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Staff ReporttowN oc MEETING DATE: 11/17/15 ITEM NO: tos�aos COUNCIL AGENDA REPORT DATE: NOVEMBER 9, 2015 TO: MAYOR AND TOWN COUNCIL FROM: LAUREL PREVETTI, TOWN MANAGER d SUBJECT: AUTOMATED MATERIALS HANDLING SYSTEM A. AUTHORIZE THE TOWN MANAGER TO EXECUTE AN AGREEMENT WITH BIBLIOTECA, LLC IN THE AMOUNT OF $134,025 FOR AN AUTOMATED MATERIALS HANDLING SYSTEM FOR THE LOS GATOS LIBRARY B. AUTHORIZE A BUDGET ADJUSTMENT WITHIN THE CLELLES NESS TRUST FUND IN THE AMOUNT OF $59,025 RECOMMENDATIONS: 1. Authorize the Town Manager to execute an agreement with Biblioteca, LLC in the amount of $134,025 for an automated materials handling system for the Los Gatos Library; and 2. Authorize a budget adjustment within the Clelles Ness Trust Fund in the amount of $59,025 BACKGROUND: The new Los Gatos Library opened its doors in February of 2012. Since that time, circulation has increased to more than 607,000 items per year. Currently, Library staff members check-in and sort each of these items by hand, at a rate of more than 1,700 items each day. This is a tedious and repetitive process requiring a large amount of staff time. Many of the libraries in neighboring cities have automated a significant portion of this process with great success. These libraries have found automated materials handling provides: • Significant productivity gains through reduction in key labor intensive workflow processes • Enhanced customer service with 100% check-in accuracy • Reduced materials loss • Detailed and integrated reports and configuration tools • Streamlined patron self check-in PREPARED BY: HEIDI MURPHY Library Director Reviewed by: /Assistant Town Managerown Attorney PAGE 2 MAYOR AND TOWN COUNCIL SUBJECT: LOS GATOS LIBRARY AUTOMATED MATERIALS HANDLING SYSTEM NOVEMBER 9, 2015 BACKGROUND (Cont'd): • Streamlined staff check-in • Reduced incidents of staff repetitive motion injuries • Increased capacity for staff to complete higher-level and more varied tasks DISCUSSION: On September 10, 2015, Library staff issued a Request for Proposal for an automated materials handling (AMH) solution for the Los Gatos Library that would automate the check-in and sorting process of Library materials. The Library received four proposals for the project from: 3M (now Biblioteca and hereinafter referred to as such), Lyngsoe Systems, P.V. Supa, and Tech Logic. A panel of four staff raters from three Town departments judged these proposals on a 100 point scale, using the following criteria: • Vendor reputation, experience, and qualifications in the Library AMH field (5 points) • Vendor's references for similar projects (5 points) • Design, functionality, and suitability of the proposed solution (15 points) • Suitability of on-site and remote service support provided to the Library (15 points) • Clarity and completeness of the submitted proposal, and adherence to the specifications (15 points) • Ability to deliver requested products in accordance with the Library's timeline (20 points) • Affordability of the proposed system with clearly defined annual costs (25 points) In addition to the reference checks, the raters conducted site visits to local libraries that are using each of the four proposed systems. Biblioteca, LLC, came out as the highest ranking vendor for the Los Gatos Library based upon the criteria mentioned above and set forth in the Request for Proposal. The proposed solution offers both an automated system for the public to return Library materials at one existing book drop and maintains one traditional book drop. The traditional book drop will allow patrons who are not ready for this change to continue to use the Library return in a manner with which they are familiar. However, the staff side of this traditional book drop will be automated, with staff members able to feed materials from the bin into AMH system for quicker, more accurate, and less labor intensive check-in and sorting. Use of the AMH system will reduce staff time currently being spent on material check-in and processing, allowing for this time to be reallocated to enhance the Libraries innovative programs and front-line customer service. NEXT STEPS: Upon approval of the contract, Biblioteca, LLC will begin construction of the AMH system immediately and complete installation during the holiday closure period from December 24, 2015 to January 1, 2016. As part of the installation project, the Biblioteca system will synchronize data collection from Library security gates, self -checks, and the new AMH system. PAGE 3 MAYOR AND TOWN COUNCIL SUBJECT: LOS GATOS LIBRARY AUTOMATED MATERIALS HANDLING SYSTEM NOVEMBER 9, 2015 NEXT STEPS (Cont'd): This will streamline Library data collection for door counts and circulation, and provide additional tools for Library staff to analyze these data. It is projected that the AMH system would be in full operation by January 2, 2016, with continued staff training for optimization of the system. We anticipate Library Pages would be able to take on new and varied duties such as program set-up and support for our librarians and inventory checks by February 2016. CONCLUSION: As a way to enhance productivity and redirect staff time to the Library's innovative programs and front-line customer service, staff recommends that the Town Council authorize the Town Manager to execute an agreement with Biblioteca, LLC (Attachment 1) in the amount of $134,025 for an automated materials handling system for the Library. To fund this project, staff recommends that the Town Council approve a budget adjustment within the Clelles Ness Trust Fund in the amount of $59,025. ENVIRONMENTAL ASSESSMENT: The Council's discussion of this matter is not a project defined under the California Environmental Quality Act (CEQA), and no further action is required. FISCAL IMPACT: Money for this project is available in the Clelles Ness Trust Fund (Fund 713). The Clelles Ness Trust Fund was established in 1961 by Ansten R. Ness, M.D. as a memorial to his wife, Clelles Ness. The original intent of the fund was to use interest and income from the trust to purchase library materials and services not ordinarily available from public funds such as special art books. In 1999 the Town began to plan for a new Library and therefore a new agreement was made with the daughter of Clelles Ness to use the trust monies for a new Library facility. Per this agreement, the balance of the trust fund may be used to purchase items for the new building, such as furniture, shelving, and equipment. The current available balance in this trust fund is $166,470. The Library originally budgeted $75,000 from this trust for fiscal year (FY) 2015/16 to complete a passive noise reduction project in the building. However, an AMH system for the Library is a more urgent need with a greater cost benefit for both operations and customer service. Increasing the budgeted amount of money for this project from the Trust by $59,025 will fully fund the $134,025 project. After the completion of this project, the trust will have a remaining balance of $32,445 to be used for future projects, including the passive noise reduction project. The remainder of the passive noise project is expected to be less than $50,000. Library staff would identify additional sources of funds, either trust accounts or Friends of the Library support, to make up any remaining costs for the passive noise project in FY 2016/17. PAGE 4 MAYOR AND TOWN COUNCIL SUBJECT: LOS GATOS LIBRARY AUTOMATED MATERIALS HANDLING SYSTEM NOVEMBER 9, 2015 FISCAL IMPACT (Cont'd): Beginning in FY 2016/17 there will be a reoccurring annual ongoing maintenance fee of $11,747. The annual cost will be incorporated into the Library's annual operating budget during the budget development process, and subject to Council approval at that time. Attachment: 1. Draft Agreement for Services with Biblioteca, LLC PURCHASE AND SERVICE AGREEMENT THIS AGREEMENT is dated for identification this 17 of November, 2015 and is made by and between TOWN OF LOS GATOS, a California municipal corporation, ("Town") and Biblioteca, LLC, ("Supplier"), whose address is 3M Center, Building 225-4N-01, St. Paul, MN 55144-1000. This Agreement is made with reference to the following facts. This contract will remain in effect from November 18, 2015 to December 31, 2016. I. RECITALS 1.1 Town sought proposals for the purchase and service described in this Agreement, and Supplier was found to be the most qualified and lowest price responsible supplier for this purchase. During the selection process, supplier indicated its name change from 3M to Biblioteca LLC. 1.2 Supplier informed the Town that it manufactures, installs, and services the 3M Intelligent Return and Sorter FX product. 1.3 Supplier represents that it is a qualified and competent supplier of the items to be purchased and serviced under this Agreement. 1.4 The Town desires to engage Supplier to provide an AUTOMATED MATERIALS HANDLING SYSTEM for the Los Gatos Library. 1.5 The Supplier represents and affirms that it is qualified and willing to perform the desired work pursuant to this Agreement. II. AGREEMENTS 2.1 Supplies and Terms. Supplier hereby agrees to deliver to Town at 100 Villa Ave., Los Gatos, CA 95030 the items and materials described in the Revised Pricing document (Exhibit A), which is attached hereto and incorporated by reference. The terms and conditions are as follows: (1) Price. Town shall pay Supplier the amounts defined in Exhibit A, not to exceed $134,025, which include sales tax and delivery charges. Payment shall be net 30 days from delivery. (2) Delivery. The delivery of the items and materials shall be no later than December 28, 2015. Delivery shall be made between 8:00 a.m. and 6:00 p.m. on weekdays that are not Town holidays or furlough days. 2.2 Time of the Essence. Prompt delivery of the items and materials is essential to this Agreement. 2.3 Scope of Services. Supplier shall provide services as described in that certain PROPOSAL submitted by 3M and sent to the Town on October 12, 2015, which is hereby summarized: N:/MASTER/Agreements/Purchase and Service Agreement Template.rtf ATTACHMENT 1 • System manufacturing to align with Final Layout Drawing (Exhibit A, Page 2) • System Delivery • System installation, including the Command Center which centralizes data from self -checks, AMH system, and door gates • Staff training on system functionality, maintenance, daily operations, and reports • One year system maintenance and warranty 2.4 Time of Performance. The services to be performed are as follows: • System delivered December 21-28, 2015 • System installed December 28-31, 2015 • System training December 21, 2015 -January 7, 2016 • Systems maintenance and warranty December 21, 2015 -December 31, 2016 2.5 Compliance with Laws. The Supplier shall comply with all applicable laws, codes, ordinances, and regulations of governing federal, state and local laws. Supplier represents and warrants to Town that it has all licenses, permits, qualifications and approvals of whatsoever nature which are legally required for Supplier to practice its profession. Supplier shall maintain a Town of Los Gatos business license pursuant to Chapter 14 of the Code of the Town of Los Gatos. 2.6 Sole Responsibility. Supplier shall be responsible for employing or engaging all persons necessary to perform the services under this Agreement. 2.7 Information/Report Handling. All documents furnished to Supplier by the Town and all reports and supportive data prepared by the Supplier under this Agreement are the Town's property and shall be delivered to the Town upon the completion of Supplier's services or at the Town's written request. All reports, information, data, and exhibits prepared or assembled by Supplier in connection with the performance of its services pursuant to this Agreement are confidential until released by the Town to the public, and the Supplier shall not make any of the these documents or information available to any individual or organization not employed by the Supplier or the Town without the written consent of the Town before such release. The Town acknowledges that the reports to be prepared by the Supplier pursuant to this Agreement are for the purpose of evaluating a defined project, and Town's use of the information contained in the reports prepared by the Supplier in connection with other projects shall be solely at Town's risk, unless Supplier expressly consents to such use in writing. Town further agrees that it will not appropriate any methodology or technique of Supplier which is and has been confirmed in writing by Supplier to be a trade secret of Supplier. 2.8 Compensation. Compensation for the supplies and materials delivered and for supplier's professional services shall not exceed $134,025, inclusive of all costs. Payment shall be based upon Town approval of each task. 2.9 Billing. Billing shall be by invoice within thirty (30) days of the rendering of the services and shall be accompanied by a detailed explanation of the work performed by whom at what rate and on what date. Also, plans, specifications, documents or other pertinent materials shall be submitted for Town review, even if only in partial or draft form. N:/MASTER/Agreements/Purchase and Service Agreement Template.rtf Payment shall be net thirty (30) days. All invoices and statements to the Town shall be addressed as follows: Invoices: Town of Los Gatos Attn: Accounts Payable P.O. Box 655 Los Gatos, CA 95031-0655 2.10 Availability of Records. Supplier shall maintain the records supporting this billing for not less than three years following completion of the work under this Agreement. Supplier shall make these records available to authorized personnel of the Town at the Supplier's offices during business hours upon written request of the Town. 2.11 Assignability and Subcontracting. The services to be performed under this Agreement are unique and personal to the Supplier. No portion of these services shall be assigned or subcontracted without the written consent of the Town. 2.12 Independent Contractor. It is understood that the Supplier, in the performance of the work and services agreed to be performed, shall act as and be an independent contractor and not an agent or employee of the Town. As an independent contractor he/she shall not obtain any rights to retirement benefits or other benefits which accrue to Town employee(s). With prior written consent, the Supplier may perform some obligations under this Agreement by subcontracting, but may not delegate ultimate responsibility for performance or assign or transfer interests under this Agreement. Supplier agrees to testify in any litigation brought regarding the subject of the work to be performed under this Agreement. Supplier shall be compensated for its costs and expenses in preparing for, traveling to, and testifying in such matters at its then current hourly rates of compensation, unless such litigation is brought by Supplier or is based on allegations of Supplier's negligent performance or wrongdoing. 2.13 Conflict of Interest. Supplier understands that its professional responsibilities are solely to the Town. The Supplier has and shall not obtain any holding or interest within the Town of Los Gatos. Supplier has no business holdings or agreements with any individual member of the Staff or management of the Town or its representatives nor shall it enter into any such holdings or agreements. In addition, Supplier warrants that it does not presently and shall not acquire any direct or indirect interest adverse to those of the Town in the subject of this Agreement, and it shall immediately disassociate itself from such an interest, should it discover it has done so and shall, at the Town's sole discretion, divest itself of such interest. Supplier shall not knowingly and shall take reasonable steps to ensure that it does not employ a person having such an interest in this performance of this Agreement. If after employment of a person, Supplier discovers it has employed a person with a direct or indirect interest that would conflict with its performance of this Agreement, Supplier shall N:/MASTER/Agreements/Purchase and Service Agreement Template.rtf promptly notify Town of this employment relationship, and shall, at the Town's sole discretion, sever any such employment relationship. 2.14 Equal Employment Opportunity. Supplier warrants that it is an equal opportunity employer and shall comply with applicable regulations governing equal employment opportunity. Neither Supplier nor its subcontractors do and neither shall discriminate against persons employed or seeking employment with them on the basis of age, sex, color, race, marital status, sexual orientation, ancestry, physical or mental disability, national origin, religion, or medical condition, unless based upon a bona fide occupational qualification pursuant to the California Fair Employment & Housing Act. III. INSURANCE AND INDEMNIFICATION 3.1 Minimum Scope of Insurance: i. Supplier agrees to have and maintain, for the duration of the contract, General Liability insurance policies insuring him/her and his/her firm to an amount not less than: one million dollars ($1,000,000) combined single limit per occurrence for bodily injury, personal injury and property damage. ii. Supplier agrees to have and maintain for the duration of the contract, an Automobile Liability insurance policy ensuring him/her and his/her staff to an amount not less than one million dollars ($1,000,000) combined single limit per accident for bodily injury and property damage. iii. Supplier shall provide to the Town all certificates of insurance, with original endorsements effecting coverage. Supplier agrees that all certificates and endorsements are to be received and approved by the Town before work commences. iv. Supplier agrees to have and maintain, for the duration of the contract, professional liability insurance in amounts not less than $1,000,000 which is sufficient to insure Supplier for professional errors or omissions in the performance of the particular scope of work under this agreement. General Liability: The Town, its officers, officials, employees and volunteers are to be covered as insured as respects: liability arising out of activities performed by or on behalf of the Supplier; products and completed operations of Supplier, premises owned or used by the Supplier. This requirement does not apply to the professional liability insurance required for professional errors and omissions. N:/MASTER/Agreements/Purchase and Service Agreement Template.rtf ii. The Supplier's insurance coverage shall be primary insurance as respects the Town, its officers, officials, employees and volunteers. Any insurance or self -insurances maintained by the Town, its officers, officials, employees or volunteers shall be excess of the Supplier's insurance and shall not contribute with it. iii. Any failure to comply with reporting provisions of the policies shall not affect coverage provided to the Town, its officers, officials, employees or volunteers. iv. The Supplier's insurance shall apply separately to each insured against whom a claim is made or suit is brought, except with respect to the limits of the insurer's liability. 3.2 All Coverages. Each insurance policy required in this item shall be endorsed to state that coverage shall not be suspended, voided, cancelled, reduced in coverage or in limits except after thirty (30) days' prior written notice by certified mail, return receipt requested, has been given to the Town. Current certification of such insurance shall be kept on file at all times during the term of this agreement with the Town Clerk Administrator. 3.3 Workers' Compensation. In addition to these policies, Supplier shall have and maintain Workers' Compensation insurance as required by California law and shall provide evidence of such policy to the Town before beginning services under this Agreement. Further, Supplier shall ensure that all subcontractors employed by Supplier provide the required Workers' Compensation insurance for their respective employees. 3.4 Indemnification. The Supplier shall save, keep, hold harmless and indemnify and defend the Town its officers, agent, employees and volunteers from all damages, liabilities, penalties, costs, or expenses in law or equity that may at any time arise or be set up because of damages to property or personal injury received by reason of, or in the course of performing work which may be occasioned by a willful or negligent act or omissions of the Supplier, or any of the Supplier's officers, employees, or agents or any sub -contractor. IV. GENERAL TERMS 4.1 Waiver. No failure on the part of either party to exercise any right or remedy hereunder shall operate as a waiver of any other right or remedy that party may have hereunder, nor does waiver of a breach or default under this Agreement constitute a continuing waiver of a subsequent breach of the same or any other provision of this Agreement. 4.2 Severability. If any term of this Agreement is held invalid by a court of competent jurisdiction, the remainder of this Agreement shall remain in effect. N:/MASTER/Agreements/Purchase and Service Agreement Template.rtf 4.3 Warranty. Supplier shall remedy any defects due to faulty materials and/or workmanship and pay for any damages to other work and/or existing facilities resulting therefrom which shall appear within a period of one year from the date of recording of final acceptance. 4.4 Governing Law. This Agreement, regardless of where executed, shall be governed by and construed to the laws of the State of California. Venue for any action regarding this Agreement shall be in the Superior Court of the County of Santa Clara. 4.5 Termination of Agreement. The Town and the Supplier shall have the right to terminate this agreement with or without cause by giving not less than fifteen days (15) written notice of termination. In the event of termination, the Supplier shall deliver to the Town all supplies and services scheduled to be delivered to Town within that fifteen (15) day period. 4.6 Amendment. No modification, waiver, mutual termination, or amendment of this Agreement is effective unless made in writing and signed by the Town and the Supplier. 4.7 Disputes. In any dispute over any aspect of this Agreement, the prevailing party shall be entitled to reasonable attorney's fees, including costs of appeal. 4.8 Notices. Any notice required to be given shall be deemed to be duly and properly given if mailed postage prepaid, and addressed to: Town of Los Gatos Biblioteca, LLC Attn: Town Clerk Attn: Mary Zilles 110 E. Main Street 3M Center, Building 225-4N-01 Los Gatos, CA 95030 St. Paul, MN 55144-1000 OR personally delivered to Supplier to such address or such other address as Supplier designates in writing to Town. 4.9 Order of Precedence. In the event of any conflict, contradiction, or ambiguity between the terms and conditions of this Agreement in respect of the Products or Services and any attachments to this Agreement, then the terms and conditions of this Agreement shall prevail over attachments or other writings. N:/MASTER/Agreements/Purchase and Service Agreement Template.rtf 4.10 Entire Agreement. This Agreement, including all Exhibits, constitutes the complete and exclusive statement of the Agreement between the Town and Supplier. No terms, conditions, understandings or agreements purporting to modify or vary this Agreement, unless hereafter made in writing and signed by the party to be bound, shall be binding on either party. IN WITNESS WHEREOF, the Town and Supplier have executed this Agreement. Town of Los Gatos by: Laurel Prevetti, Town Manager Recommended by: Heidi Murphy, Library Director Approved as to Form: Robert Schultz, Town Attorney Biblioteca, LLC, by: Mary Zilles, Bid and Contracts Manager N:/MASTER/Agreements/Purchase and Service Agreement Template.rtf The following information details the costs associated with purchasing the 3M AMH System products we propose for the Los Gatos Library. These prices include installation, shipping, project management, training and a 12 -month warranty/license. PRODUCTS QUANTITY PRICE PER EXTENDED Year 5 Year 6 UNIT PRICE AMH $9,179 $9,454 $9,833 3M Intelligent Return and Sorter FX 1 $88,763 $88,763 Includes: $1,092 Years 2-6 Prepaid $44,991 One Intelligent Return - Classic Exterior $11,747 1 $11,747 1 $11,982 One Sided Sorter FX, with 6 Sort locations 1 $12,836 Years 2-6 Prepaid $52,862 Six Standard Bins Two Site VISIts Installation 12 Month Warranty Command Center Software, Enterprise — No Charge is' year) Shipping $1,575 Shipping is based upon the items and quantities shown above, any changes may increase/decrease shipping costs. TOTAL AMH SOLUTION: $90,338 Add Staff Station and one conveyance add $23,273 Upgrade from "Classic"to 'Plus" Intelligent Return add 4,948 Upgrade to Premium bins add $600 $3,600 6 each Add extended shelf kit 1 add $625 $625 Base Plate for Sorter 1 add $457 $457 TOTAL AMH WITH OPTIONS: $123,241 Tax 8.75%** $10,784 TOTAL AMH WITH TAX $134,025 ** Note: Tax will be included on the invoice at the current applicable rate. Annual Service Year 2 Year 3 Year 4 Year 5 Year 6 Base System $8,999 $8,999 $9,179 $9,454 $9,833 Command Center, Enterprise $999 $999 $1,019 $1,050 $1,092 Years 2-6 Prepaid $44,991 With Staff Station $11,747 1 $11,747 1 $11,982 1 $12,341 1 $12,836 Years 2-6 Prepaid $52,862 LOS GATOS LIBRARY / AUTOMATED MATERIALS HANDLING SOLUTION EXHIBIT A Final Layout with Staff Station LOS GATOS LIBRARY / AUTOMATED MATERIALS HANDLING SOLUTION