SR 09-11-2018 7B
City Council
Report
City Council Meeting: September 11, 2018
Agenda Item: 7.B
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To: Mayor and City Council
From: Susan Cline, Director, Public Works, Architecture Services
Subject: Introduction and first reading of Ordinance amending Santa Monica Municipal
Code Section 2.24.071 to update Public Works Contracts requirements;
Award of Bid #SP2524 to eight general contractors to provide as-needed
general construction services; and Authorization for the City Manager to
execute a master on-call task order services agreement with each pre-
qualified contractor, once the ordinance becomes effective
Recommended Action
Staff recommends that the City Council:
1. Introduce for first reading the attached ordinance amending Santa Monica
Municipal Code Section 2.24.071 (Public Works Contracts) authorizing the use of
City Council approved Master As-needed Services agreements.
2. Award Bid #SP2524 to eight California-based general contractors to provide as-
needed general construction services on various Public Works projects including
Airport, Facilities, Engineering, and Architecture work.
3. Authorize the City Manager to negotiate and execute an As-needed Master
Services agreement with eight general contractors for a total amount not to
exceed $5,000,000 over a five-year period for each agreement, subject to
Council approval of the biennial operating budget and the biennial capital
improvement program budget which would allow appropriation of funds for any
task order issued under each as-needed master services agreement, once the
ordinance becomes effective.
Executive Summary
Achieving top quality and best price are the long-standing goals of public construction
contracting in Santa Monica. The Santa Monica Municipal Code (SMMC) Section
2.24.071 (Public Works Contracts) stipulates that every contract involving an
expenditure of more than $175,000 for public works projects must be competitively bid
and presented to the City Council for approval of the contract award prior to project
commencement. Unfortunately due to required legal steps involved in that process, a
bid award process takes 20 to 27 weeks depending on the complexity of the project. In
addition to extending the project completion timeline, the lengthy process burdens
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staffing resources with paperwork and process without directly contributing to the goals
of quality and economy. To streamline the costly and inefficient process for smaller
projects, staff recommends an ordinance amending SMMC Section 2.24.071 to add an
alternate contracting method to deliver public works projects up to $1,000,000 to allow
the execution of eight As-Needed Master Services agreements (MSAs).
Background
On June 12, 2018, Council adopted the first year and approved the second year of the
Capital Improvement Program (CIP) FY 2018-20 Biennial Budget. The adopted CIP
Budget incorporated Santa Monica’s Framework for a Sustainable City of Wellbeing.
These projects will advance goals in five of the seven outcome areas, and address
Council’s strategic goals, particularly the Mobility strategic goal. In order to expeditiously
complete these projects while still maintaining a bala nce between quality and cost, the
Public Works Department performed an efficiency assessment to develop
recommendations on improving project delivery and ensuring that the expectations of
Council and the public are being met. This assessment built upon the Finance
Department’s overview of current procurement processes presented to Council in 2016.
Currently, all construction contracts over $175,000 are required to be competitively bid
and approved by the City Council. For projects estimated under $1,000,000,
commencing construction can take approximately 20-27 weeks from procurement to
contract execution for projects with little or no design work (Attachment A). The
efficiency assessment identified the use of MSAs as a way to improve efficiency and
expedite project delivery.
Discussion
The proposed ordinance would amend SMMC Section 2.24.071 to add an alternate
construction contracting/procurement approach which would allow the Public Works
Department to utilize MSAs to expedite the commencement of work. The ordinance
would authorize the City Manager, subject to certain conditions specified in the
ordinance, to enter into an MSA, and would authorize the Public Works Director, or her
designees, to issue task orders in amounts up to $1,000,000 for construction under
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each MSA. Goals for this new approach include: 1) accelerating the commencement of
small, relatively simple public works projects, 2) increasing overall efficiency for the
procurement, contracting and project delivery methods used for small projects including
emergency work, and 3) accomplishing general construction services in a timelier
manner. If the ordinance is approved, the Finance and Public Works departments, and
the City Attorney’s Office will draft administrative guidelines to ensure competitive
bidding, appropriate environmental review and orderly implementation.
The MSA approach would work as follows:
1) City solicits general contractors through a request for qualifications including a
formal competitive bidding and advertisement process.
2) City establishes a list of pre-qualified contractors from which to select its MSA
contractors.
3) City presents the recommended MSA contractors to Council for approval to
negotiate and execute MSA contracts.
4) Once MSAs are executed, bids from at least three contractors would be solicited
for each task order.
5) All task orders would be awarded to the best bidder.
6) All projects under an MSA would have their own task order number for tracking
and reporting.
7) The Director of Public Works or his/her designees may issue task orders in
accordance with the terms and conditions of the MSA. Individual task orders shall
not exceed $1,000,000 and the cumulative amount of task orders under each
MSA shall not exceed $5,000,000.
8) All projects utilizing MSAs would be reviewed to ensure (i) appropriate
environmental review, (ii) that projects are funded by Council-adopted biennial
budgets, and (iii) that contractors adhere to all prevailing wage requirements .
9) Once a task order is completed, the task order amount would be tracked and
counted against each contractor’s maximum cumulative MSA amount.
10) Public Works would report back to Council annually by submitting an Information
Item every June. The Information Item would include a summary of all projects
completed per MSA including vendor names, amounts and task order numbers
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as well as an evaluation of whether the revised process yielded the efficiencies
expected.
Staff believes using MSAs would improve project delivery and benefit the City by
shortening project timelines by an estimated 20-27 weeks, decreasing the risk of
potential escalation costs, reducing the amount of time staff spends on a project, and
facilitating a more accurate overall project schedule. Other municipalities such as the
cities of San Francisco, Los Angeles, and Anaheim have already adopted similar forms
of as-needed contracting ordinances to improve project delivery.
To expedite vendor selection, in the event that Council approves the recommended
ordinance, staff conducted a process to pre-qualify contractors to provide general
construction services on various public works projects for five categories of work:
interior remodels/tenant improvements, exterior building renovations,
parks/playgrounds/site work, general engineering, and pier work. Should Council
approve awarding bids to these MSA contractors, task orders issued pursuant to the
agreements entered would not exceed the current $175,000 threshold unless and until
the proposed ordinance became effective.
Vendor Selection
RFQ Data
RFQ Posting Date RFQ Posted On RFQ Advertised In
(City Charter & Municipal Code)
# of Firms
Downloaded
# of
Submittals
Received
Date Publicly
Opened
06/07/2018 City's Online
Bidding Site Santa Monica Daily Press 52 10 06/21/2018
Pre-qualified List Vendor Selection Recommendation
John S. Meek
Company, Inc.
Kasa
Construction,
Inc.
Municipal Code SMMC 2.24.072
Judge Netting,
Inc. Ramco
Evaluation
Criteria
Previous experience/technical
competence, answers to a
questionnaire, references, resumes
of relevant staff, and DIR project
experience (labor compliance).
Cushman
Contracting
Corporation
Blois
Construction,
Inc.
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Kemcorp
Construction,
Inc.
GSE
Construction
Company, Inc.
Justification to Short-List
Eight of the 10 statements of qualifications received for general construction services
were rated and deemed acceptable and were placed on a pre-qualified list. Attachment B
shows the breakdown by vendor on which of the five categories (interior remodels/tenant
improvements, exterior building renovations, parks/playgrounds/site work, general
engineering, and pier work) each vendor is pre-qualified to perform as-needed work.
These eight pre-qualified vendors were ranked highly and are recommended to enter into
a master services agreement. Bids will be solicited from all pre-qualified contractors prior
to performing work valued at more than $10,000. Concept Consultants and Graph
Company, the ninth and tenth vendors, did not meet the criteria to be placed on the pre-
qualified list due to inaccurate submissions; hence, these vendors are not recommended.
Financial Impacts and Budget Actions
Staff requests authority to award a Master As-needed Services agreement with each of
the eight pre-qualified general contractors. All amounts are not to exceed $5,000,000
over a five-year period. Funding for existing projects to be completed under these MSAs
was approved by Council in the FY 2018-19 Adopted Budget. Future year funding is
contingent on Council budget approval. Expenditures would occur only upon issuance
of a task order by the Public Works Director to an MSA vendor, listed below.
Master Services Agreement Request
Vendor
FY 2018-19 through FY 2022-23 Budget
Various Departments/CIP Account #
Total Contract
Amount
John S. Meek Company, Inc. Various $5,000,000
Judge Netting, Inc. Various $5,000,000
Cushman Contracting Corp. Various $5,000,000
Kemcorp Construction, Inc. Various $5,000,000
Kasa Construction, Inc. Various $5,000,000
Ramco Various $5,000,000
Blois Construction, Inc. Various $5,000,000
GSE Construction Company, Inc. Various $5,000,000
Total $40,000,000
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Prepared By: Phillip Ticun, CIP Project Manager
Approved
Forwarded to Council
Attachments:
A. Procurement Timeline
B. SP2524 - General Contractor Services Pre-Qualification List
C. John S Meek Oaks Form
D. Judge Netting Oaks Form
E. Cushman's Contracting Oaks Form
F. Kemcorp Oaks Form
G. KASA Oaks Form
H. RAMCO Oaks Form
I. GSE Construction Oaks Form
J. Blois Construction Oaks Form
K. Ordinance - Public Works - Contracting - 09112018
SMALL
PROJECT 4 weeks 2 weeks 1 week 7 weeks 6 weeks START
COMPLEX
PROJECT 8 weeks 4 weeks 2 week 7 weeks 6 weeks START
Simple projects take approximately 20 weeks to commence work.
Complex projects take approximately 27 weeks to commence work.
BID PREP ONLINE BIDDING BID EVALUATION STAFF REPORT EXECUTE CONTRACT
BID PREP ONLINE BIDDING BID EVALUATION STAFF REPORT EXECUTE CONTRACT
TIMELINE FOR PUBLIC WORKS CONTRACTS
20 WEEKS
27 WEEKS
requiring City Council approval
Bidder's Name: KASA Construction, Inc. (enter on each bid form page)
ID
CITY OF SANTA MONICA OAKS INITIATIVE DISCLOSURE FORM
Sal. 11.ajca
In order to facilitate compliance with the requirements of the Oaks Initiative, the City compiles and
maintains certain information. That information includes the name of any person or persons who is
seeking a "public benefit." If the "public benefit" is sought by an entity, rather than an individual
person, the information includes the name of every person who is: (a) trustee, (b) director, (c)
partner, (d) officer, or has (e) more than a ten percent interest in the entity.
Public benefits include:
1.Personal services contracts in excess of $25,000 over any 12-month period;
2.Sale of material, equipment or supplies to the City in excess of $25,000 over a 12- month
period;
3.Purchase, sale or lease of real property to or from the City in excess of $25,000 over a 12-
month period;
4.Non-competitive franchise awards with gross revenue of $50,000 or more in any 12-month
period;
5.Land use variance, special use permit, or other exception to an established land use plan,
where the decision has a value in excess of $25,000;
6.Tax "abatement, exception, or benefit" of a value in excess of $5,000 in any 12- month period;
or
7.Payment of "cash or specie" of a net value to the recipient of $10,000 in any 12- month
period.
Name(s) of persons or entities receiving public benefit:
KASA Construction, Inc.
- Diana Kasbar - President/Treasurer
- Sam Kasbar - V. P./Secretary
Name(s) of trustees, directors, partners, and officers:
KASA Construction, Inc.
- Diana Kasbar - President/Treasurer
- Sam Kasbar - V.P/Secretary
Name(s) of persons with more than a 10% equity, participation, or revenue interest:
KASA Construction, Inc.
- Diana Kasbar - President/Treasurer
-Sam Kasbar - V. P./Secretary
Prepared by: _PanaXasbar 4 Title: President
Signature:
Date: 6/21/18
Email: hectorz@kasaco n.corn Phone: 909-457-8260
F FOR CITY USE ONLY;
Bid/PO/Contract #
Permit #
Bid Form- October 2017 29 1 P a g a
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City Council Meeting: September 11, 2018 Santa Monica, California
ORDINANCE NUMBER _________ (CCS)
(City Council Series)
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
SANTA MONICA MODIFYING SECTION 2.24.071 OF THE SANTA MONICA
MUNICIPAL CODE TO AUTHORIZE AS-NEEDED SERVICES AGREEMENTS FOR
PUBLIC WORKS PROJECTS
WHEREAS, existing local law requires that every contract involving an expenditure of
more than $175,000 for public works projects be competitively bid and presented to the City
Council of the City of Santa Monica (“City”) for approval of the contract award prior to project
commencement; and
WHEREAS, this bid award process takes twenty to twenty-seven weeks depending on
the complexity of the project; and
WHEREAS, in addition to extending the project completion timeline, this lengthy
procurement process burdens staffing resources; and
WHEREAS, amending local procurement laws to authorize an alternate contracting
method to allow the City to select prequalified contractors to be awarded as-needed services
agreements will expedite project commencement, streamline the hiring process, protect against
escalation costs and reduce staff time spent on procurement.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA
DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1. Santa Monica Municipal Code Chapter 2.24.071 is hereby amended, as
follows:
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2.24.071 Public works contracts.
(a) Every contract involving an expenditure of more than one hundred seventy-five
thousand dollars for public works projects including, but not limited to, the construction of public
buildings, streets, drains, sewers, utilities and parks shall be let to the best bidder after publication
of a notice inviting bids therefor. The publication shall be in a newspaper of general circulation in
the City of Santa Monica, by two or more insertions, the first of which shall be published at least
ten days before the time for opening bids. All notices inviting bids issued under this subsection (a)
shall also be posted on the City’s online vendor portal website.
(b) Public works contracts of one hundred seventy-five thousand dollars or less may be let
to contract by informal purchasing procedures as set forth in Section 2.24.090(b).
(c) For public works projects estimated to exceed one million dollars in cost or for public
works projects with unique or complex characteristics, the City Manager may authorize a phased
selection process for determining the best bidder if the characteristics of the project, including, but
not limited to, its size, complexity, uniqueness or potential impact on the City, are such that a
phased process would best effectuate the public interest. The phased selection process shall solicit,
review and evaluate the qualifications of prospective bidders in accordance with the criteria set
forth in Santa Monica Municipal Code Section 2.24.072, with project specifications and with such
administrative instructions, rules and regulations as may be issued by the City Manager. The best
bidder shall be competitively selected from those prospective bidders who have been determined as
qualified to responsibly complete the project in accordance with applicable City criteria. The City
Manager is authorized to issue administrative instructions, rules and regulations as necessary for
the purpose of satisfying the requirements of this subsection.
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(d) The City Council may reject any and all bids received whenever in the opinion of the
City Council:
(1) The bid or bids do not comply with the bid notice and specifications;
(2) The proposed project or purchase should be abandoned or delayed;
(3) The materials or services may be purchased more reasonably on the open
market or the work done less expensively by City personnel;
(4) The bids are higher than anticipated and a new call for bids would result in
savings to the City;
(5) The best interests of the City would be served by a rejection of any or all bids.
(e) By two-thirds affirmative vote of its membership, the City Council may forego the
bidding procedures otherwise required by this Section if the City Council finds that:
(1) The goods or services can be purchased more economically on the open
market;
(2) There exists no competitive market for the provision of the goods or services
necessary to construct the public works project; or
(3) Due to urgent necessity, the public health, welfare or safety would be
jeopardized if the bidding procedures of this Section were followed.
(f) During any period of declared state of local emergency, the City Manager, the
Emergency Services Manager, or the Purchasing Agent is authorized to implement such practices,
policies and procedures for the construction, maintenance, or repair of public works projects as are
necessary to protect the public health, welfare or safety without otherwise complying with this
Section, if the City Manager or the Emergency Services Manager finds that complying with this
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Section would cause unnecessary expense or delay. The City Manager shall report all such findings
at a regular meeting of the City Council no later than thirty days after the finding is made.
(g) Notwithstanding any other provision in this Chapter, the City may, in its
discretion and when deemed to be in the best interest of the City, obtain construction,
maintenance, or repair services pursuant to as-needed services agreements in accordance with the
following terms and procedures:
(1) The City shall solicit, review and evaluate the qualifications of prospective
contractors for as-needed services agreements in accordance with rules and regulations
established by the Director;
(2) The Director shall pre-qualify contractors for as-needed service
agreements;
(3) The Council may award as-needed services agreements to prequalified
contractors, in amounts not to exceed $5,000,000 and with terms of no more than five (5)
years;
(4) The Director shall be authorized to issue task orders with specific scopes
of work to prequalified contractors pursuant to as-needed services agreements;
(5) When the need arises for the performance of specific tasks that are within
the scope of as-needed service agreements, the Director shall seek bids from at least three
(3) prequalified contractors and, using the evaluation criteria set forth under Section
2.24.072, issue a task order to the best bidder in an amount not to exceed $1,000,000 for a
specifically defined scope of work;
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(6) In the event that the Director is unable to obtain three (3) bids, the
Director may issue a task order to the best bidder of the bids submitted;
(7) The Director may reject any and all bids received in accordance with the
standards set forth in subsection (d);
(8) Prequalified contractors performing task orders under as-needed services
agreements shall file payment and performance bonds in conjunction with each task order
awarded as required by the Director or applicable law; and
(9) The Director shall submit a report to the City Council on an annual basis
which shall contain information concerning the implementation of this subsection,
including a listing of task orders issued pursuant to this subsection.
SECTION 2. Any provision of the Santa Monica Municipal Code or appendices thereto
inconsistent with the provisions of this Ordinance, to the extent of such inconsistencies and no
further, is hereby repealed or modified to that extent necessary to affect the provisions of this
Ordinance.
SECTION 3. If any section, subsection, sentence, clause, or phrase of this Ordinance is
for any reason held to be invalid or unconstitutional by a decision of any court of competent
jurisdiction, such decision shall not affect the validity of the remaining portions of this
Ordinance. The City Council hereb y declares that it would have passed this Ordinance and each
and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional
without regard to whether any portion of the ordinance would be subsequently declared invalid
or unconstitutional.
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SECTION 4. The Mayor shall sign, and the City Clerk shall attest to the passage of this
Ordinance. The City Clerk shall cause the same to be published once in the official newspaper
within fifteen (15) days after its adoption. This Ordinance shall become effective thirty (30)
days from its adoption.
APPROVED AS TO FORM:
_________________________
LANE DILG
City Attorney