Archived decisions

Contact: Tristan Meekins, ext 7949 email: [email protected]

1. Summary

1.1 The Main Road and Footway Surface Dressing Contracts reach the end of their contract periods this year. Surface Dressing is one of the major methods of maintaining roads and footways, and Hampshire County Council has a regular large maintenance programme of works each year. Options to extend the contracts or to include the work in the Highways Term Maintenance Contract (TMC) were considered but found not to be viable due to EU regulations. It is therefore proposed to let two short term (two year) contracts, each with the option of two further, one year extensions. This will enable the end of the Surface Dressing Contracts to be matched to coincide with the end of the Highways TMC (with or without any extensions). This in turn will enable the possibility of merging all three surface dressing contracts at some time in the future, should the need arise.

2. Objective

2.1 The aim of this report is to provide the information required to make a decision about the re-tendering of the Main Road Surface Dressing Contract.

3. Contextual Information

3.1 Surface Dressing is a proven low-cost method for prolonging the life of carriageways and footways, restoring skid resistance and helping to reduce accidents. The County Council has used this technique for many years and it has helped to contribute to the Council achieving its PSA targets on improving road condition and safety.

3.2 The County Council spends approximately £4 million per annum on surface dressing. Funding comes from the Capital Highway Structural Maintenance budget. Currently there are three contracts covering surface dressing: Minor Roads, Main Roads and Footways.

4. Identification of the Issues

4.1 The Minor Road Surface Dressing work is incorporated into the Highways TMC. This is a five year contract (April 2002 to April 2007) with options for up to three, one year extensions. The first year extension to the TMC is currently being considered. No changes are proposed within the life of this contract.

4.2 The Main Road Surface Dressing Contract is a separately tendered contract and is due to finish this year. Although the contract was written with the possibility of giving a one year extension (2006-07), due to the volume of work passed through the contract (approximately £6 million to date) it now exceeds the financial limit for contracts to be advertised in the European Union Journal (£3.7 million) and a further year cannot be awarded.

4.3 Similarly, the Footway Surface Dressing Contract is due to finish this year. Although the possibility of extending for a further year was considered, it was felt that the opportunity should be taken to re-tender at the same time as the Main Road Contract, in order to see if economies of scale could provide efficiency savings.

4.4 In previous years there were sufficient technical differences between the main road, minor road and footway surface dressing methods to warrant separate tenders for each type of work. The contracts were often won by different contractors. At present there are more contractors available to take on all the different types of work. Therefore it is proposed, to achieve economies of scale, to let the contracts as linked packages, ie requesting contractors to offer discounts if they win the two surface dressing contracts. This will test the market to see whether any future combination of all work types into one contract is both viable and desirable.

4.5 To achieve this the surface dressing contracts will need to coincide with the end of the Highways TMC (which has options to extend until 2010). A report on the options for the first year's extension is also an item on this agenda. If approved, this contract will continue at least until April 2008.

4.6 Details of the content of the new contract are being looked at and will be developed over the next few months. Linkage of the Main Road and Footway Surface Dressing contracts will allow for any economy of scale efficiency savings. In addition the opportunity will be taken to include in the contract additional efficiency-related clauses linked to annual inflation increases, rebates for larger works values and promoting further recycling opportunities. This in turn will assist in meeting the County Council's Gershon efficiency saving requirements.

5. Impact Assessments

5.1 The tender documents for this contract will contain suitable clauses to comply with the County Council's policy on race and equalities.

Recommendation

That authority be given to tender for the Main Road and Footway Surface Dressing Contracts for a two year period with the option of two additional, one year extensions.

452Rpt/TM