People wait for the bus at a stop along Hollister Avenue in Old Town Goleta, which is set to be restriped in the Hollister Avenue Old Town Interim Striping Project. (Serena Guentz / Noozhawk photo)

The Goleta City Council decided Monday to reject all bids for the Hollister Old Town Interim Striping Project and will instead try to incorporate it into the larger Project Connect.

This action comes after construction bids for the Old Town Interim Striping Project — which aims to increase parking and improve traffic safety — came in $4 million above budget

Monday’s special meeting including a presentation on the city’s five-year capital improvement program.

When presenting the construction bids for Project Connect — which includes the Hollister Avenue Bridge and Roundabout projects, and the Eckwill Street and Fowler Road extension projects — Assistant Public Works Director Luz “Nina” Buelna said that the current market has been experiencing “considerable fluctuations.”

“In my previous role, I observed an unprecedent trend in the market I only experienced one other time during my career and that was the Great Recession,” Buelna said. “As we bid on projects from 2020 to 2022, bids came in at approximately 20 to 40% higher than the engineer’s estimate. The current market is inherently unpredictable.”

While construction bids for Project Connect were above the engineer’s estimate of over $55 million, the lowest bid from Security Paving was within 14% of the engineer’s estimate, which staff said is within industry standards.

The City Council awarded the construction contract to Security Paving, and directed staff to negotiate a construction change order with the company to include the Old Town Interim Striping Project.

City staff said this approach is projected to save between $500,000 and $1 million.

With Project Connect’s total cost of over $100 million and the Old Town Interim Striping Project’s cost of over $5 million, staff said the two projects have about $27 million unfunded.

To find the funding, city staff presented options including deferring some proposed projects, reassigning money from Measure A and Measure B, and using unassigned balances from the General Fund and the Development Impact Fee program.

This strategy is expected to fund the gap of $27 million over a five-year period.

Some councilmembers did take issue with the idea of deferring projects, especially the Cathedral Oaks Crib Wall project and pavement rehabilitation.

“One of the biggest concerns is the opportunity cost, that there are projects that we think and that we have declared are critical and important,” Councilmember Stuart Kasdin said.

“So when it comes to something like the crib wall, it’s important that we not only keep on eye on it or that we assess it, but we have a plan on how we’re going to fund it, not just a hope that somehow money will turn up. … We know we have an issue now. The time to address it is before we’re in that situation, not to wait for it to happen and then say we’re going to do something about it.”

The City Council ultimately authorized the city manager to request an amendment to the Santa Barbara County Association of Governments’ Measure A Investment Plan to transfer $8.4 million from the named Goleta U.S. Highway 101 Overcrossing project to these projects discussed Monday.

City staff are set to return to the Goleta City Council on Dec. 19 to approve the change order to incorporate the Hollister Avenue Old Town Interim Striping Project with Project Connect. This is expected to only set the Old Town Interim Striping Project back by a month. 

The City Council is scheduled to review Goleta’s Capital Improvement Program project delivery and funding options in April.