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SR 08-27-2019 3G City Council Report City Council Meeting: August 27, 2019 Agenda Item: 3.G 1 of 4 To: Mayor and City Council From: Susan Cline, Director, Public Works, Architecture Services Subject: Award Bid and enter into Master Services Agreement for General Construction Services Recommended Action Staff recommends that the City Council: 1. Award Bid #SP2524 to nine California-based general contractors to provide as- needed general construction services on various projects for the Public Works Department. 2. Authorize the City Manager to negotiate and execute an as-needed master services agreement with nine general contractors in an 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. Summary Timely delivery of high quality projects at the best price is the City’s long-standing approach to public construction contracting. Santa Monica Municipal Code Section 2.24.220(g) (Public Works Contracts) allows the City Council to award as-needed service agreements (Master Services Agreements or MSAs) to prequalified contractors for construction, maintenance or repair services in amounts not to exceed $5 million over a five-year period. MSAs enable the City to complete administrative procedures for procurement and contracting ahead of time and subsequently allow for timely delivery as service needs occur. Staff recommends awarding nine as-needed MSAs for various operations and capital improvement projects for the Public Works Department. Discussion The proposed agreements would enable the Public Works Department to expedite the commencement of work by an estimated 20-27 weeks because most of the administrative work in the procurement process, including vendor evaluation, 2 of 4 prequalification, authorization, and contract execution, would be completed upfront. This would result in the acceleration of the commencement of small, relatively simple Public Works projects, decrease the risk of potential escalation costs, and reduce the amount of staff time spent on procurement for each individual project. Staff conducted a process to pre-qualify contractors to provide general construction services for 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. After the City Council’s approval in October 2018, only one contractor agreement was executed in two of the five categories. Having completed this second solicitation, staff is recommending additional contractors in order to obtain better competitive pricing from all five categories. Past Council Actions 10/08/2018 (Attachment A) Second Reading and Adoption of Ordinance Modifying Section 2.24.071 of the Santa Monica Municipal Code to Authorize As- Needed Services Agreements for Public Works Projects 09/11/2018 (Attachment B) 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 Vendor Selection RFQual Data RFQual Posting Date RFQual Posted On RFQual Advertised In (City Charter & Municipal Code) # of Firms Downloaded # of Submittals Received Date Publicly Opened 05/17/2019 City's Online Bidding Site Santa Monica Daily Press 46 9 06/13/2019 Pre-qualified List Vendor Selection Recommendation West Valley Investment Group Waisman Construction, Inc. Municipal Code SMMC 2.24.190 Olympos Painting, Inc. Granite Construction Evaluation Criteria Previous experience/technical competence, answers to a questionnaire, references, 3 of 4 Company resumes of relevant staff, and Department of Industrial Relations project experience (labor compliance). Excel Paving Company Sully-Miller Contracting Company Metro Builders & Engineering Group MTM Construction, Inc. W.A. Rasic Construction Justification to Short-List A panel of staff from the Engineering and Street Services and Architecture Services divisions of the Public Works Department rated all nine firms’ statements of qualifications for general construction services. Staff deemed all statements acceptable and placed them on a pre-qualified list. Attachment C shows the breakdown 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. Staff recommends awarding an MSA to each of these nine pre-qualified vendors. Staff will solicit bids from all pre-qualified contractors prior to commencing work valued at more than $25,000. Financial Impacts and Budget Actions Staff seeks authority to award an as-needed Master Services Agreement with each of the nine 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 2019-20 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 2019-20 through FY 2023-24 Budget Various Departments/CIP Account # Total Contract Amount West Valley Investment Group Various $5,000,000 Olympos Painting, Inc. Various $5,000,000 Excel Paving Company Various $5,000,000 Metro Builders & Engineering Various $5,000,000 Waisman Construction, Inc. Various $5,000,000 Granite Construction Company Various $5,000,000 4 of 4 Sully-Miller Contracting Company Various $5,000,000 MTM Construction, Inc. Various $5,000,000 W.A. Rasic Construction Co, Inc. Various $5,000,000 Total $45,000,000 Prepared By: Phillip Ticun, CIP Project Manager Approved Forwarded to Council Attachments: A. October 9, 2018 Staff Report B. September 11, 2018 Staff Report C. Pre-Qualified ShortList D. MTM Oaks Initiative Disclosure Form E. W.A. Rasic Oaks Initiative Disclosure Form F. Waisman Oaks Initiative Disclosure Form G. West Valley Oaks Oaks Initiative Disclosure Form H. Olympos Painting Oaks Initiative Disclosure Form I. Excel Oaks Initiative Disclosure Form J. Sully-Miller Oaks Initiative Disclosure Form K. Granite Oaks Initiative Disclosure Form L. Metro Oaks Initiative Disclosure Form City Council Report City Council Meeting: October 9, 2018 Agenda Item: 7.A 1 of 1 To: Mayor and City Council From: Lane Dilg, City Attorney, City Attorney’s Office Subject: Second Reading and Adoption of Ordinance Modifying Section 2.24.071 of the Santa Monica Municipal Code to Authorize As-Needed Services Agreements for Public Works Projects Recommended Action Staff recommends that City Council adopt the attached Ordinance. Executive Summary At its meeting on September 11, 2018, the City Council introduced for first reading an ordinance modifying Section 2.24.071 of the Santa Monica Municipal Code to authorize as-needed services agreements for Public Works projects. The ordinance is now presented to City Council for adoption. Prepared By: Elsa Kapsinow, Executive Assistant to the City Attorney Approved Forwarded to Council Attachments: A. Ordinance - Public Works - Contracting - Second Reading - 10092018 City Council Report City Council Meeting: September 11, 2018 Agenda Item: 7.B 1 of 6 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 2 of 6 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 3 of 6 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 4 of 6 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. 5 of 6 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 6 of 6 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 A p p e n d i x 5 0 REFERENCE: Agreement Nos. 10920 - 10928 (CCS)