Dear Mayor and Council Members,
On behalf of City Manager Ed Shikada, please see staff responses below for questions from Council Member Tanaka on the Monday, October 28 Council Meeting.
Item 5: Approval of Construction Contract Number C25192135 with Anderson Pacific Engineering Construction, Inc. in the Amount Not-to-Exceed $6,215,000; Authorization for the City Manager or Their Designee to Negotiate and Execute Change Orders up to a Not-to- Exceed Amount of $621,500 for Related, Additional but Unforeseen Work Which May Develop During the Project; Approval of Amendment Number 5 to Contract C21176592C with Carollo Engineers, Inc. in the Amount of $1,314,192 for a New Compensation Not-to-Exceed Amount of $14,695,384 for the Wastewater Treatment Fund for the 12kV Electrical Power Distribution Loop Rehabilitation Bid Package 2 Project at the Regional Water Quality Control Plant, Funded by the Plant Repair, Retrofit, and Equipment Replacement Project (WQ-19002); CEQA Status – Exempt Under Section 15301
1. Given the complexity of the project and previous experiences with Bid Package 1, how can we ensure that the $621,500 contingency is sufficient for unforeseen issues, considering potential supply chain uncertainties and rising costs?
Staff response: Staff is confident in the sufficiency of the contingency, given the comprehensive bid package and improved knowledge about supply chain uncertainties. If additional contingency is needed, staff will return to Council with an appropriate recommendation.
2. With only one proposal received from Carollo Engineers, how do we justify moving forward without reopening the bidding process to explore more competitive and potentially cost-effective options?
Staff response: Staff requested proposals from all five pre-approved construction management firms but only received the proposal from Carollo Engineers. As described in the report, other firms indicated they would not be submitting a proposal because they were not well-positioned for the work or were nonresponsive. Carollo Engineers has performed well in its management of the Bid Package 1 construction project, and staff believes their proposal is cost-effective and positions the Bid Package 2 project for a positive outcome.
3. Have we secured binding agreements from partner agencies for their share of any additional costs, and how do we prevent Palo Alto residents from bearing an unfair financial burden if partners opt out of cost-sharing?
Staff response: This project is authorized by the existing partner agreements.
Item 8: Approval of Amendment No. 1 to Contract Number C21181420 with West Coast Arborists, Inc. for Tree Pruning and Removal Services in the Amount of $3,011,228, for a New Total Not-to-Exceed Amount of $6,776,608, and Extend the Term by Two Years; CEQA Status – Exempt per Section 15301(h) (maintenance of existing landscape)
1. Why hasn’t a competitive bidding process been conducted for this contract extension, and what measures are in place to ensure we aren't missing better offers from other qualified contractors?
Staff response: The RFP and the contract for this three-year general services agreement include the ability to extend the contract up to two years if both parties agree. The service quality West Coast Arborists (WCA) has provided over the three years of the contract has been excellent. Their proposal to provide a 2% cost reduction across all contract items for the two-year extension will save the City $55,818 over the Year Three contract prices for the two-year extension. Industry-wide, staff estimates the costs for municipal tree trimming services have increased between 9% and 15% since the release of the last RFP.
2. Have we considered engaging contractors with specialized expertise in sustainable practices or innovative tree care techniques that could better address Palo Alto's unique urban forestry challenges?
Staff response: WCA is currently servicing more than 350 municipal tree maintenance contracts and is considered an industry leader in providing these services. They operate with 100% diversion of all wood waste produced by their maintenance work. Most of the large wood generated, such as tree trunks, are processed by their Urban Wood Division for use in urban lumber and consumer ready products. All wood mulch generated by WCA tree maintenance is either processed into commercial arbor mulch or composted directly into compost and other soil products. As described in the staff report, Palo Alto’s contract specifications for tree maintenance include standards that meet or exceed typical industry standards.
3. What steps can we take to gather resident feedback on tree maintenance services, and would it be beneficial to hold public forums to ensure our decision aligns with community values and expectations?
Staff response: City staff receives unsolicited feedback from citizens on their experience with WCA on a fairly regular basis. Compliments on the services provided and details on their positive interactions with the WCA contract crews far outweigh the few complaints received. Staff conducts an annual Community Forum session on Urban Forestry with the Parks and Recreation Commission, which is an opportunity for community members to learn about and provide input on management of the urban forest, including street tree maintenance.
Item 10: Approval of Amendment No. 2 to Contract Number C23184827 with Nomad Transit, LLC (Via) in the Amount of $1,200,000 for a total not to exceed $3,801,500 to Continue the City of Palo Alto On-Demand Transit Service through June 2025; Approve a Cost Sharing Agreement with Stanford Research Park to Partially Fund the Service up to $600,000; and Adopt an Ordinance Amending the FY 2025 Municipal Fee Schedule to Increase Fares; CEQA status – not a project
1. Considering the current economic uncertainty, how does the city plan to mitigate potential financial impacts on ridership and funding stability? What specific economic indicators are being monitored to assess risk?
Staff response: As written in the staff report: The City has secured funding from Stanford Research Park ($600,000) and the TFCA ($441,000) to reduce reliance on the General Fund. "The FY 2025 Adopted Operating Budget has sufficient funding... with $500,000 in net General Fund support." Staff also continues exploring new partners and grant opportunities. The service will run as a pilot through June 30, 2025, as the service as well as other alternatives will be evaluated for long-term viability.
2. How is the Palo Alto Link service's operational efficiency and cost compared to other similar on-demand transit services in our region? Are we confident that we are not investing in a service that is less efficient than alternatives? Staff response: Other California implementations of on-demand transit similar to this range from $43-$78 per trip (LA Metro, SacRT, OCTA, Carlsbad). The Link’s service and cost efficiency has improved and the operating costs per ride have dropped from over $30 to $24.60. Palo Alto Link remains in the pilot phase and will be re-evaluated during this 10- month extension.
3. Given the significant fare increases proposed, what specific measures are being implemented to ensure that ridership does not decline? Can you guarantee that these increases will not deter low-income users or seniors from using the service? Staff response: We will provide advance notice of the fare increase. The $4 fare is reasonable compared to VTA’s regular bus fare $2.50, given Palo Alto Link’s higher level of service. Staff will monitor ridership. The fare adjustments in conjunction with grant funding and renegotiation of the SRP cost-sharing agreement were a part the City’s strategy in the development of a more fiscally sustainable program, as directed by the Finance Committee during the FY 2025 budget process. The impact of these adjustments will be closely monitored as the program continues for the remainder of the fiscal year.