TO:
Honorable Mayor and Members of the City Council
THROUGH:
Talyn Mirzakhanian, City Manager
FROM:
Joe DeFrancesco, Interim Public Works Director
Gilbert Gamboa, City Engineer
Lisa Naslund, Consultant Project Manager
Justin Murray, Engineering Technician II
SUBJECT:Title
Consideration of a Resolution to Increase the Contingency Amount on the Construction Agreement with Asplundh Construction, LLC by $46,137 for Work Within the Right-of-Way and Private Utility Conversion Work in Underground Utility Assessment Districts (UUAD) 19-12 and 19-14 for a total not to exceed $177,762 (No Budget Impact) (Interim Public Works Director DeFrancesco).
ADOPT RESOLUTION NO. 26-0033
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RECOMMENDATION:
Staff recommends that the City Council adopt Resolution 26-0033 to authorize the City Manager and/or her designee to approve additional construction work by Asplundh Construction, LLC (Asplundh) for work within the right-of-way and private utility conversion work in Underground Utility Assessment District (UUAD) 19-12 and 19-14 increasing the construction contingency by $46,137 for a total not to exceed $177,762.
FISCAL IMPLICATIONS:
Sufficient funds are currently available for the increased contingency on the construction contract with Asplundh within the UAD Fund.
The current contract budget consists of $81,875 in the General Fund, $27,000 in the UAD Fund, and $22,750 in the County Lots Fund for a total not to exceed amount of $131,625. After the contingency increase under consideration is processed, the General Fund and the County Lots Fund contingencies will be reduced by $16,375 and $4,550, respectively. The new contract budget will consist of $65,500 in the General Fund, $94,062 in the UAD Fund, and $18,200 in the County Lots Fund for a total not to exceed amount of $177,762. A Project Budget and Expenditures Summary is attached.
BACKGROUND:
UUAD 19-12 and 19-14 were formed in 2019 following successful Proposition 218 balloting to underground overhead utility infrastructure in portions of Manhattan Beach. The districts are funded through property owner assessments and bond financing. The project includes underground installation of electrical and communication facilities, removal of overhead wires and utility poles, and the required private utility conversions for affected properties.
UUAD 19-12 and 19-14 represent one of the largest and most complex undergrounding efforts undertaken by the City to date. The combined districts include approximately 474 total parcels, of which only 103 properties were previously underground at the time of district formation (approximately 22% existing underground), resulting in approximately 371 properties requiring conversion.
For context, prior undergrounding districts completed by the City have been considerably smaller. For example, UUAD 4 included approximately 163 total parcels, with 88 properties already underground at the time of formation (about 54% existing underground), leaving only 75 properties requiring conversion. Compared with UUAD 19-12 and 19-14, the current effort involves nearly five times as many required conversions, contributing to a longer implementation timeline and increased coordination complexity.
In addition to the larger scale, UUAD 19-12 and 19-14 present unique challenges due to their location within the El Porto area, which was historically unincorporated County territory before annexation by the City in 1980. As a result, the area was developed under less stringent standards than the rest of the City, including reduced setbacks, narrower rights-of-way, and inconsistent utility layouts. These conditions have introduced additional constraints related to construction access, utility coordination, and installation of underground infrastructure.
Furthermore, coordination with utility companies continues to present scheduling challenges due to system-wide resource constraints and competing regional priorities.
These combined factors, including significantly larger program size, a higher number of required conversions, utility limitations, and site-specific constraints, have contributed to the extended duration of the UUAD 19-12 and 19-14 program relative to prior districts.
DISCUSSION:
Status Update
As of April 20, 2026, approximately 70% of properties within UUAD 19-12 and 19-14 have completed private underground conversion, reflecting substantial progress. The remaining properties are in various stages of private conversion, with a small number still incomplete despite ongoing outreach and coordination efforts.
As private conversions are completed, utility providers will proceed with the removal of overhead wires and poles within the districts. This transition represents a critical phase of the project and requires coordination among property owners, the City, and utility companies.
As part of this process, five existing City-owned streetlights currently mounted on utility poles must be replaced with new standalone streetlight poles once the overhead infrastructure is removed.
Staff recommends proceeding with the contract change order with Asplundh Construction to finalize the replacement of City-owned streetlights, convert private property services, and maintain the progress of completing Districts 12 and 14.
Change Order Scope
A total of 34 existing utility poles within UUAD 19-12 and 19-14 are being removed as part of the undergrounding program and replaced with marbelite streetlight poles. Among these, five are City-owned, and Southern California Edison (Edison) owns 29. The attached City Streetlight Map illustrates these locations, which represent the City-owned streetlights scheduled for replacement. Edison will replace the remaining streetlights in the districts as part of their underground conversion project.
The proposed Contract Change Order No. 1 includes:
1. Private service conversion for 221 39th Street.
2. Private service conversion for 220 El Porto.
3. Increase in cost for installation of a new City-owned electrical metered pedestal at 4200 The Strand.
4. The removal of an unforeseen concrete block obstruction and extending the existing conduit stub out onto the property at 4414 Ocean Drive.
5. Removal and replacement of five City-owned streetlight poles.
The total value of Change Order 1 will increase the Contract amount by $72,462, approximately 31% of the original construction agreement, resulting in a new Contract amount of $177,762. The original Contract period of 60 working days will remain unchanged.
Asplundh Construction Budget:
$105,300 Original Contract Award
+$26,325 Original Contingency Authorization
$131,625 Total Available Asplundh Contract Budget
Asplundh Construction Expenditures:
$105,300 Contracted Work Completed
+$72,462 Pending Change Order No. 1 - Additional Work
$177,762 Total Contract Work and Change Order
Asplundh Construction Revised Budget with Additional Contingency Authorization:
$105,300 Original Contract Award
+$26,325 Original Contingency Authorization
+$46,137 Additional Contingency Authorization
$177,762 Total Revised Asplundh Contract Budget
The proposed contract change order allows the City to complete this work and advance key project elements toward completion. While private utility conversions are ongoing, overall project completion continues to depend on coordination with property owners and utility providers for overhead wire and pole removal, as well as the final system transition.
Additional City action may be considered in the future to address any remaining private property conversion needs, if necessary.
PUBLIC OUTREACH:
Since the formation of UUAD 19-12 and 19-14, staff have conducted extensive public outreach to inform and assist affected property owners throughout each phase of the project. Outreach began during the 2017-2019 formation period and included mailed notices, public hearings, and informational meetings conducted in accordance with Proposition 218 requirements.
Following district formation and the start of construction, staff continued regular communication through direct mailings, project update letters, email correspondence, and field coordination to keep residents informed of project milestones and required private conversion activities. Formal notices were issued at key stages of the project, including the September 2022 Notice of Deadline, November 2022 Notice of Non-Compliance, April 2023 Notice to Provide Underground Utilities, and June 2023 Final Notice.
Additional project update letters issued in February 2024, October 2024, and April 2025 provided progress updates and clarification of remaining requirements. In July 2025, staff distributed a postcard mailer providing property-specific information to assist homeowners with remaining conversions and inspections.
On March 19, 2026, the City issued “Spectrum Final Notice” letters to all property owners and current residents at properties that have not yet completed conversion. The notice informed recipients that Spectrum plans to decommission its overhead facilities and remove all overhead lines beginning May 1, 2026, and established an April 30, 2026, deadline for completion of underground Spectrum service. Properties that do not complete conversion by this deadline may experience interruption of internet service until underground work is completed and service is reestablished.
The City also maintains an Interactive Property Status Map on the Undergrounding Program webpage to allow property owners to track project progress. Staff continues to provide individualized assistance by phone, email, and in the field as the districts move toward completion.
ENVIRONMENTAL REVIEW:
The City reviewed the proposed activities for compliance with the California Environmental Quality Act (CEQA) and determined that undergrounding overhead utility systems qualifies for a Categorical Exemption pursuant to Sections 15302(d) and 15303(d) (Conversion of overhead electric utility distribution system facilities to underground, and conversion of existing small structures to small new equipment and facilities in small structures.) Thus, no further environmental review is necessary.
LEGAL REVIEW:
The City Attorney has reviewed this report and determined that no additional legal analysis is necessary.
ATTACHMENTS:
1. Resolution No. 26-0033
2. Budget and Expenditures Summary
3. City Streetlight Map
4. Location Map