1 Date: August 6, 2024
To: Jovan Grogan
Executive Director
Santa Clara Stadium Authority
From: Jenti Vandertuig
Procurement Director
Forty Niners Stadium Management Company LLC
Subject: Recommendation to Amend Agreements with ACCO Engineered Systems, Inc., and O.C. McDonald Co., Inc., for On-Call Mechanical and Plumbing Maintenance and Repair Services at Levi’s Stadium
Recommendation
Recommend approval to execute the first amendment to the agreement with ACCO Engineered Systems, Inc., for on-call mechanical and plumbing maintenance and repair services at Levi’s Stadium to extend the term of the agreement from September 6, 2024 to September 6, 2025 with an option to extend for one additional year. The amount of the amendment for the fourth contract year shall not exceed $250,000. Total compensation, in the aggregate, shall not exceed $1,000,000 over the four-year period. The term for subsequent fiscal years shall be conditioned upon approval of the Stadium Authority budget for the applicable fiscal year that includes the amounts due under this agreement.
Recommend approval to execute the second amendment to the agreement with O.C. McDonald Co., Inc., for on-call mechanical and plumbing maintenance and repair services at Levi’s Stadium to extend the term of the agreement from September 6, 2024 to September 6, 2025 with an option to extend for one additional year. The amount of the amendment for the fourth contract year shall not exceed $250,000. Total compensation, in the aggregate, shall not exceed $1,254,922 over the four-year period. The term for subsequent fiscal years shall be conditioned upon approval of the Stadium Authority budget for the applicable fiscal year that includes the amounts due under this agreement.
Reasons for Recommendation
Forty Niners Stadium Management Company LLC (Stadium Manager) provides management services for the Stadium on a continual, year-round basis, including overseeing the day-to-day operations and maintenance of the Stadium. The Stadium is a 1.8 million square foot facility completed in 2014. It utilizes complex mechanical components matching the size and age of the
2 facility. Stadium Manager determined that having a list of qualified, experienced bench of contractors to provide mechanical and plumbing maintenance and repair services at the Stadium on an as-needed basis was essential. Therefore, it was in Stadium Manager’s best interest to solicit proposals from contractors capable of handling a wide range of mechanical (HVAC) and plumbing repairs.
Pursuant to a formal solicitation process, on July 27, 2021, Stadium Manager recommended and received approval from the Santa Clara Stadium Authority (SCSA) Board to establish agreements with ACCO Engineered Systems, Inc., and O.C. McDonald Co., Inc., for on-call mechanical and plumbing maintenance and repair services at Levi’s Stadium, for a three-year period with an option to extend the agreement for two additional one-year periods. The amount of each agreement was not to exceed $250,000 per contract year without prior approval from the SCSA. Total compensation, in the aggregate, was not to exceed $750,000 under each agreement. Stadium Manager executed agreements with ACCO Engineered Systems, Inc. and O.C. McDonald Co., Inc. for a three-year period beginning September 7, 2021 through September 6, 2024.
The following are orders placed or expenditures incurred during the initial term of the agreements:
ACCO Engineered Systems, Inc.
Contract Year One - $237,013.13
Contract Year Two - $244,417.20
Contract Year Three - $174,017.43
O.C. McDonald Co., Inc.
Contract Year One – $0.00
Contract Year Two - $37,424.02
Contract Year Three - $254,922 (amendment issued utilizing SCSA capital expenditure funds)
During the term of the agreement, Stadium Manager recommended and received approval and authorization from the SCSA Executive Director to execute an amendment to the agreement with O.C. McDonald Co., Inc. for the emergency procurement of the Temporary Domestic Boiler Emergency Project increasing the maximum compensation for year three from $250,000 to $504,922 to complete the emergency repair utilizing SCSA capital expenditure funds. A copy of the executed amendment has been provided to the SCSA.
Stadium Manager has a continued need for these services and contacted ACCO Engineered Systems, Inc., and O.C. McDonald Co., Inc. to exercise the option to extend the agreements for an additional year.
ACCO Engineered Systems, Inc. provided rate increases between 3.5 and 10 percent from the last increase exercised in year two of the agreement, which was an average 5.6 percent increase from year one. ACCO Engineered Systems, Inc. did not have any rate increase in year three. Cost of living adjustments, market conditions and union contracts were reasons for the rate increase by ACCO Engineered Systems, Inc.
3 O.C. McDonald Co., Inc. did not have any rate increase in years two and three. However, due to the increase in union wages their employees are subject to, O.C. McDonald Co., Inc. provided rate increases between 1.75% to 26.19% for their daily weekday rates substantiating the increases due to the Union Labor Agreement established in the month of June for labor rates to reflect the cost of living in this region for 2024-2025.
Upon review, Stadium Manager determined that it would be in our best interest to exercise the option to extend the agreements with both providers for an additional year with a not to exceed amount of $250,000 each for the contract year. By way of obtaining quotations from both providers, Stadium Manager can be assured of issuing task orders for services based on availability and at the lowest cost to Stadium Manager. Stadium Manager will request the SCSA for approval to increase the maximum compensation during the contract year, if warranted.
Fiscal Impact
The cost for such services is covered in the FY24/25 SCSA Budget, Engineering Department budget, as a shared expense.
Next Steps
Once approved, Stadium Manager will forward a copy of the executed amendments to the SCSA.
Submitted By: Date:
Jenti Vandertuig, Procurement Director