBQ; repairing all concrete areas inside and outside that have multiple cracks; construction of a new concrete ramp; cast iron piping; installation of a pre-fabricated ladder to allow access to the roof; installing ceiling fans; and roof patching.