CITY OF SIGNAL HILL
STAFF REPORT
2175 Cherry Avenue • Signal
Hill, California 90755-3799
12/12/2023
AGENDA ITEM
TO: HONORABLE MAYOR
AND MEMBERS OF THE CITY COUNCIL
FROM: CARLO TOMAINO
CITY MANAGER
BY: THOMAS BEKELE
PUBLIC WORKS DIRECTOR
SUBJECT:
PROFESSIONAL CONSULTANT SERVICES AGREEMENT WITH DUDEK TO
PREPARE AN UPDATE TO THE WATER MASTER PLAN AND RATE STUDY Summary:
The City Council will consider approving a Professional Consultant Services Agreement with Dudek for the preparation of an update to the 2018 Water Master Plan (WMP) and the 2019 Water System Rate Study, in the amount of $336,423 (with a contingency of up to $33,642.30). The City released a Request for Proposals (RFP) for these services on November 3, 2023, with a proposal due date of November 27, 2023; the City received two proposals by the deadline. Following staff review of proposals and interviews, Dudek was the highest ranked firm. Based on the evaluation process, staff believes Dudek is the best qualified firm with the proper experience to prepare a comprehensive water master plan based on the qualification criteria identified in the RFP. If approved by the City Council, staff anticipates work can begin on December 15, 2023, and be completed within a ninemonth period, by fall 2024, from the contract start date.
Strategic Plan Goal(s):
Goal No. 4 Infrastructure: Maintain and improve the City’s physical infrastructure, water system, and recreational spaces.
Recommendations:
1. Authorize the City Manager to enter into a Professional Consultant Services Agreement with Dudek for the preparation of an update to the 2018 Water Master Plan and 2019 Rate Study, for a 9-month term contract (with one 3-month extension) for a not-to-exceed contract amount of $336,423, in a form approved by the City Attorney.
2. Authorize the Public Works Director to utilize a project contingency of up to 10% ($33,642.30).
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3. Adopt a resolution entitled:
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SIGNAL HILL, CALIFORNIA
AMENDING THE ADOPTED BUDGET AND AUTHORIZING BUDGET APPROPRIATIONS FOR FISCAL YEAR 2023-24
Fiscal Impact:
The total cost for the proposed contract is $336,423 with contingency funds of $33,642.30, increasing the project cost to $370,065.30. The Public Works budget originally included an appropriation for this contract service; however, the funds were required to address unforeseen water emergencies.
Therefore, staff is requesting to reclassify existing approved budget appropriations from three CIP projects to fund the proposed Water Master Plan/Rate Study as follows:
Background:
A Water Master Plan (WMP) is an essential document that addresses the growing water demand and assessment of the existing water system’s infrastructure. This plan serves as a vital tool for the City to analyze and rectify the deficiencies in its water system while preparing for the future. By leveraging computer modeling and field data, the Master Plan encompasses the entire water distribution system, CITY OF SIGNAL HILL Page 2 of 6 Printed on 12/7/2023
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computer modeling and field data, the Master Plan encompasses the entire water distribution system, offering a comprehensive overview of its functions and highlighting areas requiring improvement based on capacity and reliability assessments. A WMP is a guide used by staff in identifying concerns related to hydraulic performance and capacity, evaluating water storage and supply, and recommending a proactive and manageable utility capital improvement program for the next five years. For example, the City's previous WMP, prepared in 2018, outlined capital improvement projects such as pipeline replacements, Well No. 10 construction, water control related enhancements, and maintenance projects. To date, the City completed the majority of these projects.
As a result of a water rate analysis performed in 2016 and in the 2018 WMP, the City conducted a formal water rate study in late 2019. On January 28, 2020, the City Council approved a rate increase, which included the following: 15% increase in 2020 and 2021, 12% increase in 2022, and 7.5% increase in 2023 and 2024, as stipulated in Signal Hill Municipal Code Section 13.04.130. There is a need for a new rate study due to the upcoming 2024 expiration date of the last approved rate increase. By January 2025, the City plans to implement a new rate structure that effectively addresses both the operational and infrastructure needs of the City's water system.
Analysis
Water Master Plan
Considering the updated population growth projections identified in the City’s 2021 Housing Element updates and the emergence of new development since the adoption of the 2018 WMP, staff recognized the imperative need for a comprehensive update to its Water Master Plan. This update will address various factors, including a recent upswing in water leaks, heightened demands from the State for elevated water quality standards, water conservation mandates, and the enhanced resiliency and reliability of the City's distribution system and supply sources. Furthermore, the WMP will formulate an updated list of capital improvement projects that align with the current state of the City’s infrastructure. The WMP will analyze the following key items:
· Population and land use data in relation with current and future water demand · Water quality enhancement
· General assessment of the City’s water facilities
· Controls (SCADA - Supervisory Control and Data Acquisition) system improvement · Reservoir management systems review
· Valve assessment
· Infrastructure life cycle analysis
· Water production and demand
· Capital Improvement Plan.
· GIS based hydraulic model
· Infrastructure needs for upcoming regulations in relation to maximum contaminant levels (MCL) for Perfluorooctanoic Acid (PFOA) and Perfluorooctane Sulfonate (PFOS) Water Rate Study
The rate study conducted in late 2019, along with its associated approved rate increase, did not anticipate or consider some of the significant impacts on cash flow that occurred following its implementation. Over the past four years, the City's water enterprise fund has endured several CITY OF SIGNAL HILL Page 3 of 6 Printed on 12/7/2023
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implementation. Over the past four years, the City's water enterprise fund has endured several financial impacts, such as the City purchasing a higher volume of imported water from the Metropolitan Water District (MWD) as a result of the statewide drought conditions causing a drop in the water table level making the City’s groundwater inaccessible. Emergency drought statewide regulations further restricted water usage, resulting in a reduction of revenue from the City’s water sales. The City paid higher replenishment assessment costs for pumped groundwater due to rate increases passed by the Water Replenishment District (WRD). The State imposed enhanced water quality requirements which required costly, unanticipated upgrades to the treatment system. Senate Bill 998 (Water Shutoff Protection Act) enacted in 2020, granted customers extended time to pay their bills, resulting in delayed water revenues. Similarly, the COVID-19 pandemic and associated water payment forgiveness also had an impact. Lastly, the water system faced a higher number of unforeseen infrastructure repairs due to aging pipes and reservoirs.
The purpose of this study is to conduct a comprehensive rate analysis and develop an updated fiveyear tiered rate structure. The consultant shall provide expertise in water management and financing.
The WMP will guide the development of the rate structure. The goals and objectives of the rate study are to establish a sustainable and equitable rate structure while ensuring adequate funding for water system operations and capital improvements.
As part of the rate study, the consultant is required to perform the following:
· Review of existing financial data
· Revenue requirement assessment
· Financial modeling
· Financial Plan
· Cost of service analysis
· Public outreach efforts
· Debt service and payment plan
· Preparation of rate study and structure for City review at 50%, 90% and 100% completion
Throughout the preparation of the rate study, staff will convene two Ad-Hoc workshops that will involve the participation of two City Council members as well as members of the public. This collaborative approach is aimed at facilitating open discussions between staff, City Council, community members and the consultant to establish priorities and consider the addition of key projects and services that may significantly impact the overall rate structure. The results of this collaboration will be presented to City Council upon the completion of the WMP. Furthermore, the rate study will encompass a comprehensive Prop 218 assessment process, conducted in strict accordance with State law. Staff will work closely with the City Attorney's office to meet all necessary requirements and regulations.
RFP Circulation Process
On November 3, 2023, staff issued a Request for Proposals (RFP) for the Water Master Plan and Rate Study. The City posted the RFP at the following locations:
· PlanetBids via the City’s online portal
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· City’s Website
· Public notice locations as identified in the Signal Hill Municipal Code Section 1.08.010 Seven prospective proposers were notified of the RFP opportunity through PlanetBids, and a total of four prospective proposers downloaded the contract documents. The proposals were due to the City on November 27, 2023, at 2:00 pm. The City received two (2) proposals from the following firms:
· Ardurra Group, Inc.
· Dudek
Evaluation Process
Staff verified that all proposals were complete and met the City’s requirements. The City’s Selection Committee (consisting of the Public Works Director, Associate Engineer, and Contracts Manager) evaluated the proposals using the following criteria:
a) Qualifications of the Firm: Technical experience in performing work of a similar nature; experience working with public agencies; strength and stability of the firm; and assessment by client references.
b) Proposed Team and Organization: Qualifications of proposed personnel and key personnel; logic of organization; and adequacy of labor commitment and resources to satisfactorily perform the requested services and meet the City's needs. Firm’s current workload and ability to demonstrate their ability to deliver the project based on the committed resources and within the proposed defined schedule.
c) Detailed Work Plan: Thorough understanding of the City's requirements and objectives; logic, clarity, specificity, and overall quality of work plan. Defined approach to carry out and acquire the field review data; perform the design in an efficient and effective manner; and ability to deliver quality final work product per the proposed project schedule.
Consultant Selection:
On November 28, 2023, the Selection Committee interviewed both firms regarding the contents of their proposal and their technical and managerial approach to the project. Based on the results of the evaluation of proposals and interviews, the Selection Committee determined that Dudek adequately addressed the evaluation criteria, conveyed a logical approach and methodology for the scope of services, and demonstrated the qualifications, professional licensure, and competence necessary for the satisfactory performance of the services. Staff believes that Dudek and its proposed staff and financial subconsultant are qualified to provide the technical engineering and finance services required for the project.
In accordance with best practices in qualifications-based selections for professional services, staff evaluated the proposed fee and negotiated adjustments to ensure the completeness of the scope of services, the reasonableness and competitiveness of fees, and the adequacy of the budget. The total not-to-exceed fee of $336,423 is deemed reasonable based on the agreed-upon anticipated work breakdown structure and is consistent with staff's estimates for the scope of services requested by CITY OF SIGNAL HILL Page 5 of 6 Printed on 12/7/2023
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the City.
Staff recommends the award of the Professional Consulting Services Agreement to Dudek for the preparation of the WMP and Rate Study. Upon contract award, staff would issue a Notice to Proceed to Dudek to commence their services. Staff anticipates Dudek would initiate services on December 15, 2023, and complete the scope of services within the nine-month term, by fall 2024. If approved by City Council, the new rates would be adopted by January 2025.
Reviewed as to Fiscal Impact:
_________________________
Sharon del Rosario
Attachment:
A. Contract Agreement
B. Budget Reclassification Resolution
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