HomeMy WebLinkAboutStaff Report 3483
City of Palo Alto (ID # 3483)
Finance Committee Staff Report
Report Type: Action Items Meeting Date: 3/19/2013
City of Palo Alto Page 1
Summary Title: Modifications to Street Sweeping Program
Title: Options for Cost Savings Modifications to Palo Alto's Street Sweeping
Program
From: City Manager
Lead Department: Public Works
Recommendation
Staff recommends that the Finance Committee direct staff to conduct a pilot
program to modify sweeping frequency of residential and light industrial routes
from weekly service to bi-weekly service in the late spring through early fall 2013.
This reduction would initially be done as a pilot project with City crews in order to
collect data that would allow staff to evaluate the effectiveness of the cleaning
and finalize the analysis of cost savings modifications to the Palo Alto Street
Sweeping Program. Staff also recommends that the Finance Committee direct
staff to finalize the cost savings analysis in late 2013, which would allow time to
implement Council-approved modifications and any resulting contracts in Fiscal
Year (FY) 2015.
Background
During the FY 2013 Budget process, the Finance Committee requested that staff
investigate further ways to reduce costs in the Refuse Fund. The Street Sweeping
Program was a key area, given that it constitutes approximately $2.2M of the
$30M Refuse Budget and utilizes approximately one-half of the full time staff
positions in the Refuse Fund Budget.
Discussion
Public Works and Administrative Services (ASD) staff analyzed eight options
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(Attachment A) and narrowed the field to three of the most feasible options for
the purpose of this discussion. The options all deal with the portion of the
program that involves large street sweepers working on regular routes
(approximately 44% of the budgeted sweeping expenses). Staff targeted this
element of the program first because it is much more amenable to analysis and
utilizing outside contracts. The other elements of the overall sweeping program
are a collection of smaller programs and would be analyzed as a second, more
difficult step to analyze.
For the purpose of obtaining contracting costs ASD staff contacted numerous
Street Sweeping vendors who supplied approximate costs for the proposed
frequencies. Staff included an allowance in the estimate for customer ‘call back’
work and contingencies.
Option 1 (Current Situation)
Currently the City conducts all street sweeping with in-house staff. The City owns
its own equipment and on average sweeps streets more frequently than any cities
that were surveyed by Staff (See Attachment B for survey results).
Residential/light commercial areas (”Residential”) are swept weekly and the
Downtown/California areas (“Downtown”) are swept 3 times per week year-
round. All of the cities surveyed are swept less frequently than Palo Alto. Most of
the Cities surveyed are swept on average every other week during the year with
some exceptions for the downtown/commercial areas.
Option 2 (All Outside Contracting)
This option would reduce the sweeping of residential areas to once every other
week during the March through October non-leaf season (leaving the leaf season
at once per week). This option keeps the downtown sweeping frequency at three
(3) times per week and contracts out the entire street sweeping operation.
Option 3 (Mix of City Staff and Contracting)
As with Option 2, this option would reduce the sweeping of Residential areas to
every other week during the non-leaf season (leaving the leaf season at once per
week). This option keeps the Downtown street sweeping frequency at three (3)
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times per week by contract and Residential routes once every other week
completed by in-house staff supplemented by Contractors during the leaf season.
Staff recommends finalizing the analysis with a focus on Option 3 and returning to
the Finance Committee after piloting the every other week frequency reduction
this summer. While details of a pilot program have not yet been worked out, it is
envisioned that a representative portion of the City will be selected for the trial
period. During the ‘no sweep’ week of the pilot program, affected operator(s)
would be working on other items (such as weeding, roadside trash cleaning, etc.)
instead of sweeping. If the pilot is successful (as determined by whether there are
an increased number of complaints; routes that cannot be completed due to
excessive debris buildup between sweepings; more leaf, bag and other debris that
must be cleared from the pump station trash racks after the initial rains, etc), and
if the next steps are approved by Council, then staff would issue a Request for
Proposal (RFP) to obtain firm pricing for contract work for Option 3 outlined
above. Option 3 is favored because it saves money but balances the need to
reduce costs with the desirability of maintaining an in-house capability. An in-
house capability is desirable to deal with storms (mud and debris cleanup) and
urgent/emergency situations. Option 2 (full contracting) saves more money but
leaves the city completely dependent on outside contractors in emergency
situations, when contractors may be overwhelmed by requests. The costs are
summarized in the “Resource” Section below.
Options 2 and 3 involve reducing sweeping frequency in residential (and light
commercial) areas from weekly to every other week in the non-leaf season. Staff
believes this reduction can be accommodated without significant impacts because
less leaf litter and debris are collected in the non-leaf season. The small amount
of debris during the non-leaf season can be readily left in place until the following
week and collected then. This is what most cities do now as summarized in
Attachment B. Since it rains very little in the non-leaf season it is anticipated that
debris will not be moved downstream in this additional one week time period.
The Municipal Regional Permit (MRP), issued by the Regional Water Quality
Control Board (Water Board) to regulate storm water discharges by the City of
Palo Alto and other Bay Area communities, requires increasingly stringent
measures over the next ten years to reduce the amount of trash entering local
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creeks and San Francisco Bay via municipal storm drain systems. Street sweeping
is one of the most effective tools that can be used to achieve compliance with the
MRP provision on trash load reduction. The Water Board is currently reviewing
requirements for long-term trash load reduction plans, with street sweeping
being one of the key items under review. While the proposed reduction in street
sweeping frequency in residential neighborhoods does not affect current
compliance with the MRP, there may be future requirements imposed by the
Water Board that would require the City to make a choice between restoring
street sweeping frequencies back to current levels and implementing other
measures that would reduce trash loading to the storm drain system to an
equivalent level.
No final decision is requested of the Finance Committee at this time. Rather,
piloting and refining the estimates are recommended.
Policy Implications
Approval of this pilot program does not represent any change to the existing
policy. Weekly residential sweeping is not required by City policy.
Resource Impact
Cost estimates of the three Options are listed below:
Cost Comparison of Options
Option Cost Description
1 $ 980K Current situation: weekly Residential - all City crews – No
contract work
2 $ 441K Complete contracting out: Biweekly residential - leaf
season/weekly
3 $ 675K Mix of contracting/city crews : same frequency as Option 2
The savings for Option 2 are $539K (the difference between 1 and 2) and the
savings for Option 3 are $305K (the difference between 1 and 3). The savings will
help offset cost increases associated with rising staff benefit costs and inflation,
and would potentially minimize rate increases over the next couple of years. Staff
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recommends focussing on Option 3. Although the savings are lower with Option
2, Option 3 maintains a Staff capability to deal with urgent and emergency
sweeping needs.
In addition to the direct savings that would occur if the proposal process confirms
the contractor’s approximate quotes, there could also be long term
pension/health care savings to the City as a result of contracting out these
services. ASD staff have calculated that there could be $132K in future annual
savings if Option 3 is implemented and two Full Time Equivalents are reduced.
Timeline
The next steps would be:
1) Conduct a pilot (bi-weekly residential sweeping), reducing Residential
sweeping frequency on representative routes to once every other week in
the non-leaf season during the late Spring to early Fall timeframe;
2) Finalize pilot program analysis in Fall 2013;
3) Return to Finance Committee with staff recommendations in late 2013; and
Full implementation in FY 2015.
Environmental Review
The recommended action does not constitute a project under the California
Environmental Quality Act (CEQA).
Attachments:
Attachment A - Sweeping Scenarios (PDF)
Attachment B - City Sweeping Survey (DOC)
Attachment A: SR 3483
Cost Allocation Sweep Weekly Year Round Bi‐Weekly Sweeping (Leaf Season Weekly) Monthly Sweeping (Leaf Season Weekly)
City Crews Only
(C1) Option #1
Contractor Only
(C2)
City Crews Only
(A1)
Contractor Only
(A2) Option #2
Mix of City Crews
and Contractor
(A4) Option #3
City Crews Only
(B1)
Contractor Only
(B2)
Mix of City Crews
and Contractor
(B4)
Refuse Fund Expense
City Crews 901,786$ ‐$ 740,509$ ‐$ 470,018$ 664,582$ ‐$ 276,489$
Contractor ‐$ 445,000$ ‐$ 360,584$ 124,593$ ‐$ 250,842$ 154,669$
Subtotal 901,786$ 445,000$ 740,509$ 360,584$ 594,611$ 664,582$ 250,842$ 431,158$
Downtown Parking District Expense
City Crews 78,575$ ‐$ 91,097$ ‐$ ‐$ 98,140$ ‐$ ‐$
Contractor ‐$ 65,678$ ‐$ 80,293$ 80,293$ ‐$ 95,198$ 95,198$
Subtotal 78,575$ 65,678$ 91,097$ 80,293$ 80,293$ 98,140$ 95,198$ 95,198$
Total Annual Expense 980,361$ 510,678$ 831,606$ 440,877$ 674,904$ 762,722$ 346,040$ 526,356$
Pension/Health Care Liability 330,648$ ‐$ 330,648$ ‐$ 198,389$ 330,648$ ‐$ 132,259$
Total FTEs 5 0 5 0 3 5 0 2
Notes
1 All options assume weekly sweeping during leaf season and 3 x per week downtown year round.
2 Downtown Parking District Expense Assumptions
a) Option 1 and C2 = Refuse Fund subsidizes 1 out of 3 sweeping events per week.
b) Options A1, 2 and 3 = Refuse Fund subsidizes 1/3rd of the sweeping events during leaf season and approx. 1/6th of the events during non leaf season.
b) Options B1, B2 and B4 = Refuse Fund subsidizes 1/3rd of the sweeping events during leaf season and approx. 1/12 of the events during non leaf season
Attachment B – Staff Report 3483
City Sweeping Survey
City Frequency Contracted or In-House
Palo Alto 1 x week Residential/Commercial
3 x week Downtown In-House
Menlo Park
1 x week leaf season Residential/Commercial
1 x week Summer (Downtown only)
1 x every other week (Sept. Oct. Mar.-May)
1 x month (Summer) Residential only
Contracted
Santa Clara 1 x every other week Residential
1 x every 8 days Commercial/Downtown In-House
Sunnyvale 1 x every other week Residential/Commercial
3 x week Downtown In-House
Mountain View 1 x every other week Residential
1 x week Commercial
In-House except for lots and
garages.
Milpitas 1 x every other week Residential
1 x week Commercial Contracted
Cupertino 1 x every other week Residential
1 x month Commercial Contracted
Redwood City 1 x month Residential
1 x week Commercial In-House
Los Altos 1 x month Residential
1 x week Commercial Contracted
San Jose Variable In-House Commercial
Contracted Residential