THE WELCH COMPANY
440 Davis Court #1602
San Francisco, CA 94111-2496
415 781 5700


S U M M A R Y


DIARY: February 2, 1997 08:59 AM Sunday; Rod Welch

Review Dutra's schedule submissions made on 961213.

1...Summary/Objective
2...Exhibit V Contains Questionable Quantities of 423000 CY
3...Exhibit VI & VII Support Schedule Completion on 971119
.....Questionable Quantities May Extend Completion to 980528
.....Issues Not Addressed By Dutra
.........Shoaling During 1997/1998 - Final Quantity 8.4M CY
.........DB #24 Production & Availability of Other Equipment
.........Availability of other equipment for completing Galbraith, tugs
.........Standard Depth Calculation Criteria
4...Exhibit VIII Shows Average Cut Depth 2.56; G&B Reported 5.6 Ft
5...If G&B is correct, then Dutra's forecasts may be optimistic.


..............
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CONTACTS 

SUBJECTS
Schedule for Construction, 52.236-15
Cure Notice, 0019
Schedule Review, Dutra, Port of Oakland,
Spreadsheet Analysis
Shoaling
Measurement and Payment, Dredging

0908 -    ..
0909 - Summary/Objective
0910 -
091001 - Follow up ref SDS 10 0000, ref SDS 8 0000.
091002 -
091003 - "Practicability" of Dutra's schedule is questionable for submission on
091004 - 961213, which was held to follow up the meeting with Dutra on 961113.
091005 - ref SDS 1 7381  This analysis increases concern about Dutra's ability
091006 - to perform that were raised on 961202, ref SDS 6 0636, and discussed
091007 - on 961216 with Max and Tom Keesling. ref SDS 11 9788
091008 -
091009 - Correction of possible errors in Dutra's calculations, and inclusion
091010 - of current shoaling could extend completion of the job from 971119,
091011 - forecast by Dutra, to 980528. ref SDS 0 5933
091012 -
091013 -    [On 970206 reviewed with Tom Keesling and Max, ref SDS 22 7777;
091014 -    submission of analysis to G&B reported on 970211, ref SDS 23 8069.]
091015 -
091016 -    [On 970724 submitted spreadsheet analysis again for claim team
091017 -    review. ref SDS 25 0000.]
091018 -
091019 -    [On 970721 $1M overpayment discovered. ref SDS 24 5839]
091020 -
091021 -    [On 971027 $30M extra paid to contractor. ref SDS 26 9152]
091022 -
091023 -
091024 -  ..
0911 -
0912 -
0913 - Progress
0914 -
091401 - On 970110 Dutra's schedule submitted on 961213 required analysis of
091402 - entitlement to extra payment from the government. ref SDS 21 3384  The
091403 - District was collecting information on this matter. ref SDS 21 2487
091404 -
091405 - Dutra's spreadsheets in Exhibits V - VIII, ref DRP 2 9502, analyse
091406 - project quantities to support its schedule in Exhibit III, which was
091407 - presented at the meeting on 961213, as part of Dutra's serial letter
091408 - #0205. ref SDS 10 6732
091409 -
091410 - For this analysis, Exhibit V is put in a separate file, ref OF 3 0000
091411 - because it needs special formatting to print properly.
091412 -
091413 -
091414 -  ..
091415 - Exhibit V Contains Questionable Quantities of 423000 CY
091416 -
091417 - This exhibit shows the total amount to be dredged based on the
091418 - predredge survey, the October 1996 survey and the amount dredged to
091419 - date.
091420 -
091421 - There seems to be an error in reporting "Amount of In-Fill", called
091422 - "shoaling" in the contract, for polygon OC-10.  Dutra's formula is not
091423 - expressly stated in its submission, but it seems to subtract the "Fall
091424 - 96 Conditional Survey" amount from the "Volume Remaining" amount. This
091425 - formula should therefore use following numbers:
091426 -
091427 -              99580 - (18884) = 118464  per ref DRP 2 8022.
091428 -
091429 -     ...however, Dutra's spreadsheet shows:
091430 -
091431 -                              =  58111
091432 -
091433 -       [On 970721 $1M overpayment discovered. ref SDS 24 5839]
091434 -     ..
091435 -     Research may reveal an adequate explanation for this
091436 -     difference.
091437 -
091438 -     A possible explanation may relate to the "Amount Dredged To Date"
091439 -     column being a negative number, which seems to suggest that more
091440 -     material was encountered than was anticipated by GB Star's survey
091441 -     figures.  Was this an error in the survey?  There are no notes or
091442 -     references in Dutra's spreadsheets to sources explaining negative
091443 -     numbers.
091444 -
091445 -     Additionally, there does not seem to be any combination of numbers
091446 -     or formulas that reconcile the 58111 number posted in Dutra's
091447 -     spreadsheet as "in-fill" for OC-10.
091448 -
091449 -     Therefore, it is marked as "Question" in the spreadsheet.
091450 -
091451 - Not all of the numbers in Dutra's spreadsheet that differ from the
091452 - formula calculations (i.e., numbers that seem to be "plugged") occur
091453 - where there is a negative "Amount Dredged To Date."  Some polygons in
091454 - Dutra's spreadsheet apply negative numbers in the normal manner.  This
091455 - lack of consistency in the treatment of negative numbers suggests they
091456 - do not require unique treatment.
091457 -
091458 - These differences, marked as "Question" in Exhibit 5, understate the
091459 - quantity to be dredged in a total amount of over 396K CY (25K + 371K
091460 - in last column) ref DRP 2 0068, assuming Dutra dredges only half of
091461 - the overdredge allowed, as it intends, or 423K CY based on contract
091462 - quantities. ref DRP 2 0068
091463 -
091464 - Tom Keesling advised on 961213 that Dutra's schedule uses "standard
091465 - depth" criteria which is not specified for this project. The impact of
091466 - this difference, if any, has not yet been analysed, ref SDS 10 0529
091467 -
091468 - In a meeting with G&B on 961218, Rick Olniczak indicated Dutra's
091469 - figures do not reconcile with GB Star survey, ref SDS 15 0218.  This
091470 - analysis may explain part of the difference identified by G&B.  The
091471 - meeting on 961218 addressed the need for a spreadsheet to analyse time
091472 - extensions based on actual project quantities, ref SDS 15 7056.
091473 -
091474 - On 961219 Tom reported further action on this, ref SDS 16 8799, but
091475 - Tom was later assigned to other duties.
091476 -
091477 -
091478 -
091479 -  ..
091480 - Exhibit VI & VII Support Schedule Completion on 971119
091481 -
091482 - These exhibits are spreadsheets that develop project duration based on
091483 - production per day and average cut depth for each polygon based on new
091484 - acceptance sections.  They use input from Exhibits V and VIII, of
091485 - Dutra's 971213 submission.
091486 -
091487 - Exhibit VI is for the Outer Harbor, ref DRP 2 8499.  Exhibit VII is
091488 - for the Inner Harbor, ref DRP 2 0481.  Dutra's spreadsheet seems to
091489 - check out mathematically.  There is a 2% error in the average yardage
091490 - per CF of cut depth, but that does not impact the schedule
091491 - significantly.
091492 -
091493 - I made a separate column "i" to show the impact ref DRP 2 9618.
091494 -
091495 -      ..
091496 -     Questionable Quantities May Extend Completion to 980528
091497 -
091498 -     At the bottom of Exhibit VII, I developed additional spreadsheet
091499 -     analysis of factors that may impact actual completion.
091500 -
091501 -     Contractor's spreadsheet analysis in Exhibits VI and VII seems to
091502 -     support a job completion date of 971119, as shown in its 961213
091503 -     schedule, ref DRP 2 4040, presented by Dutra at the 961213
091504 -     meeting, ref SDS 10 7466.
091505 -
091506 -     If Contractor's estimate of a 10% increase in production does not
091507 -     occur, then the completion date will be 971222. ref DRP 2 9603
091508 -
091509 -     If the differences found in Exhibit V are applied to the analysis
091510 -     in Exhibits VI and VII, then the completion could extend to
091511 -     980212. ref DRP 2 0400
091512 -
091513 -
091514 -      ..
091515 -     Issues Not Addressed By Dutra
091516 -
091517 -     Three additional factors may impact final job completion.
091518 -
091519 -          ..
091520 -         Shoaling During 1997/1998 - Final Quantity 8.4M CY
091521 -
091522 -         If shoaling occurs at the same rate as the prior year due to
091523 -         bad weather this year, then final pay quantity could exceed 8M
091524 -         CY, and extend the completion date to 980528. ref DRP 2 0391
091525 -
091526 -         This would increase original bid quantity of 5.5M CY by about
091527 -         3M CY or 60%.
091528 -
091529 -            [On 971008 District estimated final payment to contractor
091530 -            would include $10M for additional quantity.
091531 -
091532 -
091533 -          ..
091534 -         DB #24 Production & Availability of Other Equipment
091535 -
091536 -         Dutra's production analysis does not seem to reflect using the
091537 -         DB #24, contrary to Dutra's representation at the 961213
091538 -         meeting, ref SDS 10 0630.  If this machine is added to the
091539 -         job, and can produce at the rate of the Paula Lee, it could
091540 -         help the schedule as analysed at ref DRP 2 9612.
091541 -
091542 -  ..
091543 -
091544 -         Availability of other equipment for completing Galbraith, tugs
091545 -         and scows relative to reported financial challenges facing
091546 -         Dutra, are not reflected in this analysis, but require
091547 -         consideration.  The record indicates the most likely scenario
091548 -         is that Dutra will not achieve planned production, because
091549 -         supervision and equipment will not be provided in sufficient
091550 -         degree due to collateral matters, e.g., other projects.
091551 -
091552 -
091553 -          ..
091554 -         Standard Depth Calculation Criteria
091555 -
091556 -         As cited above, Tom Keesling reported on 961213 that Dutra's
091557 -         schedule is predicated on "standard depth" criteria which is
091558 -         not specified for this project. ref SDS 10 0529
091559 -
091560 -         The impact of this difference should be analysed.
091561 -
091562 -
091563 -
091564 -  ..
091565 - Exhibit VIII Shows Average Cut Depth 2.56; G&B Reported 5.6 Ft
091566 -
091567 - Dutra develops an average cut depth for work performed by the Antone
091568 - of 2.56 feet, that is then applied by Dutra to determine the rate of
091569 - dredging per foot of cut depth. ref DRP 2 9205  However, G&B seems to
091570 - report that average cut depth was 5.6 feet, per meeting on 961219..
091571 - ref SDS 16 9488
091572 -
091573 -  ..
091574 -
091575 - If G&B is correct, then Dutra's forecasts may be optimistic.
091576 -
091577 -    [On 970206 submitted to Tom Keesling. ref SDS 22 7777]
091578 -
091579 -    [On 970211 submitted by Marc to G&B for comment. ref SDS 23 8069]
091580 -
091581 -
091582 -
0916 -