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