HomeMy WebLinkAboutP.R. NO. 25160 CHANGE ORDER NO. 2 HIGHWAY 365 SEWER FORCE MAIN REPLACEMNENT PROJECT. City of
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INTEROFFICE MEMORANDUM
Date: September 11, 2026
To: The Honorable Mayor and City Council
Through: Ronald Burton, CPM, City Manager
From: Calvin Matthews,P.E., Water Utilities Director
RE: PR No. 25160—Change Order No. 2 Highway 365 Sewer Force Main
Replacement Project(Project No. WS0012-CON)
Introduction:
This agenda item is to seek the City Council's authorization for the City Manager to execute
Change Order No. 2 for the Highway 365 Sewer Force Main Replacement Project(Project No.
WS0012-CON)with Allco,LLC of Beaumont,Texas,extending the time of the contract by 210
consecutive calendar days to a new contract time of 683 days.
Background:
Resolution No. 25-050 approved a contract with Allco, LLC, of Beaumont, Texas, for the
Highway 365 Sewer Force Main Replacement Project. The project will replace approximately
9,300 linear feet of force main as part of the City's Texas Commission on Environmental Quality
Supplemental Environmental Project requirement addressing the critical conditions that
contributed to multiple sanitary sewer overflow violations.
Before the contract was approved, City staff and the project engineer anticipated difficulty in
obtaining the easements and temporary workspace necessary for construction. The project
crosses numerous properties and rights-of-way and is located near multiple existing pipelines
and utility facilities.
On July 15,2025,Resolution No.25-310 approved acceptance of a utility easement from Labelle
Properties, Ltd., for a portion of the project near Highway 365, West Port Arthur Road, and
Riley Street. A portion of this easement is located within an existing utility corridor shared by
multiple pipeline operators, including Colonial Pipeline Company, Enterprise Pipeline, and
Cameron Highway Oil Pipeline Company,LLC,also known as Genesis Pipeline. Encroachment
agreements with the applicable pipeline operators were required before construction could
proceed in those areas.
"Remember,we are here to serve the Citizens of Port Arthur"
P.O.Box 1089 X Port Arthur,Texas 77641-1089 X 409.983.8101 X FAX 409.982.6743
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www.PortArthurTx.gov
Negotiations with Genesis Pipeline and Colonial Pipeline Company took longer than anticipated.
Communication with both companies was difficult because they did not consistently respond to
City communications.
While negotiating the necessary encroachment agreements, the City also contacted Angel Mid
Jeff County, J.V. ("Angel Mid Jeff') to obtain a temporary workspace easement for another
portion of the project area. Negotiations with Angel Mid Jeff were also delayed because the
landowner did not respond in a timely manner.
On February 24, 2026, pursuant to Resolution No. 26-068, the City approved a temporary
workspace easement with Angel Mid Jeff. Subsequently, however, Angel Mid Jeff denied the
City access to the temporary workspace area. As a result, the project design had to be modified
to avoid the temporary easement area. The design modification required additional permits and
revisions from the Texas Department of Transportation and Drainage District No. 7.
On March 24,2026,Resolution No.26-114 approved an encroachment agreement with Cameron
Highway Oil Pipeline Company, LLC (Genesis Pipeline).
Due to the delays associated with securing the required encroachment agreements and
easements,Resolution No. 26-248, approved on June 16,2026, authorized Change Order No. 1.
Change Order No. 1 increased the contract time by 108 days, from 365 days to 473 consecutive
calendar days.
On July 14, 2026, pursuant to Resolution No. 26-303, the City approved and executed an
encroachment agreement with Colonial Pipeline Company for the portion of the project along
Highway 365, West Port Arthur Road, and Riley Street.
The City also determined, through review of survey descriptions, that Kinder Morgan Texas
Pipeline's property line extended beyond the standard right-of-way area along Highway 365.
Accordingly, the City was required to obtain a permanent easement and temporary workspace
access from Kinder Morgan Texas Pipeline. Resolution No. 26-345, approved on August 11,
2026, authorized the City to resolve those property-access issues.
While the City was working to resolve the Kinder Morgan easement and access issues, Allco,
LLC requested a second suspension of work beginning July 27, 2026, with an anticipated
resumption date of September 26, 2026. The suspension delayed construction activities and
required the City to seek an extension of the Union Pacific Railroad permit and reschedule
railroad flagging services for the drilling operations.
"Remember,we are here to serve the Citizens of Port Arthur"
P.O.Box 1089 X Port Arthur,Texas 77641-1089 X 409.983.8101 X FAX 409.982.6743
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SPI Engineering and City staff recommend approval of Change Order No. 2 for the Highway
365 Sewer Force Main Replacement Project. Change Order No. 2 would increase the contract
time by an additional 210 consecutive calendar days,from 473 days to 683 consecutive calendar
days, and extend the contract completion date from September 18, 2026,to April 16, 2027.
The 210-day extension includes time associated with the work suspension, the Union Pacific
Railroad permit extension and flagging rescheduling,Kinder Morgan easement and underground
access issues, and construction-scope changes. Those scope changes include revisions to the
TxDOT permit to relocate the force main within the State Highway 365 right-of-way.
Budtet Impact:
There is no budgetary impact associated with Change Order No. 2. The contract amount will
remain$2,709,931.50.
Recommendation:
It is recommended that the City Council approve Proposed Resolution No. 25160, authorizing
the City Manager to approve Change Order No. 2 for the Hwy 365 Sewer Force Main
Replacement Project with Allco, LLC of Beaumont, Texas, as described/outlined above.
"Remember,we are here to serve the Citizens of Port Arthur"
P.O.Box 1089 X Port Arthur,Texas 77641-1089 X 409.983.8101 X FAX 409.982.6743
P.R.No. 25160
9/11/2026 cm
Page 1 of 3
RESOLUTION NO.
A RESOLUTION AUTHORIZING THE CITY MANAGER TO
EXECUTE CHANGE ORDER NO. 2 TO THE HIGHWAY 365 SEWER
FORCE MAIN REPLACEMENT PROJECT (PROJECT NO. WS0012-
CON) WITH ALLCO, LLC. OF BEAUMONT, TEXAS, EXTENDING
THE CONTRACT TIME BY 210 DAYS TO THE NEW TOTAL
CONTRACT TIME OF 683 DAYS, THEREBY SHIFTING THE
COMPLETION DATE TO APRIL 16, 2027; PROVIDING THAT
CHANGE ORDER NO.2 HAS NO BUDGETARY IMPACT.
WHEREAS,pursuant to Resolution No. 25-050, City Council approved the contract with Allco,
LLC (Contractor) of Beaumont, Texas for the Highway 365 Sewer Force Main Replacement Project to
replace 9,300 linear feet of force main,with a projected budgetary impact of$2,709,931.50; and
WHEREAS, before the contract was approved, City staff and the project engineer anticipated
difficulty in obtaining the easements and temporary workspace necessary for construction. The project
crosses numerous properties and rights-of-way and is located near multiple existing pipelines and utility
facilities; and
WHEREAS, on July 15, 2025, Resolution No. 25-310 approved acceptance of a utility easement
from Labelle Properties, Ltd., for a portion of the project near Highway 365, West Port Arthur Road, and
Riley Street. A portion of this easement is located within an existing utility corridor shared by multiple
pipeline operators,including Colonial Pipeline Company,Enterprise Pipeline,and Cameron Highway Oil
Pipeline Company, LLC, also known as Genesis Pipeline. Encroachment agreements with the applicable
pipeline operators were required before construction could proceed in those areas; and
WHEREAS, on November 21, 2025, due to the time required to obtain the easements and
encroachment agreements, Allco, LLC requested a suspension of contract time to resume on March 9,
2026 and as a result of the 108-day suspension the completion date shifted from June 2,2026,to September
18, 2026; and
WHEREAS negotiations with Genesis Pipeline and Colonial Pipeline Company took longer than
anticipated. Communication with both companies was difficult because they did not consistently respond
to City communications.; and
WHEREAS, while negotiating the necessary encroachment agreements, the City also contacted
Angel Mid Jeff County, J.V. ("Angel Mid Jeff') to obtain a temporary workspace easement for another
portion of the project area. Negotiations with Angel Mid Jeff were also delayed because the landowner
did not respond in a timely manner; and
P.R.No. 25160
9/11/2026 cm
Page 2 of 3
WHEREAS, On February 24, 2026, pursuant to Resolution No. 26-068, the City approved a
temporary workspace easement with Angel Mid Jeff. Subsequently, however, Angel Mid Jeff denied the
City access to the temporary workspace area. As a result, the project design had to be modified to avoid
the temporary easement area. The design modification required additional permits and revisions from the
Texas Department of Transportation and Drainage District No. 7; and
WHEREAS, On March 24, 2026, Resolution No. 26-114 approved an encroachment agreement
with Cameron Highway Oil Pipeline Company, LLC (Genesis Pipeline); and
WHEREAS, due to the delays associated with securing the required encroachment agreements
and easements, Resolution No. 26-248, approved on June 16, 2026, authorized Change Order No. 1.
Change Order No. 1 increased the contract time by 108 days, from 365 days to 473 consecutive calendar
days; and
WHEREAS,on July 14,2026,pursuant to Resolution No.26-303,the City approved and executed
an encroachment agreement with Colonial Pipeline Company for the portion of the project along Highway
365, West Port Arthur Road, and Riley Street; and
WHEREAS,the City also determined,through review of survey descriptions,that Kinder Morgan
Texas Pipeline's property line extended beyond the standard right-of-way area along Highway 365.
Accordingly,the City was required to obtain a permanent easement and temporary workspace access from
Kinder Morgan Texas Pipeline.Resolution No. 26-345,approved on August 11,2026,authorized the City
to resolve those property-access issues; and
WHEREAS, while the City was working to resolve the Kinder Morgan easement and access
issues, Allco, LLC requested a second suspension of work beginning July 27, 2026, with an anticipated
resumption date of September 26, 2026. The suspension delayed construction activities and required the
City to seek an extension of the Union Pacific Railroad permit and reschedule railroad flagging services
for the drilling operations; and
WHEREAS, SPI Engineering and City staff recommend approval of Change Order No. 2 for the
Highway 365 Sewer Force Main Replacement Project. Change Order No. 2 would increase the contract
time by an additional 210 consecutive calendar days, from 473 days to 683 consecutive calendar days,
and extend the contract completion date from September 18, 2026,to April 16, 2027; and
WHEREAS,the 210-day extension includes time associated with the work suspension,the Union
Pacific Railroad permit extension and flagging rescheduling, Kinder Morgan easement and underground
access issues, and construction-scope changes. Those scope changes include revisions to the TxDOT
permit to relocate the force main within the State Highway 365 right-of-way.
P.R.No. 25160
9/11/2026 cm
Page 3 of 3
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
PORT ARTHUR,TEXAS:
THAT,the facts and opinions in the preamble are true and correct; and,
THAT, the City Council hereby approves Change Order No. 2 (EXHIBIT "B") extending the
contract time by 210 days to the new total contract time of 683 consecutive calendar days,thereby shifting
the completion date to April 16, 2027; and,
THAT,there is no budgetary impact for Change Order No. 2; and,
THAT, a copy of the caption of this Resolution be spread upon the Minutes of the City Council.
READ,ADOPTED AND APPROVED THIS day of , 2026 at a Regular
Meeting of the City Council of the City of Port Arthur, Texas,by the following vote:
AYES: Mayor
Councilmembers:
NOES:
Charlotte M. Moses
Mayor
ATTEST:
Christie Whitley Ned
City Secretary
P.R.No. 25160
9/11/2026 cm
Page 4 of 3
APPROVED AS TO FORM:
Roxann Pais Cotroneo
City Attorney
APPROVED FOR ADMINISTRATION:
Ronald B PM
City Man
/(e
Suhail Kanwar, P.E.
Director of Public Services
Calvin Matthews, P. .
Water Utilities Director
APPROVED AS TO THE AVAILABILITY
OF FUNDS:
Lynda(Lynda) Boswell, MA CGFO
Finance Director 'I))
[, ,ja44..
Clifton E. Williams Jr. CPPB
Purchasing Manage
EXHIBIT A
(Suspension of Contract Request)
ALICO
Build
Construction Management
General Contactor
Corporate Office—P.O.Box 3684,Beaumont,TX 77704 Phone 409.860.4459 Fax 409.860.3857
Central Texas—P.O.Box 11807,College Station,TX 77842 Phone 979.260.1000 Fax 979-450-7310
Houston Office—5065 Westheimer,Ste.1150,Houston,TX 77056 Phone 713.222.1331 Fax 713.936.4858
September 9, 2026
Schaumburg&Polk
8865 College Street
Beaumont, TX 77707
ATTN: Jeff Beaver, P.E.
RE: City of Port Arthur—Hwy. 365 Force Main
Dear Mr. Beaver;
Please let this letter serve as our request for a time extension for the above referenced project. This
request for extension is due to delays from the Union Pacific railroad permit having expired, lack of
easement from Kinder Morgan to access their property, and revision to the TXDOT permit on Highway
365. As of today, Kinder Morgan says they have not received their payment for the easement. Until
payment is received,we cannot access their property.
We request 210 calendar days due to delays on the project.
Please contact me if you have any questions or comments.
Sincerely,
ALLCO LLC
Euvreee
Keith Burrell
EXHIBIT B
(Change Order No. 2)
APPROVAL OF CONTRACT
CHANGE
CHANGE ORDER No.Two(2)
DATE: September 10,2026
PROJECT: City of Port Athur
Highway 365 Force Main Improvements
P25-050
OWNER: City of Port Athur,Texas
444 4t Street
Port Arthur,Texas 77640
CONTRACTOR: Allco,LLC
P.O.Box 3684
Beaumont,Texas 77704
TO THE OWNER: Approval of the following contract change is requested.
Reason for Change:
-To adjust the contract time due to delay from the Union Pacific railroad permit having expired,delay from Kinder Morgan easement access,
and revisions to the TxDOT permit to move force main location within the SH365 right-of-way.
ORIGINAL CONTRACT AMOUNT: $ 2,709,931.50
TOTAL AMOUNT OF THIS CHANGE ORDER: $ 0.00
TOTAL REVISED CONTRACT AMOUNT INCLUDING THIS CHANGE ORDER: $ 2,709,931.50
CONTRACT TIME
Revised Contract Time per prior Change Order No.1 473 calendar days
Additional time per this Change Order No.2 210 calendar days
Revised Contract Time per this Change Order No.2 683 calendar days
CONDITION OF CHANGE:
"Contractor acknowledges and agrees that the adjustments in contract price and contract time stipulated in this Change Order represents full
compensation for all increases and decreases in the cost of,and the time required to perform the entire work under the Contract arising directly
or indirectly from this Change Order and all previous Change Orders. Acceptance of this waiver constitutes an agreement between Owner and
Contractor that the Change Order represents an all inclusive,mutually agreed upon adjustment to the Contract,and that Contractor will waive
all rights to file a claim on this Change Order after it is properly executed."
Recommended by: Approved by: Accepted by:
c u g
k,I c. City of Port Arthur Allco,LLC
gineer Owner Contractor
Date: 7 //"- 2cet Date: Date: ! ,z4
Page 1 of 1
1.! Design Build
Construction Management
General Contactor
Corporate Office—P.O.Box 3684,Beaumont,TX 77704 Phone 409.860.4459 Fax 409.860.3857
Central Texas—P.O.Box 11807,College Station,TX 77842 Phone 979.260.1000 Fax 979-450-7310
Houston Office—5065 Westheimer,Ste.1150,Houston,TX 77056 Phone 713.222.1331 Fax 713.936.4858
September 11, 2026
Schaumburg& Polk
8865 College Street
Beaumont, TX 77707
ATTN: Jeff Beaver, P.E.
RE: City of Port Arthur—Hwy. 365 Force Main
Dear Mr. Beaver;
Please let this letter serve as our request for a suspension of time for the above referenced project. We ask
for this suspension from July 27, 2026, due to delays from the expiration if the Union Pacific railroad
crossing permit, lack of Kinder Morgan easement and TXDOT permit extension. Due to these delays, we
have been unable to work.
Please contact me if you have any questions or comments.
Sincerely,
ALLCO LLC
Keith Burrell