SR 10-24-2017 3A
City Council Report
City Council Meeting: October 24, 2017
Agenda Item: 3.A
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To: Mayor and City Council
From: Susan Cline, Director, Public Works, Water Resources
Subject: Award Contract for Charnock Well Field Operations, Maintenance and
Management Services RFP
Recommended Action
Staff recommends that the City Council:
1. Award RFP #131 to Grace Environmental Services, a California-based company,
for Charnock Well Field operations, maintenance and management services for
the production and treatment of potable water;
2. Authorize the City Manager to negotiate and execute a contract with Grace
Environmental Services, for a total amount not to exceed $2,000,000 over a five-
year period, with future year funding contingent on Council budget approval.
Executive Summary
The City of Santa Monica requires contractor services to operate and maintain the City's
Charnock Well Field site to treat groundwater for provision to Santa Monica water
customers in accordance with federal and state regulations. Two valid proposals were
received in response to the City’s Request for Proposals (RFP) for such services issued
in August 2017. Staff recommends Grace Environmental Services to operate, maintain
and manage the Charnock Well Field for a total not to exceed amount of $2,000,000
over a five-year period.
Background
The City has used contractor services to operate, maintain and manage the Charnock
Well Field site (11375 Westminster Avenue, Los Angeles, CA 90066) since November
2010, when new facilities were commissioned to treat groundwater contaminated by
methyl tertiary-butyl ether (MTBE) and other volatile organic compounds. Approximately
75% of City’s water from the Santa Monica Basin (7,619 acre-feet in fiscal year 2016-
17) is produced and treated at the Charnock site. The City's current contract #9973
(CCS) with Evoqua Water Technologies (previously known as Siemens Water
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Technologies until 2014) runs through November 19, 2017.
Discussion
The City requires the selected contractor to provide an on-site, state-certified water
treatment plant operator for 40 hours per week, on-call services on a 24/7 basis for
emergencies, and other administrative support to comply with all the conditions of the
City’s operating permit issued by the State of California Division of Drinking Water. The
contractor oversees day-to-day operations at Charnock, maintains and repairs
equipment, ensures the proper application of chemicals, oversees repairs, takes water
samples, monitors various analyzers and other instrumentation, keeps records,
prepares reports, updates safety, training and operations plans, and performs other
duties as required. The contractor coordinates Charnock operations and reports to City
staff based at the Arcadia Water Treatment Plant (1228 S. Bundy Drive, Los Angeles,
CA 90025).
Vendor Selection
On August 16, 2017, the City issued a Request for Proposals (RFP) for Charnock
Operations, Maintenance and Management Services. The RFP was posted on the
City’s on-line bidding site, and notices were advertised in the Santa Monica Daily Press
in accordance with City Charter and Municipal Code Section 2.24.100(a) provisions. A
total of 41 vendors downloaded the RFP, and three proposals were received. One
proposal could not be accepted as the bidder did not have a valid Public Works
Contractor registration with the State of California Department of Industrial Relations at
the time of bid submittal as required for prevailing wage projects. Responses to the RFP
from the following two firms were reviewed by a selection panel of staff from the Water
Resources Division:
Evoqua Water Technologies
Grace Environmental Services
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Proposals were evaluated based on experience and qualifications, project team, cost,
and quality control. Based on the pricing received, staff calculated the estimated annual
cost for provision of operator services at 40 hours per week along with various project
management and administrative costs.
Grace Environmental Services offered the best hourly rates and lowest estimated
annual cost of approximately $245,000 per year including five hours per week of
administrative/project management services, with additional materials and contractor
services to be reimbursed at +10% above cost. Grace Environmental also offered an
alternate proposal for services including two full-time operators and all labor and
materials including maintenance, training, safety and supplies for $35,670.84 per month
or $428,050 per year (discussed in further detail in the “Estimated Contractual Services
Costs” section below). Additional service years would be subject to price increases of
1.0% to 1.6% annually.
Evoqua Water Technologies offered an estimated annual cost of $371,000 per year
including one hour per week of administrative/project management services, not
including reimbursable expenses. Additional service years would be provided at the
same price, terms and conditions.
Grace Environmental Services has previously provided similar services for the San
Simeon Community Services District, Los Osos Community Services District, and
Lockheed Martin Corporation. Staff checked references and found that work was
completed in a timely and efficient manner at a reasonable cost. Based on this criteria
and the criteria in SMMC 2.24.072, staff recommends Grace Environmental Services as
the best qualified firm to provide operations, maintenance and management services at
the Charnock Well Field.
Estimated Contractual Services Costs
In addition to providing a state-certified operator for 40 hours per week and
administrative support for an estimated 5 hours per week for approximately $245,000 in
Year 1, Grace Environmental Services would also be required to respond to after-hours
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/ weekend emergency calls within two hours of notification for on-site issues that cannot
be resolved remotely using the City’s Supervisory Control and Data Acquisition
(SCADA) system. Grace Environmental Services would also begin to address a list of
deferred maintenance items at the Charnock Well Field including replacement of pump
equipment and other items with any required materials and services not purchased by
the City reimbursable at +10% above cost. Staff estimates that an allowance not to
exceed $155,000 per year would be sufficient to provide for any after-hours responses,
address the current deferred maintenance list for Charnock Well Field and provide
sufficient funding for future repair/maintenance costs as needed for an approximate total
not to exceed $400,000 per year, or $2,000,000 over a five-year period.
Staff may opt to move forward with the alternate proposal submitted by Grace
Environmental Services. The alternate proposal would allow for the use of two operators
for a few months at the beginning of the contract term to address deferred maintenance
items needing immediate attention and would also allow the operators to familiarize
themselves with the facility, at a cost of $35,670.84 per month or $428,050 per year,
prior to returning to the standard services of one operator for 40 hours per week.
Alternative – City Staffing of the Charnock Well Field
Council approved contracted staff for this service as part of the January 13, 2015
Contract and As-Needed Staff Review (Attachment A). However, upon further review,
staff determined that equivalent services could be provided by two new full-time City
staff (one Lead Water Production & Treatment Plant Operator and one Staff Assistant
III) instead of three full-time staff as noted in the report. Additionally, City staff would
provide an equivalent level of specialized/technical expertise as compared to a
contractor with a level of risk similar to that of City water treatment staff stationed at the
nearby Arcadia Water Treatment Plant (1228 S. Bundy Drive, Los Angeles, CA 90025).
A cost analysis for providing these two new City positions versus comparable contractor
costs for Grace Environmental Services (excluding reimbursable costs for materials and
services which would also need to be provided by the City) indicated City staff would be
$43,000 more expensive in Year 1 and $345,000 more expensive over a 5-year period,
with higher annual increases in City costs in out-years largely attributable to fringe
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benefits.
Table 1 – Charnock Staffing Cost Estimates
Staffing Year 1 5-Year Total
City Staffing – 1 Lead Operator & 1 Staff Assistant III $288,000 $1,600,000
Contractor Services – Grace Environmental Services $245,000 $1,255,000
Cost Difference: $43,000 $345,000
Financial Impacts and Budget Actions
The contract to be awarded to Grace Environmental Services is for an amount not to
exceed $2,000,000. Funds of $400,000 are available in the FY 2017-18 budget in the
Public Works Department. The contract will be charged to account 25672.555010.
Future funding is contingent on Council budget approval.
Prepared By: Kevin Nagata, Senior Administrative Analyst
Approved
Forwarded to Council
Attachments:
A. January 13, 2015 Staff Report - Contract and As-Needed Staffing Review Report
B. Oaks Initiative Disclosure Form - Grace Environmental Services
REFERENCE:
CONTRACT NO. 10488 (CCS)