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The Honolulu Advertiser
Posted on: Sunday, December 13, 2009

Kiewit offered city 'best value'


By Sean Hao
Advertiser Staff Writer

Hawaii news photo - The Honolulu Advertiser

Wayne Yoshioka

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Competition for the biggest contract yet on Honolulu's planned $5.5 billion rail transit project apparently wasn't even close.

The city awarded Kiewit Pacific Co. the nearly $483 million deal in late October based on an evaluation of a five-member panel. Kiewit's bid was $23.8 million less than that of competitor Flatiron/SNC-Lavolin/Ledcor LLC, according to evaluation committee scoring sheets obtained by The Advertiser via the Freedom of Information Act.

However, Kiewit's proposal was deemed superior to the Flatiron proposal and another bid, $588 million by Nordic PCL/Hawaiian Dredging, on nearly all criteria, including cost. Under terms of the city's request for proposals, the contract was awarded to the bidder deemed to provide the "best value" to the city rather than the one with the lowest-cost bid.

The contract covers design and construction of the first 6 1/2 miles of the 20-mile project. The first phase will run from Kapolei to Pearl Highlands near Leeward Community College.

Kiewit's bid was the lowest and generally scored higher than competitors among evaluation committee members on criteria such as management approach, personnel experience, technical solutions, schedule, price realism and project support.

The "best value" criteria is meant to ensure that the city not only gets a good price, but that the price is realistic and that the contractor has the ability to complete the project, said city Transportation Director Wayne Yoshioka.

"We really want them to do a good job, and we want them to do it right," he said. "We don't want them to cut any corners."

The committee that evaluated the proposals comprised three city employees and two employees of project management oversight consultant InfraConsult. Kiewit's proposal garnered the most points — 8,607 — followed by Nordic PCL/Hawaiian Dredging (7,495 points) and the Flatiron consortium (7,222 points), according to the committee's scoring sheets.

The city Department of Transportation Services is withholding the minutes of evaluation committee meetings from public disclosure. The Advertiser is appealing that decision with the state Office of Information Practices.

Yoshioka, who wasn't on the evaluation committee, said Kiewit's proposal was strong in all areas.

"It's just coincidental and very fortunate that they were also the lowest (bidder)," he said. "We're very happy that things did turn out the way they did, and that the costs came in so much lower than we expected."

City officials had estimated that construction of the first guideway segment would cost $500 million to $600 million.

Under terms of the city's bid solicitation, the two losing teams that were finalists for the construction contract are eligible for up to $500,000 to offset the costs of bidding on the project. The stipend was meant to foster competition.

The two other teams that were eliminated from contention for the contract early on were the Shimmick, Obayashi, Goodfellow Bro-thers Joint Venture and the Perini/Parsons HLR Joint Venture.