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AMEND THE PROFESSIONAL SERVICES CONTRACT FOR SOLID WASTE AND RECYCLING DIVISION ASSISTANCE WITH HF&H CONSULTANTS, LLC TO ADD $125,000 FOR A REVISED TOTAL AMOUNT NOT TO EXCEED $175,000
recommended action
RECOMMENDATION
It is recommended that the City Council approve a resolution to:
1. Execute Amendment No. 1 to the Professional Services Contract with HF&H Consultants, LLC for Solid Waste and Recycling Division Assistance to increase the maximum compensation by $125,000, for a revised amount not to exceed $175,000.
2. Appropriate funds in the amount of $175,000 from Fund 047 - Solid Waste fund balance.
3. Approve findings that support an exception to the competitive bidding requirement pursuant to Stockton Municipal Code 3.68.070.
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 City’s residential and commercial solid waste franchise agreements commenced in 2004 and expire on May 31, 2019. The franchise agreements provide the City one opportunity to extend the agreement for up to five years. The City exercised its right to extend the franchise agreements and issued notice to both companies on September 7, 2018. The new franchise termination date is December 31, 2021.
On January 31, 2018, the City issued a Request for Proposals (RFP) to retain a Solid Waste consultant to assist with the franchise extension and future planning. The City received three proposals, and the Selection Committee ranked HF&H Consultants, LLC of Walnut Creek, CA, as the most qualified firm. On May 4, 2018, the City Manager approved a contract with HF&H Consultants, LLC (Attachment A).
Staff recommends that the City procure solid waste services beyond 2021 through a competitive RFP process. This process requires development of an RFP document detailing the specifications of a new, long-term franchise agreement. New State requirements for organics disposal take effect in 2022 and must be included in the scope of the new agreement(s). Expert consultant services are required to develop the RFP document and advise during the procurement process. The amount of work is extensive, and the process must be completed by 2020.
HF&H Consultants, LLC’s familiarity with the City’s current agreements and status of the industry enables them to commence this process immediately. HF&H Consultants, LLC has the resources and experience to assist the City in planning for long-term solid waste and recycling services. Staff recommends that Council approve a contract amendment to increase the total compensation by $125,000, for a revised total of $175,000, to ensure the availability of contracted consulting services required through completion of the bidding process.
DISCUSSION
Background
On April 29, 2003, Council approved exclusive residential and commercial solid waste, recycling, green waste, food waste, and street sweeping agreements with Republic Services (formerly Sunrise Sanitation, Inc.) and Waste Management (formerly USA Waste of California, Stockton Scavengers). The effective start date was June 1, 2004. The base term of the franchise agreements expires on May 31, 2019.
The franchise agreements provide the City one opportunity to extend the agreement for up to five years (Attachment B).
Staff recommends that the City utilize a competitive RFP process to procure solid waste services beyond expiration of the current contract. This process will take several years to complete and fully implement. In addition, new State requirements for organic disposal established by Senate Bill (SB) 1383 take effect in 2022. The factors make extension of the current agreement to the end of calendar year 2021 the optimal timeframe. On September 7, 2018, the City issued notice of this extension to both companies. The new expiration date of the existing franchise agreements is December 31, 2021.
Present Situation
On January 31, 2018, staff issued an RFP to assist with the franchise extension and future planning. The RFP was transmitted to three highly qualified solid waste consulting firms - SCS Engineers, HF&H Consultants, LLC, and R3 Consulting Group, Inc. Each firm submitted a proposal by the February 15, 2018, due date.
Public Works’ staff reviewed the proposals based on the criteria contained in the RFP. Based on the specific scope of work, and the potential for further franchise analysis, staff recommended HF&H Consultants, LLC as the preferred proponent. On May 4, 2018, the City Manager approved a contract with HF&H Consultants, LLC (Attachment A). The existing contracted services include facilitating discussions between the City and the franchised haulers related to extension of the current franchise agreement and resolution of issues related to outstanding receivables.
The recommended RFP process to procure solid waste services beyond 2021 will require development of an RFP document detailing the specifications of a new, long-term franchise agreement. Compliance with SB 1383 and other State mandates will be a critical component of the specifications. Expert consultant services are required to develop this document and advise during the procurement process. This process must be completed by 2020 to allow time for final negotiations and implementation at the beginning of 2022.
HF&H Consultants, LLC’s familiarity with the current franchise agreements and operational status enables them to commence this process immediately, and their experience in northern California is vast. The City’s current franchise agreements are significantly favorable to the City’s ratepayers, and one of the architects of these agreements is on the current HF&H Consultants, LLC’s project team. HF&H Consultants, LLC has the resources and experience, and are the best qualified to assist the City in planning for long-term solid waste services. Staff recommends that Council adopt a resolution authorizing the City Manager to execute Amendment No. 1 to HF&H Consultants, LLC’s existing Professional Services Contract for Solid Waste and Recycling Division Assistance, and increasing the compensation by $125,000, for a total amount not to exceed $175,000. The scope of services is attached to Amendment No. 1.
Findings
Pursuant to Stockton Municipal Code (SMC) section 3.68.070(A)(3), Council may approve findings which support an exception to the competitive bidding process. These findings include:
1. The City does not have sufficient staff to complete development of the RFP document and bidding process within the required deadlines.
2. HF&H Consultants, LLC has extensive experience and knowledge of the City’s current franchise agreements, and is the most qualified to assist with development of the RFP and the bidding process.
3. The City awarded the current contract to HF&H Consultants, LLC following solicitation of competitive proposals in accordance with SMC section 3.68.070(A)(3).
FINANCIAL SUMMARY
Funding for this contract amendment is available in the Solid Waste and Recycling fund balance (Fund 047). Funds in the amount of $175,000 need to be appropriated to the FY 2018-19 Solid Waste operating budget from Fund 047.
With this action there is sufficient funding in Account No. 047-3088-540 to cover the increased cost of $125,000 for the contract with HF&H Consultants, LLC, for a total of $175,000, and for potential contingencies.
Taking this action will have no impact on the General Fund.
Attachment A - Professional Services Contract
Attachment B - Article 3 Collection Services Agreement, 3.1 Agreement Term and Extensions, B. Extensions