HomeMy WebLinkAbout04.b. Review Annual Contracts and Blanket Purchase Orders (BPOS) Older than five years with an annual spend greater than $25,000Page 1 of 25
Item 4.b.
F--1-448�411C-S0
June 25, 2024
TO: FINANCE COMMITTEE
FROM: STEPHANI E KING, CONTRACTS AND PROCUREMENT PROGRAM
ADMINISTRATOR
KEVIN MIZUNO, FINANCE MANAGER
REVIEWED BY: PHI LI P LEI BER, DEPUTY GM, ADMINISTRATION
ROGER S. BAILEY, GENERAL MANAGER
SUBJECT: REVIEW ANNUAL CONTRACTS AND BLANKET PURCHASE ORDERS
(BPOS) OLDER THAN FIVE YEARS WITH AN ANNUAL SPEND GREATER
THAN $25,000
Consistent with past practice, although not required by law or policy, on an annual basis staff provides the
Finance Committee with a listing of contracts and blanket purchase orders (BPOs) that have not been
competitively bid in over five years. This was initially requested by the Finance Committee many years
ago as part of an effort to improve transparency over longstanding contracts and determine whether it was
appropriate to bid them out. Accordingly, attached is a report that lists all contracts and BPOs that are
older than five years and have an annual spend (calendar year 2023) greater than $25,000. This
information is being provided to the Finance Committee for awareness (including review and discussion,
as appropriate) purposes only and no action is required by the Board.
Status and plans for rebidding is indicated on the attachment. With respect to the contract for security
guard services (currently PacWest Security Services), an RFP is currently under development for release
this summer.
GOAL FOUR: Governance and Fiscal Responsibility
Strategy 1 - Promote and uphold ethical behavior, openness, and accessibility, Strategy 2 - Encourage and facilitate
public participation, Strategy 3 - Maintain financial stability and sustainability
ATTACHMENTS:
1. Contracts and BPOs > 5 yr and $25k
2. PacWest Sole Source-1-2022
3. PacWest Sole Source-1-2023
4. Solar Turbine Board Resolution Sole Source
June 25, 2024 Regular FINANCE Committee Meeting Agenda Packet - Page 109 of 135
Contracts and Blanket Purchase Orders Older than Five Years and > $25,000 Spend in 2023 ATTACHMENT 1
Total
Annual
Contract
Spend
Contract
Contract
Duration
Calendar Year
Contract/
#
Number
Vendor
Description
Start Date
End Date
(Yrs.)
2023
PO total
Notes
This is a long-term contract which is exempt from the
competitive process based on contracting with another
public agency. The daily rack price of fuel updates daily and
is currently slightly over $3 a gallon. The County takes the
daily rack price and adds an overhead fee to the price which
is currently $0.55/gallon resulting in Central San paying
roughly $3.55/gallon at the County fuel station which is well
below retail cost. In addition, the County manages Voyager
27246/
Contra Costa County
Off -site Fueling
fuel cards for each of the vehicles which allow Central San
1
IP105
General Services
Services
4/11/2003
6/30/2025
22.2
$ 124,622.38
N/A
to fill up at retail stations if needed.
The Board has authorized the General Manager to extend
this sole source, long-term services contract with Solar
43398/
60 Month Full
Turbines Incorporated as indicated in Resolution No. 2015-
2
P236
Solar Turbines, Inc.
Service Agreement
9/1/2015
8/31/2025
10.0
$ 272,807.89
$ 2,831,770.00
028 (attached).
See attached temporary exemptions (Jan 2022 and Jan
43652/
Pacwest Security
Security Guard
2023). The Risk Division hired a consultant to help with RFP
3
IP114
Services
Services
1/11/2016
4/30/2024
8.3
$ 623,258.15
$ 3,252,250.00
scope of work. This work took longer than expected.
The Filter Plant Clearwell Project (#007361) was initially
budgeted to be completed in 6 fiscal years (FY17-18
through FY22-23) and new project appropriations were
therefore not included in the FY 23-24 CIB. The project was
carried forward into FY 23-24 (Current year) for completion
which resulted in the project lifetime spanning through 7
fiscal years. The engineering agreement with Stantec was
therefore extended beyond 5 years to accommodate the
Filter Plant and
longer than anticipated life of the project. The agreement
46383/
Clearwell
is expected to be closed coinciding with the completion of
4
IP34
iStantec
Improvement
1 7/3/2018
6/30/2024
6.0
$ 488,891.02
$ 5,762,000.00
the capital project.
Page 1 of 2
June 25, 2024 Regular FINANCE Committee Meeting Agenda Packet- Page 110 of 135 DRAFT
Contracts and Blanket Purchase Orders Older than Five Years and > $25,000 Spend in 2023
Total
Annual
Contract
Spend
Contract
Contract
Duration
Calendar Year
Contract/
#
Number
Vendor
Description
Start Date
End Date
(Yrs.)
2023
PO total
Notes
Per email from Capital Projects Division (A. Holt) dated
12/5/23, due to equipment delivery issues the project
managers wish to extend this agreement to 5/31/24.
Subsequently, Project Manager (N. Molina) requested via
Steam & Aeration
an email on 5/3/24 to extend the contract as record
46907/
HDR Engineering,
Blower Renovations
drawings were not yet complete extending the term of the
5
IP42
Inc.
Project
1/14/2019
12/31/2024
6.0
$ 832,711.87
$ 5,776,000.00
project.
Plant Operations Division Manager requested an extension
of this contract as Polydyne is the sole source provider of
the specific polymer used in Central San's current sludge
dewatering process (WE-385). Competitive sourcing is
planned to be conducted prior to the term of this extended
contract to assess whether other polymer suppliers should
be considered. Per Plant Operations Division Manager, this
1 year contract extension reflects favorable pricing of only
47109/
Supply and Delivery
3.4%, which is reasonable relative to other significant
6
IP85
Polydyne, Inc.
of Clarifloc WE-385
3/18/2019
2/28/2025
6.0
$ 572,765.15
$ 3,059,000.00
chemical price increases incurred in recent years.
Per Planning & Development Division (D. Gemmell) via an
email on 12/4/23, staff is still performing rate model tasks
FY 2018-19 Cost of
for the Financial Plan update to the Board expected in
46679/
Raftelis Financial
Service Consulting
March 2025. Accordingly, staff requested to extend the
7
IP39
Consultants
(rate review)
10/10/2018
6/30/2024
5.7
$ 30,080.00
$ 149,404.00
agreement to the end of the fiscal year (June 2024).
This is an award to Republic Services, Inc., owner of the
Keller Canyon and Vasco Road landfills with whom the
Disposal of
District possesses grandfathered-in hauling arrangements.
46703/
Treatment Plant
A new PO is expected to be issued after the expiration of
8
IP248
Republic Services
Waste Streams
11/7/2018
6/30/2024
5.6
$ 59,065.27
$ 237,000.00
the current agreement.
Extended to provide more time for sourcing and
Konica Minolta
negotiations for new contract. Communications Division
47137/
Business Solutions
Reprographics
staff intend to bid this service out in the summer of 2024
9
P149
USA, Inc.
Services
4/23/2019
10/31/2024
5.5
$ 192,443.85
$ 1,270,000.00
anticipating a new contract in Oct/Nov.
Page 2 of 2
June 25, 2024 Regular FINANCE Committee Meeting Agenda Packet - Page 111 of 135 DRAFT
Page 4 of 25
r-e- ca - C�cs
Central Contra Costa Sanitary District
SOLE SOURCE REQUEST
(Products & Services)
REQUISITION #::R1794 ESTIMATE: $712,500.00
I VENDOR / SUPPLIER / BRAND NAME / CONTRACTOR: PacWest Security
I
TYPE OF PRODUCT /SERVICE & DESCRIPTION: Security Guard Services
ATTACHMENT 2
This form must accompany the requisition whenever a request is made for a non-competitive purchase. When the requesting
department is requesting a particular vendor, brand, product, or service provider, this fact must be made clear on their requisition.
Best practice procurement for a public agency, as is Central Contra Costa Sanitary District, provides that we engage in soliciting
competitive pricing for the products and services we acquire unless a determination of non -competition is made. It is the policy of the
District that competitive pricing is obtained for all purchases of products and non-professional services greater than $3,500 unless there
is a validated exemption to the competitive process.
When a requisition is made for a non-competitive acquisition of goods or services that contain specifications and/or other
operational/technical requirements which limits the ability for the District to seek more than one bid or quotes in the marketplace, the
requesting department representative must complete the information below with factual statements, attach any and all supporting
documentation of their effort to review comparable products or services, and obtain approval to waive the competitive process.
Please check ONE of the following that applies to your request. Provide the information requested for the
category you checked.
1. ❑ SOLE SOURCE: Products or services are available from one source only (i.e. one manufacturer,
service provider of proprietary service, etc). What are the unique features, design, qualifications, rights,
licenses, etc. of the product/brand/service/service provider that are not available in any other
brand/service/service provider?
Have you contacted other suppliers/service providers to evaluate items/services with similar features
and capabilities? If no, explain why not. If yes, list suppliers/service providers and explain why their
products/services do not meet the department's requirements.
2. 0 SOLE BRAND OR SERVICE: Multiple sources may be able to supply the specified model and brand
or service. In these cases, competitive bids or quotes will be solicited for the requested brand or
service only. If only one source of supply of the brand exists (i.e. a dealer is the only one in a protected
territory) the purchase will be made upon confirmation without further solicitation of bids or quotes.
Why is the specified brand or service required (not just preferred) and how would your requirements for
this specific brand or service be inhibited or burdened without purchase of the particular brand or
service requested?
Have you contacted other suppliers/service providers to evaluate items/services with similar features
and capabilities? If no, explain why not. If yes, list suppliers/service providers and explain why their
products/services do not meet the department's requirements.
Central Contra Costa Sanitary District
Sole Source Request (Products & Services)
Page 1 of 3
June 25, 2024 Regular FINANCE Committee Meeting Agenda Packet- Page 112 of 135 DRAFT
Page 5 of 25
,3. ❑ REPLACEMENT OEM (ORIGINAL EQUIPMENT MANUFACTURER) PARTS: The requested part is
an integral repair part or accessory compatible with existing equipment. The District requires this
replacement part from an original manufacturer. This replacement part is not interchangeable with
other similar parts from other manufacturers. Please explain.
Existing Equipment:
Equipment Manufacturer Name / Model #:
Part Name and #:
Multiple sources may be able to supply the specified model and brand. In these cases, competitive
bids or quotes will be solicited for the requested brand only. If only one source of supply of the brand
exists (i.e. a dealer is the only one in a protected territory) the purchase will be made upon confirmation
without further solicitation of bids or quotes.
4. ❑ STANDARDIZATION REQUEST: The District requires the item(s) or service(s) in order to standardize
on parts, design, quality, adherence to form, fit and/or function, and/or to maintain warranty or a
maintenance contract on an existing product or system. Please specify.
If justification is based on the need to match the new item or service with existing equipment, parts,
etc., list the quantity, manufacturer/brand and model of the existing equipment pertaining to this request
and why the matching is required (i.e. compatibility, repair and maintenance, training, productivity,
minimization of supplies or spare parts, eliminates need to modify existing equipment, volume price
discounts or savings, safety, etc).
Existing Equipment:
Existing Equipment Manufacturer Name / Model #-
Quantity:
Part Name and # (if applicable):
Why is matching required? Please explain.
❑ Compatibility:
❑ Repair and maintenance:
❑ Training:
❑ Productivity:
❑ Minimization of supplies or spare parts:
❑ Eliminates need to modify existing equipment:
❑ Volume price discounts or savings:
Fj Safety:
Other:
5. ;Z OTHER NON-COMPETITIVE RECOMMENDATION: Examples include time constraints (emergency
situations), pre -qualified suppliers (suppliers awarded contracts from cooperative bidding, where price
and other factors have already been assessed), or quality/reliability and performance history indicates
an award of contract to a particular supplier/service provider would not be in the best interest of the
District. See Purchasing Policy 4.8 Exemptions to Competitive Pricing for definitions and examples.
Indicate which situation exists for this request along with applicable information to support this
exemption. Best Interest of the District +
Central Contra Costa Sanitary District
Sole Source Request (Products & Services) Page 2 of 3
June 25, 2024 Regular FINANCE Committee Meeting Agenda Packet- Page 113 of 135 DRAFT
Page 6 of 25
Department / Division Name: Administration/Risk Managemenyt
Department / Division Representative: Shari Deutsch, Risk Mgr
Department Director: Phil Leiber
*General Manager: Roger S. Bailey
*Requests over $50,000 require General Mana
require General Manager or Board approval.
it and signature.
Date: 1 /13/22
Date: 111317,
Best Interest of the District and pilottestlexemptions
FOR PURCHASING DIVISION USE ONLY
Buyer: C�� Date: 1/20/2022
Purchasing & Materials Manager: -Qrr;- Date: 1/21/2022
Comments (if necessary):
Central Contra Costa Sanitary District
Sole Source Request (Products & Services)
Page 3 of 3
June 25, 2024 Regular FINANCE Committee Meeting Agenda Packet- Page 114 of 135 DRAFT
Page 7 of 25
Discussion
The District currently contracts with PacWest to provide on -site security guard services
for the treatment plant and surrounding properties at the Martinez campus. This contract
will expire on January 31, 2022.
In spring 2021 the District went out to bid for this contract and received over 20
responses, many of which provided insufficient information to evaluate the proposals.
We realized that the RFP required more detailed minimum qualifications and more
specific performance metrics. Staff rejected all proposals and planned to reissue the
RFP in Fall 2021, hoping that economic and public health conditions would be more
favorable.
Staff began that process in Fall 2021 and discovered that the current service -
contracting environment is still unpredictable, and in some ways, presents greater
challenges than those of early 2021. Therefore, staff believes the District should extend
its relationship with PacWest. This would allow the District to maintain its current level
of security provided by the experienced and diligent personnel of PacWest rather than
assume the risks associated with changing service providers. Staff wishes to extend
the current contract for 18 months (through June 30, 2023) and then reconsider
conducting an RFP in a (hopefully) more stable operating environment.
Considerations include:
Increased uncertainty - The ongoing effects of COVID-19 and its variants has
changed our definition of normal operations. The main campus has not yet returned to
pre -pandemic occupation levels and many workplace restrictions are still in effect.
Current guard personnel are familiar with both prior and interim practices we've
implemented to ensure compliance with these requirements. They have already
demonstrated their ability to modify their duties and adapt their practices as these
requirements have changed often over the last two years. With a smaller contingent of
on -site staff, the guards have expanded their access control and observational
functions.
Increased risk from the arealenvironment - Incidents of theft, vandalism and illegal
dumping have increased notably over the last two years and the guards have been
instrumental in reporting such events to staff. Their familiarity with the campus has
provided us with early notice of new or expanding homeless encampments on District
property and other incidents that may not be recognized by a newer workforce. Current
guard personnel are sufficiently familiar with the treatment plant and its personnel to
respond to operations staff requests for assistance that may extend beyond the limited
role of a security guard (they do go above and beyond for us).
Tight Labor Market - The current labor market is such that a new provider may not be
able to properly staff the service. PacWest already pays its guards more than minimum
wage and provides benefits and incentives to reduce turnover and to maintain a diligent
June 25, 2024 Regular FINANCE Committee Meeting Agenda Packet- Page 115 of 135 DRAFT
Page 8 of 25
workforce. The PacWest team has negotiated rate increases with the District throughout
the contract term to increase the guards' hourly wages over time. In a tight labor market,
a new provider may not be able to hire competent, experienced, and diligent staff at
even higher costs.
Familiarity with current security systems, practices and tools — PacWest staff
already has the skills and experience with the District's access control systems, its
practices for controlling, monitoring and tracking the various types of visitors allowed
through the main gate, and directing approved traffic into and out of the plant, reporting
and responding to events, and integrating the company's proprietary software with the
needs of District staff. Should the District contract with a different provider, a great deal
of time will be required to integrate systems, train staff and test operations before
reaching a comparable level of responsiveness and seamless communications.
Invariably, there would be a learning curve during which time gate management may be
less efficient and responses to unusual circumstances may be delayed or avoided until
the new personnel receive further direction. As noted above, staff wishes to avoid the
need to absorb these effects of novelty during a pandemic.
A history of exceptional performance —PacWest has had very little turnover among
guard personnel over the last few years. This is a result of considerable staff time spent
with PacWest personnel to modify their own procedures to align with ours, to develop
incentive programs, improve communications, expand guard training and to implement
other methods to reduce turnover and to maintain a diligent and engaged group of
guards. We have accomplished that goal and continue to work with PacWest and their
guard staff to maintain this high level of stability and performance. This could not be
immediately replicated with a new provider.
June 25, 2024 Regular FINANCE Committee Meeting Agenda Packet- Page 116 of 135 DRAFT
Page 9 of 25
Suzette Crayton
From:
Philip Leiber
Sent:
Tuesday, January 18, 2022 1:54 PM
To:
Suzette Crayton
Cc:
Michele Barajas; Shari Deutsch
Subject:
RE: PacWest Sole Source Request and Discussion
Hi Suzette,
Here is what I understand:
The current firm has been responsive and is presently performing well, in Risk's opinion.
The current contracting environment with COVID, low -unemployment, inflation, is not viewed as conducive to
obtaining a "better deal".
This is not a good time to make a transition to a new firm given some heightened risks at the Central San
campus, with increased homeless encampments, thefts, and few people on site.
Phil Leiber
From: Suzette Crayton
Sent: 0118, 2022 01:02 PM
To: Shari Deutsch <SDeutsch@centralsan.org>
Cc: Michele Barajas <MBarajas@centralsan.org>; Philip Leiber <pleiber@centralsan.org>
Subject: RE: PacWest Sole Source Request and Discussion
Importance: High
Shari, I put this on Roger's desk and the Best Interest of the District is indicated with no explanation of why the
extension is in the best interest of the District or am Roger and I missing something. Please let me know. Thanks.
From: Shari Deutsch <J e .r < air n.Or >
Sent: Friday, January 14, 2022 11:07 AM
To: Suzette Crayton <:=: ;:._: ` `T'_.:,:.` '_,r_ :>
Cc: Michele Barajas <`_._i�._('_>
Subject: FW: PacWest Sole Source Request and Discussion
Hi Suzette,
When you get the sole source form back from Roger, would you scan and send it to Michele so she can set up Docusign
as Chris requests below? You can send me back the hard copy via IOM.
Thanks,
Shari
June 25, 2024 Regular FINANCE Committee Meeting Agenda Packet- Page 117 of 135 DRAFT
Page 10 of 25
Pr,4@Ek___sD
Central Contra Costa Sanitary District ATTACHMENT 3
SOLE SOURCE REQUEST
(Products & Services)
REQUISITION #: R2035 I ESTIMATE: $632,000 1
VENDOR / SUPPLIER / BRAND NAME / CONTRACTOR: PacWest Security
TYPE OF PRODUCT / SERVICE & DESCRIPTION: Security Guard Services
This form must accompany the requisition whenever a request is made for a non-competitive purchase. When the requesting
department is requesting a particular vendor, brand, product, or service provider, this fact must be made clear on their requisition.
Best practice procurement for a public agency, as is Central Contra Costa Sanitary District, provides that we engage in soliciting
competitive pricing for the products and services we acquire unless a determination of non -competition is made. It is the policy of the
District that competitive pricing is obtained for all purchases of products and non-professional services greater than $3,500 unless there
is a validated exemption to the competitive process.
When a requisition is made for a non-competitive acquisition of goods or services that contain specifications and/or other
operational/technical requirements which limits the ability for the District to seek more than one bid or quotes in the marketplace, the
requesting department representative must complete the information below with factual statements, attach any and all supporting
documentation of their effort to review comparable products or services, and obtain approval to waive the competitive process.
Please check ONE of the following that applies to your request. Provide the information requested for the
category you checked.
1. ❑ SOLE SOURCE: Products or services are available from one source only (i.e. one manufacturer,
service provider of proprietary service, etc). What are the unique features, design, qualifications, rights,
licenses, etc. of the product/brand/service/service provider that are not available in any other
brand/service/service provider?
Have you contacted other suppliers/service providers to evaluate items/services with similar features
and capabilities? If no, explain why not. If yes, list suppliers/service providers and explain why their
products/services do not meet the department's requirements.
2. ❑ SOLE BRAND OR SERVICE: Multiple sources may be able to supply the specified model and brand
or service. In these cases, competitive bids or quotes will be solicited for the requested brand or
service only. If only one source of supply of the brand exists (i.e. a dealer is the only one in a protected
territory) the purchase will be made upon confirmation without further solicitation of bids or quotes.
Why is the specified brand or service required (not just preferred) and how would your requirements for
this specific brand or service be inhibited or burdened without purchase of the particular brand or
service requested?
Have you contacted other suppliers/service providers to evaluate items/services with similar features
and capabilities? If no, explain why not. If yes, list suppliers/service providers and explain why their
products/services do not meet the department's requirements.
Central Contra Costa Sanitary District
Sole Source Request (Products & Services)
Page 1 of 3
June 25, 2024 Regular FINANCE Committee Meeting Agenda Packet- Page 118 of 135 DRAFT
Page 11 of 25
3. ❑ REPLACEMENT OEM (ORIGINAL EQUIPMENT MANUFACTURER) PARTS: The requested part is
an integral repair part or accessory compatible with existing equipment. The District requires this
replacement part from an original manufacturer. This replacement part is not interchangeable with
other similar parts from other manufacturers. Please explain.
Existing Equipment:
Equipment Manufacturer Name / Model #:
Part Name and #:
Multiple sources may be able to supply the specified model and brand. In these cases, competitive
bids or quotes will be solicited for the requested brand only. If only one source of supply of the brand
exists (i.e. a dealer is the only one in a protected territory) the purchase will be made upon confirmation
without further solicitation of bids or quotes.
4. ❑ STANDARDIZATION REQUEST: The District requires the item(s) or service(s) in order to standardize
on parts, design, quality, adherence to form, fit and/or function, and/or to maintain warranty or a
maintenance contract on an existing product or system. Please specify.
If justification is based on the need to match the new item or service with existing equipment, parts,
etc., list the quantity, manufacturer/brand and model of the existing equipment pertaining to this request
and why the matching is required (i.e. compatibility, repair and maintenance, training, productivity,
minimization of supplies or spare parts, eliminates need to modify existing equipment, volume price
discounts or savings, safety, etc).
Existing Equipment:
Existing Equipment Manufacturer Name / Model #:
Quantity:
Part Name and # (if applicable):
Why is matching required? Please explain.
❑ Compatibility:
❑ Repair and maintenance:
❑ Training:
❑ Productivity:
❑ Minimization of supplies or spare parts:
❑ Eliminates need to modify existing equipment:
❑ Volume price discounts or savings:
❑ Safety:
❑ Other:
5. ® OTHER NON-COMPETITIVE RECOMMENDATION: Examples include time constraints (emergency
situations), pre -qualified suppliers (suppliers awarded contracts from cooperative bidding, where price
and other factors have already been assessed), or quality/reliability and performance history indicates
an award of contract to a particular supplier/service provider would not be in the best interest of the
District. See Purchasing Policy 4.8 Exemptions to Competitive Pricing for definitions and examples.
Indicate which situation exists for this request along with applicable information to support this
exemption. The District currently contracts with PacWest Security to provide on -site security
Central Contra Costa Sanitary District
Sole Source Request (Products & Services) Page 2 of 3
June 25, 2024 Regular FINANCE Committee Meeting Agenda Packet- Page 119 of 135 DRAFT
Page 12 of 25
and access control services for the Treatment Plant and surrounding properties at the Martinez
campus.
Currently, there are two security guards present 24/7 including holidays.
Staff is requesting to exend this agreemment for one year (through 1/30/2024) and to increase the
dollar amount of the contract by $632,000. This extension will allow Risk to work with the new
security consultant Guidepost to develop more specific the security guard requirements for the
District and time to conduct the RFP process.
Also, staff is requesting additional funding to increase the hourly wages paid to the security guards.
We recently lost guards to better pay offered by other security firms. Low turn over is very
important to Central San and without wage increases we will lose more of the well -trained
effective personnel currently in these positions.
This request also includes additional funds to cover the increased use and cost of gas. Since the last
contract amendment gas prices have increased and we have increased the frequency of vehicle
patrols.
Department / Division Name: Administration/Risk Management
Department /Division Representative: S
Date: 1/4/2023
Department Director:
Date: 1/4/2023
*General Manager: ° �
Date. 1/4/2023
*Requests over $50,000 require General Manager's approval and signature. All Best Interest of the District and pilot test exemptions
require General Manager or Board approval.
FOR PURCHASING DIVISION USE ONLY
Buyer: Qut1� �pa
Date: 1/24/202 3
Purchasing & Materials Manager: 9r_ Kill
Date: 1/24/202 3
Comments (if necessary):
Central Contra Costa Sanitary District
Sole Source Request (Products & Services)
June 25, 2024 Regular FINANCE Committee Meeting Agenda Packet - Page 120 of 135 DRAFT
Page 3 of 3
Page 13 of 25
DocuSign
Certificate Of Completion
Envelope Id: C41319431488F4180AA9D7573CFF1 FED4
Subject: DocuSign: PacWest sole —source —request 12.16.22.docx
Source Envelope:
Document Pages: 3 Signatures: 3
Certificate Pages: 5 Initials: 0
AutoNav: Enabled
Envelopeld Stamping: Disabled
Time Zone: (UTC-08:00) Pacific Time (US & Canada)
Record Tracking
Status: Original
1/4/2023 10:54:22 AM
Security Appliance Status: Connected
Storage Appliance Status: Connected
Signer Events
Shari Deutsch
SDeutsch@centralsan.org
Risk Mgr
Security Level: Email, Account Authentication
(None)
Electronic Record and Signature Disclosure:
Accepted: 1/4/2023 1:48:58 PM
ID: b1187861-6a76-4571-ae5f-9bfdafb8cd74
Philip R. Leiber
pleiber@centralsan.org
Director of Finance & Adm
Security Level: Email, Account Authentication
(None)
Electronic Record and Signature Disclosure:
Accepted: 3/23/2020 3:23:09 PM
ID: 436328ff-5f57-4637-b 1 d7-c337ecb59e08
Roger Bailey
rbailey@centralsan.org
General Manager
Security Level: Email, Account Authentication
(None)
Electronic Record and Signature Disclosure:
Accepted: 9/28/2018 3:04:44 PM
ID:c9fb6117-1432-4032-9f2b-0360fb9ea323
In Person Signer Events
Editor Delivery Events
Agent Delivery Events
Intermediary Delivery Events
Holder: Suzette Crayton
scrayton@centralsan.org
Pool: StateLocal
Pool: Central Contra Costa Sanitary District
Signature
s6v1 vtufstL
Signature Adoption: Pre -selected Style
Using IP Address: 12.86.194.210
p
Signature Adoption: Drawn on Device
Using IP Address: 12.86.194.210
Signature Adoption: Pre -selected Style
Using IP Address: 12.86.194.210
Signature
Status
Status
Status
Status: Completed
Envelope Originator:
Suzette Crayton
5019 Imhoff Place
Martinez, CA 94553-4392
scrayton@centralsan.org
IP Address: 12.86.194.210
Location: DocuSign
Location: DocuSign
Timestamp
Sent: 1/4/2023 10:56:12 AM
Viewed: 1/4/2023 1:48:58 PM
Signed: 1/4/2023 1:49:06 PM
Sent: 1/4/2023 1:49:08 PM
Viewed: 1/4/2023 2:44:25 PM
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CENTRAL SAN
:I �IJIIFL
MEETING DATE: AUGUST 20, 2020
ATTACHMENT 4
BOARD OF DIRECTORS
POSITION PAPER
SUBJECT: ADOPT RESOLUTION NO.2020-028 MAKING FINDINGS AND
AUTHORIZING THE GENERAL MANAGER TO EXTEND THE EXISTING
SOLE -SOURCE, LONG-TERM SERVICES CONTRACT WITH SOLAR
TURBINES, INC. FOR MAINTENANCE OF THE COGENERATION GAS
TURBINE SYSTEM FORA PERIOD OF FIVE YEARS ENDING AUGUST 31,
2025, ATAN ESTIMATED COST OF $1,200,000, PURSUANT TO PUBLIC
CONTRACT CODE SECTION 3400(C)(3)AND DISTRICT PURCHASING
PROCEDURES MANUAL SECTION 5.3.15
SUBMITTED BY:
INITIATING DEPARTMENT:
CLINT SHIMA, SENIOR ENGINEER OPERATIONS -RELIABILITY ENGINEERING
REVIEWED BY: NEIL MEYER, PLANT MAINTENANCE DIVISION MANAGER
ANN SASAKI, DEPUTY GENERAL MANAGER
Roger S. Bailey Kenton L. Alm
General Manager District Counsel
ISSUE
Board approval is required to authorize the General Manager to extend the existing sole -source, long-term
services contract with Solar Turbines, I nc., the original equipment manufacturer of Central San's
Cogeneration Gas Turbine System (Cogen System), for maintenance of the Cogen System for a term of
five years.
BACKGROUND
Central San's Cogen System is a Solar Turbines, I nc., Centaur 40 System that was pre -purchased in
1993 with startup in 1995. This gas turbine generator currently produces approximately 90 percent of the
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Page 19 of 25
Treatment Plant's electrical energy and 35 percent of its steam demand. The Cogen System is the main
supply of power to the Treatment Plant and provides significant savings over purchasing electrical power from a
utility (PG&E). The Cogen System has saved Central San between $500,000 and $1,000,000 in electrical
energy costs per year over the past 25 years. Since 2015, the savings amount to $4,300,000. It is important to
note that the Cogen System is on its eighth engine, which averages to one overhaul every three years.
Maintenance of the Cogen System: The Cogen System was commissioned for full-time operation in
November 1995. From the initial startup to 2011, the Cogen System was maintained under a long-term
services contract with Solar Turbines, I nc. The contract was all-inclusive; it covered all repairs and
guaranteed availability and reliability of the Cogen System. I n 2011, Central San re -bid the contract and
changed service providers to the Wood Group. On March 29, 2012, the Cogen System suffered a
catastrophic failure caused by an explosion in the exhaust system. The Cogen System was re-
commissioned by Solar Turbines, Inc., and returned to service on October 3, 2012. The six-month outage
resulted in $1,641,000 in electric utility expenses, an increase of approximately $960,000. From 2012, the
Cogen System was maintained under a series of short-term services contracts with Solar Turbines, I nc.
As part of a long-term services contract, Solar Turbines, Inc. required that Central San replace and
upgrade the fuel and control systems. On September 5, 2013, the Board adopted a resolution authorizing
the General Manager to execute a sole -source contract with Solar Turbines, I nc. for the Cogen Controls
Upgrade Project, District Project (DP) 7308. The fuel and control system upgrades were completed in
April 2014, for a cost of $1,300,000.
On May 21, 2015, the Board adopted a resolution authorizing the General Manager to execute a sole -
source, long-term services contract with Solar Turbines, Inc., for maintenance of Central San's Cogen
System for a term of five years. The current contract began September 1, 2015 and will terminate August
31, 2020, unless extended. A portion of the monthly fees are applied towards future engine overhauls that
are recommended every 30,000 to 40,000 operating hours. Solar Turbines, I nc., utilizes condition
assessment reports and checklists to systematically monitor and evaluate the Cogen System's condition in
determining when engine overhauls are required. The contract had a provision to ensure that two
overhauls, which were completed in November 2015 and November 2019, were included in the pricing.
Benefits of the 2015 Lon -Term Services Contract: The existing long-term services contract with
Solar Turbines, Inc. ensured prompt field service response and minimized the length of unplanned
downtime for the Cogen System. Since 2018, availability of the Cogen System has been 96 percent, and
reliability, which excludes planned outages, has been 98.5 percent. Unplanned downtime has accounted
for less than two percent of elapsed time over the past two years. It is unlikely that a short-term services
contract or an aftermarket service provider could have provided the same level of reliability.
As part of the long-term service contract, Solar Turbines, Inc. provides their InSight PlatformTm remote
monitoring system, which monitors over 3,200 diagnostics daily to optimize and improve asset
management. It collects, stores, and analyzes machine data which is transformed into actionable
information. The Fleet Manager and Central San staff receive early detection notifications of potential
issues as well as event summaries afterwards. It also provides dashboards available by handheld device.
Solar Turbines, Inc. is constantly improving the InSight PlatformTm remote monitoring system with updates
every six to eight weeks to enhance features, increase speed, add new hardware, and incorporate new
technology. A third -party vendor cannot match the level of predictive diagnostics that Solar Turbines, I nc.
has established. Solar Turbines, I nc. leverages their expertise and knowledge to ensure equipment
reliability.
In 2016, a routine borescope inspection discovered a damaged first -stage tip shoe, a critical wear
component in the engine. Solar Turbines, I nc. dispatched their field repair crew to replace the tip shoe
and rebuild the engine combustion section. This repair was made at no additional cost to Central San
since it was covered by the contract. However, outside of the contract, the cost was estimated to have
June 25, 2024 Regular FINANCE Committee Meeting Agenda Packet - Page 127 of 135
Page 20 of 25
been $200,000. Upon completion of the repair, Solar Turbines, Inc. investigated the failure and provided a
Failure Analysis Report at no additional cost.
The Cogen System also saw multiple troubleshooting callouts, for which the parts and labor costs were
fully covered under the contract. Notable items for unscheduled troubleshooting and repair services
included: repair or replacement of water injection system components, combustion liner borescope
inspection, and replacement of the inlet guide vanes actuator and controller. Remote troubleshooting
services were also provided. The technicians noted and implemented several safety improvements within
the package.
The long-term services contract with Solar Turbines, I Inc., has proven to be effective for overall
performance and reliability of the Cogen System and beneficial to Central San.
2020 Long -Term Services Contract Terms: The proposed five-year sole -source services contract
amendment would extend the 2015 contract terms through August 31, 2025. The total cost is expected to
be $1,200,000 over the next five years, starting at $230,000 annually and adjusted for escalation in
subsequent years. I n 2015, Central San paid an Existing Hours fee for the gap in coverage from 2011 to
2015, but that fee does not apply to the amendment. The monthly fee of $18,700 represents a 3.5
percent increase from 2015.
Under the long-term services contract, Central San would continue to be granted several priority
advantages. Our assigned Fleet Manager will coordinate, plan, and provide technical assistance. Central
San will have preferred status for scheduling and experience better emergency service response times.
The service includes call -outs for advanced troubleshooting with no additional costs for labor, travel, and
subsistence. Solar Turbines, Inc. would continue to repair or replace any malfunctioning component or
part within a reasonable timeframe using certified replacement parts, and would continue to provide remote
monitoring of the Cogen System with the Insight Platform TM. With the I nSight Platform TM, Solar Turbines,
I nc. engineers can view operating screens in real-time, allowing for efficient machinery management to
mitigate unplanned downtime while extending the turbine package lifecycle. The limit of liability would
remain the same at $750,000.
Under the long-term services contract, the engine is completely covered for replacement as many times as
needed. The contract amendment has a provision to ensure that one overhaul is included in the pricing. If
the overhaul is not performed during the contract, Central San can receive the overhaul after the contract
term. The Cogen engine operating hours is currently over 6,100 hours; therefore, the next engine overhaul
is not expected until 2024.
California_ Environmental Quality Act (CEQA)
Staff has concluded that this action is exempt from CEQA under the CEQA Guidelines, Section 15301, since it
involves maintenance to an existing public facility involving no expansion of use. Approval of this action will
establish the Board's independent finding that this project is exempt from the CEQA.
ALTERNATIVES/CONSIDERATIONS
Sole -sourcing is an exemption to the competitive bidding process, which does not foster competition;
however, staff believes sole -sourcing is appropriate in this case. In 2012, Central San experienced a
catastrophic failure of its Cogen System when maintenance was performed by an aftermarket service
provider. Subsequently, staff recommended that future maintenance of the Cogen System not be
competitively bid as the design of the equipment is proprietary and only the manufacturer has the unique
product knowledge to safely and economically maintain the Cogen System.
The following alternatives were reviewed:
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Page 21 of 25
1. Enter into a Be-neficial Use Services Contract with Solar Turbines, Inc.
Under this alternative, Central San would contract with Solar Turbines, I nc. for maintenance only with no
engine overhauls. The monthly fee would be $11,800 per month, and approximately $750,000 over five
years with escalation. All required engine overhauls would be paid by Central San as needed. This
alternative would initially reduce costs by $450,000 by avoiding paying monthly for a future engine
overhaul. However, when the cost of an engine overhaul is incorporated, the cost of the Beneficial Use
Services contract is comparable to the proposed long-term services contract, but would not cover any
premature overhauls due to unanticipated breakdowns. The Cogen System is on its eighth engine;
therefore, it is anticipated that at least one overhaul will be required during the five-year term of the
maintenance contract. The terms and conditions would be similar; however, the limit of liability will be
reduced from $750,000 possibly down to the standard limit of $141,600. The total estimated cost of this
alternative would be $1,200,000 (includes cost of engine overhaul).
The cost to overhaul the engine will depend on the number of run hours at the time. The service fee is
currently $8.96 per hour, with a minimum charge of 3,500 hours, and subject to the same annual escalation
as other fees. Unexpected engine overhauls over $200,000 requires Board approval causing potential
delays in repairs, and adversely affecting the Operations and Maintenance budget.
The Beneficial Use Services contract is recommended if the existing Cogen System is not part of Central
San's future plans, but that decision has yet to be determined. The Steam and Aeration Blower System
Renovation Project, DP 7349 is currently evaluating options in pre -design. There is no buy -in fee changing
from a long-term services contract to a Beneficial Use Services contract. If it is determined that the
existing Cogen System is not part of Central San's long-term plans, the contract will be changed to a
Beneficial Use Services contract to reduce costs and the Board will be notified of this change.
2. Enter into Short -Term Services Contracts with Solar Turbines. Inc.
Central San could continue using short-term services contracts. However, the disadvantage is that these
contracts do not provide the remote monitoring and diagnostics services provided with the long-term
services contracts, which could increase the risk for more frequent and prolonged outages. If a prolonged
outage were to occur, Central San would need to import electrical power from PG&E and would incur
significant demand charges. Also, repair costs could range widely in magnitude and would be difficult to
budget. The terms and conditions would remain the same.
3. Bid the Contract and Seek Another Vendor
Central San could seek an alternate vendor. This approach was taken in 2011 and Central San entered into
a long-term services contract with Wood Group for $208,800. This alternative is not recommended as it is
not anticipated that the pricing will be lower than the proposed contract. The bid received in 2011 is
comparable to the cost of the proposed contract when escalated to today dollars. It is uncertain as to
whether the terms and conditions would be significantly better given the age of the Cogen System and its
past history with the 2012 explosion. This alternative is not recommended.
4. Import PG&E Power
Shutting down the Cogen System when it needs repairs (on an as -needed basis) and relying on PG&E as
the main power source removes a layer of redundancy for Central San's power system, and increases
steam and electricity costs. The Standby Power Facility (existing 2-2 MW diesel generators) will become
the only backup to PG&E and reduces resiliency at the Treatment Plant. The auxiliary boilers will need to
generate the makeup steam. The six-month outage in 2012 resulted in an increase in utility expenses of
approximately $960,000. Due to the higher cost, loss of reliability/redundancy, and additional risk
associated with this option, this alternative is not recommended.
Other Considerations: The Cogen System has been operating for 25 years. The age of the equipment,
as well as related risk factors, warrants an evaluation for replacement. However, until the Steam and
Aeration Blower System Renovation Project, DP 7349 design work is finalized, it is anticipated that the
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Page 22 of 25
existing Cogen System will need to be relied upon for at least the next five or more years.
n November 2017, an evaporative cooler and carbon monoxide catalyst were installed under the
Treatment Plant Cogeneration Unit Optimization Project, DP 7320. The new ducting was designed with
room to accommodate an additional catalyst element for removal of future regulated compounds, such as
formaldehyde.
The design for the Solids Handling Facilities Improvements Project, DP 7348 is currently being finalized.
Capital Projects is examining various construction sequences and scenarios, including shutdown of the
entire Solids Conditioning Building. The latest scenario considered is to continue operating the Cogen
System during construction of the project. The Steam and Aeration Blower Systems Renovations Project,
DP 7349 is in the pre -design phase. The condition assessments have been completed and alternatives
are being developed to evaluate the future of the Cogen System. Design for this project is expected to
start next year.
After a review of the alternatives, staff recommends that it is in the best interest of Central San to extend
the sole -source, long-term contract with Solar Turbines, Inc. The Cogen System is critical to the
operation of the Treatment Plant. Solar Turbines, Inc., has the operational knowledge of the Cogen
System and they have proven that they understand what is takes to keep the Cogen System maintained
and operational. Since 2015, Solar Turbines, Inc., has demonstrated to be a beneficial asset under the
long-term services contract. Solar Turbines, I nc., has the proprietary engineering skill, product information,
knowledge, and parts to safely perform the long-term services contract and ensure long-term reliability of
the Cogen System.
Staff has concluded that this action is exempt from the California Environmental Quality Act (CEQA) under
the CEQA Guidelines, Section 15301, since it involves maintenance to an existing public facility involving
no expansion of use. Approval of this action will establish the Board's independent finding that this project
is exempt from the CEQA.
FINANCIAL IMPACTS
The five-year value of the contract amendment is approximately $1,200,000. This amount includes
$230,000 per year for five years of maintenance services and escalation for inflation. The costs are
included in the FY 2020-21 Operations and Maintenance Budget.
COMMITTEE RECOMMENDATION
The Engineering and Operations Committee reviewed this matter on August 4, 2020, and recommended
Board approval.
RECOMMENDED BOARD ACTION
Adopt the proposed resolution:
1. Authorizing the General Manager to extend the existing sole -source, long-term services contract with
Solar Turbines, Inc. for maintenance of the Cogeneration Gas Turbine System for a period of five
years ending August 31, 2025, at an estimated, cost of $1,200,000, pursuant to Public Contract
Code Section 3400(c)(3) and District Purchasing Procedures Manual Section 5.3.15; and
2. Finding that:
- The long-term services contract is exempt from California Environmental Quality Act (CEQA);
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Page 23 of 25
• The public interest is best served by utilizing the unique technology and proprietary knowledge
that Solar Turbines, Inc., the original equipment manufacturer, has developed to maintain the
Cogeneration Gas Turbine System; and
• Under the circumstances, Solar Turbines, I nc., is the only qualified supplier to maintain the
rebuilt Cogeneration System equipment and that it is in the best interest of Central San to
proceed with a sole -source contract with Solar Turbines, I nc.
Stratc- c Plan Tie -In
GOAL FIVE: Infrastructure Reliability
Strategy 1— Manage assets optimally to prolong their useful life
GOAL SIX: Innovation and Optimization
Strategy 2— Improve and modernize operations through technology and efficiency measures
ATTACHMENTS:
1. Proposed Resolution
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Page 24 of 25
RESOLUTION NO. 2020-
A RESOLUTION OF THE CENTRAL CONTRA COSTA SANITARY DISTRICT
APPROVING EXTENSION OF A SOLE -SOURCE CONTRACT WITH
SOLAR TURBINES, INC., FOR LONG-TERM MAINTENANCE SERVICES
OF THE COGENERATION GAS TURBINE SYSTEM
WHEREAS, Section 3400(c) of the California Public Contract Code sets forth certain
conditions under which a particular material or product or service may be purchased
without the necessity of competitive bidding;
WHEREAS, the Central Contra Costa Sanitary District's (Central San) Purchasing
Procedures Manual Section 5.3.15 provides that, in those cases involving a unique or
novel product application required to be used in the best public interest, Central San may
specify such unique or novel product as an appropriate sole source;
WHEREAS, Central San upgraded its Cogeneration Solar Centaur 40 Gas Turbine
System and is in need of continued long-term maintenance services;
WHEREAS, Solar Turbines, Inc.'s, proprietary technology is utilized and incorporated in
the District's upgraded Cogeneration Gas Turbine System, thereby extending the service
life of the turbine and increasing reliability and maintainability; and
WHEREAS, Central San staff has evaluated alternative long-term maintenance service
providers in the past and concluded that no other service providers offer the same
knowledge, experience, and resources.
NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Central Contra
Costa Sanitary District (the Board) as follows:
1. THAT the Board hereby adopts the recitals set forth above as the basis of its
findings.
2. THAT the contract is exempt from the California Environmental Quality Act under
the California Environmental Quality Act Guidelines, Section 15301, since it
involves maintenance to an existing public facility involving no expansion of use.
3. THAT the Board finds the public interest is best served by utilizing the unique
technology and proprietary knowledge that Solar Turbines, Inc., has developed to
maintain the upgraded Cogeneration Gas Turbine System.
4. THAT, in accordance with Section 3400(c) of the California Public Contract Code,
the Board finds that the proprietary technology offered by Solar Turbines, Inc., shall
be utilized in Central San's Treatment Plant to maintain the Cogeneration Solar
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Page 25 of 25
Central Contra Costa Sanitary District
Resolution 2020-
Sole-Source Contract — Solar Turbines, Inc.
Page 2 of 2
Centaur 40 Gas Turbine System, and that a sole -source contract with Solar
Turbines, Inc., meets the criteria set forth in that section.
5. THAT the Board authorizes the General Manager to extend the existing sole -
source, long-term services contract with Solar Turbines, Inc. for maintenance of the
upgraded Cogeneration Gas Turbine System for a period of five years, ending
August 31, 2025, at an estimated cost of $1,200,000.
PASSED AND ADOPTED this 20th day of August, 2020, by the Board of Directors of the
Central Contra Costa Sanitary District by the following vote:
AYES: Members:
NOES: Members:
ABSENT: Members:
Michael R. McGill, P.E.
President of the Board of Directors
Central Contra Costa Sanitary District
County of Contra Costa, State of California
COUNTERSIGNED:
Katie Young
Secretary of the District
Central Contra Costa Sanitary District
County of Contra Costa, State of California
Approved as to form:
Kenton L. Alm, Esq.
Counsel for the District
CAProgram Files(x86)lneevia.comldocConverterProltemplNVDC132208BCB-F96E-44CA-8E1C-752F9548A8B41Central Contra Costa
Sanitary District.7799.1.Proposed_Resolution_ _Solar_Turbines_08-20-2020.docx
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