Patrick Leonard crowded into a construction shack Wednesday with about
20 California Department of Transportation workers for "an interesting,
vice president of Oregon Iron Works, and the others watched Caltrans'
Web cast of a bid opening for a major contract to build the new
east span of the San Francisco-Oakland Bay Bridge.
Many people, Leonard
said, expected any bid would surpass Caltrans' $740 million estimate.
No one, however, predicted
a lone bid roughly $1 billion higher than the original estimate,
according to Leonard and others familiar with the bidding process.
The lone construction
bid leaves cash-strapped Caltrans in a quandary about its next step.
Oregon Iron Works and three Portland-Vancouver partners are keenly
interested in the process as they hope to secure an estimated $300
million subcontract that could create as many as 300 new jobs.
"We are guardedly
optimistic," said Tom Hickman, marketing manager for Oregon
Iron Works. "Who knows what Caltrans is going to do. Everybody
was telling them all along that their budget was unrealistic."
Oregon Iron Works and
three other companies announced in March that they had formed Bay
Bridge Fabricators with the goal of obtaining the Bay Bridge decking
The partners said they
would lease a 25-acre site at the Port of Vancouver and spend up
to $30 million improving the site.
The job will require
the construction of 28 steel boxes -- called girders in bridge parlance
-- that would support the bridge deck. Each box would be 95 feet
wide by 18 feet deep and up to 235 feet long, weighing 1,200 to
1,500 tons. The finished products would be shipped by barge to the
bridge construction site.
The new jobs would include
hiring from the Iron Workers and Sheet Metal Workers union with
an annual payroll of $13.5 million.
The consortium gambled,
however, by not even submitting a bid for Wednesday's Web cast event.
Consortium partners believed
before the bid opening that no acceptable proposal would emerge
because Caltrans' estimate was too low.
The consortium did not
want to commit to a price for the decking because the partners did
not think the contract would be awarded on the first bid, Hickman
He also said the partners
now think Caltrans will reject the sole bid and readvertise for
new bids. Hickman pointed to lesser contracts associated with the
project that were sent out for rebidding after an initial bid was
Hickman and others said
it was possible Bay Bridge Fabricators would be a subcontractor
to the successful bidder for the overall bridge contract.
A joint venture of American
Bridge, Nippon Steel Bridge and Fluor Corp. made the sole bid Wednesday.
One bid, of $1.8 billion, would use American steel. The other, of
$1.4 billion, would use foreign steel.
Under "Buy America"
rules, Caltrans can use foreign steel on the bridge only if the
cost is 25 percent less. The "Buy America" provision is
being enforced because federal money is helping to pay for the project.
Any hope for the Bay
Bridge Fabricators rests on "Buy America." Consortium
partners say American steel costs more because of higher wages and
more stringent environmental and worker safety regulations here
Leonard, the Oregon Iron
Works vice president, was at the bridge construction site Wednesday
checking on a smaller steel fabrication project. His company, Thompson
Metal Fab of Vancouver, and Universal Structural of Vancouver are
sharing in a $30 million contract to build other substructure components.
When Leonard walked into
the construction trailer he saw that Caltrans workers were holding
a playful betting pool for the worst-case estimate of the bid price.
When a Caltrans employee
read the bid amounts on the Web cast, about half the people in the
trailer were stunned, Leonard said.
And the winning estimate
in the betting pool, he said, wasn't even close to the actual bid