REPORT TO COUNCIL
SUBJECT
Title
Action to Authorize the City Manager to Negotiate and Execute Amendments to the Agreement with Tucker Construction, Inc. for Encampment Cleanup Services to Exercise Option Years and to Increase the Total Not-to-Exceed Maximum Compensation and Approve the Related Budget Amendment
Report
BACKGROUND
Encampment debris contributes to visual blight, odors, stormwater pollution, and other aesthetic and safety concerns in surrounding neighborhoods. The City must follow stringent procedures to protect both the rights of individuals impacted by encampment cleanups and the safety of the personnel performing the cleanup services. Encampment cleanups often entail sending notifications prior to and after cleanup, storage and distribution of personal property, and employee safety training to deal with
potential job site hazards. Due to these complexities, it is necessary to contract with an experienced vendor to ensure the City can clean up encampments swiftly before they grow in size or become health risks.
The Police Department (PD), Community Development Department (CDD), and Department of Public Works (DPW) coordinate extensively to remove encampments at City-maintained properties throughout Santa Clara. PD coordinates with CDD to provide resources to individuals in need of assistance and works with them to clear personal belongings from sites before abatement. PD and DPW determine a date and time for the anticipated cleanup activity and DPW coordinates with the vendor to perform the cleanup services.
In June 2024, the City Council authorized the City Manager to execute an agreement with Tucker Construction (Tucker) for citywide encampment cleanup services following a competitive Request for Proposals process (RTC 24-1511, Attachment 1). The agreement includes an initial one-year term beginning July 1, 2024 and ending June 30, 2025, with up to four additional one-year options to extend the agreement through June 30, 2029 (Attachment 2). Current option year 1 of 4 is set to end on June 30, 2026. The maximum compensation authorized for the initial term and option year 1 is $250,000.
DISCUSSION
Since contract execution in 2024, Tucker has provided encampment cleanup services in accordance with the agreement. Maintaining continuity of these services is essential to minimize encampment debris which contributes to visual blight, odors, stormwater pollution, and other aesthetic and safety concerns in surrounding neighborhoods.
The City Manager’s Office has communicated the need to increase the number of encampment cleanups from 12 per year to 24 per year. Additional off-schedule cleanups have also increased to address cleanups outside of the scheduled monthly cleanups. Funding levels allocated for the current agreement are insufficient to carry out the increased number of encampment cleanups.
To continue these services beyond June 30, 2026, staff requests authorization to increase the agreement’s not-to-exceed amount to $1,135,453 to cover the costs through the remaining three one-year option periods and associated contingency. Table 1 below provides a summary of the costs under the agreement.
Table 1 - Cost Summary
|
Term |
Amount |
|
Initial 1-Year Term (7/1/24 - 6/30/25) |
$81,268 |
|
Option Year 1 (7/1/25 - 6/30/26) |
$168,732 |
|
Option Year 2 (7/1/26 - 6/30/27) |
$213,000 |
|
Option Year 3 (7/1/27 - 6/30/28) |
$219,390 |
|
Option Year 4 (7/1/28 - 6/30/29) |
$225,972 |
|
Subtotal |
$908,362 |
|
Contingency (25%) |
$227,091 |
|
Total Not-to-Exceed Maximum Compensation |
$1,135,453 |
Option Year 2 reflects an increase of approximately 26% based on the higher anticipated activity level, while Years 3 through 4 assume annual price increases of 3%. Tucker may request adjustments to the rates; however, Tucker must demonstrate to the satisfaction of the City that any increase is warranted. All price adjustments are subject to the City’s written approval.
A contingency is included to account for unanticipated needs and potential increases in service demands over the term of the agreement. Staff will manage expenditures throughout the full term based on operational needs, allocating funds as needed, provided that the total compensation does not exceed the authorized amount.
Upon approval, staff will amend the contract to include additional compensation for the option years and will provide notice of the City’s intent to exercise the option to Tucker Construction, as applicable.
Tucker Construction will be required to pay prevailing wages under the terms of the agreement.
ENVIRONMENTAL REVIEW
Awarding the subject agreement with I Tucker does not constitute a "project" within the meaning of the California Environmental Quality Act ("CEQA") pursuant to CEQA Guidelines section 15378(a) as it has no potential for resulting in either a direct physical change in the environment, or as a reasonably foreseeable indirect physical change in the environment. Notwithstanding the foregoing, any abatement activities performed pursuant to the Agreement may be categorically exempt under CEQA Guidelines sections 15301 (Existing Facilities), 15304 (Minor Alterations to Land), and 15321 (Enforcement Actions by Regulatory Agencies), depending on the site and work required.
FISCAL IMPACT
As part of the adoption of the FY 2026/27 and FY 2027/28 Biennial Capital Budget, the operating budget for DPW included $114,444 for the encampment cleanups. Due to the increased number of cleanups, the FY 2026/27 appropriation is insufficient to cover the costs of Option Year 2 of $266,250, including contingency. Staff recommends the following budget amendment to increase the budget by $151,806, offset by the use of the unrestricted ending fund balance, as detailed below.
Budget Amendment
FY 2026/27
|
|
Current |
Increase/ (Decrease) |
Revised |
|
General Fund |
|
|
|
|
Expenditure |
|
|
|
|
Department of Public Works - Materials, Services, Supplies |
$7,395,881 |
$151,806 |
$7,547,687 |
|
|
|
|
|
|
Fund Balance |
|
|
|
|
Unrestricted Ending Fund Balance |
$3,939,253 |
($151,806) |
$3,787,447 |
Funding for future option years remains subject to Council appropriation and will be included as part of the annual budget process.
COORDINATION
This report has been coordinated with the Finance Department and City Attorney’s Office.
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 Sections 15301 (Existing Facilities), 15304 (Minor Alterations to Land), and 15321 (Enforcement Actions by Regulatory Agencies) of Title 14 of California Code of Regulations;
2. Authorize the City Manager or designee to execute amendments to the agreement with Tucker Construction, Inc. for homeless encampment cleanup services, to increase the maximum compensation up to $1,135,453, subject to the appropriation of funds and final review and approval as to form by the City Attorney;
3. Authorize the City Manager or designee to take any actions as necessary to implement and administer the agreement with Tucker Construction, Inc., including exercising up to the remaining three additional one-year options through June 30, 2029, and to negotiate and execute future amendment(s) to (a) add or delete services consistent with the scope of services, (b) adjust rates consistent with market conditions, and (c) make de minimis changes, subject to the above maximum compensation limit and final review and approval as to form by the City Attorney; and
4. Approve the FY 2026/27 budget amendment in the General Fund, increasing the Department of Public Works budget in the amount of $151,806 and decreasing the unrestricted ending fund balance in the amount of $151,806 (five affirmative Council votes required for the use of unused balances).
Staff
Reviewed by: Craig Mobeck, Director of Public Works
Approved by: Jovan Grogan, City Manager
ATTACHMENTS
1. RTC 24-1511
2. Original Agreement with Tucker Construction, Inc.