REPORT TO COUNCIL
SUBJECT
Title
Award of Contract to Peterson Power Systems, Inc. for On-Call Engine Maintenance and Repair (F19-177)
Report
REPORT IN BRIEF
Approval is requested to award a Maintenance and Repair contract to Peterson Power Systems, Inc. of San Leandro, to provide on-call engine maintenance and repair for the Water Pollution Control Plant and various water, storm and sewer pumping stations for a one-year period with a contract amount not-to-exceed $500,000. Approval is also requested to authorize the City Manager to increase the not-to-exceed contract amount within budget appropriation.
EXISTING POLICY
Pursuant to Section 2.08.040 of the Sunnyvale Municipal Code(SMC), City Council is required for contracts for the procurement of goods and service 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 multiple engines that support power generation at the Water Pollution Control Plant (WPCP) and critical water, sewer and storm pumping stations throughout the City. Over the last five years the City has spent approximately $1.6 million in corrective maintenance, major rebuilds, and water and sewer pumping station engine routine maintenance. In 2013, new air regulatory emission requirements on the Power Generation Facility (PGF) engines at the WPCP have led to additional maintenance and more frequent overhauls. The schedule for routine, annual and major overhauls of these engines occurs during a 3-year cycle period.
The PGF at the WPCP is an electrical generation power plant which was commissioned in 1997. The PGF is owned and operated by the City and has the capacity to generate 1.6 megawatts of electricity. The facility is equipped with two Caterpillar Model 3516 Engine Generator sets with Caterpillar Brushless SR4 Generators. The engines are designed to burn lean fuels, including landfill gas, digester gas and air blended natural gas, or any combination of those gases. Digester and landfill gases are free by-products of waste processing, and are used in place of natural gas and electricity to help offset two-thirds of the Plant’s energy expenses, estimated at approximately $1.2 million annually. In addition, two standby generators are located at the WPCP, one manufactured by Caterpillar and one by Kohler.
The Baylands Pump Station No.1 utilizes two Caterpillar engines for storm water and sewer pumping while Baylands Pump Station No. 2 has one Generac and one Perkins back-up generator engine, which drive storm water pumps. Also, emergency water pumps powered by Waukesha engines are at the Mary-Carson Water Plant, and Generac and Perkins backup generators are at the Wolfe-Evelyn Water Plant.
On August 22, 2019, an Invitation for Bids (IFB) was advertised on the City’s public procurement network and directly emailed to five companies. Nine (9) companies requested the bid documents. Sealed bid were due on September 25, 2019, with a sole responsive bid received from Peterson Power Systems. The bid summary is attached as Attachment 1. This is an on-call agreement and therefore the agreement allows flexibility on services provided, staff is recommending establishing the agreement with a not to exceed of $500,000.
Peterson Power Systems is the authorized Caterpillar engine dealer in the Bay Area. Additionally, Peterson Power Systems technicians are qualified to repair the various types of other engines currently in use by the City.
It is anticipated that ongoing costs for the routine, annual and major overall maintenance of the engines identified will be higher. With the engines aging and the quality of the landfill gas decreasing it is anticipated that additional corrective maintenance needs will also arise. Additionally, it is expected that emergency repairs may be needed from time to time to ensure consistent performance. Therefore, staff is recommending Council approve an initial one-year contract, with two additional option years that will complete all generator maintenance needs during a three-year maintenance cycle.
FISCAL IMPACT
Budgeted funds are available as follows:
- Operating Program 360 (Water Resources) in the Water Supply and Distribution Fund
- Operating program 367 (Wastewater Collection System) in the Wastewater Management Fund
- Operating Program 365 (Wastewater Management) in the Wastewater Management Fund
- Project 020201- Wastewater Equipment in the Wastewater Management Fund
- Project 830210 - Repairs to the Power Generation Facility in the Wastewater Management Fund
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
Take the following actions:
- Award an on-call contract to provide on-call engine maintenance and repair services for the Water Pollution Control Plant with a contract amount not-to-exceed $500,000 in substantially the same form as Attachment 2 to the report
- Authorize the City Manager to execute the agreements when all conditions have been met
- Authorize the City Manager to increase the not to exceed contract amount within budget appropriation.
Staff
Prepared by: Gregory S. Card, Purchasing Office
Reviewed by: Timothy J. Kirby, Director of Finance
Reviewed by: Ramana Chinnakotla, Director of Environmental Services
Reviewed by: Teri Silva, Assistant City Manager
Approved by: Kent Steffens, City Manager
ATTACHMENTS
1. Bid Summary
2. Draft On-Call Maintenance and Repair Contract