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SR-05-28-2013-3B - 510-001-02FrR City Council Report City of Santa Monica City Council Meeting: May 28, 2013 Agenda Item: 313 To: Mayor and City Council From: Martin Pastucha, Director of Public Works Subject: Award Construction Contract for Main Library Parking Garage LED Lighting Upgrade Project Recommended Action Staff recommends that the City Council: 1. Authorize the City Manager to negotiate and execute a contract with Yesco LLC, a Utah -based company, in an amount not to exceed $177,808 (includes a 10% contingency) for the Main Library Parking Garage LED Lighting Upgrade Project. 2. Authorize the Director of Public Works to issue any necessary change orders to complete additional work within budget authority. 3. Authorize the City Manager to enter into a loan agreement for On -Bill Financing with Southern California Edison Company, a California -based company, in the amount of $149,256 and accept a one -time incentive of $28,552, for a total amount not to exceed $177,808, for a term of approximately 6.5 years for the Main Library Parking Garage LED Lighting Upgrade Project. 4. Appropriate the budget increases as outlined in the Financial Impacts and Budget Actions section of this report. Executive Summary The Main Library Parking Garage was identified as a prime opportunity for energy and maintenance cost savings. This project would replace the existing lighting with LED Fixtures with Bi -Level Motion Sensor Control in order to minimize energy use while providing adequate lighting for safety and egress. A Notice Inviting Bids for construction services was issued on February 21, 2013. After evaluating bids received on March 25, 2013, staff recommends Yesco LLC for the lighting upgrade of the Main Library Parking Garage, with a total project cost not to exceed $177,808. The project would be funded by On -Bill Financing, a Southern California Edison Company at no cost with a 0% interest loan program for energy efficiency projects. The monthly loan payment amount of $1,909 equals the monthly savings on the Southern California Edison portion of the electric bill. With energy savings generated from the project, the City would recover the cost for the lighting retrofit within 4 years. 1 Discussion Consistent with the Climate Action Plan, the City has researched and developed a preliminary concept to improve lighting systems and conserve energy. An energy audit provided by the Community Energy Partnership identified an energy efficiency opportunity to upgrade the existing lighting fixtures in the Main Library Parking Garage to highly efficient LED lighting. The existing lighting design primarily uses metal halide fixtures that use approximately 515,000 Kwh of electricity each year. This project would replace the existing lighting with LED Fixtures with Bi -Level Motion Sensor Control in order to minimize energy use while providing adequate lighting for safety and egress. Monthly electric bills for the Main Library Parking Garage have averaged $6,050 over fiscal year 2012 -13. The replacement light fixture would require 146,000 Kwh of electricity each year resulting in a potential annual savings of up to $39,075 in electricity costs. This is a conservative savings estimate that assumes that electricity charges remain constant. The savings would be realized in the Main Library Parking Garage utility bills, currently paid for by the General Fund in the Parking division. Southern California Edison's On Bill Financing program provides 0% interest, no cost loans for energy efficiency projects. This program represents an opportunity for the City to upgrade to energy efficient solutions with a short term investment. Staff recommends entering into a loan agreement with Southern California Edison in the amount of $149,256 and accepting a one -time incentive of $28,552 for a total of $177,808 to fund the Main Library Parking Garage LED Lighting Upgrade Project. The loan amount and the one -time incentive would be received after completion of the project. The loan would be for a term of approximately 6.5 years (about 78.2 months), and monthly loan payments of $1,909 would be made on the electric bill of the facility receiving the efficiency upgrade. The monthly loan payment amount of $1,909 equals the monthly savings on the SCE portion of the electric bill. Because the City purchases electric transmission from SCE and electric generation from Commerce Energy, actual monthly electric bill savings will N be larger than savings from the SCE bill. Actual monthly savings in both transmission and generation charges would be $3,256, yielding a shorter payback period of approximately 4 years for the project than the term of the SCE loan. Contractor Selection: A Notice Inviting Bids was issued on February 21, 2013, published in the Santa Monica Daily Press and posted on the City's online bidding website in accordance with the City Charter and Municipal Code provisions. The scope of work would include the replacement of 280 light fixtures on three levels of subterranean parking. Eighteen bids were received and publicly opened on March 25, 2013. The bid results are shown in Attachment A. Bids were evaluated based on price, experience, qualifications and references. Based on these criteria, Yesco LLC is recommended as the best bidder. Staff contacted references provided by Yesco LLC for prior project experience at Cedars -Sinai Medical Center, Los Angeles Civic Park and McCarren International Airport. All respondents reported that their work was completed in a timely and cost - efficient manner while maintaining consistent quality. Staff also verified with the Contractors State License Board to ensure that Yesco LLC license is current, active, and in good standing. Construction Schedule Construction work is tentatively scheduled to begin in mid -July 2013 for a period of approximately 30 days. All disruptive work would occur outside of regular garage business hours. K Financial Impacts & Budget Actions The contract to be awarded to Yesco LLC is for an amount not to exceed $177,808. Award of the contract requires an appropriation of $177,808 to account C016039.589000. Entering into the loan agreement with Southern California Edison will result in increased revenue of $177,808 ($149,256 loan revenue, $28,552 energy incentive payment) in FY 2013 -14. Upon Council approval, these amounts will be included in the FY 2013 -15 proposed budget in accounts 01990.601013 and 01225.410050. The loan amount of $149,256 will be repaid over approximately 6.5 years (about 78.2 months) in monthly installments of $1,909. Funds are available in division 225; monthly payments will be charged to account 01225.556240. Budget authority for subsequent years will be requested in each budget for Council approval. Future funding is contingent upon Council approval and budget adoption. Prepared by: Tom Afschar, Architect Approved: pc-1�2 Martin Pastucha Director of Public Works Attachment: A — Bid Results 12 Forwarded to Council: Rod Gould City Manager Attachment A — Bid Results Main Library Garage LED Replacement Lighting Upgrade Project Bidder Base Bid Yesco $161,642.25 ABI Construction & Electric, Inc $176,626.80 Regreen, Inc $187,600.00 Go Green Solutions $199,360.00 R & H Industries, DBA Best Electric $204,120.00 Peterberg Construction, Inc $224,420.00 Waisman Construction $229,000.00 Facility Solution Group, Inc $234,194.80 W.E. Construction, Inc $237,500.00 Siemens $239,680.00 Golden Sun Firm& Co Inc $254,996.00 Amers, Inc $257,300.00 JFL Electric, Inc $260,960.00 YaalLevanon $266,364.00 Unispec $276,640.00 Lighting Technology Services, Inc $279,622.05 Pacific Lighting Mgmt, Inc $293,595.00 MS Navarro Engineering $296,800.00 Reference Contract No. 9740 (CCS)