SR-03-12-2013-3CCity Council Meeting: March 12, 2013
Agenda Item: �
To: Mayor and City Council
From: Andy Agle, Director of Housing and Economic Development
Subject: Prevailing Wage Monitoring for Affordable Housing Construction
•nu-I!•r ' •t
Staff recommends that the City Council authorize the City Manager to negotiate and
execute a fifth modification to Professional Services Agreement #9052 in the amount of
$88,000 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 will result in a
five -year amended contract with a new total amount not to exceed $513,000 through
June 30, 2014, with future year funding contingent on Council budget approval.
Executive Summary
To ensure City compliance with local, state and federal prevailing wage regulations, the
City relies on experts to monitor wages paid to construction workers on affordable
housing developments. CHS is currently providing these services for several affordable
housing developments in various stages of construction and which involve multi -year
construction cycles. Staff recommends amending the existing contract to ensure that
CHS continues to provide the monitoring services. This action would increase the total
not -to- exceed contract amount from $425,000 to $513,000.
Background
In April 2009, June 2011, and June 2012, the City Council authorized the current
contract (original contract and amendments) with CHS. The contract budget for
monitoring construction of affordable housing developments requires additional funds in
the amount of $88,000 to allow the continued provision of prevailing wage monitoring
through June 2014, when the affordable housing developments that are currently
underway should be mostly completed.
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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. CHS has been providing
prevailing wage monitoring services for ten affordable housing developments (totaling
459 apartments) that are in various stages of construction. These developments are
funded with various local, state and federal monies that require the payment of
prevailing wages and, to the greatest extent feasible, the provision of 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
United States Housing and Urban Development Act of 1968. By June 2014, all but one
of the affordable housing developments currently under construction should be
completed and prevailing wage monitoring of the remaining development can be largely
handled by staff in an effort to reduce operational expenditures.
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 by
affordable housing developments, the City contracts with firms who specialize in
prevailing wage monitoring and Section 3 compliance.
Contractor Selection
At the end of 2008, CHS participated in a Request for Proposals process for prevailing
wage and Section 3 monitoring services. Staff determined that CHS was one of two
best bidders and awarded a contract during 2009. More recently, in March 2011, staff
again 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 capacity, experience, qualifications, technical
skills, fee schedule and references. The staff committee determined that CHS was the
most qualified and the best bidder. Increasing the existing professional service
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agreement with CHS by $88,000 for prevailing wage and Section 3 monitoring would
allow for continuity in the delivery of these services.
Financial Impacts & Budget Actions
The contract modification to be awarded to CHS is $88,000 for a revised contract total
not to exceed $513,000. Funds in the amount of $38,000 are available in the FY12 -13
budget in division 01264; the contract will be charged to account 01264.555060. The
remaining $50,000 will be requested as part of the FY 2013 -15 Proposed Biennial
Budget and is contingent on Council budget approval.
Prepared by: James Kemper, Housing Administrator
Approved:
Andy Agle, Dire
Housing and Economic Development
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Forwarded to Council:
Rod Gould
City Manager
Reference Amended
Contract No. 9052 (CCS)