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APPROVE MOTION TO AWARD A SERVICE CONTRACT FOR ON-CALL HEATING, VENTILATION, AND AIR CONDITIONING EQUIPMENT REPAIR AND MAINTENANCE SERVICES
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RECOMMENDATION
It is recommended that the City Council approve a motion to:
1. Award a five-year Service Contract, in the amount not to exceed $900,000, to American Chiller Service, Inc. of Modesto, CA, for On-Call Heating, Ventilation, and Air Conditioning Equipment Repair and Maintenance Services, Project No. OM-24-012.
2. Authorize the City Manager to execute two optional one-year extensions to this Service Contract upon completion of the original term, in the amount not to exceed $400,000, for a total contract amount of $1,300,000.
3. Approve findings pursuant to Stockton Municipal Code section 3.68.070 in support of an exception to the competitive bidding process.
It is also recommended that the City Manager be authorized to take appropriate and necessary actions to carry out the purpose and intent of this motion.
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Summary
The City has solicited contractors for on-call heating, ventilation, and air conditioning (HVAC) maintenance and repair services of the City’s HVAC systems as needed. Services include, but are not limited to, cooling towers, air handling units, boilers, chillers, and compressors.
On August 23, 2023, the City advertised a Request for Proposals (RFP) for On-Call HVAC Equipment Repair and Maintenance Services, Project No. OM-24-012. This on-call Service Contract will retain a contractor to provide as-needed HVAC maintenance and repair services with set response times.
It is recommended that Council approve a motion authorizing the City Manager to execute a five-year Service Contract, in the amount not to exceed $900,000, with American Chiller Service, Inc. of Modesto, CA (Attachment A). Contracted services will expire on June 30, 2028, with the option of two one-year extensions at the same rate structure. With the optional extensions, the total not to exceed contract amount is $1,300,000. The contract will be funded from Public Works, Economic Development, and Municipal Utilities Departments’ Annual Operating Budgets (Attachment B).
DISCUSSION
Background
The Public Works Department is responsible for maintaining approximately 500 HVAC systems throughout City owned facilities. As needed, HVAC maintenance and repair services are required to maintain functionable operation of individual systems at each location.
Public Works does not have sufficient staffing to support routine maintenance, planned repairs, and emergency repairs at all City facilities. In order to meet the operational needs throughout the city, Public Works has solicited contractors for as needed HVAC maintenance and repair services.
On July 26, 2016, Council adopted a Community Workforce and Training Agreement (CWTA). The CWTA became effective August 25, 2016, and applies to all Public Works projects over $1 million that are bid after that date. On July 16, 2019, by Motion No. 2019-07-16-1403, Council extended the CWTA term to August 25, 2024. The CWTA does not apply because this is not a construction project.
Present Situation
On August 23, 2023, the City advertised an RFP for On-Call HVAC Equipment Repair and Maintenance Services, Project No. OM-24-012. On September 8, 2023, three proposals were received from the following:
• ACCO Engineered Systems (Sacramento, CA)
• American Chiller Service, Inc. (Modesto, CA)
• EMCOR Services Mesa Energy (West Sacramento, CA)
A Selection Committee consisting of Public Works’ staff evaluated and ranked all proposals based on each firm’s experience, quality of work, qualifications of staff, ability to meet the City’s required response times, ability to maintain readily available replacement parts, and cost. The Selection Committee conducted interviews with three responsive companies to complete the evaluation process. American Chiller Service, Inc. was selected to perform the work.
Hiring a contractor for HVAC maintenance and repair services with set pricing and response times will allow City staff to focus their efforts on preventative maintenance and provide better customer service.
It is recommended that Council approve a motion authorizing the City Manager to execute a five-year Service Contract, in the amount not to exceed $900,000, with American Chiller Service, Inc. of Modesto, CA, for On-Call HVAC Equipment Repair and Maintenance Services, Project No. OM-24-012 (Attachment A). The annual not to exceed amount of $200,000 is an estimate based on historical expenditures for labor and materials for these services. The Service Contract is a Unit Price Contract, and the City will only pay for services performed. The proposed Service Contract provides comprehensive on-call HVAC maintenance and repair services through June 30, 2028, with the option of two one-year extensions by mutual agreement. With the optional extensions, the total not to exceed contract amount is $1,300,000.
Findings
Pursuant to Stockton Municipal Code (SMC) section 3.68.070, Council may approve findings which support an exception to the competitive bidding process. These findings include:
1. Citywide on-call HVAC services involve specialized, variable heating, ventilation, and air conditioning service requests requiring experienced, qualified contractors who successfully provide services of similar frequency and scope.
2. The City does not have a sufficient number of staff available to perform the work required for this Service Contract.
3. Use of the RFP process is appropriate for this Service Contract because, in addition to cost, it relies on the evaluation of professional qualifications and performance as the basis for the selection of a vendor. Use of the criteria helps ensure selection of a vendor that will provide professional, responsive, and timely service, which is in the public interest.
FINANCIAL SUMMARY
The Service Contract with American Chiller Service, Inc. for On-Call HVAC Equipment Repair and Maintenance Services, Project No. OM-24-012, is proposed to be funded at the set fees listed below and in accordance with the Scope of Work in the Service Contract.
Five-Year Term Annual Cost
Through June 30, 2024 $ 100,000
July 1, 2024 - June 30, 2025 $ 200,000
July 1, 2025 - June 30, 2026 $ 200,000
July 1, 2026 - June 30, 2027 $ 200,000
July 1, 2027 - June 30, 2028 $ 200,000
TOTAL $ 900,000
The Service Contract will be funded from Public Works, Economic Development, and Municipal Utilities Departments’ Annual Operating Budgets. Funding is available in Fiscal Year 2023-24 departmental budget appropriations for services. Funding for the remaining years of the Service Contract will be contingent on future annual budget appropriations. The funding split will remain the same over the life of the Service Contract as outlined in Attachment B.
There is no additional impact to the City’s General Fund or any other unrestricted fund as a result of taking the recommended actions.
Attachment A - Service Contract with American Chiller Service, Inc.
Attachment B - Financial Breakdown by Account