HomeMy WebLinkAbout08 - Amendment MSA for Citywide Tree Maintenance Services (Contract No. 5648-1A)Q �EwPpRT
CITY OF
s NEWPORT BEACH
`q44:09 City Council Staff Report
May 14, 2024
Agenda Item No. 8
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: David A. Webb, Public Works Director - 949-644-3311,
dawebb@newportbeachca.gov
PREPARED BY: Kevin Pekar, Parks & Trees Superintendent - 949-644-3069,
kpekar@newportbeachca.gov
TITLE: Approve Amendment No. Three to the Maintenance Services
Agreement with Great Scott Tree Service, Inc. for Citywide Tree
Maintenance Services (Contract No. 5648-1A)
ABSTRACT -
The City of Newport Beach utilizes a contractor to perform tree planting, trimming,
inspection, root pruning and removal services to keep City trees in good condition. The
current tree maintenance agreement with Great Scott Tree Services, Inc. (GSTS) expires
on June 30, 2024, and includes provisions for three, two-year extensions. With the
impending expiration, GSTS expressed its willingness to extend the agreement if unit
rates could be increased more than the contract -specified Consumer Price Index (CPI)
maximum of 2.5%. GSTS further expressed challenges maintaining the current rates due
to mandated prevailing wage rate increases for tree work classifications set by the State
of California Department of Industrial Relations. After analysis and negotiations, staff
requests an amendment to the agreement to extend the term three years and add an
additional $6,100,000 to the contract for a total not -to -exceed contract amount of
$23,060,000.
RECOMMENDATIONS:
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. Three to the Maintenance Services Agreement with Great
Scott Tree Service, Inc. for Citywide Tree Maintenance Services with a three-year
extension and additional not -to -exceed amount of $6,100,000 for a total not -to -exceed
amount of $23,060,000, and authorize the Mayor and City Clerk to sign the
amendment.
DISCUSSION:
The City's urban forest is comprised of over 35,000 public trees across 26 square miles.
These trees serve to enhance the quality of life in Newport Beach, provide beautiful
backdrops to the City's public streets and 68 parks, provide environmental and habitat
benefits (such as cleaner air, more oxygen, cooler streets, conservation of energy and
water, prevention of soil erosion), and serve as one of the main reasons why Newport
Beach has been named "Tree City USA" for the last 34 years.
8-1
Approve Amendment No. Three to the Maintenance Services Agreement with
Great Scott Tree Service, Inc. for Citywide Tree Maintenance Services
May 14, 2024
Page 2
To maintain and preserve this substantial urban forest, the City has 2.5 full-time
employees assigned to management and care of the urban forest, as well as a service
contract with GSTS to perform the necessary citywide tree maintenance services.
Current Services Contract and Conditions:
The multi -year GSTS contract was executed on November 13, 2013, for a not -to -exceed
amount of $1,300,000 per year plus cost -of -living increases and is set to expire on
June 30, 2024. The current overall projected not -to -exceed amount of the contract is
$16,960,000. The contract has been amended twice. Amendment No. One increased the
contract cap by $500,000, with potential options to extend the contract through 2029.
No scope changes were included in Amendment No. One.
Amendment No. Two increased the total not -to -exceed amount by $636,298.81. The
increased amount provided more services to care for the urban forest and decreased the
City's potential liability from City -owned trees. For example, the City's grid trimming cycle
went from every two to three years to a two-year cycle. Additionally, more not -to -exceed
funding was added to provide contingency funding for necessary, as -needed storm
response work. Also, the contract end date was revised to June 30, 2024, to align it to
the City's fiscal year (FY), which assisted with budget funding and the keeping of tree
maintenance records. Finally, to bring the contract into compliance with State prevailing
wage requirements, language was added to that amendment to update the contract in
order to maintain compliance with the State Department of Industrial Relations. At the
time, this was discussed with GSTS and as the contractor was already paying its workers
prevailing wage, no change to the existing billing rates was needed to maintain
compliance.
Staff has been pleased with the quality of work provided by GSTS and the responsiveness
of its employees. Thus, staff met early on to discuss initiating the first two-year extension
of the contract. GSTS representatives explained that they wished to extend the contract,
however, they could no longer absorb the predetermined prevailing wage increases set
by the State and would need to address the higher than planned past and current annual
CPI costs. GSTS's initial request was an approximately 30% increase to the current unit
rates. With this, staff began looking into both negotiating with GSTS to find a mutually
agreeable contract increase based on actual CPI and State -mandated wage increases,
while simultaneously researching and preparing a new Request for new Bids (RFB) to
provide this necessary City service.
In looking into re -biding the contract, staff research of recent similar contracts with
neighboring cities indicated that the City could expect bids to come in from slightly higher
to up to 30% or more, with the likely range to be an increase of between 10% to 30%.
Working in parallel with this RFB process, staff also researched State labor rates, prior
and projected CPI rates, and other related or controlling factors, while negotiating with
GSTS for a more amenable increase.
8-2
Approve Amendment No. Three to the Maintenance Services Agreement with
Great Scott Tree Service, Inc. for Citywide Tree Maintenance Services
May 14, 2024
Page 3
The Department of Industrial Relations' predetermined increases on its website over the
next three years found the following: $1.50 increase on July 1, 2024 (4.4% increase above
the current hourly wage) and a $1.60 increase on July 1, 2025 (4.5% increase above
2024's wage). With this information, staff negotiated with GSTS to eventually present
GSTS with the City's "best and final" offer of a three-year contract extension with a
one-time 9% increase to rates as a catch-up for lost CPI, and a future contract CPI
increases of 3.5% for FY 2024/2025, 3% for FY 2025/2026 and 2.5% for FY 2026/2027.
The contract would be extended through June 30, 2027. Additionally, a separate unit rate
would be established for Coral trees, select Ficus trees, and Canary Island Date Palms
that are pruned above the International Society of Arboriculture's (ISA) standard. This
new unit rate was determined by an average of the previous crew rental proposals. GSTS
agreed to accept this offer.
Amendment Summary:
Therefore, staff recommends City Council approval of Amendment No. Three with GSTS
to extend the term three years and add an additional $6,100,000 to the contract for a new
total not -to -exceed contract (NTE) amount of $23,060,000.
With the approval of the requested contract amendment, the table below displays the
annual cost to date as well as the approximate expected cost per year that could be
expended to maintain and preserve the City's urban forest. The future annual costs
(beginning July 1, 2024) include the negotiated, one-time 9% increase and CPI
adjustments of 3.5% for FY 2024/2025, 3% for FY 2025/2026 and 2.5% for FY 2026/2027.
Contract No. 5648 Cost Summary. -
Fiscal Year
Costs
13/14 through 18/19
$8,638,184
19/20
$1,583,200
20/21
$1,622,780
21 /22
$1,663,349
22/23
$1,704,932
23/24
$1,747,555
Current NTE
$16,960,000
24/25
$1,977,065
25/26
$2,036,213
26/27
$2,086,722
Amend No. 3
$6,100,000
New Total NTE
$23,060,000
8-3
Approve Amendment No. Three to the Maintenance Services Agreement with
Great Scott Tree Service, Inc. for Citywide Tree Maintenance Services
May 14, 2024
Page 4
FISCAL IMPACT:
The adopted budget includes sufficient funding for this contract. It will be expensed to the
Contract Services Account in the Public Works Department, 0108032-811017. Future
funding needs to accommodate these contract increases will be addressed during the
City's annual budget process.
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. Three with Great Scott Tree Service, Inc.
RM
ATTACHMENT A
AMENDMENT NO. THREE TO
MAINTENANCE SERVICES AGREEMENT
WITH GREAT SCOTT TREE SERVICE, INC.
FOR TREE MAINTENANCE SERVICES
THIS AMENDMENT NO. THREE TO MAINTENANCE SERVICES AGREEMENT
("Amendment No. Three") is made and entered into as of this 14th day of May, 2024
("Effective Date"), by and between the CITY OF NEWPORT BEACH, a California
municipal corporation and charter city ("City"), and GREAT SCOTT TREE SERVICE,
INC., a California corporation ("Contractor"), whose address is 17061 Court Ave. Stanton,
CA 90680, and is made with reference to the following:
RECITALS
A. On November 13, 2013, City and Contractor entered into a Maintenance Services
Agreement ("Agreement") for tree maintenance services for City -maintained trees
("Project").
B. On November 13, 2014, City and Contractor entered into Amendment No. One to
the Agreement ("Amendment No. One") to reflect Extra Work performed under the
Agreement, and to increase the total compensation.
C. On July 1, 2019, City and Contractor entered into Amendment No. Two to the
Agreement ("Amendment No. Two") to extend the term of the Agreement, to
increase the total compensation limit, as amended, over the term of the Agreement
to account for the anticipated increase in volume of work, revise annual billing rate
increases, update the Schedule of Billing Rates, update the project manager
information, update the City's administrator information, update the notices
section, update the claims section, and incorporate language pertaining to
prevailing wage requirements.
D. The parties desire to enter into this Amendment No. Three to reflect additional
Services not included in the Agreement, as amended, to extend the term of the
Agreement to June 30, 2027, to increase the total compensation, and to revise the
method for adjusting billing rates set forth in the Agreement.
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 June 30, 2027, unless terminated earlier as set forth herein."
MR
2. SERVICES TO BE PERFORMED
Exhibit A to the Agreement shall be supplemented to include the Scope of
Services, attached hereto as Exhibit A and incorporated herein by reference ("Services"
or "Work"). Exhibit A to the Agreement and Exhibit A to this Amendment No. Three shall
collectively be known as "Exhibit A." The City may elect to delete certain Services within
the Scope of Services at its sole discretion.
3. COMPENSATION TO CONTRACTOR
Exhibit B to the Agreement shall be supplemented to include the Schedule of
Billing Rates, attached hereto as Exhibit B and incorporated herein by reference. Exhibit
B to the Agreement, Exhibit B to Amendment No. Two and Exhibit B to Amendment No.
Three 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. Contractor's
compensation for all Work performed in accordance with this Agreement, including all
reimbursable items and subcontractor fees, shall not exceed Twenty Three Million Sixty
Thousand Dollars and 00/100 ($23,060,000.00), without prior written authorization from
City. No billing rate changes shall be made during the term of this Agreement without the
prior written approval of City."
The total amended compensation reflects Contractor's additional compensation for
additional Services to be performed in accordance with this Amendment No. Three,
including all reimbursable items and subcontractor fees, in an amount not to exceed Six
Millon One Hundred Thousand Dollars and 00/100 ($6,100,000.00).
Section 4.2 — Section 4.2 to the Agreement is hereby deleted in its entirety and
replaced with the following: "Upon the first anniversary of July 1, 2019, and upon each
July 1 of the subsequent years thereafter, the billing rates set forth in Exhibit B ("Billing
Rates") shall be increased by two and one half percent (2.5%) of the Billing Rates in effect
immediately preceding such adjustment. Notwithstanding the foregoing, as of July 1,
2024, in lieu of the rate adjustment formula described in this paragraph, the Billing Rates
shall adjust each year as set forth in Exhibit B, with the rates listed in Exhibit B for "2024"
effective July 1, 2024, and the rates listed for each subsequent year effective July 1 of
that year."
4. 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]
Great Scott Tree Service, Inc. Page 2
8-6
IN WITNESS WHEREOF, the parties have caused this Amendment No. Three to
be executed on the dates written below.
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
Date: S'/2-12-4
By: a 7 owe
on C. Harp s
C' y Attorney 1�
ATTEST:
Date:
Leilani I. Brown
City Clerk
CITY OF NEWPORT BEACH,
a California municipal corporation
Date:
By:
Will O'Neill
Mayor
CONTRACTOR: GREAT SCOTT TREE
SERVICE, INC., a California corporation
Date:
By:
Scott P. Griffiths
Chief Executive Officer, Secretary
Date:
By:
Steve J. Guzowski
Chief Financial Officer
[END OF SIGNATURES]
Attachments: Exhibit A — Scope of Services
Exhibit B — Schedule of Billing Rates
Great Scott Tree Service, Inc. Page 3
8-7
EXHIBIT
SCOPE OF SERVICES
Great Scott Tree Service, Inc. Page A-1 s-s
Exhibit A
Scope of Services
Contractor shall perform the following services:
• Annual Coral and Ficus Tree Pruning:
Any tree Work performed on a City tree must be done according to the City's
specification. The criterion for pruning varies based on the type or purpose of
pruning. A Full Prune for Coral and Ficus trees is performed when conditions
within the crown of a hardwood tree are such that the entire tree needs to be
fully pruned. Complete pruning is recommended when the primary objective is
to maintain or improve tree health and structure, and includes pruning to
reduce overall canopy mass and excessive wood weight. Trees that are
identified for full Prune shall have as much as 50% of the live foliage removed.
It may also include crown reduction trimming as directed.
• Annual Canary Island Date Palm (Phoenix canariensis) Pruning:
Dead petiole bases shall be formed into an ornamental ball, which begins
directly below the lowest green fronds and acts to provide a base of support to
the palm crown. This ornamental ball shall be uniform and smooth in
appearance and shall extend no less than four and no more than eight feet
below the lowest live frond in the crown. Ornamental balls with flattened or "stop
sign" sides will not be accepted. The upper portion of the ornamental ball shall
not taper in, resulting in a "pineapple" appearance as this treatment defeats the
support capacity of the ball. The distal portion of the ball shall begin at a point
flush with the periphery of the palm trunk and make a gradual taper upwards
until it reaches the periphery of the shaped ornamental ball. While forbidden to
use chainsaws for pruning fronds, fruit and flowers from any palm tree, the
Contractor may use a clean chainsaw in forming and/or shaping the ornamental
ball of a Canary Island Date Palm. The use of a sharpened shovels in
shaping and maintaining ornamental balls often results in ornamental balls
which have flat, un-tapered bottoms that are likely to relax and collapse into
pedestrian and vehicular traffic zones with grave consequences.
• Sounding of Date Palms shall be conducted during each pruning.
• New blades for each and every Canary Island Date Palm at each pruning
shall be provided by the contractor at their sole cost
•
EXHIBIT B
SCHEDULE OF BILLING RATES
Great Scott Tree Service, Inc. Page B-1 8.10
Exhibit B - Billing Rates
Rates Effective as of July 1, 2024
Trim Frequency
Grid Pricing
Each
Annual Pruning of Palms
Each
Annual Pruning of Coral trees, Ficus trees, and Date Palms
(Due to Change in Scope)
Each
Service Request Pruning
Each
Palm Skinning
Per foot
Tree and Stump Removal
DSH per inch
Tree Only Removal
DSH per inch
Stump Only Removal
DSH per inch
Inspection Reports
Per Tree
Certified Arborist inspection
Conimon
Per Hour
variety Trees
15 gallon Mo rb
Each
15 gallon w! rb
Each
24 in box w/o rb
Each
24 in box w! rb
Each
36 in box w/o rb
Each
36 in box w! rb
Each
48 in box w/o rb
Each
48 In box w! rb
IlEach
60 in box w/o rb
IlEach
60 in box w! rb
Each
15 gallon w!o rb
Each
15 gallon w! rb
Each
24 in box w/o rb
Each
24 in box wl rb
Each
36 in box w/o rb
Each
36 in box w/ rb
Each
48 in boxwlo rb
Each
48 in box wl rb
Each
60 in box wlo rb lEach
60 in box wl rb
Each
GPS Inventory
Per tree site
Root prune with 12 in barrier
root
Root prune with 18 in barrier
Fool
Tree injection
Per tree site
Watering iday
Crew Rental (3 men)
per hour
Emergency Crew rental (3 men)
per hour
2 yr5.
Year 1 Year 2 Year 3
2024 2025 2026
$67.06 $69.07 $70.80
$67.06 $69.07 $70.80
$280.91 $289.34 $296.57
$81.01
$83.44
$85.53
$16.76
$17.27
$17.70
$30.73
$31.65
$32.44
$19.56
$20.15
$20.65
$12.58
$12.96
$13.29
$62.86
$64.75
$66.36
$90.80
$93.53
$95.87
$125.72
$129.49
$132.73
$153.67
$158.28
$162.23
$314.31
$323.74
$331.94
$356.22
5366.91
$376.08
$970.89
$1,000.01
$1,025.01
$1,040.73
$1,071.95
$1,098.75
$2,088.45
$2,151.11
$2,204.89
$2,228.14
$2,294.99
$2,352.36
$3,485.40
$3,589.96
$3,679.71
$3,625.10
$3,733.85
$3,827.19
$202.56
$208.64
$213,85
$230.50
$237.42
$243.35
$454.01
$467.63
$479.32
$495,91
$510.79
$523.56
$1,250.27
$1,287.78
$1,319.97
$1,320.12
$1,359.72
$1,393.71
$2,507.53
$2,582.75
$2,647.32
$2,647.23
$2,726.64
$2,794.81
$4,044.18
$4,165.51
$4,269.64
$4,183.87
$4,309.38
$4,417.12
$4.20
$4.32
$4.43
$12.58
$12.96
$13.28
$19.56
$20.15
$20.65
$54.48
$56.11
$57.52
$412.09
$424.45
$435.06
$251.45
$259.00
$265.47
5293.36
$302.17
$309.72