February 3, 2004

SUBJECT: Award of Contract to Conduct a Performance Review of Bay Counties Waste Services and Approval of Budget Modification No. 26 (F0312-38)

REPORT IN BRIEF

Approval is requested for the award of a contract to Brown, Vence & Associates, Inc., of San Francisco to conduct a performance review of Bay Counties Waste Services for the Department of Public Works Solid Waste Division.

BACKGROUND

Bay Counties Waste Services (BCWS) is the franchised refuse collector for the City of Sunnyvale. On November 11, 2003, the City Council voted to accept a BCWS proposal to extend its contract another seven years. This will lengthen the existing contract, which would have expired in 2011, to twenty-seven years, terminating in 2018.

As part of its November 11 action, Council required BCWS to submit its operations to a detailed performance review (by a consultant to be selected by the City) to identify opportunities for route reductions and other efficiency improvements.  Council also required BCWS to pay 50% of the cost of the performance review and to make changes to its operations that are identified by the review and approved by the City.  The review is intended to substitute, to the extent it can, for the competitive process that would otherwise have been used to select the franchised hauler at the expiration of the current franchise agreement.

DISCUSSION

On December 18, 2003, the Acting City Manager provided the Mayor and Council with copies of the work plan that the staff is using in order to implement the Council's November 11 action (see Attachment B).  As scheduled, four consultant proposals to conduct the performance review were received on January 9, 2004. 

Staff has reviewed the proposals and is recommending that the contract be awarded to Brown, Vence and Associates (BVA).  BVA possesses the resources, skills, and experience required to assess and analyze BCWS’s performance and to provide the City and the company with recommendations for improvements and efficiencies.  BVA has provided professional services at the SMaRT Station in the past with good results.  The company has performed projects similar to the performance review for nearby cities and is familiar with local governmental practices and solid waste infrastructure.

The schedule proposed by BVA shows completion of the project in ten weeks, the shortest time out of the four proposals.  Completion of the performance review in ten weeks should allow enough time to incorporate the findings into contract amendment language in time to establish the new contractor payment for the new fiscal year.

BVA proposes to perform the work at an estimated cost of $69,976.  Staff recommends a 20% contingency, bringing the total cost to $84,000.  BCWS will reimburse the City for 50% of the cost.  This will reduce the final cost to the refuse ratepayers to a maximum of $42,000.

FISCAL IMPACT

Each of the City’s utilities is operated as an independent enterprise, and all expenses and revenues for each service are accounted for separately. Payments to BCWS for collection of solid waste and recyclables in Sunnyvale occur from the Solid Waste Management Fund, along with all other expenses related to maintaining and operating the City’s solid waste facilities.  

Staff recommends approval of Budget Modification No. 26 to establish a special project for the BCWS performance review.  The total project cost, including a 20% contingency, is $84,000 to be funded by a $42,000 reimbursement from BCWS and an appropriation of $42,000 from the Solid Waste Fund Rate Stabilization Reserve.

Based on the current positive position of the Solid Waste Fund and the level of the reserve, the appropriation of funds from the Rate Stabilization Reserve will have a minimal impact on refuse rates.

RECOMMENDATION

It is recommended that Council take the following actions:

1. Award a contract to Brown, Vence & Associates, Inc., in substantially the same form as the attached draft and in an amount not to exceed $69,976; and

2. Authorize a project contingency in an amount not to exceed $14,024; and

3. Approve Budget Modification No. 26.

Prepared by:

Mark A. Bowers
Solid Waste Program Manager

Reviewed by:

Mary Bradley
Director, Finance

Reviewed by:

Marvin Rose
Director, Public Works

Approved by:

Amy Chan
Acting City Manager

Attachments

A. Draft Consultant Services Agreement
B. Work Plan Schedule for Implementation (pdf format)