City Council Agenda Report
Meeting Date: November 4, 2025
From: Todd Dusenberry, General Manager of Public Utilities Department: Public Utilities
Submitted by: Adriana Ramos, Senior Management Analyst
Subject
Labor and Materials Contract with SPX Cooling Tech, LLC Recommendation
A. Find that the proposed action is categorically exempt from California Environmental Quality Act (CEQA) review, in accordance with CEQA Guidelines Section 15301, because the project consists of the maintenance of the existing cooling tower and involves negligible or no expansion of an existing use;
B. Approve and authorize the City Administrator to execute a Labor and Materials Contract with SPX Cooling Tech, LLC, in substantially the same form as submitted, for repair work on the Cooling Tower, for a total amount not-to-exceed $245,792; and C. Authorize a contingency amount of five percent (5%) or $12,289.60 to cover any unforeseen expenses and grant authority to the City Administrator to approve and execute amendments up to the contingency amount, if necessary.
Background
The Malburg Generating Station (MGS) operates a multicell cooling tower designed to dissipate low-quality heat generated during the production process. The cooling tower provides essential cooling for various plant processes that generate heat, with the primary heat load coming from the Steam Turbine Generator. After steam is produced from the exhaust heat of the Gas Turbines and used to generate energy inside the Steam Turbine, it is discharged into the Condenser. Cold water from the Cooling Tower recondenses this steam back into condensate, allowing it to be reused in the steam cycle.
The Cooling Tower, constructed in 2005 during the original development of MGS, is made of wood and fiberglass. These materials have a lifespan of 20 to 30 years. Over time, they deteriorate due to UV exposure, chemical exposure, and water saturation.
MGS staff have continuously monitored the Cooling Tower’s condition, assessing its structural integrity and the performance of its internal water spray nozzles. While staff have successfully maintained cooling efficiency through nozzle repairs and upgrades, recent inspection reports have identified several structural concerns, primarily in areas with high structural loads and equipment support. These components, now in the later stages of their lifecycle, require major repair and refurbishment to preserve the overall structural integrity of the system.
The necessary repairs require specialized engineering plans and material specifications. SPX Cooling Tech, LLC (SPX)/Marley serves as the Original Equipment Manufacturer (OEM) and installation contractor for the Cooling Tower equipment. As the OEM, SPX/Marley maintains the original drawings and design specifications, which are confidential and constitute the exclusive property of SPX/Marley. Therefore, Vernon Public Utilities has engaged SPX to perform the refurbishment and address the critical structural issues. SPX designs, tests, and manufactures its own fill media, drift eliminators, and mechanical equipment components.
The proposed Labor and Materials Contract is exempt from competitive bidding and competitive selection pursuant to Sections 3.32.110(A)(2) and 3.32.110(B)(I) of the Vernon Municipal Code (VMC). This exemption arises as the original drawings and design specifications are proprietary to SPX/Marley. Furthermore, SPX serves as both the OEM and installation contractor for the Cooling Tower. Pursuant to VMC Section 3.32.030(A), City Council approval is required for the proposed contract, as the total value of the contract exceeds $100,000.
VPU staff recommends that the City Council approve the Labor and Materials Contract with SPX for repair work on the Cooling Tower for a total amount not-to-exceed $245,792. Additionally, staff recommends a contingency of five (5%) percent or $12,289.60 for unforeseen expenses.
The proposed Labor and Materials Contract has been reviewed and approved as to form by the City Attorney’s Office.
Fiscal Impact
The fiscal impact is not-to-exceed $258,081.60. Sufficient funds are available in the Electric Fund, Malburg Generating Station, Capital Outlay, Account No. 055-050-586-660000 for the current fiscal year.
Attachments
1. Labor and Materials Contract with SPX Cooling Tech, LLC.
2. Sole Source Letter from SPX Cooling Tech, LLC.