All four bids for a new emergency and specialty services (ESS) building at Jefferson Healthcare were rejected by commissioners on Feb. 4 as being over the authorized construction budget limit of $19,075,000.

Hospital CEO Mike Glenn told commissioners they had no choice but to reject the bids submitted on Jan. 29 because the board had not authorized any more funds.

The lowest bid was from Aldrich & Associates of Bothell for $20,498,000. The highest bid was from Lydig Construction of Bellevue for $23,890,000. Graham Contracting of Seattle bid $21,555,000, and Forma Construction of Olympia bid $22,934,000.

Hospital commissioners – and Glenn – voiced disappointment.

Glenn noted the bids were evidence that the Seattle construction market is still hot. He said one contractor’s bid implied that the company would be happy to bid on the project in Jefferson County, “but it’s going to cost you.”

“These estimates certainly missed the mark,” said Glenn.

Commissioners paused before voting unanimously to reject the bids, as Glenn had recommended.

“I’d be more inclined to put more money to do it right,” said commissioner Tony DeLeo.

There also was brief speculation that some contractors might not be bidding because they already have enough work.

Glenn said he would go back to the hospital’s design team to review the bids, and clarify a mechanical and electrical section whose cost seemed to be far higher than anyone expected. The scope of work complexity and issues related to connecting the hospital’s old section to the new section were identified as areas to evaluate.

It also was noted that the same electrical contractor was listed as the subcontractor for all four of the general contractors, a point that interested DeLeo. Glenn said he wasn’t sure what that meant.

Glenn said the goal would be to come up with $250,000-$500,000 in potential engineering savings as well as to review the hospital’s financial condition to determine if more funds could be found.

Glenn estimated he would return to the board on Feb. 18 to make another presentation and potentially authorize rebidding the project.

The hospital is set build with a long-term, low-interest federal loan and without requesting any public bonds or property-tax increases.

THE PROJECT

The project has been discussed since 2013, with construction initially expected to begin in 2014 and finish in 2015.

Construction estimates rose at the same time as Seattle’s construction market experienced another boom. Glenn noted last week that one measurement of construction activity is the number of construction cranes in Seattle. He said he was told there are 51 cranes right now, proof that contractors have plenty to do.

The Port Townsend project entails building a three-story, 45,842-square-foot, hospital-grade wing; remodel portions of buildings on campus that were built in 1965 and 1988; and demolish a three-story building constructed in 1929.

Two reconfigurations of parking areas, including 28 handicapped-accessible spaces and associated site work, are included. Bids for that work also varied wildly, Glenn noted.

The hospital is looking for a single contract bid for architectural, mechanical, electrical, civil, landscaping and hazardous material remediation work, with a number of subcontractors expected to bid as well.

The project was advertised through the Builders Exchange of Washington, a clearinghouse for construction projects in Washington. That ad was taken off the website last week.

FUTURE GROWTH

The expanded space would allow the hospital to grow its outpatient services, such as its anticoagulation clinic, oncology and chemotherapy, infusion center for IV antibiotics, pain management and wound center, and orthopedics.

The proposed ESS building also would house an emergency room, diagnostic imaging, sleep medicine and central registration, and serve as the hospital’s main entrance off Sheridan Street.

In anticipation of construction taking place this year, some offices have already been moved off the hospital’s campus.