Decision details

Decision

 

Weymouth Harbour are seeking approval to spend in excess of £500k on replacement pontoons at Customs House Quay, Weymouth Harbour.

 

The existing pontoon sections installation occurred between 1993 and 2006, meaning that some of the sections are 30 years old. This project is a planned replacement of the infrastructure which is required to ensure business continuity of the Harbour with regard to accommodating visiting recreational and commercial vessels in line with the Open Port Duty.

The Harbour has a programme of pontoon replacement through its Committee and Full Council approved Asset Management Plan. This year, it is planned to replace 300 metres of pontoon which has reached the end of its design life at Customs House Quay. The replacement pontoon is to be rated higher than that currently in place to accommodate larger motor yachts, greater footfall from for example cruise ship tenders, and to allow year-round use of the pontoon during more inclement weather conditions. This should generate additional income to the harbour, provide safer facilities and allow for more flexible harbour berthing operations.

 

A procurement tender process has been carried out seeking prices for two options. These have been scored on the basis of quality, social value and price and the preferred contractor from this process has been selected. The options were as follows:

Option 1: replace all but one pontoon section - £488,000 – one pontoon is only 5 years old so it was considered that if costs were too high this pontoon could be left in place although this would be at the lower specification

Option 2: replace all pontoons at the higher specification - £554,000 – the 5-year-old pontoon would then be used to replace another pontoon that has reached the end of its design life in the harbour or used in a different location in the harbour for additional berthing space.

The difference in cost between the options is £66k. However, to remobilise contractors and manufacture a pontoon in the future would be a more expensive option to replace the remaining lower specification section of pontoon. In addition, a run of pontoons with the same specification would be easier to manage operationally during busy periods of berthing. For these reasons, it is considered that the preferred option would be option 2, but this brings the cost above the threshold permitted without Cabinet approval. However, as Harbours are a non-executive function of Dorset Council this decision falls either to Full Council, or in the case of an urgent request can be delegated to a Chief Officer:-

 

In any cases which s/he considers to be urgent, to discharge any function and deliver any

service within the Chief Officers responsibility, other than those functions which can only be

discharged by the Council or a specific Committee. This delegation is subject to the

following conditions :

(a) prior consultation with the Monitoring Officer and the Section 151 Officer;

(b) consultation with the appropriate Executive Member or the Chairman of the

appropriate Committee; and,

(c) to the extent it will incur expenditure from working balances and/or reserves, the prior

approval of the s151 Officer.

 

An urgent decision is required because of the potential for increased costs and the delayed timing of delivery. The contractor has been contacted and asked if they had to wait for a decision until October (when the next Full Council meeting is to be held) would this have any effect on the delivery schedule or cost. It potentially would on both counts and the schedule for replacement could run into the new season (next May 2023) which would be unworkable. An urgent decision is therefore required.

Funding for the pontoon replacement has already been approved through the Harbours Committee and Full Council and will be covered by the harbour reserve.

 

Alternative options considered and rejected:

 

Tenderers were required to price for two scenarios:

·       Scenario 1 - Replacement of sections A, B and C

 

·       Scenario 2 - Replacement of sections A and B, with the redeployment and extension of the existing pontoon at section A, to section C

 

Awarding Scenario 1 was the preferred choice however due to uncertainty of costs and affordability, Scenario 2 was formed as this would be lower in cost.

Within each scenario, tenderers were also invited to price for different options in relation to the material of the pontoons to be installed – galvanised steel or concrete.  Several tender ‘Lots’ were created to allow for these price options.  Concrete pontoons typically have a longer life but are higher in cost.  It was unknown if suppliers would be able to offer concrete or if the costs would even be affordable, however the Council did not want to rule the option out hence allowing tenderers to offer what they could. 

Clear evaluation methodology was developed in advance which would allow the Council to compare offers for different options against each other fairly. This methodology was provided to tenderers within the tender documents for transparency (see Pricing Methodology below).

It was also detailed to tenderers that Scenario 1 tenders would be evaluated in the first instance, and then if the lowest tendered prices offered under this scenario exceeded the Council's allocated budget, then Scenario 2 would be evaluated.

 

Pricing methodology

Tenderers were required to submit a price for each section of pontoon along with a breakdown of costs for each section, for each Lot they tendered for. They were also required to state the longevity for each section, as this would vary with the material.

The total price was divided by the expected lifespan of the pontoon to give a Price Per Annum for each section. A maintenance cost per annum was stated, based upon the current maintenance costs to the Harbour Team on steel and concrete pontoons, which was then added to the Price Per Annum for each section. This gave a Price Per Annum + Maintenance (PPAM) figure.

The PPAM figure was used for the purpose of price evaluation to allow the prices for different materials and longevities to be evaluated comparatively.

Three offers were received. However, one tenderer failed the pass/fail criteria.

 

The lowest offer for Scenario 1 (the Councils preferred choice) was £554,270 and this was also the preferred contractor.

 

 

 

 

Decision:

 

In consultation with the Monitoring Officer, Section 151 Officer, Chairman of the Harbours Committee and the Portfolio Holder for Highways, Travel and the Environment and the Chair of Place Resources and Scrutiny Committee, the Executive Director for Place has decided that a payment in excess of £500k can be made in relation to the replacement of pontoons at Customs House Quay as outlined above.

 

Reason(s) for Decisions:

 

It will be more cost effective in the long-term to replace the full complement of Customs House Quay pontoons with the higher specification products at this time. This will also improve safety and increase operational flexibility.