City Council
Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: IT Department
Meeting Date: October 7, 2024
Report #:2408-3399
TITLE
Approval of Two Purchase Orders, 4525000111 and S25192604 with ePlus Technology Inc. to procure Data Center Equipment and Implementation for Fiber-to-the-Premises for a Three-Year Term with an Amount Not-To-Exceed $543,134; CEQA Status – Mitigated Negative Declaration Approved June 2024.
RECOMMENDATION
Staff recommends that City Council approve and authorize the City Manager or their designee to execute two purchase orders 4525000111 and S25192604 with ePlus Technology, INC., utilizing two cooperative agreements, NASPO AR3227, California Participating Addendum (3-18- 70-1448C) and an Agreement with OMNIA Partners – TD Synnex – R200803 for the purchase of data center equipment for Fiber-to-the-Premises for a term of three years and a total not-to- exceed $543,134.
EXECUTIVE SUMMARY
Approval for two purchase orders for the data center networking equipment and professional services for design, configuration, implementation, and support needed to continue to build the City’s Fiber-to the-Premises (FTTP) Project providing broadband high-speed internet directly to Palo Alto homes and businesses. The purpose of ordering the equipment now is because the lead time on the delivery of the equipment is at least 60 days. The data center will support FTTP subscribers and hosted in a private cage in an Equinix Data Center in Palo Alto.
BACKGROUND
On December 19, 2022, City Council directed staff to proceed with the Fiber Expansion Plan to implement the Fiber Rebuild project and Phase 1 of the Fiber-to-the-Premises (FTTP) project. In Phase 1, FTTP would be built out in selected areas of the city and expanded gradually (Staff Report ID 148001). Construction of the new fiber backbone in the Fiber Rebuild project and last 1Staff Report ID 14800: https://www.cityofpaloalto.org/files/assets/public/v/1/agendas-minutes- reports/reports/city-manager-reports-cmrs/2022/12-19-2022-id-14800.pdf
mile infrastructure to provide FTTP broadband internet to the community in the FTTP project will be a significant undertaking for the City.
On June 19, 2023, Council approved the FY 2024 Capital Budget with both the new FTTP Project (FO-24000), and Grid Modernization for Electrification Project (EL-24000). The approval of the electrification project accelerated efforts to align electrification and fiber construction, which impacted the Fiber Expansion Plan. Staff was directed to explore opportunities to align the grid modernization project and projects under the Fiber Expansion Plan to help minimize utility engineering pole make-ready work, pole replacements, noise disruption, and construction activity in neighborhoods.
On December 18, 20232, to execute on Council’s direction, staff informed Council that a pilot would be deployed to evaluate how alignment of fiber and grid modernization projects may help control project costs, minimize construction impacts to the community, and prevent major delays. Activities essential to the roll-out of the pilot were highlighted as well, such as the California Environmental Quality Act (CEQA) determination and purchase of a fiber hut.
ANALYSIS
Fiber-to-the-Premises consists of the construction of a fiber optic backbone and fiber distribution infrastructure to provide communication services throughout the City of Palo Alto.
FTTP would provide municipal high-speed internet service to residences and businesses in Palo Alto.
The proposed project includes the following main components:
1. Installation of approximately 194 miles of fiber optic cables (consisting of about 90 miles of below-ground installation and 104 miles of aerial installation using existing utility poles);
2. Installation of approximately two local aggregation sites either inside modular communications shelters (i.e., fiber huts) or enclosed within existing commercial buildings;
3. Installation of approximately 4,200 underground utility vaults and 147 aboveground utility cabinets; and,
4. Fiber internet connections directly to subscribing customers’ homes and/or businesses (“subscribers”).
To ensure reliable internet services, implementing robust core network equipment and services is critical. The core network and services aim to provide subscribers access to the WWW (World Wide Web), including digital content such as public websites, digital streaming, online education, online shopping, etc. The hardware and services purchased will scale as subscribers 2 December 18, 2023 https://www.cityofpaloalto.org/files/assets/public/v/1/agendas-minutes- reports/reports/city-manager-reports-cmrs/2023/12-11-2023-id-2309-2094.pdf grow, which means the hardware is scalable to meet increasing demands while purchasing the minimum amount of licensing to reduce initial costs. The professional services contract will assist with the carrier-grade network's design, configuration, implementation, and operations.
These POs are for the purchase of an initial phase of equipment and installation, including Routers, software and installation services.
Procurement Process
The City’s procurement policies and procedures provide for the purchase of goods and services through cooperative purchasing agreements as permitted by PAMC section 2.30.360(j). A cooperative purchase agreement is a contract that allows multiple entities to purchase goods and services at pre-negotiated prices. The goal of a cooperative purchase agreement is to combine demand from multiple entities to achieve a more economical purchase. The Cooperative Agreements utilized for these two purchase orders execute similar procurement methods as the City performs such as soliciting service providers, review and evaluation of qualifications and pricing, and negotiation of contract terms. Staff selected the vendor based on providing the best discounts, being flexible, and extensive experience building new internet service provider infrastructures.
FISCAL/RESOURCE IMPACT
Funding for these Purchase Orders are available in the Fiscal Year 2025 Fiber Fund in the FTTP Project (FO-24000). No additional funding for these purchase orders is being requested.
STAKEHOLDER ENGAGEMENT
Staff continues to engage with the community on the FTTP and Grid Modernization Projects primarily through the City’s Finance Committee and Utilities Advisory Commission discussions which are open to the public to participate and share feedback.
On November 7, 2023, the Finance Committee was updated on the Fiber Master Plan, which included the pilot program area to align FTTP with the Electric grid modernization project. The Finance Committee provided feedback on timeline, costs, and alignment of FTTP to grid modernization (Staff Report #2309-20823). In addition, staff continues to share updates through the Palo Alto Fiber project webpage54, City communications channels such as social media5, Medium.com blog 6and interactive Palo Alto Fiber Hub87.
ENVIRONMENTAL REVIEW
The FTTP Project has been assessed in accordance with the authority and criteria contained in the California Environmental Quality Act (CEQA), the State CEQA Guidelines, and the 3 Finance Committee staff report 2309-2082, https://www.cityofpaloalto.org/files/assets/public/v/1/agendas- minutes-reports/reports/city-manager-reports-cmrs/2023/11-7-2023_2309-2082-mini-packet.pdf 4 Palo Alto Fiber Webpage, https://www.cityofpaloalto.org/paloaltofiber 5 City Social Media Channels, https://www.cityofpaloalto.org/connect 6 Palo Alto Connect, https://medium.com/@paloaltoconnect 7 Palo Alto Fiber Hub, https://fiber-palo-alto.hub.arcgis.com/ environmental regulations of the City. An Initial Study-Mitigated Negative Declaration has been prepared and was circulated for a 30-day public review beginning on May 1, 2024, and ending on May 31, 2024. A final IS/MND that incorporated revisions, as appropriate, based on public comments published on June 6, 2024. The analysis in the IS/MND includes evaluation of the fiber hut.
The IS/MND concludes that no significant and unavoidable impacts are anticipated for the proposed project. Mitigation is incorporated to mitigate potential impacts on air quality, biological resources, cultural resources, geology and soils, hazards and hazardous materials, hydrology and water quality, Transportation, and tribal cultural resources to a less than significant level.
The City received five comments letters on the proposed project during the MND circulation period. These comments were from one member of the public and four responsible agencies for the proposed project: Caltrans, Valley Water, Santa Clara County, and California Department of Fish and Wildlife (CDFW). Comments from the member of the public were not related to the environmental analysis. Comments from the responsible agencies primarily indicated the permits that would be required for work in certain areas for which they have jurisdiction.
Comments from CDFW recommended additional measures for the protection of Crotch’s Bumble Bee, California Ridgeway’s Rail and Black Rail. While the City concluded that impacts on these species would be less than significant, the city has agreed to implement these additional measures to further reduce impacts on those species. This is detailed further in the Final MND.
An e-mail has been sent to each commenter responding to their comments and, where applicable, indicating where their comments have been addressed in the Final MND. A link to the Final IS/MND and MMRP are included in the City of Palo Alto Fiber webpage8
ATTACHMENTS
Attachment A: 4525000111 EPLUS TECHNOLOGY INC
Attachment B: S25192604 EPLUS TECHNOLOGY INC
APPROVED BY:
Darren Numoto, Chief Information Officer
8 City of Palo Alto Fiber Webpage, https://www.cityofpaloalto.org/paloaltofiber