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CITY COUNCIL AGENDA REPORT
City of Anaheim
PUBLIC UTILITIES DEPARTMENT
DATE: JULY 28, 2026
FROM: PUBLIC UTILITIES DEPARTMENT
SUBJECT: MASTER CONSTRUCTION AGREEMENT FOR HIGH
VOLTAGE ELECTRIC UTILITY CONSTRUCTION,
MAINTENANCE, REPAIR, AND IMMEDIATE RESPONSE
PROJECTS
ATTACHMENT (Y/N): YES ITEM # 08
GOVERNMENT CODE § 84308 APPLIES: NO
RECOMMENDATION:
That the City Council, by Motion:
1. Approve the Master Construction Agreement – High Voltage Electric Facilities (Master Agreement) for high voltage electric utility construction, maintenance, repair, and immediate response projects (Attachment 1), with a five-year term (2026-2031) and extensions of up to one year as needed to complete in- progress work, and authorize the Public Utilities General Manager or designee (collectively, “General Manager”), on behalf of the City of Anaheim (Anaheim), to execute individual Master Agreements with each contractor currently prequalified by the Anaheim Public Utilities Department (APU), as listed in Attachment 2, and with any additional contractors prequalified by APU during the five-year term of the Master Agreement, with any changes that do not materially alter the terms and conditions of the Master Agreement, as determined by the City Attorney’s Office;
2. Approve a not-to-exceed amount of $1,000,000 per work order package or request for immediate response services with a limit of $4,000,000 in total awards per contractor per fiscal year during the term of the Master Agreement, with change order authorization for up to 10% of the work order package/request amount capped at $100,000 in total change orders;
3. Authorize the General Manager, on behalf of Anaheim, to execute any documents contemplated by or related to the Master Agreement, including work orders and changes thereto, and to take any necessary or advisable actions to implement, fund, and administer the Master Agreement; and
4. Determine that the projects to be performed under the Master Agreement are categorically exempt under the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines (Cal. Code Regs., title 14, ch. 3) sections 15301, 15302, 15303, and 15304; and further determine that none of the exceptions to the categorical exemptions set forth in CEQA Guidelines § 15300.2 apply.
Master Construction Agreement for High Voltage Electric Utility Construction, Maintenance, Repair, and Immediate Response Projects July 28, 2026
DISCUSSION:
The Public Utilities Board (PUB), at its meeting on June 24, 2026, recommended that the City Council approve these actions.
APU utilizes construction contractors with expertise in high-voltage electric utility systems to supplement internal field crews in the operation and maintenance of the electric system.
Having access to external resources allows APU to respond to customer needs, address infrastructure repairs and improvements in a timely manner, and maintain access to contractors with specialized crews and equipment for immediate response in the event of emergencies that require additional resources.
The Master Agreement for electric utility construction work was developed to comply with all public contracting requirements and to establish pre-qualified contracting services, enabling work to begin as quickly as possible. The current five-year Master Agreement was approved by the City Council on July 20, 2021, and is nearing the end of its term. If approved, the new proposed Master Agreement will be in effect for a five-year period (2026-2031).
Background
Engaging the services of external contractors is necessary for APU to achieve the timely completion of budgeted projects, such as maintaining aging infrastructure, installing new streetlights, and relocating facilities at the request of other agencies. The judicious use of contractors provides the flexibility needed to accommodate fluctuations in workload while maintaining an appropriate level of internal staffing and leveraging specialized expertise for specific projects. The key benefits of using external contractors through the Master Agreement process are as follows:
Work can begin quickly. The Master Agreement streamlines project timelines by several months, as contractors already have executed agreements in place, along with required bonding and insurance. This reduces administrative burden by eliminating the need to repeatedly submit the same documentation for each project. Additionally, because contractors are pre-qualified, verification of their experience with high-voltage utility systems and qualified electrical personnel is already complete, allowing for an immediate response to perform repairs.
Contractors are on-call for emergencies. During extended heat waves, windstorms, earthquakes, or other emergency events, APU crews are the first to be called in to make repairs; however, in situations where internal staffing is insufficient to respond to multiple outages, contractors are called upon, and those with available crews can report for work within a four-hour period. Having pre-established agreements increases the likelihood that contractors will remain available to Anaheim; otherwise, they may be secured by other utilities if the event is regional and extends beyond Anaheim’s borders. An example of the importance of on-call contractors occurred during Labor Day weekend in 2020, when a severe heat event caused dozens of outages across multiple neighborhoods. Having pre-qualified contractors allowed APU to secure crews from two companies, accelerating outage restoration and supplementing internal crews.
Master Construction Agreement for High Voltage Electric Utility Construction, Maintenance, Repair, and Immediate Response Projects July 28, 2026
Ensures competition for planned projects. Since each contractor is pre-qualified in one or more specific categories, awards are made strictly on the basis of the lowest bid submitted. Categories of work include transmission, distribution, and substations. Maintains transparency. Through Anaheim’s online bid advertisement system, the scope of work is distributed to pre-qualified contractors, and bid prices are posted immediately after the bid opening.
Master Agreements for planned upgrades, maintenance, and emergency service restoration have historically been limited to $500,000, a threshold that has remained unchanged since May 2000 and was originally established to accommodate minor repair or replacement of utility infrastructure. However, escalating labor and material costs over the past two decades have significantly increased the cost of utility construction, making it increasingly difficult to deliver projects within the existing threshold. For example, the replacement of aging underground direct buried (DB) cable is a common type of repair performed under such Master Agreements. Historically, these projects ranged from approximately $350,000 to $475,000 to replace one mile of DB cable. Based on the current bidding environment, project costs have increased significantly and now typically range from $650,000 to $950,000 per mile.
To address these challenges, staff recommends increasing the per-project award limit from $500,000 to $1,000,000 and increasing the annual aggregate award limit from $3,000,000 to $4,000,000 per contractor. These adjustments would better align the Master Agreement program with current construction cost conditions, reduce the need to scale back project scope, improve flexibility in responding to planned and emergent utility work, and support a more balanced distribution of work among pre-qualified contractors while maintaining a competitive bidding environment.
Major projects, such as underground conversions or new substations, will continue to follow standard public contracting procedures through the Department of Public Works and will remain subject to City Council review and approval on a per-project basis.
Pre-Qualification Process
In order to pre-qualify, all interested contractors were invited to complete a standard questionnaire and provide supplemental background information demonstrating that they have sufficient experience and resources to work on electric utility systems, including qualified electrical workers trained to perform work on energized high-voltage systems.
Anaheim’s pre-qualification process is consistent with Public Contract Code section 20101, enacted as part of Assembly Bill 574, which allows public agencies to pre-qualify contractors for either a specific project or a specified time period. City staff utilized the questionnaire format developed by the California Department of Industrial Relations, with input from the construction industry, as part of the pre-qualification process.
The pre-qualification package was advertised on January 30, 2026, and eighty-five (85) companies downloaded the package from Anaheim’s electronic bidding system. APU received and evaluated twenty-three (23) pre-qualification proposals. Contractors that were unable to demonstrate direct contractual experience performing work for other electric utility agencies, as well as substantial experience working on energized high-voltage equipment, were not pre-qualified. Due to the safety implications associated with high- voltage electrical work, verification of direct electric utility experience is critical.
Master Construction Agreement for High Voltage Electric Utility Construction, Maintenance, Repair, and Immediate Response Projects July 28, 2026
Of the twenty-three (23) contractors seeking pre-qualification, seventeen (17) contractors listed in Attachment 2 were found to meet the minimum pre-qualification requirements and are recommended for consideration for the Master Agreement. Additional reviews will be conducted for other entities to determine whether they have sufficient utility experience, including reference checks, site visits, and interviews with key representatives.
Ensuring Proper Controls
APU has implemented several measures to ensure transparency in the way Master Agreement work packages are advertised, awarded, and managed, and to foster competition among bidders. These include:
All work packages are advertised through Anaheim’s online bidding system. This system enables electronic notifications, bid downloads and submissions, and online access to bid documents, while ensuring that bidding closes for all contractors simultaneously. This automated bidding process eliminates the need for Anaheim staff to tally bid submissions, as bid results are posted immediately and electronically. APU provides a quarterly report to the PUB detailing all Master Agreement work package awards. The PUB has the opportunity to review and request additional information regarding any of APU’s Master Agreement awards. This information is accessible to the public on Anaheim’s Boards and Commissions webpage. To ensure that Master Agreement work packages remain within budgetary constraints, APU has internal controls in place requiring project managers to obtain management authorization prior to issuing any work package for bidding. Since multiple funding sources may be involved, including cash, bonds, grants, and customer reimbursements, maintaining controls to ensure expenditures are properly matched to funding sources is a high priority and is incorporated into the approval process prior to issuing a request for bids.
A review of contractors’ insurance and bonding is conducted prior to each award to ensure compliance with the terms of the Master Agreement. A provision limiting the cumulative annual award amount to $4,000,000 per contractor to align with current cost conditions and encourage competition among qualified contractors.
Master Agreements have been an effective tool for APU to serve customers and improve reliability expeditiously. They are also a vital resource for enhancing system resilience and ensuring access to qualified contractors during major emergency events.
The Master Agreements support multiple goals in the 2025-26 Strategic Plan. These include Goal C – Invest in Infrastructure and Amenities, Strategy 13 – Address deferred and ongoing maintenance needs, and Goal E – Support Public Safety, Strategy 5 – Assess the City’s emergency preparedness capabilities, resources, and tools, and implement changes as needed to ensure the City is properly positioned to respond to disasters.
ENVIRONMENTAL DETERMINATION:
Since the projects to be carried out under the Master Agreements will typically consist of replacements, repairs, maintenance, or small additions, they fall under one or more of the Master Construction Agreement for High Voltage Electric Utility Construction, Maintenance, Repair, and Immediate Response Projects July 28, 2026
following exemption pursuant to the CEQA Guidelines: Sections 15301, 15302, 15303, and 15304.
IMPACT ON BUDGET:
There is no budgetary impact associated with pre-qualifying contractors under the Master Agreement. Projects ultimately awarded through the Master Agreement are included in APU’s Fiscal Year 2026/27 restricted Electric Utility Fund budget, and funding for subsequent years is subject to City Council approval of budget appropriations.
Respectfully submitted,
Brian Beelner
Acting Public Utilities General Manager
Attachments:
1. Master Construction Agreement – High Voltage Electric Facilities (form)
2. List of 2026-2031 Pre-qualified High Voltage Electrical Contractors