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AMEND THE PROFESSIONAL SERVICES MASTER AGREEMENT FOR ON-CALL PLANNING CONSULTING SERVICES WITH MICHAEL BAKER INTERNATIONAL, INC. TO ADD $500,000 FOR A REVISED TOTAL AMOUNT UP TO $1,000,000
recommended action
RECOMMENDATION
It is recommended that the City Council approve a motion to:
1. Approve findings that support of an exception to the competitive bidding requirement pursuant to Stockton Municipal Code 3.68.070; and
2. Authorize the City Manager to execute an amendment to the Professional Services Master Agreement for On-call Planning Consultant Services Contract with Michael Baker International, Inc. to increase the maximum compensation by $500,000, for a revised amount not to exceed $1 million; and
3. Authorize the City Manager to take appropriate and necessary actions to carry out the purpose and intent of this motion.
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Summary
In recent years, the Community Development Department utilized a combination of staff and contracted planning services to meet workload demands. This approach allows staff to meet the lowest anticipated workload demand and supplement with contracted services to address peak workloads and provide specialized expertise. It also minimizes staffing fluctuations and potential layoffs, while providing the necessary resources to process development applications in a timely manner. Consistent with this approach, a Request for Proposals (RFP) was issued in July 2016, and Council approved a negotiated contract with Michael Baker International, Inc. for planning services on December 6, 2016 (Attachment B - Professional Services Contract).
Economic growth within our community resulted in more development applications than originally estimated. The increased workload requires additional resources to meet demand. The proposed FY 2018-19 budget includes additional staff, and additional contracted services are also needed for the duration of the three-year contract. Staff recommens that Council approve a contract amendment to increase the total compensation by $500,000, for a revised total of $1 million, to ensure the availability of contracted planning services to process development applications in an accurate and timely manner (Attachment A - Professional Services Contract Amendment).
DISCUSSION
Background
Additional resources to augment planning staff and provide specialized planning services were included in the proposed budget. A combination of modest staffing increases and consulting services is the most responsible way to address increasing development activity and demand for planning activities such as development code updates, financial impact analysis, and implementation of General Plan policies and programs. This approach avoids over-hiring permanent staff in response to cyclical development activity by using consultants to augment staffing and procures specialized planning services that would not be economical to provide by hiring permanent specialist staff.
On July 14, 2016, a RFP was posted to the City’s Bid Flash webpage to solicit on-call and specialized planning services to address increased workload associated with cyclical development activity. Proposals were received from six planning consultant firms, and Michael Baker, Inc. was the highest ranked firm. On December 6, 2016, the City Council approved entering into a three-year contract in the amount of $500,000, which is scheduled to expire in January 2020.
There has been a rapid increase in development project valuation in the City of Stockton over the last several years. The increase in total project valuation is indicative of an upward trend in market conditions, and results in increased planning and building permit activity and economic growth.
• FY 2013-14 project valuation for all issued permits was $153 million
• FY 2014-15 project valuation for all issued permits was $212 million
• FY 2015-16 project valuation for all issued permits was $306 million
• FY 2016-17 project valuation for all issued permits was $334 million
• FY 2017-18 (as of April 30th) project valuation for all issued permits was $411 million
Permit valuation increased due to the volume, type, and complexity of projects proposed in this economy. Utilizing a combination of staff and consultant services is recommended to maintain project processing timelines and provide good customer service as development activity increases. Consultant services are recommended as an alternative to hiring permanent staff to protect against market volatility, while providing the capacity to respond to the cyclical increases in workload. The use of contract services addresses peaks in the development cycle, and allows the flexibility to easily scale back resources during cyclical downturns in development activity.
Present Situation
In FY 2017-18, project valuation for all issued permits increased to $411 million through April and is estimated to be $500 million for the whole fiscal year. Permit valuation continues to increase because of the volume, magnitude, and complexity of projects proposed during this period of economic growth.
Therefore, staff recommends that Council adopt a motion authorizing the City Manager to execute an amendment to the existing Professional Services Contract for On-call Planning Consultant Services Contract with Michael Baker International, Inc., increasing the compensation by $500,000 for a total amount not to exceed $1 million.
Findings
Stockton Municipal Code (SMC) section 3.68.070(A)(3) authorizes the City Council to award contracts without competitive bidding in cases where the City Council has approved findings which support and justify exceptions to the competitive bidding process.
The following findings support and justify an exception to the competitive bidding process:
1. The City does not have the staff, technology, resources or capacity required to meet workload demand. Michael Baker International, Inc., has demonstrated that they possess the capacity and capability to assist the City in meeting workload demand.
2. A combination of increased staff and consulting services is the most responsible way to address increasing development activity because it avoids over-hiring permanent staff in response to cyclical development activity.
3. Use of the RFP process is appropriate for this agreement because it relies on the evaluation of professional qualifications and performance as the basis for selection of a vendor. Use of these criteria helps ensure selection of a vendor that will provide the highest quality professional service which is in the public interest.
4. The City negotiated the contract following the solicitation of competitive proposals in accordance with SMC section 3.68.070.A.3
FINANCIAL SUMMARY
There is sufficient budget authority in the Development Services Fund Planning Division account (048-1825-510) to cover the increased costs of $500,000 for the contract with Michael Baker International for a total of $1,000,000.
Attachment A - Professional Services Contract Amendment
Attachment B - Professional Services Contract