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Home My WebLink About11 - Amendment to Service Agreement for Water Meter Reading ServicesQ SEW Pp�T CITY OF z NEWPORT BEACH c�<,FORN'P City Council Staff Report April 26, 2022 Agenda Item No. 11 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: Mark Vukojevic, Utilities Director - 949-644-3011, mvukojevic@newportbeachca.gov PREPARED BY: Joshua Rosenbaum, Senior Management Analyst, jrosenbaum@newportbeachca.gov PHONE: 949-644-3057 TITLE: Approval of Amendment No. Two to Service Agreement with Alexander's Contract Services for Water Meter Reading Services ABSTRACT: The Utilities and Finance Departments utilize a service provider to physically read non -digital water meters. These water meters are manually read (in person) monthly or bimonthly by a contractor and the agreement expires on May 31, 2022. The Utilities Department is requesting to amend and extend the current contract for water meter reading services with Alexander's Contract Services (Alexander's) as the City of Newport Beach (City) completes the Automated (Water) Meter Infrastructure project. RECOMMENDATION: a) Determine this action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly; and b) Approve Amendment No. Two to the Service Agreement with Alexander's Contract Services for Water Meter Reading Services, with an additional $75,000 in contract compensation, a one-year contract extension, and authorize the Mayor and City Clerk to execute the agreement. DISCUSSION: Over the past two years, with the implementation of the City's Advanced Water Meter Infrastructure (AMI) project, the number of water meters manually read by Alexander's has reduced from more than 26,000+ to about 11,400 resulting in a significant reduction to the monthly cost of service. As a manually read meter is replaced with an AMI meter, it no longer needs to be manually read by Alexander's. Approval of Amendment No. Two to Service Agreement with Alexander's Contract Services for Water Meter Reading Services April 26, 2022 Page 2 In late 2021 and into 2022, the City's AMI vendor experienced supply chain issues (i.e. semiconductors) resulting in delays in the receipt of advanced water meters and the completion of the AMI project. The supply chain issues are expected to subside over the coming months, and the City will receive the remaining AMI meters for installation over the next year. With the project delays, the City continues to require the services of Alexander's to manually read the remaining 11,400 water meters yet to be replaced with an advanced AMI water meter. Once the AMI project is fully implemented, the annual savings equates to $325,000. The City's contract with Alexander's for meter reading services expires May 31, 2022. Alexander's has performed satisfactorily and has requested inflationary adjustments to its pricing. Staff believes Alexander's pricing is competitive and their service will phase out as the supply chain crisis resolves. Staff is recommending extending the current agreement for one more year and adding $75,000 to the contract compensation to cover the continuation of meter reading services. FISCAL IMPACT: The adopted budget includes sufficient funding for this agreement. The costs for services under this agreement will be expensed to the Water Enterprise Fund program Meter Reading Services account in the Utilities Department, 7019052-811049. ENVIRONMENTAL REVIEW: Staff recommends the City Council find this action is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. NOTICING: The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item). ATTACHMENT: Attachment A — Amendment No. Two to Service Agreement with Alexander's Contract Services 11-2 ATTACHMENT A AMENDMENT NO. TWO TO SERVICE AGREEMENT WITH ALEXANDER'S CONTRACT SERVICES, INC. FOR WATER METER READING SERVICES THIS AMENDMENT NO. TWO TO SERVICE AGREEMENT ("Amendment No. Two") is made and entered into as of this 26th day of April, 2022 ("Effective Date"), by and between the CITY OF NEWPORT BEACH, a California municipal corporation and charter city ("City"), and ALEXANDER'S CONTRACT SERVICES, INC., a California corporation ("Contractor"), whose address is 8655 Morro Road, Suite C, Atascadero, California 93422, and is made with reference to the following: RECITALS A. On June 1, 2015, City and Contractor entered into a Professional Services Agreement ("Agreement") to engage Contractor to perform water meter reading services for City ("Project"). B. On May 12, 2020, City and Contractor entered into Amendment No. One to the Agreement to extend the term of the Agreement to May 31, 2022, to increase the total compensation, to update the Contractor's Project Manager's name, to update the City's Administration of the Agreement, and to update insurance requirements. C. The parties desire to enter into this Amendment No. Two to extend the term of the Agreement to May 31, 2023, and to increase the total compensation. NOW, THEREFORE, it is mutually agreed by and between the undersigned parties as follows: 1. TERM Section 1 of the Agreement is amended in its entirety and replaced with the following: "The term of this Agreement shall commence on the Effective Date, and shall terminate on May 31, 2023, unless terminated earlier as set forth herein." 2. COMPENSATION TO CONTRACTOR Exhibit B to the Agreement shall be supplemented to include the 2022 Schedule of Billing Rates, attached hereto as Exhibit B and incorporated herein by reference. The 2022 Schedule of Billing Rates shall be effective as of June 1, 2022. Exhibit B to the Agreement, Exhibit B to Amendment No. One, and Exhibit B to this Amendment No. Two, shall collectively be known as "Exhibit B." Section 4.1 of the Agreement is amended in its entirety and replaced with the following: "City shall pay Contractor for the Services on a time and expense not -to -exceed basis in accordance with the provisions of this Section and the Schedule of Billing Rates attached hereto as Exhibit B and incorporated herein by reference. Except as otherwise provided herein, no rate changes shall be made during the term of this Agreement without the prior written approval of City. Contractor's compensation for all Services performed in accordance with this Agreement, including all reimbursable items, shall not exceed Two Alexander's Contract Services, Inc. Page 1 11-3 Million Eighty One Thousand Six Hundred Dollars and 00/100 ($2,0$1,600.00), without prior written amendment to the Agreement." The total amended compensation reflects Contractor's additional compensation for additional Services to be performed in accordance with this Amendment No. Two, including all reimbursable items and subcontractor fees, in an amount not to exceed Seventy Five Thousand Dollars and 001100 ($75,000.00). 3. INTEGRATED CONTRACT Except as expressly modified herein, all other provisions, terms, and covenants set forth in the Agreement shall remain unchanged and shall be in full force and effect. [SIGNATURES ON NEXT PAGE] Alexander's Contract Services, Inc. Page 2 11-4 IN WITNESS WHEREOF, the parties have caused this Amendment No. Two to be executed on the dates written below. APPROVED AS TO FORM: CITY ATTORNEY'S OFFICE Date: z7��A By:_� Aaron C. Harp wa 3•� City Attorney ATTEST: Date: Leilani I. Brown City Clerk Attachments: CITY OF NEWPORT BEACH, a California municipal corporation Date: By: Kevin Muldoon Mayor CONTRACTOR: Alexander's Contract Services Inc., a California corporation Date:�q�� By: Q Timothy Chief E> Alexander utive Officer Date: QLf-01v 2% By: Christopher G. Molina Chief Financial Officer [END OF SIGNATURES] Exhibit B — Schedule of Billing Rates Alexander's Contract Services, Inc. Page 3 11-5 EXHIBIT B SCHEDULE OF BILLING RATES 2022 Billing Rates — Water Meter Reading Services (Effective June 1, 2022) *Exact number of meters subject to change based on new work scheduled by the City. Annual total also includes $135.00 data handling fee per month. Alexander's Contract Services, Inc. Page B-1 11-6 Unit Price: Quantity*: Frequency: Annual Total: Monthly Meter Reading $1.18 11,400 12 times per year $163,100.00 *Exact number of meters subject to change based on new work scheduled by the City. Annual total also includes $135.00 data handling fee per month. Alexander's Contract Services, Inc. Page B-1 11-6