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AWARD A PROFESSIONAL SERVICES AGREEMENT TO THE SOLIS GROUP FOR LABOR COMPLIANCE AND MONITORING SERVICES TO ENSURE FEDERAL AND STATE LABOR REGULATIONS AND PREVAILING WAGE REQUIREMENTS ARE MET (PUR 25-016)
recommended action
RECOMMENDATION
It is recommended that the City Council approve a motion to:
1. Approve an agreement with the Solis Group in an amount not-to-exceed $750,000 to provide labor compliance services, for a period of three-years, with options to extend for up to an additional two years; and
2. Authorize the City Manager, or designee, to take appropriate actions to carry out the purpose and intent of this motion.
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Summary
The City of Stockton (City) offers several low- and moderate-income housing construction and rehabilitation loans, as well as commercial rehabilitation loans, which may be funded under state/federal programs. These programs require the City to ensure that Labor Standards Provisions are met, and Davis-Bacon and/or California Prevailing Wage be paid for all onsite labor. To meet labor compliance requirements, it is recommended that a three-year agreement (Attachment A - Professional Services Agreement) be awarded to The Solis Group, per a fixed fee (percentage) schedule, to provide such services. The agreement also contains the option to extend up to a maximum of two additional years.
DISCUSSION
Background
The City manages several housing and commercial rehabilitation loan programs which are funded under federal and state programs. For federally-funded projects, federal Labor Standards Provisions must be met, and the Davis-Bacon Act requires prevailing wage to be paid for all onsite labor. State-funded projects are subject to California’s prevailing wage laws.
The City has contracted labor compliance services since 2006, delivering on key projects managed under the Economic Development Department (EDD) including: multi-family housing, façade, and capital improvements. Due to staffing capacity and budget constraints for additional personnel, the City is looking to continue outsourcing these services.
Present Situation
On January 23, 2025, a Request for Proposals (RFP) for labor compliance services (PUR 25-016) was issued. A total of six proposals were received on February 20, 2025. The Selection Committee was comprised of staff from the Economic Development, Housing, and Events and Parking Divisions within the Economic Development Department. The criteria used to evaluate the proposals included the firm’s expertise and experience in labor compliance monitoring; the firm’s ability to provide the scope of services, as specified in the RFP; the firm’s references; and the cost proposals. Based on total scores leading to a unanimous decision, the Selection Committee recommended The Solis Group be awarded the three-year Professional Services Agreement, with the option to extend up to a maximum of two additional years.
The primary services to be provided under this agreement include:
• Labor compliance services for the City of Stockton to assure that all federal Labor Standards provisions, Davis-Bacon Prevailing Wage and/or state Prevailing Wage requirements are met for the City’s housing construction, SF rehabilitation projects, commercial rehabilitation projects and Capital Improvement projects. This includes, for example, conducting pre-bid/preconstruction meetings with property owners and contractors, providing the necessary documentation and forms, conducting job site interviews, reviewing certified payroll records, and providing monthly project status reports.
FINANCIAL SUMMARY
The proposed action will have no financial impact on the General Fund, or any other unrestricted fund.
The cost of this agreement will depend on the number and type of projects approved, however, historical annual spending on these services has been approximately $100,000/year. Pricing is based on fixed fee (percentage) and dependent on estimated construction costs, length of construction, and the number of prime and sub-contractors to be monitored. Staff is recommending a $750,000 not-to-exceed amount, for the entire term and extension period, to allow for inflation factors in construction/labor costs as well as a large pipeline of affordable housing developments and community benefit projects that are moving into production. Funds will be budgeted annually to pay for services and will be paid from a variety of account numbers based on project funding.
Attachment A - Professional Services Agreement