REPORT TO COUNCIL
SUBJECT
Title
Award of Contract for Custodial Services (F18-196)
Report
REPORT IN BRIEF
Approval is requested to award a contract to Imperial Maintenance Services, Inc. of Stockton, California for a five-year period with the option to renew the contract for an additional one-year period.
EXISTING POLICY
Pursuant to Section 2.08.040 of the Sunnyvale Municipal Code, City Council approval is required for contracts for the procurement of goods and services exceeding $100,000 in any one transaction.
ENVIRONMENTAL REVIEW
The action being considered 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 a reasonably foreseeable indirect physical change in the environment.
BACKGROUND AND DISCUSSION
The City has contracted with Sunnyvale Building Maintenance (SBM) for custodial services since 2007, and the existing contract is scheduled to expire May 31, 2018. Services are currently provided at most City facilities, with exact locations identified in Attachment “A” of the Services Agreement (Attachment 2 of the RTC).
The contracted services scope is to provide varied custodial services on a daily, weekly, monthly, semi-annual, and annual basis. Services provided range from daily removal of trash and recyclables, cleaning offices and vacuuming carpets to monthly striping and waxing of bathroom floors and annual deep cleaning of furniture, carpets, tile floors, computers, light fixtures and window covering.
Service levels were agreed to by departments that utilize these facilities to maintain cleanliness for City staff and the public. Cleaning schedules for facilities vary; however, most cleaning occurs between 6:00pm and 3:00am. The contractor is also required to provide a twenty-four (24) hour emergency response, while responding to the City within two (2) hours of a request for emergency services.
In February 2018, an Invitation for Bids (IFB No. F18-196) for custodial services was issued through the City’s Onvia DemandStar public procurement network. Two mandatory site walkthrough dates were scheduled, with four (4) contractors in attendance. One (1) sealed bid was received and opened publicly on March 21, 2018. Imperial Maintenance Services, Inc. was the sole responsive bidder, as shown in Attachment 1 Bid Summary.
Pursuant to Section 2.08.120 (a) of the Sunnyvale Municipal Code, the City Manager authorized the Purchasing Officer to negotiate a reasonable price with the sole bidder. Imperial Maintenance Services, Inc. submitted an initial bid in the amount of $3,906,668.72 for a five-year period (year one: $730,385, year two: $765,754, year three: $765,754, year four: $802,891, year five: $841,885). Subsequent scope and fee discussions resulted in a decrease of the year one bid amount to $717,518 and establishing service cost escalations for years two through five based on the Bureau of Labor Statistics for the San Francisco Bay Area annual Consumer Price Index (CPI) (estimated at 2.5% per year).
Therefore, it is recommended that Council award a contract to Imperial Maintenance Services, Inc. for custodial services. City will issue a new agreement each year in consideration of compensation adjustments validated by the actual CPI.
In anticipation of the contract start date, and in accordance with California Labor Code 1060 and 1420, Imperial Maintenance Services, Inc. will contact SBM to coordinate potential employment with its staff.
FISCAL IMPACT
The proposed contract represents an annual increase of $229,038 over the most recent contract pricing with Sunnyvale Building Maintenance. Approximately $19,086 of the increase is estimated for the remainder of FY 2017/18. Custodial costs are expended in Program 709 - Facility Services in the General Services Fund. The General Services Fund is an internal service fund for which expenditures are recovered through internal service rental rates, charged to individual department programs. The appropriation control for internal service funds is established at the fund level. Based on current expenditures, sufficient budget is available in the fund to absorb this increase in the current fiscal year and FY 2018/19; however, the budget will need to be increased going forward. The FY 2018/19 appropriation is contingent on City Council approval of the Recommended Budget, scheduled to be heard on June 26, 2018. Staff will monitor expenditures in the fund and will bring back a budget modification if required prior to the FY 2019/20 Budget.
PUBLIC CONTACT
Public contact was made by posting the Council agenda on the City's official-notice bulletin board outside City Hall, at the Sunnyvale Senior Center, Community Center and Department of Public Safety; and by making the agenda and report available at the Sunnyvale Public Library, the Office of the City Clerk and on the City's website.
RECOMMENDATION
Recommendation
1) Award a contract to Imperial Maintenance Services, Inc. for custodial services in the amount of $717,518 for year one, in substantially the same form as Attachment 2 to the report; and 2) Authorize the City Manager to renew the contract for up to five (5) additional one-year periods, subject to available funding and acceptable pricing and services.
Staff
Prepared by: Gregory S. Card, Purchasing Officer
Reviewed by: Timothy J. Kirby, Director of Finance
Reviewed by: Chip Taylor, Director of Public Works
Reviewed by: Teri Silva, Assistant City Manager
Approved by: Kent Steffens, City Manager
ATTACHMENTS
1. Bid Summary
2. Draft Services Agreement