REPORT TO COUNCIL
SUBJECT
Title
Action on Delegation of Authority to the City Manager to Negotiate and Execute Agreement(s) and Amendment(s) with Art Alger, Inc. DBA Peninsula Crane and Rigging for As-Needed Crane Services for Silicon Valley Power and the Water and Sewer Utilities Department
Report
COUNCIL PILLAR
Deliver and Enhance High Quality Efficient Services and Infrastructure
BACKGROUND
The City of Santa Clara (City) uses operated crane and rigging services for the safe handling of heavy equipment and materials such as transformers, turbines, generators, pumps, and motors. These services are needed on an as-needed basis to support preventative maintenance, capital improvement projects, emergency response, and utility operations.
In August 2024, staff issued a Request for Proposals (RFP) for as-needed crane services to support the operational needs of Silicon Valley Power (SVP), the Water and Sewer Utilities Department, and the Public Works Department. While the RFP was issued as a single solicitation, two separate agreements will result from this process, one will be managed and used by SVP (SVP Agreement) and the other will be managed by the Water & Sewer Utilities Department (Water Agreement).
DISCUSSION
Pursuant to Section 2.105.140(c) of the Santa Clara City Code (City Code), a formal Request for Proposals (RFP) was conducted with the award recommendation based on “best value.”
On August 22, 2024, the RFP for As-Needed Crane Services was published on the City’s e-procurement system. A total of 22 companies viewed the RFP, and two proposals were received by the October 2, 2024, deadline:
• Art Alger, Inc. DBA Peninsula Crane and Rigging (Peninsula)
• West Coast Cranes, Inc.
The proposals were independently evaluated by a panel against the criteria published in the RFP. Peninsula received the highest overall scores and was selected for the award.
Prior to completing an agreement, SVP issued purchase orders to Peninsula for critical projects. These purchase orders totaled less than $250,000, which is within the City Manager’s signature authority pursuant to Section 2.105.300 of the City Code. These purchase orders are exclusive to the proposed agreement amounts discussed below.
Staff is seeking City Council approval to delegate authority to the City Manager to negotiate and execute the SVP Agreement and future amendments. The proposed SVP Agreement has a maximum compensation of $2,000,000 for a five-year term ending on July 31, 2030, with an optional one-year term extension through July 31, 2031. Based on anticipated system growth and projected future service needs, future amendments may be needed to increase the maximum compensation by up to $500,000, for a newly revised maximum compensation of $2,500,000 for the six-year period including the one-year option.
Separately, the Water and Sewer Utilities Department is proposing to enter into a second agreement with Peninsula under the same RFP and staff is seeking City Council approval to delegate authority to the City Manager to negotiate and execute the Water Agreement and future amendments. The Water Agreement will have the same term as the SVP Agreement, ending on July 31, 2030, with an optional one-year term extension through July 31, 2031. The proposed maximum compensation for the Water Agreement is $350,000 for the six-year period including the one-year option.
Compensation under both agreements includes hourly labor rates based on classifications such as crane operator, rigger, foreman, and also for equipment rates such as crane, boom truck, and trailer. The contractor may request rate adjustments annually subject to the City’s approval.
ENVIRONMENTAL REVIEW
Staff recommends that the City Council determine that the actions being considered are exempt from the California Environmental Quality Act (“CEQA”) pursuant to section 15301 of Title 14 of the California Code of Regulations as the services involve maintenance and repair of existing facilities and mechanical equipment.
FISCAL IMPACT
The maximum compensation for the agreement between Peninsula and SVP is not anticipated to exceed $2,000,000, and $350,000 for the agreement between Peninsula and the Water and Sewer Utilities Department. Sufficient funds for the SVP Agreement are available in the FY 2025/26 Adopted Budget in the Electric Utility Operating or Capital Fund depending on the specific project. Funding for the Water Agreement is available in the FY 2025/26 Storm Drain Capital Improvement Fund in the SDPS Motor and Control Maintenance, Repair, and Replacement project, which is supported by the Public Works Department and in the Public Works Department Operating Budget for the storm drain pump station facility maintenance and repair.
Funds required for future years will be requested through the regular budget process.
COORDINATION
The report has been coordinated with the Finance Department, the City Attorney’s Office, the Electric Department - Silicon Valley Power (SVP), the Water and Sewer Utilities Department, and the Public Works Departments.
PUBLIC CONTACT
Public contact was made by posting the Council agenda on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any agenda report may be requested by contacting the City Clerk’s Office at (408) 615-2220, email clerk@santaclaraca.gov or at the public information desk at any City of Santa Clara public library.
RECOMMENDATION
Recommendation
1. Determine that the proposed actions are exempt from CEQA pursuant to Section 15301 (Existing Facilities) of Title 14 of the California Code of Regulations;
2. Delegate authority to the City Manager or designee to negotiate and execute an agreement with Art Alger, Inc. DBA Peninsula Crane and Rigging for Silicon Valley Power (SVP Agreement) for a five-year term beginning on or around August 1, 2025, with a one-year option to extend the agreement term through July 31, 2031, and a maximum compensation not to exceed $2,000,000, subject to the review and approval as to form by the City Attorney;
3. Delegate authority to the City Manager or designee to negotiate and execute an agreement with Art Alger, Inc. DBA Peninsula Crane and Rigging for the Water and Sewer Utilities Department (Water Agreement) for a five-year term beginning on or around August 1, 2025, with a one-year option to extend the agreement term through July 31, 2031, and a maximum compensation not to exceed $350,000, subject to the review and approval as to form by the City Attorney; and
4. Authorize the City Manager or designee to take any actions as necessary to implement and administer the SVP Agreement and Water Agreement, and to negotiate and execute amendments to these agreement to: (a) add or delete services consistent with the scope of services, (b) adjust future rates based on market conditions, (c) extend the term one additional year through July 31, 2031, (d) make de minimis changes, and (e) increase the maximum compensation for the SVP Agreement up to $500,000 for a total maximum compensation of $2,500,000, subject to the appropriation of funds and to the review and approval as to form by the City Attorney.
Staff
Reviewed by: Nico Procos, Acting Director of Electric Utility
Reviewed by: John Ramirez, Director, Water & Sewer Utilities
Approved by: Jovan D. Grogan, City Manager