HomeMy WebLinkAboutStaff Report 3.D Part 1 12/21/2009
CITY OF PETALUMA, CALIFORNIA ~^
AGEl~I)A SILL ®ecernber 21, 2009
Agenda Title: Resolution Authorizing City Manager to Execute a First Meeting Date: Dec. 21, 2009
Amendment to the 2007-2009 Agreerrtent`with MV Transportation; Inc. to
Extend the Contract to June 30, 2010, and to Delete Section 2.7:3 of-the Meetinz; Time: ^ 3:00 PM
Scope of Services ®7:00 PM
Category: ^ Presentation ^ Appointments ®Consent ^ Public Hearing ^ Unfinished Business ^ New Business
Department: D'rec or: Contact Person: Phone Number:
Public Works nc engo Joe Rye 778-4421
Cost of Proposal: Not to Exceed $33.5,000 for last half of FY09/10 Name of Fund: Transit
Account Number:
Amount Budgeted: 6500.65200.54111
Transit Professional Services COS 6500.65200.54111 $640,000 annual 6500..65200.56410
Transit Insurance Premiums 6500.65200.56410 $25,000 annual Current Fund Balance:
6500.65200.54111: $485,089.92
6500.65200.56410: $17,619.45
Recommendation: It is recommended that the City Council take the following action:
Approve resolution authorizing City Manager to execute a first amendment to the agreement with MV
Transportation, Inc. to extend the contract to June 30, 2010, and to delete Section 2.7.3 of the Scope of Services.
l . ^ First reading of Ordinance approved unanimously, or with unanimous vote to allow posting prior to second reading
2. ^ First reading of Ordinance approved without unanimous vote: Ordinance has been published/posted prior to second
reading; see Attachment
3. ^ Other action requiring special notice: Notice has been given, see Attachment
Summary Statement: The MV Transportation; Inc. (MV) contract to provide fixed route transit services, which
expires on December 31, 2009, includes a provision to amend the contract for up to two additional. one-year
terms. Based on the quality of service during the base years, and the desire to bring both the fixed route and
paratransit contracts into calendar alignment, staff recommends extending this contract six months to June 30,
20.10. This action will ensure adequate time'to prepare and execute a comprehensive and competitive
procurement, process, and avoid the need to negotiate an extension to the Petaluma People Services Center
(PPSC) paratransit operations contract, which expires June 30, 2010.
In addition, the current MV contract should be amended to delete Section 2.7.3 of the Agreement Scope of
Services to comply with the Transportation Development Act's farebox recovery requirements.
Attachments to Agenda Packet Item:
1. Resolution, including Exhibit A, Proposed First Amendment to 1VIV Contract
2. 2007-20091VIV Contract (available online and through City Clerk's office)
_ Reviewed b Finance Dir: '~ Reviewed by C' ttorne A rove na er:
Date: ~~~ ~~~ / Date: Date: ~z - ~ v
Rev.'# 1' ~ Date Last Revised: l2/l'S/09 File: 4:<Iransit d; "rrtut~Fiot,ttuon'.cc :\aetid~ 13iils':t rans;t operar~un
I2-IS-~9 t:ontntcts?Fised Route (39V}`,.Coittract Extension Amendment 2~1U1A~1~' Transit
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CITY OF' PETAI,IIIVIA, CAI,IF'ORNIA
DECEMBER Z1, 2009
AGENDA REPORT
FOR
RESOLUTION AUTHORIZING CITY MANAGER TO EXECUTE A FIRST AMENDMENT TO THE
ZOO7-2009 AGREEMENT WITH 1VIV TRANSPORTATION, INC. TO EXTEND THE CONTRACT BY
SIX 1VIONTHS AND DELETE SECTION 2.7.3 OF THE SCOPE OF SERVICES
I. RECOMMENDATION:
Approve resolution authorizing City Manager to execute a first amendment to the agreement with MV
Transportation, Inc. to extend the contract to June 30, 2010, and to delete Section 2.7.3 of the Scope of
Services.
2. BACKGROUND:
Contract Extension
The MV Transportation contract to provide fixed route transit services, which expires on December 31,
20Q9, includes a provision to amend the contract for up to_two additional one-year terms at the lesser of
the increase in the CPI or 3.0%. Since there was no increase in the Bay Area CPI (+0.0%) last year,
there would be no increase in the base contract cost in the.event of a contract extension.
Exercise of the option year makes :sense at this point, in anticipation of the budget cycle for Fiscal Year
2010-1 1. MV is operating services in an efficient manner and meeting service delivery requirements. In
order to allow a competitive bid process to determine the extent of the cost escalation, and because the
City is near the end of its current agreement with MV, issuing an RFP sooner, rather than later, is in the
City's best interest.
To obtain the most competitive pricing on fixed route and paratransit operations contracts, staff prefers
to let both the fixed route and paratransit contracts out. at the same time. Executing only six months of an
optional one year extension on the MV contract will align the term with the City's paratransit contract,
which was extended for one year on July 1, 2009 to expire on June 30, 2010.
While there is no CPI-based increase associated with the extension, staff recommends that MV coritinue
to be allowed to pass through to the City the direct cost of bringing individual driver wages up to the
wages defined in the City's Living Wage Ordinance.
Section 2.7.3
Section 2.7.3 of the Agreement Scope of Services contains text requiring the operations contractor to
make up any passenger fares less than 15% of total operating costs for the service. Section 2.7.3 was
identified in a recent TDA Triennial audit as questionable under TDA law, and the City was advised to
remove this provision in the current and any future transit operations contracts. The City had never
enforced Section 2.7.3 on its transit operations contractors, so removal of the language from the contract.
is all that :is required.
2
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This provision was in transit operations contracts to ensure that the City meets Transportation
Development Act farebox recovery guidelines. Farebox recovery refers to the amount of passenger
fares and local funds that combine to form a revenue base that offsets operating cost. For fixed route
transit, the State requires operators to recover 15% of expenses with such revenue. However, in recent
discussions with TDA fund administrators at the Metropolitan Transportation Commission (MTC),
Petaluma Transit's apportionments of Sonoma County voter-enacted Measure M are considered part of
the "local generated funds", along with traditional farebox revenue. This ruling enables Petaluma
Transit to meet- the mandated 15% farebox recovery ratio without the need for any further contribution
from its operations contractors.
The recent (June 2008) Triennial Performance Audit of the City of Petaluma recommended that the City
"evaluate the inclusion of the contract clause requiring contractors to supplement farebox revenues."
The impetus for this recommendation was first, that this contract requirement doesn't comply with the
TDA definition of local funding which is "revenues derived from taxes imposed by the operator or by a
county transportation commission", and second, that the effect of including this clause in operating
contracts can have negative consequences on operating efficiencies if the contractor chooses to either
increase its price to cover the anticipated shortfall or cut back on costs to compensate for the payment.
With respect to deletion of Section 2.7.3 of the Scope of Services, although the audit report only
suggests that the City "evaluate" changing the contract language, the fact that these funds do not appear
to meet the terms of the regulation supports elimination of this section in its entirety, in order to comply
with State of California Law and funding obligations. The same clause was recently removed from the
City's PPSC (paratranst) contract by City Council at its meeting of April 20, 2009.
3. DlscussloN:
The City is pleased with the quality of fixed route services being provided to its residents via this
contract.
Staff is preparing the necessary Request for Proposals (RFP) documents. The RFP should be ready for
release in February in order to award new operations contracts by late spring (prior to June 30, 2010).
4. FINANCIAL IMPACTS:
Under this amendment, .the base contract rate will remain unchanged. Some additional costs will
continue to be incurred to accommodate a discrepancy between the current driver wages and the Living
Wage Ordinance. This is estimated to be less than $5,000 annually. (The amount will vary, based on
seniority of the driving staff). Currently, as dictated in the new Collective Bargaining Agreement
(CBA), MV driver wages range from $14.44 to $1.8.05 per hour (from $13.20 to $17.20 in original
agreement).
3
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ATTAC~iMEiNT 1
RESOLUTION
AUTHORIZING CITY MANAGER TO EXECUTE A FIRST AMENDMENT TO THE 2007-2009
AGREEMENT WITH MV TRANSPORTATION, INC. TO EXTEND THE CONTRACT BY SIX
MONTHS AND DELETE SECTION 2.7.3 OF THE SCOPE OF SERVICES
WHEREAS, the MV Transportation, Inc. (MV) contract to provide fixed route transit services, which
expires on December 30, 2009, includes a provision to amend the contract for two additional one-year terms at
the lesser of the increase in the CPI or 3.0%; and
WHEREAS, in exercising the option year, the existing contract states that "any such extended year
shall be increased over that of the preceding year by the inflation rate, as measured by the Consumer .Price
Index for all urban consumers in the San Francisco-Oakland-San Jose Metropolitan Statistical Area, not to
exceed an increase of three percent (3%) annually"; and
WHEREAS, the Association of Bay Area Governments year-over-year change in the CPI from
December 2008 to December 2009 for the Consolidated Metropolitan Statistical Area covering San Francisco -
Oakland -San Jose was 0%; and
WHEREAS, to align with the recent PPSC (paratransit) contract extension to June 30, 2010, staff
recommends exercising the first six. months of the first year of the option to extend the agreement to the
conclusion of Fiscal Year 09/10, at no increase to the base cost, with'a provision allowing pass-through of the
direct. cost associated with bringing wages into conformance with the City's Living Wage Ordinance; and
WHEREAS., in response to a recent (June 2008) MTC-TDA Triennial Performance Audit, and in order
to comply with State of California Law and Funding obligations, staff recommends deletion of Section 2.7.3 of
the Agreement Scope of Services.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Petaluma hereby:
1. Authorizes City Manager to execute a First Amendment to the 2007-2009 contract with MV
Transportation, Ine., attached hereto as Exhibit A and incorporated herein by reference, in order to
a. Exercise the first year option for a period of six months, ending June 30, 2010, at no increase
to the base cost, with a provision allowing pass-through of the direct cost associated with
bringing wages into conformance with the City's Living Wage Ordinance; and
b. Delete Section. 2.7.3 of the Agreement Scope of Services in order to comply with State of
California Law and Funding obligations.
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E%I~I~IT A T®. RES®LUT~Oid
FIRST AMENDMENT TO AGREEMENT BETWEEN TINE CITY OF PETALIJ'MA ANI) MV
TRANSPORTATION FOR TIIE PROVISION OF FIXED ROUTE TRANSIT SERVICES
WHEREAS; this FIRST AMENDMENT TO AGREEMENT BETWEEN THE CITY OF PETALUMA
AND MV TRANSPORTATION, INC. FOR THE PROVISION OF FIXED ROUTE TRANSIT
SERVICES is made and entered into this day of , 2009, by and between the City of
Petaluma, a municipal corporation ("CITY") and MV Transportation, Inc., a California corporation
("CONTRACTOR"). CITY and CONTRACTOR are sometimes referred to hereafter as the
"PARTIES".
WIIEREAS, the PARTIES entered into an Agreement Between .the City of Petaluma and MV
Transportation for the Provision of Fixed Route Transit Services from January 1, 2007, to and including
December 30, 2009 (the ``Agreement''); and
WIIEREAS, the PARTIES desire to extend the Agreement for six months, ending June 30, 2010, rather
than for one year, as provided for in Section 3 of the Agreement;. and
WIIEREAS, the PARTIES wish to delete Section 2.7.3 of the Agreement Scope of Services to comply
with State law.
NOW, TIIEREFORE, for good and valuable consideration, the PARTIES hereby agree as follows:
1. The name and capacity of CONTRACTOR is MV TRANSPORTATION, INC., a California
corporation.
2. The Agreement period specified in Section 3 of the Agreement shall be extended for six
months, beginning January 1, 2010 and ending June 30, 2010, at no increase in the operations
budget specified in the Agreement, not to exceed a total .cost for the period, from January 1,
2009 through June 30, 2010, of $335,000, with a monthly fixed fee of $14,738 and a revenue
hour rate of $29.47.
3. Section 2.7.3 of the Agreement Scope of Services is deleted in its entirety.
4. Except as expressly amended herein, all terms and conditions of the Agreement shall. remain in
full force and effect as originally executed.
City of Petaluma
By:
John Brown
City Manager
Date
MV Transportation, Inc.
a California corporation
By:
Name/Title
Date
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ATTEST:
City Clerk
APPROVED AS TO FORM:
City Attorney
APPROVED:
Department Director
APPROVED:
Risk Manager
APPROVED:
Finance Director
] ] 76 ] 06.1
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EX~IdI~ST d~ 1'® itES®L.IJTI®~!
.FIRST AMENDMENT TO AGREEMENT BETWEEN THE CITY OF PETALUIVIA AND 1VIV
TRANSPORTATION FOR THE PROVISION OF FIXED ROU'T'E TRANSIT SERVICES
WI~EREAS, this FIRST AMENDMENT TO AGREEMENT.BETWEEN THE CITY OF PETALUMA
AND MV TRANSPORTATION, INC. FOR THE PROVISION OF FIXED ROUTE TRANSIT
SERVICES is made and entered into this day of , 2009, by and between the City of
Petaluma, a municipal corporation ("CITY") and IV1V Transportation, Inc:, a California corporation
("CONTRACTOR"). CITY `and CONTRACTOR are sometimes referred to hereafter as the
"PARTIES".
WHEREAS, the PARTIES entered into an Agreement Between the City of Petaluma and MV
Transportation for the Provision of Fixed Route Transit Services from January 1, 2007, to and including
December 30, 2009' (the "Agreement"); and
WHEREAS, the PARTIES desire to extend the Agreement for six months, ending June 30, 2010, rather
than for one year, as provided for in Section 3 of the Agreement; and
WHEREAS, the PARTIES wish. to delete Section 2.7.3 of the Agreement Scope of Services to comply
with State law.
NOW, THEREFORE, for good and valuable consideration, the PARTIES hereby agree as follows:
1. The name- and capacity of CONTRACTOR is MV TRANSPORTATION, INC., a California
corporation.
2. The. Agreement period specified in Section 3 of the Agreement shall be extended for six
months; beginning January 1, 2010 and ending June 30, 2010, at no increase in the operations
budget .specified in the Agreement, not to exceed a total cost, for the period, from January 1,
2009 through June 30, 201'0, of $335,000, with a monthly fixed fee of $14,738 and a revenue
hour rate of $29.47.
3. Section 2.7.3 of the: Agreement Scope of Services is deleted in its entirety.
4. Except as expressly amended herein, all terms and conditions of the Agreement shall remain in
full force `and effect as originally executed.
7
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City of Petaluma
By:
John Brown
City Manager
Date
ATTEST:
City Clerk
APPROVED AS TO FORM:
City Attorney
APPROVED:
Department Director
APPROVED`
Risk .Manager
APPROVED`
Finance Director
1176.106.1
MV Transportation, Inc.
a California corporation
By:
Name/Title
Date
8
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