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Home My WebLink AboutSupplemental Questions from Robert GoldbergGloria Harper From: Robert Goldberg <rgoldberg@live.com> Sent: Monday, December 09, 2019 9:12 AM To: Thomas Moore; Schelly Sustarsic; Mike Varipapa; Sandra Massa-Lavitt; Joe Kalmick Cc: Jill Ingram; Gloria Harper; Steve Myrter, Patrick Gallegos Subject: Questions and Comments for Monday Night's Open Session Attachments: 12.09.19 Questions.doc; FRA Purchase Order.pdf, Data Ticket Invoice 9.20.16.pdf, IPS Contract.pdf, Line Repair 2015.pdf, City Manager pay raise 7.1.19.xls Dear Council and Staff, Please find my attached my comments and questions and referenced supporting documents for today's open session meeting. Thank you for your consideration and service, Robert Goldberg Questions & Comments for 12/09/19 (Open Session) from Robert Goldberg Item B: Demand on Treasury (Warrants) Pages 3, 11, 13, 15, 18, 19, 23, 28: These pages include 11 warrants for communication services from nine different providers. One of these, T -Mobile, appears to be new. A compilation of these warrants and those from the last Council meeting indicates that we are spending approximately $10,000 a month for these services: Service Start Provider Date November Invoices October Invoices Comments AT&T 2006 11/1/2019 $359 10/1/2019 $359 Frontier 2017 or earlier 11/2/2019 $3,427 10/10/19, $340 At least four different 10/25/19, service periods 10/28/19 Granite NEW: July 2019 11/1/19 $1,331 10/1/2019 $1,465 "For telephone services at various City locations" per Oct'l9 staff email to Mayor Moore GTT 2016 11/1/19 $2,307 10/1/2019 $2,204 Two invoices in November, both dated 11/1 /19 MCI 2014 11/11/2019 $38 10/11/2019 $76 Two invoices in October & 2019 for "Services Nov." 10/19/2019 Note: Warrant from 2014 says "Fax line lifeguard." Metropolitan 2014 11/8/19 $1,368 10/8/2019 $2,883 Sprint 2015 or earlier 10/20/2019 $4 Last warrant shows three lines T -Mobile NEW: Sept 2019 10/21/2019 $44 Verizon 2011 or earlier 10/1/2019 $3,788 Two invoices per month Wireless & 10/23/19 with overlapping service periods. Total Billings to Date-- November: $8,829 October: $11,163 I could not find contracts for any of the above providers listed in the City Clerk's new contract database. Furthermore, a search of historical agendas did not reveal any contracts presented to Council for approval. This appears to violate the Charter as several providers are billing close to, or over, $2000/month (GTT, Metropolitan, and Verizon) and exceeded the City Manager's spending authority years ago. A new agreement with Granite that started service last July will do so within two years. These findings lead to the following questions regarding our management of communication services: What data services and/or number of phones (land vs cell) are we getting from each provider? What is the cost per phone per provider? Why do we need nine providers? Do any of them provide volume discounts for commercial/gov't clients? Why have none of the associated agreements or contracts been presented to Council for approval? Page 11, Check #13351 for $2332 to Fieldman, Rolapp, & Associates (FRA) for "General Financial Advisory- Sept 2019." In my comments for the 8/12/19 Council meeting, I provided a chart documenting that payments to FRA from March 2017 to June 2019 had totaled over $53,000, far exceeding the City Manager's contracting authority of $33,970. Therefore, I had recommended that Council "Direct staff to refrain from asking FRA to perform any further services until staff brings a contract back to Council for approval." Staff apparently disregarded my concerns and continued to authorize work by FRA. With check #13351 for services in September, the total paid to FRA is now over $58,000 (see table below). Furthermore, a Purchase Order was issued on 10/10/19 (see attached), signed by the City Finance Director and the City Manager, for another $20,000 in services. Forecast Financial Advisory Service Period Check # Check Date Model Services Feb 2016 -Feb 2017 116102 3/23/2017 $10,054 Feb -June 2017 2294 7/20/2017 $4,783 July 2017 2666 8/17/2017 $2,952 August 2017 2738 8/17/2017 $762 Sept 2017 3375 10/5/2017 $2,492 Dec 2017 4353 12/21/2017 $159 Dec 2017 4556 1/11/2018 $1,357 $1,122 Jan 2018 5117 2/22/2018 $2,204 $2,137 Feb/Mar 2018 6140 5/3/2018 $1,412 $1,503 April 2018 6598 6/7/2018 $1,243 May 2018 6834 6/28/2018 $2,587 June 2018 7128 7/19/2018 $4,113 July 2018 7431 8/9/2018 $7,517 February 2019 10273 3/28/2019 $2,201 March 2019 10863 5/9/2019 $528 April 2019 11198 6/6/2019 $1,846 May 2019 11387 6/20/2019 $1,624 June 2019 11867 7/25/2019 $508 July 2019 12303 8/22/2019 $876 August 2019 12926 10/10/2019 $2,118 September 2019 13351 11/14/2019 $2,332 Totals: $30,130 $28,295 Total Paid to FRA $58,425 2 These actions lead me to conclude that City staff have willingly violated Charter Section 420 which reads in part: SECTION 420. Contracts. Execution. The City shall not be bound by any contract, except as hereinafter provided, unless the same shall be made in writing, approved by the City Council... By ordinance or resolution the City Council may authorize the City Manager to bind the City, with or without a written contract, for the acquisition of equipment, materials, supplies, labor, services or other items included within the budget approved by the City Council, and may impose a monetary limit {currently $33,970} upon such authority. Staff may deny a Charter violation by rationalizing that FRA has been working on two different "projects"—General Financial Advisory Services, and Financial Forecast Model—and spending on neither project, if considered alone, has violated the City Manager's spending authority. However, this rationale is not consistent with staff's interpretation of the Charter in the very recent past. The City Attorney has opined on several occasions that "contract splitting" is not allowed. To wit, this issue was discussed in the summer of 2017 as part of the proposed revision to M.C. Chapter 3.20, Purchasing System (7/10/17, Q. The proposed revision stated, in part, that "It shall be unlawful for any city officer to intentionally segment orders or contracts into smaller units to avoid complying with the requirements of this chapter." It does not matter if the "smaller units" are different projects. On 11/13/18 (Item H), a contract for $26,200 was presented to Council for approval with Rasic Construction to do electrical work on the 1St Street restaurant. The staff report notes Rasic had earlier in the fiscal year completed an unrelated emergency water main repair for $9726, and goes on to state "Since the combined total of these projects would exceed the $33,367 threshold, staff is requesting authorization to award a Professional Service Agreement." To be clear, the City Manager's spending threshold is not "per fiscal year." On the same agenda for 11/13/18, Item G requests Council approval for a $30,000 contract with Zimmerman Engineering to provide staffing assistance with the issuance of encroachment permits. Council approval was necessary because Zimmerman had been awarded a contract in the prior fiscal year for $50,000 to do unrelated work on the OCTA 405 project. Furthermore, any "per year" interpretation of the City Manager's limit would have a grossly unacceptable consequence—the granting of five-year contracts without Council approval for spending almost $170,000 over the life of each contract. At this point in time, I urge the Council to demand that Section 420 of the Charter be followed by staff. To do otherwise, is to risk losing the Council's control over spending. Staff has put their intention in writing (via Purchase Order #16137) to give RFA over $75,000 in cumulative consulting fees without the Council's approval. The Council can put a hold on any further spending on RFA by taking the following two actions: 1) Pull Item B from the Consent Calendar, and 3 2) Pass a motion to not "approve" Check #13351. While this check has already been paid for services delivered and the money will not be refunded, formal non -approval by Council is the mechanism by which the Council can officially avoid validating staff's violation of the Charter. To wit, the Council has been told in the past that the listing of warrants on the agenda is not just for informational purposes, but rather for the Council to officially "approve" them. This is the rare case where the Council should exercise its oversight authority to not approve a specific warrant. Pages 11 & 19, Checks #13359 and #13444 to the IPS Group for $7,065 and $718, respectively. The Council approved a contract with IPS on 2/12/18 (Item E) to purchase and install 78 single- space "smart" parking meters in the Main Street lots. Besides the purchase of the meters, the contract also obligated the City to pay ongoing costs associated with wireless services, management system access, and credit card fees. At the time of contract approval, I objected to the omission of any estimate of these ongoing costs in Financial Impact section of the staff report. The contract was approved for a five-year term with a not -to -exceed total of $46,319 (see attached). However, with the recent payment of checks #13359 and #13444, the total paid to IPS has now exceeded this contract limit by almost $10,000: Check # Check Date Warrant Comment Amount 6387 5/24/2018 Parking Mgmt Program $ 46,831 8059 9/26/2018 Housing Assembly $ 812 9131 12/20/2018 Parking Mg mt Program $ 732 13359 11/14/2019 Services Jan to Sept 2019 $ 7,065 13444 11/21/2019 Services Oct 2019 $ 719 Tota 1 $ 56,159 Section 1.4 of the contract states that "The City Manager may authorize extra work to fund unforeseen conditions up to the amount approved at the time of award by the City Council. Payment for additional work in excess of this amount requires prior City Council authorization." The City Manager did not comply with this contract provision which would have required her to present a contract amendment to the Council over a year ago. With ongoing monthly service charges that appear to be running at over $9000 per year, this must be done as soon as possible. Recommendation: Direct the City Manager to calendar a contract amendment as soon as possible. Page 16, Check #13411 to the City of Long Beach PWD (Public Works Dept) for $7,431 for the FY 2019 4t' quarter, presumably for collection of coins from the Main St parking lot meters. Prior quarterly warrants have been for about $3100. Have the quarterly charges doubled, or is this a payment for two quarters? 4 Page 28. Check #13534 to the Enforcement Tech Group for $28,664 for a Direct -Link Bridge "throw phone" system designed to be used in a hostage or SWAT situation. Is this being paid for (charged to) the Police Tech CIP project (BG 2005)? Item E: Contract with Data Ticket This consolidated contract is essentially identical to the two that it is replacing. The previous contracts and the proposed replacement are unique in that they have no annual or contract maximum on costs charged to the City. This is due to a majority of the contract costs being generated from fees for various services related to processing of thousands of parking citations. Thus, the majority of annual costs depend on the number of tickets written. The fixed charges enumerated in the contract are limited to a $5000 per year for an online permit portal, and a $100 per month charge for "Joint Escrow Banking Services." However, based on review of invoices from 2016, there is another fixed charge that the City never agreed to pay— a $250 per month "Bank Minimum" charge. This can be seen on the second page of the attached invoice as a deduction from our escrow account balance. Is this $250 charge currently being deducted from our escrow account every month? If not, when did this charge cease? Given that this Bank Minimum charge was not in the approved contracts (nor in the proposed contract), what action would the City need to take to recover the $3000 per year that we have paid? Item F: Change in Investment Policy The new investment policy allows for up to 20% of the City's portfolio to be invested in asset – backed securities if they are rated AA. The Council should be aware that sudden loss in the value of such securities "backed" by pools of home mortgages was one of the major contributors to the financial collapse in the last recession. At the time, these bonds were also rated AA, but the loan pools were tainted with high-risk borrowers. By authorizing this asset class for City investments, the Council is making a long-term judgment that private banks, rating agencies, and the federal government will be successful in preventing this from occurring again. Recommendation: Limit asset-backed securities to a maximum of 10% of City's investment portfolio. Item I: M2 Expenditure Report for FY 18-19 The Financial Impact section of the staff report states we received $436,679 in M2 "Fairshare" funds in FY 18-19. However, the figure entered into Schedule 2 of the M2 Expenditure Report for Local Fair Share revenue (line "(X) in is $516,945. Which figure is correct? 5 Item J: Contract for Main Street Pressure Washing When this issue was discussed during the budget workshop on May 29th, to my knowledge, the public first became aware that a contractual cleaning referred to only one side of one block rather than the whole length of Main Street. This was certainly not the understanding of the Council when they approved the existing contract in March 2015 which specified that the "work" would be completed four times per month April -September and two times per month October -March. Given that there are three blocks on Main Street with six block sides, the apparent interpretation of the word "work" by the contractor has resulted in the complete length of Main Street being cleaned only once every 6 weeks April -September (at one block side per week) and once every 12 weeks October -March (at one block side every two weeks). A review of warrants confirms this cleaning frequency through July 2019. This background brings to the fore two salient points. Firstly, the new contract language must very clearly define the length of a work unit. Is it all six block fronts or the entire length of Main Street? Secondly, now that we know that the existing cleaning frequency was literally only 1/6th of what we thought it was, what is the appropriate schedule? Regarding the new contract's language, it has improved but there are still significant inconsistencies. Section 1.1 states in part that 'The pressure washing work (Work) shall include all... sidewalks located along Main Street (East and West sides) between PCH and Ocean Avenue." This appears to define a "Work" unit as the cleaning of the entire length. However, the language in Section 1.3 is clearly not consistent with this interpretation. It states in part that 'The Work will be completed 4 times per week for a maximum monthly total of 16 times per month." So in this section, a unit of "Work" does not mean the entire length of Main Street. How many block fronts does the term "Work" in Section 1.3 refer to? If it means one block front, then how does completion of four block fronts per week result in weekly cleaning of the entire length of Main Street as stated in the staff report? Regarding the frequency of cleaning, the staff proposal to increase to weekly year-round was mentioned at the May 29th workshop along with an estimated cost of $100,000. However, this was not discussed in any detail. The staff report now states that weekly cleaning year-round (rather than twice a month from October to March as intended by Council in 2015) is recommended due to increased fruit droppings from the ficus trees. During what months do our ficus trees drop fruit? Is there an economical way to stop the trees from fruiting? For example, by spraying them with plant hormones? See https://www.mortonarb.org/trees-plants/tree-and-plant- advice/horticulture-care/preventing-or-reducing-fruit-ornamental-trees How much money would be saved by doing the full street only twice per month from October to March? r, Item L: Approval of Payment for Emergency Water Line Repairs This staff report and resolution requests that the Council ratify "actions" and approve payments related to the repair of two breaks in the Hellman Ranch waterline that occurred on July 24th and August 17tH The first break was repaired by Rasic Construction Company for $19,986, within the PW Director's (and City Manager's) spending authority and below the bidding threshold of $33,970. Therefore, nothing is at issue regarding actions that staff took regarding the timing of work, nor the City's subsequent payment in full to Rasic (Check #12761 for $19,986 issued on 9/26/19). However, with the second break, the bid from Rasic came in at $34,429, exceeding both the bidding threshold and the PW Director's spending authority. This water line break did not disrupt service to any customers. Nevertheless, it eliminated a back-up ("emergency") supply line to OT. Since this loss of system redundancy has potential public safety consequences, the bidding threshold can be waived be the City Council under Charter Section 1010 which reads in part: "Contracts likewise may be let without advertising for bids, if such work, supplies or materials shall be deemed by the City Council to be of urgent necessity for the preservation of life, health, or property. in either event, the Council shall adopt a resolution with findings supporting the letting of a contract without advertising for bids by at least three (3) affirmative votes of the Council, after which the City may proceed to have such work done or said supplies and materials purchased" [emphasis added) The problem here is that the Charter Section 1010 unequivocally specifies that no work "may proceed" before Council approval. The work was finished over three months ago. Therefore, this charter section cannot be invoked now, after -the -fact, to ratify any prior staff actions or approve payments to Rasic. To comply Charter Section 1010, the work that began on Monday August 19th would have needed to be delayed three weeks for approval by Council at the regularly scheduled meeting on September 9th. Alternatively, repairs could have been expedited by staff calling an emergency meeting of the Council, say, on Monday August 26th, a typical Council meeting date that had been previously canceled due to "lack of business." Of note is that the repair of a prior break in the same water line on May 25, 2015 was delayed by staff for four weeks until the repair work was pre -approved by Council on June 22nd (see attached staff report). That repair was similarly deemed to be "urgently necessary to protect life, health, and property." Yet, staff fully complied with Charter Section 1010. There is no reason that staff could not have similarly done so with the recent break in August. The Council needs to make it clear to staff that the Charter is our local "rule of law," and that the Council will not "ratify" its violation. Recommendations: 1) Pull Item L from the Consent Calendar for discussion, 2) Authorize the remaining payment due to Rasic of $34,429 for their work on the August repair (Stantec has already been paid in full), but 3) Delete the last "Whereas" in Resolution 6988 which references Charter Sections 107 and 1010 to "ratify the emergency contracts." Regarding Charter Section 107, this was not even discussed in the body of the staff report, and appropriately so. It is intended to be used "in order to insure continuity of governmental operations in periods of emergency resulting from disasters of whatever nature," and bestows upon the City Manager, through Municipal Code Section 3.25.020, broad powers to spend whatever money is necessary without bidding or Council approval. However, to trigger this emergency power, she would have needed to have made a formal proclamation of local emergency. This then would have become "null and void seven days after issuance unless ratified by the City Council" (MC Section 3.25.020.A2). Such a declaration was issued in the immediate aftermath of the pier fire, but obviously not in this case. Item M: MOU's with OCEA, SBSPA, Mid -Management All three contracts that expired last July had a similarly worded sub -section that stated that part-time and/or seasonal employees were not eligible for paid vacations. This sub -section in the Mid Management MOU (Section 7:C) has now been stricken from the proposed contract while it remains in the other two proposed contracts. My first thought behind this was that none of the classifications represented by Mid Management included part-timers. However, a review of the Position Allocation Plan in the budget shows a part-time Management Analyst in the City Manager's Office. Is this part-time employee now eligible for vacation pay? If so, won't this lead to a "me -too" demand from the OCEA and SBSPA for the part-time classifications that they represent? Item 0: City Manager's Raise The staff report fails to mention that in addition to the increases in base salary, the previous two contract amendments each included an increase in Ms. Ingram's deferred compensation of $3500. Increases of this magnitude were not given to other Executive Management employees. However, the staff report correctly noted that her contract does not provide a comparable 5% seniority bonus at 10 years of service. A useful "yardstick" to evaluate the proposed 4% and 5% raises is to compare her resultant total base salary and deferred compensation vs. what she would have received with the comparable provisions of a typical Executive Management employee contract. This analysis must start at the last point in time when she and other Executive Management employees both received raises at the same time (July 1, 2015). This analysis (attached) shows that from July 2015 through July 2020, her total combined base salary and deferred compensation will have risen by 19.3%. This compares to a rise of 19.0% if she had been eligible for the same raises (including a seniority bonus in October 2018) as her Executive Managers. This analysis assumes that the Executive Managers will receive the minimum CPI increase of 2% in July 2020 that has been proposed for the civilian bargaining units. 8 Cit of Seal Beach VENDOR: SHIP TO: Fieldman, Rolapp & Associates City of Seal Beach 19900 ?MacArthur Blvd. 211 8th Street Suite 1100 IRVINE, CA 92612- Seal Beach, CA 90740 - ! r-� 3 PURCHASE ORDER No. 00016137 BILL TO: City of Seal Beach 211 8th Street Seal Beach, CA 90740 VENDOR NO. VENDOR PHONE NUMBER TERMS DATE REQUIRED DELIVERY DATE FIF.04 1 (949) 660-8500 0 10/10/2019 SHIPPING INSTRUCTIONS (none) ITEM QTY U/M DESCRIPTION / TASK PRD CODE ACCOUNT UNIT PRICE AMOUNT 1 0,00 each General Financial Advisory Services ' 1h 001-019-44000 20,000.0000 20,000.00 TAXABLE: No CONFIRMING: No SPECIM, INSTRUCTIONS: SUBTOTAL: 20,000.00 TAX: 0.00 SHIPPING: 0.00 TOTAL.20,0 10 - TifRE 10 j zV t IMPORTANT: OUR ORDER NUMBER MUST APPEAR ON EVERY INVOICE ANI) PACKAGE This order is given upon the representation and guaranty of the manufacturer or seller that no breach of any State or Federal Law or Regulation has occurred in connection with the manufacturing, processing, branding, labeling or transportation of the merchandise herein mentioned. If such breach occurs or is charged by any legally constituted State or Federal authority, the buyer shall be entitled to rescind the coder and rerun the unused merchandise and shall also be held harmless by the manufacturer or seller against any penalty incurred and/or the cost of defense of any proceeding designed to penalize the buyer therefor. E DATA 4600 Campus Drive �IiI Suite 200 Newport Beach, CA ICIC. 92660 Seal Beach Attn Patrick Gallegos 211 8th St Sea[ Beach, CA 90740 Invoice Invoice Number: Odl 73450 Sent Date: 9!20/20167/ Terms: Due on receipt Entity Number: 0927/0928 DESCRIPTION QUANTITY PRICE AMOUNT Daily Citation Processing Daily Citation Processing 2,103 2,103 0.60 0.25 1,261.80 525.75 Daily Notices Out of SWEt Collec bons 1,214 6,632 0.73 0.28 886.22 1,856.96 Appeal Processing 12 0.50 6.00 Appeal'Processing 193 1.50 289.50 Other Correspondence (Appeals, Postcards, etc.) 196 0.73 143.08 Hearing Schedule Letter 8 0.75 6.00 NSF Letters 3 5.00 15.00 Refund 1 5.00 5.00 Joint Account Fee for Banking Service 1 100.00 100.00 OF UOMEIWnOence (Appeals, PoostCa etc1 Social Security Search 2 (J r] FTB Collections (n} /�_ \_-\ 2 52 282 073 3.00 0.15 1.46 156.00 42.36 Delinquent Collection Processing U) NOV 0 3 2016 August 2016 / By 4APRO4VED 1,965.90 POSTED ,NOV 0 I REI -0 { =gip i,:�/ /!/ tit " , 77A:` � �Z. a c� ._'- kccT IThank you' 11�1Prepared by: '� /� /rr�.-- In order to be Reviewed by environmentally friendly Invoice Total $7,26103 and for your convenience, - we have begun electronic Payments/Credits -$7,261.03 billing. If you would like to Phone # 949-752-6937 participate, please contact Total Amount Due $0.00 Fax # 949.752-6972 us at the email below. Accounting@DataTicket.com www. CitationProcessingCenter.com �J a !Di N' V 0 3'0i6 L By City of Seal Beach September Invoice or August Activity City of Seal Beach City of Seal Beach S 54,843.00 Bank Ending Balance Escrow Account 5102,456.00 Amount Collected at DTI $ 5,736.00 Amount Collected at DMV 5 - FTB Collections Outstanding Expenses: Outstanding Expenses. $ (250.00) ,Bank Minimum $ - Account Analysis Fee $ (76.00) Check 1103, Refund SBP702487, 0811712016 S (326.00) Total Outstanding Expenses $ Total Outstanding Expenses Outstanding Additions: Outstanding Additions: Credd Cards S $3,675.00 Total Outstanding Additions S Total Outstanding Additions i 108192.00 Total to Distribute $108,192.00 i (7.261.03) Total to Distribute Due To Invoice: 73450 pup To invoice�73450? S (26,156.50) Due to Superior Court $ (26,156.50) Duo to Superior Court $ 74,774.47 Due to Seal Beach $ 74,774.47 Duo to Seal Beach Toth Revenue for August Total Collected at DTI $102,456.00 Total Collected at Client $ 1,818.00 August 2016 Collected at DMV $ 7,574.00 Total Revenue $111,848.00 Outstanding Invoice/Tax" Summary as of September 2016 Total Amount of Outstanding Invoices: $ - a !Di N' V 0 3'0i6 L By PROFESSIONAL SERVICES AGREEMENT FOR THE SUPPLY OF PARKING METER EQUIPMENT AND RELATED SERVICES Between City of Seal Beach 211 8th Street Seal Beach, CA 90740 IPS Group Inc. 7737 Kenamar Crt., San Diego CA 92121 8585687609 This Professional Service Agreement ("the Agreement') is made as of February 12, 2018 (the "Effective Date"), by and between IPS Group, Inc. ("Consultant'), a Pennsylvania corporation, and the City of Seal Beach ("City"), a California charter city, (collectively, "the Parties"). S7296-0001 \2153207v1.doc RECITALS A. City desires certain professional services for the supply of parking meter equipment and related services. B. Consultant represents that it is qualified and able to provide City with such services. NOW THEREFORE, in consideration of the Parties' performance of the promises, covenants, and conditions stated herein, the Parties hereto agree as follows. AGREEMENT 1.0 Scope of Services 1.1. Consultant shall provide those services ("Services") set forth in the attached Exhibit A, which is hereby incorporated by this reference. To the extent that there is any conflict between Exhibit A and this Agreement, this Agreement shall control. 1.2. Consultant shall perform all Services under this Agreement in accordance with the standard of care generally exercised by like professionals under similar circumstances and in a manner reasonably satisfactory to City. 1.3. In performing this Agreement, Consultant shall comply with all applicable provisions of federal, state, and local law. 1.4. Consultant will not be compensated for any work performed not specified in the Scope of Services unless the City authorizes such work in advance and in writing. The City Manger may authorize extra work to fund unforeseen conditions up to the amount approved at the time of award by the City Council. Payment for additional work in excess of this amount requires prior City Council authorization. 2.0 Term This term of this Agreement shall commence as of the Effective Date and shall continue for a term of five (5) years ("the Initial Term")unless previously terminated as provided by this Agreement. The City shall have the option to extend the term of this Agreement beyond the Initial Term for two (2) additional one (1) year increments for a total period not to exceed seven (7) years unless otherwise agreed between the Parties in writing. The City shall notify the Consultant in writing of its intention to extend the term of the Agreement at least ninety (90) days prior to the expiry of each such term. 2of14 57296-000112153207v1.doc 3.0 Consultant's Compensation 3.1 City will pay Consultant in accordance with the rates shown on the pricing schedule set forth in Exhibit B for Services but in no event will the City pay more than $46,319 . Any additional work authorized by the City pursuant to Section 1.4 will be compensated in accordance with the fee schedule set forth in Exhibit B unless otherwise agreed between the Parties in writing. 4.0 Method of Payment 4.1. Consultant shall submit to City monthly invoices for all services rendered pursuant to this Agreement. Such invoices shall be submitted within 15 days of the end of the month during which the services were rendered and shall describe in detail the services rendered during the period, the days worked, number of hours worked, the hourly rates charged, and the services performed for each day in the period. City will pay Consultant within 30 days of receiving Consultant's invoice. City will not withhold any applicable federal or state payroll and other required taxes, or other authorized deductions from payments made to Consultant. 4.2. Upon 24-hour notice from City, Consultant shall allow City or City's agents or representatives to inspect at Consultant's offices during reasonable business hours all records, invoices, time cards, cost control sheets and other records maintained by Consultant in connection with this Agreement. City's rights under this Section 4.2 shall survive for two years following the termination of this Agreement. 4.3. City agrees to promptly notify Consultant in writing of any dispute with any invoice, and those invoices for which no such notification is made within ten (10) business days following receipt of the invoice shall be deemed accepted by the City. 4.4. Pricing shall remain fixed during the Initial Term. After the Initial Term, Consultant shall be entitled to adjust the pricing for any of the Services due to increases in inflation as published by the US Bureau of Labor Statistics for All Consumer Price Index for All Urban Consumers (CPI -U) for the US City Average. 5.0 Termination 5.1. This Agreement may be terminated by City, without cause, or by Consultant based on reasonable cause, upon giving the other party written notice thereof not less than 30 days prior to the date of termination. 3of14 S7296-0001 \2153 207v 1. d oc AGENDA STAFF REPORT It DATE: June 22,20X Zrk !' TO: Honorable Mayor and City Council THRU: Jill R. Ingram, City Manager FROM: Sean P. Crumby P.E., Director of Public Works SUBJECT: APPROVE EMERGENCY REPAIR OF HELLMAN RANCH WATER MAIN BREAK WITHOUT ADVERTISING FOR BIDS — EM1503 SUMMARY OF REQUEST: That the City Council adopt Resolution No. 6573 declaring that the emergency repair of the Hellman Ranch Watermain break is of urgent necessity for the preservation of life, health, and property, and authorizing staff to contract for the emergency repair without advertising for bids — EM 1503. BACKGROUND AND ANALYSIS: On May 25, 2015, a water main break occurred on the Los Cerritos Wetlands Authority property. The property is located at the north westerly intersection of First Street and Pacific Coast Highway adjacent to the Hellman Ranch Property. The water break occurred in an 18 -inch pipeline approximately 800 feet from the intersection. The City has a 10 foot wide easement in which the water line is located (see attached map). The break occurred in the early morning hours of May 25, 2015. Staff responded by closing the valves near the break to stop water from escaping from the water line. This waterline is critical to the City's ability to provide domestic water in Seal Beach. Without this line the City lacks redundancy in the water system and can have challenges providing adequate fire flow protection to portions of the City. With this water line out of service, there is only one path for water to be transmitted between the northern portions of the City and the coastal areas. Any problem with the single remaining line would completely compromise the City's water service in this area. Thus, the immediate repair of this water line is urgently necessary to protect life, health, and property. Due to the age of this 47 year old line, it has been budgeted for replacement. The project has been included in the FY 2013-14 and FY 2014-15 budgets. The project has not moved forward as the property owner (Los Cerritos Wetlands Authority) is preparing a master plan for restoration of the property. The last Agenda Item F water main break on this line was approximately five years ago and was smaller in severity; however, as detailed above, it is urgently necessary that the City repair this break as soon as possible. Staff has already engaged in preparing a repair plan, soliciting a contractor, and reaching out to the property owner (Los Cerritos Wetlands Authority) where the waterline easement lies. At this time, the details of the repair are estimated as the City has not yet been able to expose the pipe and determine the extent of the damage. Normally, a public works project of this magnitude requires the City to formally bid the project per the public contract code and the City's Charter. This process is time consuming with requirements to publicly solicit bids and award a contract to the lowest responsible bidder. The normal bidding process could take between 30 and 90 additional days. Under these emergency circumstances, Seal Beach Charter Section 1010 permits the City Council to dispense with public bidding and approve the project on an emergency basis. Three affirmative votes are required to approve the attached resolution. If approved, staff anticipates beginning work on the repair immediately and estimates a two week construction schedule. Staff is also investigating installation of a leak detection system that can improve response times while the existing line remains in place. ENVIRONMENTAL IMPACT: This emergency repair project to an existing water facility is categorically exempt from CEQA review under a Class 1 exemption and there is no anticipated environmental impact associated with this repair project. The watermain is located within the Coastal Area, but was installed in 1968, prior to the enactment of the Coast Act of 1973. LEGAL ANALYSIS: The City Attorney concurs that this situation meets the requirement for dispensing with public bidding for emergency projects pursuant to the City Charter. FINANCIAL IMPACT: Within the operating budget of the Public Works Department, $30,000 is budgeted annually to fund repair of water main breaks (017-900-44000). Due to the nature of this project and emergency action, it is estimated that emergency repair costs will range between $150,000 to $200,000. This estimate is conservative in nature as the pipe has not yet been exposed. Water maintenance funds will be used. A staff report will be brought to the City Council Page 2 at the conclusion of the repair closing the project and detailing the expenditures of the repair. There will be no impact to the City's General Fund. RECOMMENDATION: That the City Council adopt Resolution No. 6573 declaring that the emergency repair of the Hellman Ranch Watermain break is of urgent necessity for the preservation of life, health, and property, and authorizing staff to contract for the emergency repair without advertising for bids — EM 1503. NOTED AND APPROVED: �fflMXIA Sean P. Crumby P.E. Director Prepared by: Michael Ho, P.E. Deputy Director of PW/City Engineer Attachments: A. Resolution No. 6573 B. Site Map Page 3 RESOLUTION NUMBER 07J A RESOLUTION OF THE SEAL BEACH CITY COUNCIL DECLARING THAT THE EMERGENCY REPAIR OF THE HELLMAN RANCH WATERMAIN BREAK IS OF URGENT NECESSITY FOR THE PRESERVATION OF LIFE, HEALTH, AND PROPERTY AND AUTHORIZING STAFF TO CONTRACT FOR THE EMERGENCY REPAIR WITHOUT ADVERTISING FOR BIDS — PROJECT SEM1503 THE CITY COUNCIL HEREBY RESOLVES, FINDS, AND DETERMINES AS FOLLOWS: 1. On May 25, 2015 a water main break occurred on the City?& water line in the Los Cerritos Wetlands property. 2. City staff shut down the water line where the break occurred, affecting the southern portion of the City. Without the line where the break occurred, the southern portion of the City has limited fire protection and no redundant water system supply. 3. The City Council hereby declares the following: A. The repair of the recent break in the above-described water line, Project #EM1503, is of urgent necessity for the preservation of life, health and property. . B. Pursuant to the City's Charter section 1010, the Director of Public Works Is authorized to contract for the repair project without advertising for bids. C. The Director of Public Works Is directed to report back to the City Council at the conclusion of the project regarding the costs and expenditures for the project. PASSED, APPROVED, and ADOPTED by at least three affrmab a votes of the Seal Beach City Council at a regular meeting held on the 220d day of "M 2015 by the following vote: AYES: Council Members: NOES: Council Members: ABSENT: Coundl Members: ABSTAIN: Council Members: Mayor ATTEST: City Clerk STATE OF CALIFORNIA } COUNTY OF ORANGE } SS CITY OF SEAL BEACH } I, Tina Knapp, City Clerk of the City of Seal Beach, do hereby certify that the foregoing resolution is the original copy of Resolution Number 65773 on file in the office of the City Clerk, passed, approved, and adopted by the Seal Beach City Council at a regular meeting held on the 22! day of June, 2013. City Clerk O N O N O O N 0 O N N O 00 O N N r O N r r (O O N 0 C C LO L US R \ \ L N r M a i o o cn a i o 0 0 U8 �: O O U 0 a) CA O f0 C r f6 C C r r r H m H 0 N N (0o O O O O .. 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