TO:
Honorable Mayor and Members of the City Council
THROUGH:
Bruce Moe, City Manager
FROM:
Erick Lee, Public Works Director
Lou Vargas, Utilities Director
Nicholle Petroff, Senior Management Analyst
SUBJECT:Title
Consideration of a Resolution Approving a Professional Services Agreement with Black & Veatch Management Consulting, LLC in the Budgeted Amount of $68,085 for the 2023 Wastewater Rate Study (Public Works Director Lee).
ADOPT RESOLUTION NO. 22-0147
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Recommended Action
RECOMMENDATION:
Staff recommends that the City Council adopt Resolution No. 22-0147 approving a Professional Services Agreement with Black & Veatch for the 2023 Wastewater Rate Study in the Amount of $68,085.
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FISCAL IMPLICATIONS:
The Wastewater Master Plan Update project is programmed in the Wastewater fund as part of the approved Capital Improvement Plan (CIP).The amount being requested for a Professional Services Agreement for this Wastewater Rate Study is $68,085. Sufficient funding exists for this agreement as part of the project’s current budget appropriation. There are no additional fiscal implications at this time.
BACKGROUND:
The City’s Wastewater Fund supports the operation and maintenance of the City’s 86 miles of wastewater pipelines and six pump stations. Rates for these services have not been increased since 2009. As such, the Five Year CIP identifies a revenue shortfall in upcoming years because of planned capital spending to address aging infrastructure and expense inflation.
To address future capital improvement and maintenance costs, a Wastewater Rate Study needs to be performed. Such study will propose balancing affordability of expenditures while adequately investing in long-term infrastructure and ensuring reliability and sustainability. The objectives of the Wastewater Rate Study are to:
• Separate consumption costs from infrastructure and maintenance costs.
• Evaluate and provide adequate funding for routine operation & maintenance (O&M) expenditures of the wastewater system, including salaries and benefits of staff and contracted services.
• Fund necessary capital projects (e.g., equipment replacement; lift station replacements).
• Fund one-time capital projects.
• Ensure Wastewater Fund reserve levels are sufficient to meet the City’s operational needs.
DISCUSSION:
The City issued Request for Proposal (RFP) No. E1272-22S on August 9, 2022 for Professional Services to perform the 2023 Wastewater Rate Study. Three proposals were received on September 6, 2022. Proposals were evaluated and ranked by an evaluation committee of City staff according to the following selection criteria:
• Understanding the scope of services;
• Firm qualifications and experience performing similar work;
• Project management methods and quality control;
• Qualification and experience of key personnel; and
• Timeliness/schedule
The 2023 Wastewater Rate Study scope of work entails evaluating and making recommendations related to the City’s:
• Existing wastewater rates and fee schedule’s revenue generation capacity and ability to meet the City’s capital, operations, and maintenance infrastructure needs;
• Prioritization of identified wastewater infrastructure needs;
• Five-year (short-term) and 10-year (long-term) CIP programmatic schedule;
• Financing ability to address capital needs for wastewater infrastructure improvements.
The final goal of this Wastewater Rate Study is to develop a fair and reasonable rate structure and propose new wastewater rates and fees for a five-year period that will provide the necessary revenue to meet the City’s wastewater-related needs.
During the evaluation process, staff determined that Black & Veatch Corporation had the most experience and the best overall proposal at the best value to complete the Wastewater Rate Study scope of work. The proposal clearly outlined the consultant’s proposed scope of work and methodology and supplied sufficient resources to complete the project within the City's desired timeline. The firm and its staff have experience on similar projects with local agencies. All references confirmed that Black & Veatch Corporation had provided outstanding services with their projects.
Therefore, staff recommends that the City Council adopt Resolution No. 22-0147 approving a Professional Services Agreement to Black & Veatch for the 2023 Wastewater Rate Study for $68,085 and authorizing the City Manager to execute the agreement.
ENVIRONMENTAL REVIEW:
The City has reviewed the proposed project for compliance with the California Environmental Quality Act (CEQA) and has determined that the project qualifies for a Categorical Exemption pursuant to Section 15301 Class 1(d) (repair and maintenance of existing public facilities, involving negligible or no expansion of use) of the State CEQA Guidelines.
LEGAL REVIEW:
The City Attorney has approved the agreement as to form.
ATTACHMENTS:
1. Resolution No. 22-0147
2. Agreement - Black & Veatch Management Consulting, LLC.