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City Council
Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Utilities
Meeting Date: January 12, 2026
Report #:2510-5308
TITLE
Approval of Professional Services Contract Number C26195486 with Baron Contracting in an Amount Not-to-Exceed $514,528 for Gas Leak Survey Services for a Period of Three Years. CEQA Status – Exempt Under CEQA Guidelines Sections 15301(c) and 15308 (Existing Facilities).
RECOMMENDATION
Staff recommends that the City Council approve and authorize the City Manager or their designee to execute Contract No. C26195486 (Attachment A) with Baron Contracting for annual walking and mobile gas leak surveys for a three-year term with a total not-to-exceed amount of $514,528, including $424,528 for basic services and $90,000 for additional services.
EXECUTIVE SUMMARY
The City’s Gas Operations in the Utilities Department conducts an annual mobile survey that tests of the atmosphere near gas mains; in gas, electric, telephone, sewer, and water system manholes; at cracks in the pavement and sidewalks; and at other locations offering an opportunity to find gas leaks. This survey checks every gas main in the City and walks every service line in each of the fourteen identified business districts.
Gas Operations also conducts a walking survey of each gas service in the system in one half of the City every year, so that within a two-year cycle, the entire City is surveyed by walking.
Natural movement in the ground as well as human impacts can cause small leaks in the system that would not necessarily be identified until they became larger and more hazardous. The walking leak survey involves a qualified technician carrying gas detection equipment and walking every gas service line and evaluating every gas meter in the portion of the City being surveyed.
BACKGROUND
The City of Palo Alto owns and operates its own utilities (water, gas, wastewater collection and treatment, and electric) and delivers gas to over 24,000 meters. The Utilities Department maintains and operates over 210 miles of distribution main and approximately 17,395
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individual gas service pipelines with an average service length of 61 feet. The distribution main pipeline material is comprised of polyethylene (PE) pipe, coated steel, polyvinyl chloride (PVC), and acrylonitrile butadiene styrene (ABS). The gas distribution system is split into a grid system by northern and southern sections. One section is leak surveyed annually, for one complete survey of the City every two years. There are fourteen principal business districts throughout the City, (consisting of over 1,870 gas services) which are surveyed annually. Lastly, leaks that were not repaired the previous year are carried over to the next year for leak surveying. These carry over leaks consist of approximately 100 annually.
A leak survey of the entire gas distribution system is completed once every two years and is conducted between the months of March through November. A complete annual gas leak survey of the City is broken up using the following four methods:
1. Mobile Survey: The mobile survey is conducted annually on half of the gas mains throughout the City, alternating between the northern and southern sections of the City. The survey is conducted using a mounted vehicle leak survey device and, in some locations, requires a walking survey of the mains to be completed when access using a vehicle is not feasible. The survey is conducted in April and May of each year.
2. Business Districts: There are 14 Business Districts in the City, consisting of over 1,870 gas services; a walking leak survey of the gas service from the main to the gas meter, including the gas meter, is performed annually. The survey starts in the beginning of April and is completed by the end of May each year.
3. Walking Survey: A walking leak survey is completed either in the northern or southern section of the City, excluding the gas services already walked within the business districts. Only one section of the City is completed each year. A walking leak survey of the existing gas service from the main to the gas meter, including the gas meter, is performed. The survey begins after the mobile survey is completed. It is usually completed by the end of December each year.
4. Existing Gas Leaks (Re-checks): A walking leak survey of all carry-over gas leaks from the previous year is conducted annually. There are approximately 100 carry-over gas leaks to be surveyed annually. The re-check evaluates the existing gas leak and requires an updated grading of each leak. The survey starts in the beginning of March and is completed by the end of April each year.
It is critical that the completion of each leak survey component be completed within the specified timeframe. Maintenance of the gas distribution system includes the annual walking and mobile gas leak surveys in accordance with federal regulations. Palo Alto Utilities takes a rigorous approach to leak identification and repair and completes a survey of the entire system every two years instead of the Department of Transportation (DOT) mandated minimum of every five years. This evaluation allows us to improve the City’s infrastructure and work towards the overall reduction and prevention of future leaks. 8 3
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ANALYSIS
Bid Process
On August 19, 2025, the City posted a request for proposal (RFP) for the Gas Leak Survey on the City’s electronic procurement system, OpenGov. The bidding period was 22 calendar days. The City received four (4) proposals from qualified contractors on September 18, 2025, as listed below.
BID SUMMARY
Solicitation Process
Summary of Request for Proposal
Proposal Description Walking and Mobile Gas (Methane) Leak Surveys RFP No. 195486
Proposed Length of Project 3 years
Number of Proposal Packages Downloaded 20
Total Days to Respond to Proposal 30
Pre-Proposal Meeting No
Number of Proposals Received 4 (2 responsive and 2 non-responsive) Proposal Price Range $424,558 to $1,140,140
Public Link to Solicitation https://procurement.opengov.com/portal/palo- alto-ca/projects/191826
Proposal results of responsive submittals are shown below:
Vendor Year 1 Year 2 Year 3 Total
Baron Contracting $ 138,000 $ 141,525 $ 145,033 $ 424,558 Alisto Inc $ 367,300 $ 379,520 $ 393,320 $ 1,140,140 After a thorough review of the proposals submitted, Heath Consultants was disqualified due to being non-responsive to clarify their proposal cost calculations. Leak Detection Services Inc. was considered non-responsive as they did not provide all required documents in their proposal package. Baron Contracting was selected due to the quality of their proposal, past experience working with public agencies and total cost.
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The City’s current vendor, Manesco Corporation, is currently completing the third year of a six- year contract for Gas Leak Survey services. Unfortunately, Manesco will be retiring and is unable to fulfill the remainder of the contract. The RFP was issued in anticipation of Manesco closing their business, solicitating proposals for three-years so that during this time, staff can evaluate the service provided.
The recommended contract is in line with staff’s estimate and is 25% above the current annual contract amount of $110,000. This variance reflects the below-market price from Manesco who have been performing gas surveys for the City over the past 20 years. The contract with Baron Contracting includes $30,000 of additional services per year for a total not to exceed amount of $90,000 for the contract term. Additional services include requests for gas leak surveys after earthquakes or other natural disasters as well as non-emergency surveys for pressure uprating or follow-up surveys at the request of the Department. Additional services will be authorized through the use of a task order and will be managed in compliance with the contract document.
FISCAL/RESOURCE IMPACT
Funding for the first year of the contract is available in the FY 2026 Gas Operations/Maintenance budget. Funding for subsequent years are contingent upon Council appropriation and approval of funds through the annual budget process.
STAKEHOLDER ENGAGEMENT
The City will provide notification of the Gas Leak Survey via the City website and social media platforms.
ENVIRONMENTAL REVIEW
Council’s approval of this term agreement for gas leak surveys and gas leak rechecks is categorically exempt from the California Environmental Quality Act (CEQA) under CEQA Guidelines 15301(c) (operation, repair, maintenance of existing facilities), and 15308 (actions by regulatory agencies for protection of the environment), thus no environmental review is required.
ATTACHMENTS
Attachment A: Baron Contracting, Contract C26195486
Attachment B: Bid Summary
Attachment C: Gas Leak Survey Grid
APPROVED BY:
Alan Kurotori, Director of Utilities