sr-061212-3gCity Council Meeting: June 12, 2012
Agenda Item:
To: Mayor and City Council
From: Andy Agle, Director of Housing and Economic Development
Subject: Prevailing Wage Monitoring for Affordable Housing Construction
Recommended Action
Staff recommends that the City Council authorize the City Manager to negotiate and
execute a modification to Professional Services Agreement #9052 in the amount of
$130,000 with Comprehensive Housing Services, Inc., (CHS), a California -based
company, to provide federal and state prevailing wage monitoring and Section 3
compliance for City- funded affordable housing developments. This modification would
increase the contract amount to a total of $425,000 through June 30, 2013, with a City
option to extend the contract for one additional year.
Executive Summary
To ensure City compliance with local, state and federal prevailing wage regulations, the
City relies on experts to monitor wages for affordable housing developments. CHS is
currently providing these services for seven affordable housing developments in various
stages of construction which involve multi -year construction cycles. Staff recommends
that the City amend and increase the existing contract with CHS to continue to provide
these services. This action would increase the contract amount from $295,000 to
$425,000.
Background
In April 2009 and in June 2011, the City Council authorized the current contract with
CHS. The contract budget for monitoring construction of affordable housing
developments is almost exhausted and staff anticipates that the existing funds will be
depleted within the next month. Additional funds in the amount of $130,000 would allow
the continued provision of prevailing wage monitoring for approximately one more year.
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Discussion
An increase of the existing contract with CHS is recommended to ensure continuity in
the monitoring of current affordable housing developments through the completion of
construction. CHS is currently providing prevailing wage monitoring services for seven
affordable housing developments (totaling 360 units) that are under construction. An
additional three affordable housing developments (totaling 60 units) are expected to
commence construction during FY 2012 -13. These developments are funded with
various local, state and federal monies that require the payment of prevailing wages .
and, to the greatest extent feasible, provide opportunities for job training and
employment to lower- income and minority residents. The applicable regulations are
City of Santa Monica Municipal Code Section 7.28.030, the California Labor Code,
Section 1770, et. seq., the federal Davis -Bacon Act and Section 3 of the Housing and
Urban Development Act of 1968.
Potential ramifications for non - compliance of prevailing wage monitoring and Section 3
compliance include fines, requiring the City to make payments to construction workers
to rectify underpayments, and withdrawal of project funding. To ensure compliance on
affordable housing projects, the City contracts with firms who specialize in prevailing
wage monitoring and Section 3 compliance.
Contractor Selection
In March 2011, staff issued a Request for Proposals (RFP) for prevailing wage and
Section 3 monitoring services. Five responses were received. Staff reviewed and
evaluated the proposals based on criteria including firm staffing, experience,
qualifications, technical skills, fee schedule and references. The HED staff committee
determined that CHS was the most qualified applicant. CHS bid at the lowest rate (as
did one other proposal), demonstrated expertise in the field, and provided excellent
references. Since CHS already has an existing contract with the City, this report
recommends amending and increasing the existing professional service agreement with
CHS to a total of $425,000 for the purpose of prevailing wage and Section 3 monitoring.
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Financial Impacts & Budget Actions
The contract modification to be awarded to CHS is $130,000, for a new contract total of
$425,000. Funds are included in the FYI 1-12 budget at account R155005.589000.
Prepared by: Melissa Lindley, Senior Development Analyst
Andy Agle, Director
Housing and Econom
Forwarded to Council:
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Rod Gould -
City Manager
Reference Amended
Contract No. 9052 (CCS).