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SR-08-25-2015-3S City Council Report City Council Regular Meeting: August 25, 2015 Agenda Item: 3.S 1 of 4 To: Mayor and City Council From: Gigi Decavalles-Hughes, Director, Finance Department, Treasury Division Subject: Extend Maintenance Agreements for the Big Blue Bus and Parking Meter Currency Counting Room Equipment Recommended Action Staff recommends that the City Council: 1. Approve a change order to the existing purchase order in the amount of $25,500 with Money System Technology, a Texas-based company, for the maintenance of two coin sorters/counters and conveyor belts used for currency counting operations. This will result in a revised purchase order total amount not to exceed $40,500 over a five-year period, with future year funding contingent on Council budget approval. 2. Approve a change order to the existing purchase order in the amount of $41,400 with Richard's Coin & Currency Counters, a California-based company, for the maintenance of various equipment for currency counting operations. This will result in a revised purchase order total amount not to exceed $65,400 over a five-year period, with future year funding contingent on Council budget approval. Executive Summary The City of Santa Monica contracted with Money Systems Technology and Richard’s Coin & Currency Counters to purchase equipment and provide preventative maintenance and repair services for the counting room equipment. Both maintenance agreements are scheduled to expire on September 24, 2015. Staff recommends sole source blanket purchase orders with Money Systems Technology in the amount of $25,500 for a three-year term and with Richard’s Coin and Currency in the amount of $41,400 for a three-year term to provide maintenance and repair services for the counting room equipment. The total estimated amount for the two vendors for the three-year term is $66,900. Background Money Systems Technology (MST) and Richard’s Coin & Currency Counters have been providing installation, preventative maintenance and repair services to the City for counting room equipment since 1999. The City purchased two coin sorter/counters 2 of 4 from MST in 2002 to process Big Blue Bus fare box currency. Richard’s Coin & Currency serves as the exclusive local representative for MST, providing maintenance services for its coin sorter/counters. In addition to serving as the local agent and technician for MST since 1999, Richard’s Coin & Currency has provided maintenance services on peripheral equipment related to the counting of coins from on-street parking meters and Big Blue Bus fare box revenue, including loose coin conveyors, bag conveyors, hydraulic bag carts, coin bag scales, paper currency counters, and a loose coin verifier. On September 24, 2013 (Attachment A), Council approved two-year sole source contracts with MST and Richard’s Coin & Currency Counters to provide preventative maintenance and repair services for the counting room equipment. Council approval was granted for a two-year term for an amount not to exceed $15,000 for MST and $24,000 for Richard’s Coin & Currency Counters. These contracts, which are servicing proprietary equipment, have reached slightly over $500,000 since Richard’s Coin & Currency began providing the services in 1999. Discussion The extension of the maintenance agreements is required to continue to provide preventative maintenance and repair services for proprietary equipment. Counting room operations provides currency and coin counting services for large volumes of cash; approximately $8.8 million annually from Big Blue Bus fare boxes and approximately $4.1 million annually from parking meters. Vendor Selection Money Systems Technology (MST) manufactured two of the coin sorters and horizontal conveyers that work with the coin vault systems that are used to process Big Blue Bus fare box currency. Richard’s Coin & Currency serves as the exclusive local MST representative for this area by providing maintenance services for the coin sorter/counters and horizontal conveyors. Some of the other equipment that is used in the counting room operations is integrated with the equipment that is owned by MST. 3 of 4 According to SMMC 2.24.080, the competitive bidding procedure is not applicable in instances where only one vendor possesses the unique ability or capability to meet the particular requirements of the solicitation. In this case, the compatibility of equipment for maintenance and repair services is of paramount consideration to prevent disruption of counting room operations. An example of the equipment integration is that there are four conveyors that bring the coins from the Big Blue Bus coin vault systems to the coin sorters; two vertical conveyors and two horizontal conveyors. The horizontal conveyors that were customized for the MST coin sorters/counters work with the vertical conveyors to transport the coins from the vaults to the coin sorters. This creates a safe, efficient and productive method of transporting coins. The agreement with MST includes two service appointments per month, labor and limited parts to repair two MST coin sorters/counters and horizontal conveyors. The agreement excludes replacement parts such as coin plates, input board, horizontal conveyor belts, and coin bag scales. The agreement with Richard’s Coin & Currency includes all labor and parts pertaining to other ancillary equipment that is used for counting of Big Blue Box fare box revenue and coins from parking meters. Financial Impacts & Budget Actions The purchase order modification to be awarded to Money Systems Technology is $25,500, for an amended purchase order total not to exceed $40,500. Funds are available in the FY 2015-16 budget in the Finance Department. The purchase order will be charged to account 012242.533120. The purchase order modification to be awarded to Richard's Coin & Currency is $41,400, for an amended purchase order total not to exceed $65,400. Funds are available in the FY 2015-16 budget in the Capital Improvement Program budget in account C410113.589000. 4 of 4 Prepared By: Yolanda Nunez, Senior Administrative Analyst Approved Forwarded to Council Attachments: A. September 24, 2013 Staff Report (web link)