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Staff Report
PREPARED BY: MATT MORLEY DIRECTOR OF PARKS AND PUBLIC WORKS Reviewed by: Assistant Town Manager Town Attorney Finance S:\COUNCIL REPORTS\2016\06-21-16\Air Systems\Staff Report - Air Systems FINAL.docx 6/16/2016 11:14 AM MM MEETING DATE: 06/21/16 ITEM NO: 11 COUNCIL AGENDA REPORT DATE: JUNE 13, 2016 TO: MAYOR AND TOWN COUNCIL FROM: LAUREL PREVETTI, TOWN MANAGER SUBJECT: AUTHORIZE THE TOWN MANAGER TO EXECUTE A FIRST AMENDMENT TO THE AGREEMENT FOR SERVICES WITH AIR SYSTEMS, INCORPORATED TO PROVIDE ADDITIONAL COMPENSATION FOR UNANTICIPATED SERVICE CALLS, EQUIPMENT FAILURES AND REPLACEMENTS FOR HEATING, VENTILATION, AND AIR CONDITIONING (HVAC) IN AN AMOUNT OF $12,000 ANNUALLY, FOR A TOTAL AGREEMENT AMOUNT NOT TO EXCEED $209,235 RECOMMENDATION: Authorize the Town Manager to execute a first amendment to the Agreement for Services with Air Systems, Incorporated to provide additional compensation for unanticipated service calls, equipment failures and replacements for heating, ventilation, and air conditioning (HVAC) in an amount of $12,000 annually, for a total agreement amount not to exceed $209,235. BACKGROUND: The Town of Los Gatos utilizes contractual HVAC services for Town owned facilities. In 2015, staff prepared a Request for Proposals (RFP) for contractual HVAC preventive maintenance and repair services for Town owned facilities, including emergency and after hour response and repair. The RFP included line item costs per hour for additional services as needed, such as minor upgrades, modifications, and replacements due to equipment failures. On October 6, 2015, the Town Council approved an Agreement for Services with Air Systems, Incorporated for contractual HVAC services and repairs. The agreement was made effective October 1, 2015 through June 30, 2019. The monthly preventive maintenance costs are $3,583 per month, and the agreement was executed for an amount not to exceed $32,247 for the first year (based on a 9-month period of October through June) and $42,996 annually thereafter, for a total contract amount not to exceed $161,235, plus a 10 percent contingency in each contract year to cover unanticipated repairs. PAGE 2 MAYOR AND TOWN COUNCIL SUBJECT: AMENDMENT TO THE AGREEMENT FOR SERVICES WITH AIR SYSTEMS, INCORPORATED TO PROVIDE ADDITIONAL COMPENSATION FOR UNANTICIPATED SERVICE CALLS, EQUIPMENT FAILURES AND REPLACEMENTS FOR HEATING, VENTILATION, AND AIR CONDITIONING (HVAC) JUNE 13, 2016 BACKGROUND (cont’d): The HVAC systems maintained under this agreement serve the Police Operations Building, Civic Center, Library, Adult Recreation Center, and Parks and Public Works Service Center, and the systems vary greatly in age, size, and complexity. The original agreement relied upon the ten percent contingency to fund unanticipated costs. This amount is not sufficient to cover the unanticipated and extraordinary maintenance and repair needs brought on by these factors. DISCUSSION: Due to the increase in unanticipated service calls in the past and the expectation that they will continue, staff is recommending an increase of $12,000 in Fiscal Year 2015/16 and subsequent years to fund non routine service calls and equipment failures. Compensation for the first year for maintenance will increase to $44,247, plus the ten percent contingency. Compensation annually thereafter will increase to $54,996, plus the ten percent contingency. The total agreement across all contract years will increase to $209,235 plus the ten percent contingency for each year. CONCLUSION: Staff recommends that the Town Council authorize the Town Manager to execute a first amendment to the Agreement for Services with Air Systems, Incorporated to provide additional compensation for unanticipated service calls, equipment failures and replacements for heating, ventilation, and air conditioning (HVAC) in an amount of $12,000 annually, for a total agreement amount not to exceed $209,235. FISCAL IMPACT: Funds for the services for Fiscal Year 2015/16 and Fiscal Year 2016/17 have been appropriated in the Parks and Public Works Operating Budget for each year respectively. Execution of any options to continue the service in subsequent years will be contingent upon staff evaluation of the quality of the services provided, as well as the Town Council’s appropriation of funding. ENVIRONMENTAL ASSESSMENT: This is not a project as defined under CEQA, and no further action is required. Attachment: 1. First Amendment to Agreement for Services containing the original Agreement for Services ATTACHMENT 1 FIRST AMENDMENT TO AGREEMENT FOR SERVICES This FIRST AMENDMENT TO AGREEMENT FOR SERICES is dated for identification this 21st day of June, 2016 and amends that certain AGREEMENT FOR SERVICES dated October 1, 2015, made by and between the TOWN OF LOS GATOS, ("Town,") and AIR SYSTEMS, INC. (“Service Provider”). RECITALS A. Town and Service Provider entered into an Agreement for Services on October 1, 2015 (“Agreement”), a copy of which is attached hereto and incorporated by reference as Attachment 1 to this Amendment. B. Town desires to amend the Agreement to provide additional compensation for unforeseen equipment repairs and replacements for heating, ventilation, and air conditions (HVAC). AMENDMENT 1. Section 2.6 Compensation is amended to read as follows: Compensation for the first year (October 1, 2015 through June 30, 2016): Preventive maintenance shall remain at $3,583 monthly for a total amount not to exceed $32,247, inclusive of all costs. Unanticipated maintenance - Compensation for Town requested service calls for unanticipated service calls, equipment failures and replacements will be calculated using the labor rates described in Exhibit A (Section B - Labor Rates for Extra Work), which is attached hereto and incorporated by reference, shall not exceed $12,000, for a total agreement amount not to exceed $44,247. Compensation annually thereafter: Preventative maintenance shall remain at $3,583 monthly for a total amount not to exceed $42,996, inclusive of all costs. Unanticipated maintenance - Compensation for Town requested service calls for unanticipated service calls, equipment failures and replacements will be calculated using the labor rates described in Exhibit A, which is attached hereto and incorporated by reference, shall not exceed $12,000, for a total agreement amount not to exceed $54,996. The total compensation for the agreement shall not exceed $209,235. ATTACHMENT 1 2. All other terms and conditions of the Agreement remain in full force and effect. IN WITNESS WHEREOF, the Town and Service Provider have executed this Amendment. Town of Los Gatos by: Air Systems, by: _______________________________ ______________________________ Laurel Prevetti Town Manager ______________________________ Name/Title Recommended by: Approved as to Form: __________________________________ ___________________________________ Matt Morley Robert Schultz Director of Parks and Public Works Town Attorney EXHIBIT A s Gatos, Calif CLERK DEPARTMENT AGR fo��11,._:.._, IIIH ORD AGREEMENT FOR SERVICES REC RESO, 4 THIS AGREEMENT is dated for identification this 1st of October, 2015 and is made by an - between TOWN OF LOS GATOS, a California municipal corporation, ("Town") and AIR SYSTEMS ("Service Provider"), whose address is 940 Remillard Court, San Jose, CA 95122. This Agreement is made with reference to the following facts. I. RECITALS 1.1 The Town desires to engage Service Provider to provide contract HVAC services and repairs at Town -owned facilities. 1.2 The Service Provider represents and affirms that it is willing to perform the desired work pursuant to this Agreement. 1.3 Service Provider warrants it possesses the distinct professional skills, qualifications, experience, and resources necessary to timely perform the services described in this Agreement. Service Provider acknowledges Town has relied upon these warranties to retain Service Provider. II. AGREEMENT 2.1 Scope of Services. Service Provider shall provide services as described in that certain Request for Proposals and Proposal sent to the Town on September 17, 2015, which is hereby incorporated by reference and attached as Exhibit A. 2.2 Term of Agreement. The effective date of this Agreement shall be October 1, 2015. The term of the Agreement shall be for a period of four years, commencing October 1, 2015, and expiring at midnight June 30, 2019. 2.3 Compliance with Laws. The Service Provider shall comply with all applicable laws, codes, ordinances, and regulations of governing federal, state and local laws. Service Provider represents and warrants to Town that it has all licenses, permits, qualifications and approvals of whatsoever nature which are legally required for Service Provider to practice its profession. Service Provider shall maintain a Town of Los Gatos business license pursuant to Chapter 14 of the Code of the Town of Los Gatos. 2.4 Sole Responsibility. Service Provider shall be responsible for employing or engaging all persons necessary to perform the services under this Agreement. 2.5 Information/Report Handling. All documents furnished to Service Provider by the Town and all reports and supportive data prepared by the Service Provider under this Agreement are the Town's property and shall be delivered to the Town upon the completion of services or at the Town's written request. All reports, information, data, and exhibits prepared or assembled by Service Provider in connection with the performance of its services pursuant to this Agreement are confidential until released by the Town to the public, and the Service Provider shall not make any of the these documents or information available to any Page 1 of 6 individual or organization not employed by the Service Provider or the Town without the written consent of the Town before such release. The Town acknowledges that the reports to be prepared by the Service Provider 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 Service Provider in connection with other projects shall be solely at Town's risk, unless Service Provider expressly consents to such use in writing. Town further agrees that it will not appropriate any methodology or technique of Service Provider which is and has been confirmed in writing by Service Provider to be a trade secret of Service Provider. 2.6 Compensation. Compensation for regular services shall not exceed $42,996 annually, inclusive of all costs. Payment shall be based upon Town approval of each task. 2.7 Billing. Billing shall be monthly by invoice within thirty (30) days of the rendering of the service 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. 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 2.8 Availability of Records. Service Provider shall maintain the records supporting this billing for not less than three years following completion of the work under this Agreement. Service Provider shall make these records available to authorized personnel of the Town at the Service Provider offices during business hours upon written request of the Town. 2.9 Assignability and Subcontracting. The services to be performed under this Agreement are unique and personal to the Service Provider. No portion of these services shall be assigned or subcontracted without the written consent of the Town. 2.10 Independent Contractor. It is understood that the Service Provider, 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 Service Provider 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. Service Provider agrees to testify in any litigation brought regarding the subject of the work to be performed under this Agreement. Service Provider 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 Service Provider or is based on allegations of Service Provider's negligent performance or wrongdoing. Page 2 of 6 2.11 Conflict of Interest. Service Provider understands that its professional responsibilities are solely to the Town. The Service Provider has and shall not obtain any holding or interest within the Town of Los Gatos. Service Provider 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, Service Provider 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. Service Provider 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 Service Provider discovers it has employed a person with a direct or indirect interest that would conflict with its performance of this Agreement Service Provider shall promptly notify Town of this employment relationship, and shall, at the Town's sole discretion, sever any such employment relationship. 2.12 Equal Employment Opportunity. Service Provider warrants that it is an equal opportunity employer and shall comply with applicable regulations governing equal employment opportunity. Neither Service Provider 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: Service Provider 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. Service Provider 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. Service Provider shall provide to the Town all certificates of insurance, with original endorsements effecting coverage. Service Provider agrees that all certificates and endorsements are to be received and approved by the Town before work commences. Page 3 of 6 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 Service Provider; products and completed operations of Service Provider, premises owned or used by the Service Provider. ii. The Service Provider's insurance coverage shall be primary insurance as respects the Town, its officers, officials, employees and volunteers. The insurance shall name on the policy, as additional insured, the Town of Los Gatos, 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 Service Provider'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 Service Provider'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. 3.3 Workers' Compensation. In addition to these policies, Service Provider 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, Service Provider shall ensure that all subcontractors employed by Service Provider provide the required Workers' Compensation insurance for their respective employees. 3.4 Indemnification. The Service Provider 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 Service Provider, or any of the Service Provider's officers, employees, or agents or any subcontractor. Page4of6 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 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. 4.3 Termination of Agreement. The Town and the Service Provider 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 Service Provider shall deliver to the Town all plans, files, documents, reports, performed to date by the Service Provider. In the event of such termination, Town shall pay Service Provider an amount that bears the same ratio to the maximum contract price as the work delivered to the Town bears to completed services contemplated under this Agreement, unless such termination is made for cause, in which event, compensation, if any, shall be adjusted in light of the particular facts and circumstances involved in such termination. 4.4 Amendment. No modification, waiver, mutual termination, or amendment of this Agreement is effective unless made in writing and signed by the Town and the Service Provider. 4.5 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. 4.6 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 Attn: Town Clerk 110 E. Main Street Los Gatos, CA 95030 Air Systems 940 Remillard Court San Jose, CA 95122 or personally delivered to Service Provider to such address or such other address as Service Provider designates in writing to Town. 4.7 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. Page 5 of 6 4.8 Entire Agreement. This Agreement, including all Exhibits, constitutes the complete and exclusive statement of the Agreement between the Town and Service Provider. 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 Service Provider have executed this Agreement. Town of Los Gatos by: Service Provider, by: Laurel revetti, Tow fvlanagcr` Recommended by: Matt orle Director of Parks and Public Works Approved as to Form: Ro . ert Schuz, Zm• ttorney Title Page 6 of 6 P ATTACHMENT 1 PROPOSAL FORM The undersigned proposer hereby offers the required services for the following price(s) in strict compliance with the specifications, terms, and conditions set forth in this Request for Proposals. A. Preventive Maintenance Building Number of Hours/Month Monthly Cost 4- Civic Center S 4 iGici Adult Recreation Center Library f i 1 O ( Police Operations Building 2 li 3 0 PPW Service Center Z sli 27 S 'fC st ietC, e QM, 5cvi SiCCaecJ- in k) plus An Co,- 50itei-5 f c.ti1(ers �+ ba* per Ad alendG. ik S i & 2. B. Labor Rates for Extra Work, as Required Labor costs must reflect prevailing wages. Labor Category Straight Time ($ per hour) Overtime (4 per hour) Plumbing n /a_ vi (Q H')AC 5c ruIce. Catt3 I VS6. 56 2.01-1 . 75 HVA-c- Hok;c Ew` "ey �r ce._ (41t6 i / c1/4- l 2 7 3 -' C. Equipment and Vehicle Charges for Extra Work, as Required Equipment Category $ per vni v� Sid N )Ac- Se,-v:ce Col( -Z-ruc k Clitapce 150 ,v- 0\ct CI( Town of Los Gatos RFP for Contract Custodial Services Page 13 of 25 EXHIBIT A — o _ 'y 7-1 QVS S 6 al to N 8 O n N H N 8 N N - th 8 M. ONi 00 VS 8 N �f c! VS N VS 8 0 O b th VS 8 Ni p b N r y U T3 a U ,,, 8 T L E O th nl to 8 4 - th. 8 I, 1-I .n 8 n th ©VS O M to O 0 LA. v. N/A O N $ 237.00 1 8 M .N pp O �' h O G o L l/S ry OC VS 0 ry t!I th 0 iD :D Vppf 0 M M 1h 0 0 O ,-1 a vl M enN C th 'Annual Cost p• 8 O O W VS O N dJ N ooO 6 O co- V. 8 40 ... VS O VpI. Q Vl c(1 VS VS N V> Q 0NJ 01 y-j vi th VS S N C1 N VS- , o_ S u U 0 O U .c c O g 8 8 .N� th 8 `D .» 8 8 N s-iy .n 8 d AA. 8 v n ✓, S .T .n 1.11 e N o Vti 0 CC .a, 270.00 8 o N v, 8 v M .h 8 d Vs .h O E ti 0 O L H C <-1 M M 0r M o00 LiC ;, m c 8 m M ., V1 $ 9,840.00 8 N C. ..* VS 8 tp M th 8 M M. th N th th 8 a, CI It; v N 3 i itt N E r N ;d 'Monthly Cost S 0 VS p O CC 1h pp0 Q 0 N S 308.00 0 N VS 0 M N 1.31' VS Q 2 O� tiD -. VS h C O N V1 pp O 4 ^ N VS 8 0 VS 0 E 3 0 .c m ^ a N N N N d U F > a > > ▪ > ▪ > n 2 2 2 2 2 Adult Rec Center 0 d a Police Ops Building PPW Service Center 0 ✓ t 0 L C ▪ L N w O 0 O 0 HVAC Service Calls - Reg Time HVAC Service Calls - Over Time HVAC Holiday/ Emergency Calls tD ^ 00 C+ Mechanical -Plumbing Engineer overtime Service Call Truck Charge Earth Compactor O N K .• i ' MCI U_I1