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ADOPT A RESOLUTION TO AWARD A PROFESSIONAL SERVICES CONTRACT WITH VIRGINIA TRANSFORMER CORPORATION FOR THE PURCHASE OF A 60 KV ELECTRIC TRANSFORMER FOR THE REGIONAL WASTEWATER CONTROL FACILITY
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RECOMMENDATION
It is recommended that the City Council adopt a resolution to:
1. Approve findings pursuant to Stockton Municipal Code section 3.68.070 which support and justify of an exception to the competitive bidding process.
2. Award a Professional Services Agreement to Virginia Transformer Corporation of Roanoke, VA, in the amount of $1,110,000 to purchase a 60 kilovolt (kV) transformer (Exhibit 1 to the Resolution).
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 resolution.
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Summary
The Municipal Utilities Department (MUD) operates and maintains the Regional Wastewater Control Facility (RWCF). The RWCF is powered by PG&E through a City-owned electrical substation. The substation contains a 10-megawatt (MW) transformer that receives electrical power from PG&E at 60,000 volts (V) and reduces it to 12,000 V to power all the wastewater treatment processes throughout the RWCF. Currently, the transformer at this substation is approaching the end of its useful life and requires replacement. If the transformer fails, the RWCF would be required to temporarily rely on generator power until the new transformer is replaced. Once the replacement is complete, the old transformer will be rebuilt to provide additional electric power supply redundancy at the RWCF.
It is recommended that the City Council approve a motion to award a Professional Services Agreement (PSA) with Virginia Transformer Corporation, in the amount of $1,110,000, to purchase a new 60 kV transformer to ensure electrical power supply to the RWCF.
DISCUSSION
Background
The Municipal Utilities Department (MUD) operates and maintains the Regional Wastewater Control Facility (RWCF). The RWCF is powered by PG&E through a substation owned by the City and located across from the RWCF at 2501 Navy Drive. The substation contains a 10 MW transformer that receives electrical power from PG&E and 60 kV and reduces it to 12 kV for distribution throughout the RWCF.
Currently, the transformer at this substation is approaching the end of its useful life and requires replacement. If the transformer fails, the RWCF would be required to temporarily rely on generator power until the new transformer is replaced. To mitigate the risk, a second transformer must be purchased. Once the replacement is complete, the old transformer will be rebuilt to provide additional electric power supply redundancy at the RWCF.
Present Situation
On April 13, 2023, MUD advertised an RFP to solicit proposals from qualified firms to furnish a 60-12.47 kV two-winding primary substation transformer for the RWCF. On June 15, 2023, two proposals were received from the following firms:
• Virginia Transformer Corporation (Roanoke, VA)
• Pralar USA, Inc. (Houston, TX)
A Selection Committee evaluated and ranked all the proposals based on each firm’s understanding of work, qualifications of the proposed team/company, experience with similar work, work plan, project approach, and cost. Virginia Transformer Corporation was found to be the most qualified firm to perform the scope of work for this project.
Staff negotiated a fee of $1,110,000 with Virginia Transformer Corporation to furnish the 60-12.47 kV transformer. This fee is reasonable for a project of this size and complexity. The fee also excludes any additional freight charges.
Findings
Pursuant to the Stockton Municipal Code (SMC) section 3.68.070, the City Council may approve findings which support and justify an exception to the competitive bidding process. The following findings support and justify an exception:
1. Use of the RFP process is appropriate for this Professional Services Agreement because it relies on the evaluation of professional qualifications and performance as the basis for selection of a vendor.
2. Use of this criterion ensures the selection of a vendor that will provide the highest quality professional service, which is in the public interest.
3. The City negotiated an agreement following solicitation of competitive proposals in accordance with SMC section 3.68.070.A.3.
Staff recommend that the City Council adopt a resolution to award a Professional Services Agreement (PSA) to Virginia Transformer Corporation in the not-to-exceed amount of $1,110,000 to furnish a redundant 60-12.47 kV transformer.
LOCAL EMPLOYMENT ORDINANCE
On September 1, 2009, the City Council adopted a Local Employment Ordinance requiring that 50 percent of the workforce on public works projects of at least $100,000 reside in the City of Stockton. The contract amount for this project is more than $100,000 but is exempt from the Local Employment Ordinance.
COMMUNITY WORKFORCE AND TRAINING AGREEMENT
On July 26, 2016, the City Council adopted a Community Workforce and Training Agreement (CWTA). The CWTA became effective on August 25, 2016, and applies to all Public Works projects over $1,000,000 that are bid after the effective date. This project is not subject to the CWTA because the scope of services does not include construction work.
FINANCIAL SUMMARY
There are sufficient funds available in the Wastewater Capital Improvement Project No. UW21010 to award the Professional Services Agreement in the amount of $1,110,000 to Virginia Transformer Corporation of Roanoke, VA, for the RWCF 60-12.47 kV Transformer Replacement. This amount does not include potential additional freight charges.
There is no impact to the General Fund, or any other unrestricted funds, from this action.