REPORT TO COUNCIL
SUBJECT
Title
Award of Contract to Shredding Systems Incorporated in the Amount of $2,672,831.22 for a Pre-Load Compactor for the Sunnyvale Material Recovery and Transfer (SMaRT) Station NextGen Project and Approve a 7% Contingency in the Amount of $175,850 (F26-020)
Report
REPORT IN BRIEF
Approval is requested to award a contract in the amount of $2,672,831.22 to Shredding Systems Incorporated (SSI) of Wilsonville, OR for a pre-load compactor for the Sunnyvale Material Recovery and Transfer (SMaRT) Station NextGen Project. Approval is also requested for a 7% contingency of $175,850.
The amount corrects the previously approved contract amount (RTC No. 25-0307) of $2,549,829, which did not include sales tax. An additional $298,852.09 is required to cover sales tax and increase the contingency to 7% from the previously approved 1.5%.
EXISTING POLICY
Pursuant to Section 2.08.040 of the Sunnyvale Municipal Code, Council approval is required for the procurement of goods and/or services greater than $250,000 in any one transaction.
Section 2.08.070(b)(3) authorizes the purchase of goods and/or services to be exempted from the competitive bidding requirements when the solicitation of bids or proposals would be impractical, unavailing or impossible.
ENVIRONMENTAL REVIEW
The City Council certified an Environmental Impact Report (EIR) for the SMaRT Station in 1990 (SCH #89022812). For the “NextGen Project”, Addendum #3 (RTC No. 25-0307 - May 20, 2025) to the existing EIR has been prepared per the provisions of the State CEQA Guidelines to document the finding that none of the conditions or circumstances that would require preparation of a subsequent EIR, pursuant to Sections 15162 and 15164 of the State CEQA Guidelines.
Staff’s review indicates that no major revisions are required to the Final EIR prepared for the SMaRT Station (1992) because the project will not cause any new significant environmental impacts that have not been identified in the EIR. As no additional environmental analysis or review is required for the proposed NextGen Project, preparation of a subsequent EIR is not necessary. The Addendum prepared and attached to the Final EIR is the appropriate CEQA document for the SMaRT Station NextGen project.
BACKGROUND AND DISCUSSION
The SMaRT Station NextGen Project is a multi-phase modernization of waste and recyclables processing infrastructure.
On May 20, 2025, the City Council approved a purchase agreement with SSI in the amount of $2,512,147 plus a 1.5% contingency of $37,682 (RTC No. 25-0307). A subsequent review determined that the sales tax was mistakenly omitted. The corrected purchase price is $2,672,831.22.
Due to the complexity of integrating the compactor with other NextGen system components, staff also recommends increasing the contingency from 1.5% to 7% ($175,850) to provide adequate flexibility during implementation.
FISCAL IMPACT
Sufficient funds are available in Fund 6143 - SMaRT Station Equipment Replacement Fund under Project 828260 - SMaRT Post-2021 Rebuild to absorb the additional cost increase and recommended contingency increase. The project will be funded primarily through the issuance of revenue bonds and a CalRecycle Grant.
PUBLIC CONTACT
Public contact was made by posting the Council meeting agenda on the City's official-notice bulletin board at City Hall, at the Sunnyvale Public Library and in the Department of Public Safety Lobby. In addition, the agenda and this report are available at the City Hall reception desk located on the first floor of City Hall at 456 W. Olive Avenue (during normal business hours), and on the City's website.
RECOMMENDATION
Recommendation
Take the following actions:
- Award a contract to SSI Shredding, Inc. for a pre-load compactor in substantially the same form as Attachment 1 to the report in an amount not-to-exceed $2,672,831.22;
- Approve a 7% Contingency for the Purchase in the Amount of $175,850.09; and
- Authorize the City Manager to execute the Contract when all necessary conditions have been met.
Levine Act
LEVINE ACT
The Levine Act (Gov. Code Section 84308) prohibits city officials from participating in certain decisions regarding licenses, permits, and other entitlements for use if the official has received a campaign contribution of more than $500 from a party, participant, or agent of a party or participant in the previous 12 months. The Levine Act is intended to prevent financial influence on decisions that affect specific, identifiable persons or participants. For more information see the Fair Political Practices Commission website: www.fppc.ca.gov/learn/pay-to-play-limits-and-prohibitions.html
An “X” in the checklist below indicates that the action being considered falls under a Levine Act category or exemption:
SUBJECT TO THE LEVINE ACT
___ Land development entitlements
___ Other permit, license, or entitlement for use
_X_ Contract or franchise
EXEMPT FROM THE LEVINE ACT
___ Competitively bid contract*
___ Labor or personal employment contract
___ Contract under $50,000 or non-fiscal
___ Contract between public agencies
___ General policy and legislative actions
* "Competitively bid" means a contract that must be awarded to the lowest responsive and responsible bidder.
Staff
Prepared by: David Battaglia, Purchasing Officer, Finance
Reviewed by: Matthew Paulin, Director, Finance
Reviewed by: Ramana Chinnakotla, Director, Environmental Services
Approved by: Tim Kirby, City Manager
ATTACHMENTS
1. Draft Services Agreement
2. SSI Quote
3. Budget Project Summary Sheet 82860