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HomeMy WebLinkAbout1999-06-21 City Council (11)City of Palo Alto City Manager’s Report TO:HONORABLE CITY COUNCIL FROM:CITY MANAGER DEPARTMENT: UTILITIES AGENDA DATE: JUNE 21, 1999 CMR:283:99 SUBJECT:REJECTION OF PROPOSALS SOLICITED UNDER RFP NO. 109355; REQUEST FOR APPROVAL OF AMENDMENT NO. 4 TO CONSULTANT CONTRACT C7094779 WITH RESOURCE MANAGEMENT INTERNATIONAL, INC. IN THE AMOUNT OF $150,000 FOR GAS REGULATORY CONSULTING SERVICES RECOMMENDATION Staffrecommends that the City Council 1. Reject all other gas regulatory service proposals received under RFP No. 109355; Approve and authorize the Mayor to execute the attached Amendment No. 4 to Contract No. C7094779 (CMR:102:97) extending the contract term to June 30, 2000, with the option to renew the contract for an additional one-year term and a maximum budget of $75,000 per year for a combined FY 99-00 and FY 00-01 total of $150,000. BACKGROUND On January 21, 1997 the City Council approved (CMR: 102:97) and authorized the mayor to execute four consulting contracts, including one with Resource Management International, Inc. (RMI.) This contract scope covered a wide range of possible work areas including natural gas regulatory and legislative assistance and technical consulting. The City’s gas regulatory activities require specialized lcno~vledge of the Proceedings at the California CMR:283:99 Page 1 of 3 Public Utilities Commission (CPUC) and Federal Energy Regulatory Commission (FERC). Amendment No. 1 extended the contract by one year until June 30, 1998 and added $160,000; Amendment No. 2 increased funds by $60,000 for consultant services related to electric restructuring; and Amendment 3 extended the contract through June 30, 1999 and increased funds by $160,000. RMI’s performance under this contract has been satisfactory. DISCUSSION In August 1998, staff issued a request for proposal (RFP 109355) to contractors for providing a variety of regulatory and risk management services to the City. Gas regulatory services were included in the scope of work with the intention of diversification through the use of more than one consultant. RMI was not asked to respond to this request for proposal since it was an existing consultant for the City. After reviewing the proposals, staff concluded that RMI was superior to the other contractors and that diversification was not practical due to interdependence between natural gas regulatory projects and the large knowledge base required to serve the City’s interests in the regulatory arena. Therefore, staff does not recommend contracting for additional gas regulatory services, and requests the Council’s rejection of all proposals received pursuant to RFP No. 109355. Amendment No. 4 will extend the contract term by one year with the option to renew the contract for an additional one-year term and authorize expenditures up to $75,000 per year. RMI will continue to provide gas and electric consulting services under the existing scope of work and other terms and conditions. RESOURCE IMPACT The estimated expenditures under the extended contract are $75,000 per year. Funds have been included in the proposed FY 99-00 Gas Fund budget. POLICY IMPLICATIONS This recommendation is consistent with existing City policies. ENVIRONMENTAL REVIEW Approval of Amendment No. 4 does not constitute a project under the California Environmental Quality Act. Therefore, an environmental assessment is not required. CMR:283:99 Page 2 of 3 ATTACHMENTS 1. Amendment No. 4 Prepared by:Karla Dailey, Resource Planner Girish Balachandran, Manager Supply Resources DEPARTMENT HEAD APPROVAL: irector of Utilities CITY MANAGER APPROVAL: Assistant City Manager CMR:283:99 Page 3 of 3 AMENDMENT NO. FOUR TO CONTRACT NO. C7094779 BETWEEN THE CITY OF PALO ALTO AND RESOURCE MANAGEMENT INTERNATIONAL, INC. This Amendment No.Four to Contract No. C7094779 (~Contract") is entered into , by and between the CITY OF PALO ALTO, a chartered city and a municipal corporation of the State of California ("CITY"), and RESOURCE MANAGEMENT INTERNATIONAL, INC., a California corporation, located at 3100 Zinfandel Drive, Suite 600, Sacramento, CA 95670 ("Contractor). RECITALS: WHEREAS, the Contract was entered into between the parties for the provision of consulting services in January 1997, and was amended in July 1997, May 1998 and October 1998; and WHEREAS, the parties wish to amend the Contract; NOW, THEREFORE, in consideration of the covenants, terms, conditions, and provisions of this Amendment, the parties agree: SECTION i. The following exhibits to the Contract are hereby amended to read as set forth in the attachments to this Amendment No. Four, which is incorporated in full by this refer- ence: Exhibit "A" entitled ~Scope of Services and Time Schedule" a. Exhibit "B" entitled "Fee Schedule". SECTION 2. Amendment No. Three is hereby ratified. 990525 syn 0071661 1 SECTION 3. Except as herein modified, all other pro- visions of the Contract, including any exhibits and subsequent amendments thereto, shall remain in full force and effect. IN WITNESS WHEREOF, the parties have by their duly authorized representatives executed this Amendment No. Four on the date first above written. ATTEST:CITY OF PALO ALTO City Clerk APPROVED AS TO FORM: Senior Asst. City Attorney Director of Utilities Director of Administrative Services Mayor RESOURCE MANAGEMENT INTERNATIONAL, INC. By: Name: Title: By: Name: Title: Taxpayer Identification No. Risk Manager (Compliance with Corp. Code § 313 is required if the entity on whose behalf this contract is signed is a corporation. In the alternative, a certified corporate resolution attesting to the signatory authority of the individuals signing in their respective capacities is acceptable) Attachment : EXHIBIT "A" : EXHIBIT "B" : SCOPE OF SERVICES AND TIME SCHEDULE FEE SCHEDULE 990525 syn 0071661 2 CERTIFICATE OF ACKNOWLEDGMENT (Civil Code § 1189) STATE OF COUNTY OF ) ) ) On notary public in and for , before me, the undersigned, a said County, personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument, and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. WITNESS my hand and official seal. Signature of Notary Public 3990525 syn 0071661 CERTIFICATE OF ACKNOWLEDGMENT (Civil Code § 1189) STATE OF COUNTY OF ) ) ) On , before me, the undersigned, a notary public in and for said County, personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument, and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. WITNESS my hand and official seal. Signature of Notary Public 990525 syn 0071661 4 Exhibit "A":.Scope of Servides and Time Sched’ule The Scope of Sc~qccs for this cont,act is provided below. The consultaal will bc asked pcrform secviccs in one or more of the following areas. A. Elect’ric’Utility - Teohnical Cons~.dling, Leelslative @nd Regulatory Service_s_ Within the Electric Utility, there are three main focus areas: A1. -Western Area Power Administration (WAPA) -Electric industry restructuring .and related issues -Miscellaneous consulting services.. .WAPA - Monitoring, analyzing, hnd reporiing on key Western Area Power Administration (WAPA) activities’ that may ~l’fect the CITY’S electric utility. These services include but’are not limited to: Identify and analyze WAPA issues and activities that may impact the rates that the CITY pays for power.or impact-the amount-of power the ~ITY receives from WAPA. Analyze Federal and State legislative activiiies that may impact CITYof PALO ALTO: tiFP 12/96)SECTION 00001-7 PART II - SCOPE of WORK or SERVICES availability or cost of the WAPA resource. City ot P~lo Altn Provide assistance ir~-developing appropriate response strategies to relevant WAPA issues. Monitor key environmental pr6ceedings such as the Bay/Delta proceedings, State W~ter Resource ’Control Board, water quality proceedings and others. A2. A3. Electric Industry Restrueturinc~ and R~lated Issu0~ Assist the CITY to respond to the’ challenges rel.ated tci electric industry restructuring, including, but not limited to: *Identification of possible market opportunities and threats; Response to the challenges th.at the CITY may face from increased competition; °Analysis Felating to stranded costs and customer contracts Assistance with monitoring and/or’ influencing any of the"Western Power Exchange (WEPEX) activities; *Financial and technical analysis related to the Independent System Operator (ISO) and Power Exchange (PX); *Assistance with transmission and’ ~)ther FERC related issues. *Assistance with State.Legislative monitoring and intervention. Assistance. with. interventions at selected proceedings, including technical assistance, draft tes’timony,.and/or analysis of related litigation. Mi~c_ell~neous Consut!;ing S#rvices_ Assistance in Planning and E~onomic Anal~,sis of transmission services and supply resources CITY ot PALOALTO: RFP(2/96) SECTION 00001-8 PART II. SCOPE or’WORK or SERVICES City ot Pa’lo Alln Assistance in analyzing and developing energy price risk management tools, products and services and in developing new energy.pricing strategies. - - Monitor, analyze, and repor.t .on key USBR, State of California, CALFED, and San Francisco Bay, Sacramento and San Joaquin Delta Oversight Committee Activities that may affect the CITY’S electric utility. Management Consulting Contract Negotiations Interconnectio~. Agreement evaluation and negotiation Identification and analysis of partneringlopporl:unities B. Natural Gaslndustrv-Tech’nical Cons.ultin~, Legislative and Regulatory Services Consultant shall provide natural gas consulting services and legislative and .reguiatory support to the City. The services and support are’in the following task categories: .. Work with tl.~..e City to establish regulaiory goals, objectives, and priorities. Monitor, analyze and testify in CPUC and FERC proceedings to represent the City’s interests. B3.Maintain routine and sufficient access to key policy makers and staff’at.~he ¯ CPUC to facil!tate, upon City authorization, effective and efficient representation of the City’s viewpoints and concerns on gas regulatory issues. B4. B5. B6. "Assist the city in attaining it~ gas acquisition and transportation objectives. Monitor and intervene in, the.legislative process as require’d. Provide the City with miscellaneous natural gas" consulting services including development and use of optimizatio’n models, financial a’nalysis and contract negotiations. ¯ CITY of PALOALTO: RFP(21961 SECTIO~I 00001-9 PART il - SCOPE of WORK or SERVICES Cib! or’ Palo Allr~ C. _Udlitv Market Assessment Services Consultant shall provide the following market assessment services as desired. C1. Forecasting Services The Consultant may be requested to assist with forecasting annual usage for electricity, natural gas, and water. Advanced probabilisticand stochastic models may be required. Shsriterm’electricity forecasts for dispatching and forecasting for specific customer classes may be required. Forecasting skills may include but are not limited to: Development of dyhamic re.gression models using Forecasi Pro, Development of probabalistic forecasts using EXCEL add-ins. Development of stochastic for.ecasting models usir~g a Monte Carlo model. Development of "appropriate and defensible methods and dat~a sets, Development of an’alysis of sensit.ive variables and correlations. .Statistical analysis of results, written and oral reporting of results with conclusions and appropriate recommendations in a concise, understandable, and con.vincing manner ..... C2. _Cus_Lomer Surveying Services_ ResoUrce Management is responsible for investigating, analyzing and reporting to upper management important market information about Utilities customers, individually, by segmentation, orin aggregate. Possible Consultant services in this area would include: Development of scientifically useful and a.ppropriate survey .. instruments Scientific and appropriate selection of customers for surv.eying ’ CITY o~’ PALO AI~TO: RFP {2/961 SECTION 00001-10 PART II - SCOPE ot’ WORK or SERVICES methods, estimating technical and market potential of these technologies, and re_commending realistic goals for customer programs Develop DSM program goals and guidelines using: 1) City DSM goals related to specific technologies, customer segments, and end-use loads; 2) knowledge of DSM and other customer program methods and technologies; 3) and customer information (from formal and informal surveys) Develop DSM and other customer programs to satisfy Utilities goals for specific techn.olo~ies, customer segments, or end-use loads Evaluate and report DSM a’nd other customer programs’ success related .to goals and guidelines" C5. Data Manage~nent Activities Resource Managemer~t is responsible for and may request consultant assistance in developing, managing, analyzing, routing, maintaining coniidentiality and providing other services related to sensitive ~atao Specifically these services may include : Development, maintenance, accessing and program.ing o[ the Marketing Information System Development, maintenance, telemetry and programing of customer and city load dat.a system Development;main!enance, pro~lram~ni’ng of an intranet information network Development~ operation, and mainte’nance of a~ informati~n clearinghouse for utility related data *Development and dissemination of confidentiality policies and procedures _TASK ASSIGNMENT PROCEDURE Select, ion of Consultant does not insure th&t t~e Consultant will be assigned work, but only makes the Con.sultant availableto provide .services to the CITY. Attim’es, CITYoIPALO ALTO: RFP(2/96} SECTION 00001-12 PART II - SCOPE or WORK or SERVICES Cib/of P’alo Akn °Appropriate professional and defensible polling of customers through: focds groups, phone, survey, written instrument surveys, etc. Analysis of survey results, written and oral reporting of results with conclusions and recommendatior~s in a concise, understandable,and convincing manner. Providers who offer services in customer surveying should demonstrate a breadth of experience and expertise in all aspects of those services listed here, as well as other relevant expertise and experience, as the proposer deems appropriate. -C3. Market Analys£s_ Resource Management is responsible for and may request consultant assistance in’. investigati.ng, analyzing and reporting information about the market environment, including market forces, legislative issues anci resu[l:ing laws, regulatory issues and resulting regulation, competitor behavior, etc. Also, Resource Management is responsible for assimilating, reporting and recommending related actions to upper management in a timely, and effective manner. Services in this area include: Investigation and evaluation of competitor activities Regulatory and legislative monil~ering, analysis, and intervention. Benchmarking of gas, water, ~ste-water, or electric utility activities and Services in terms of economics, availability, quality,.etc. . ¯ Customer risk analysis including scenario, simulation, decision analysis, etc., addressing the economic impact of customer Iosses~ individually or in aggregate, under various potential market situations. C~..DSM Proc[ra~ Activitie~ Resource Management is responsible for and may request customer assistance in: investigating new DSM technologies,’ setting DSM program goals and guideline’s, developing and maintaining customer participation data, and evaluati’~g programs. Services in this area include: " Investigation of DSM and ether ~:ustomer end-use.technologies and" CITY of PALOALTO: RFP(2/961 SECTION 00001-11 PART il - SCOPE of WORK or SERVICES Ci~,/o! Palo AII~ however, one or more Consultants may be assigned work b~ the CITY’s Project. Manager. All work assignments will be made at the discretion of the CITY’s Project Manager based on the Project Manager’s opinion of Consultan[’s qualilications, availability, and past performance. An activity work plan shall be developed far e’ach assignment requested by the Project Manager that includes scope, schedule, deliverat~les, budget and otherinformation. Said work plan mus’tbe approved by the Cil:y’s Project.Manager prior to its implementation. The Project Manager may give telephone authorizati’on to Consultant to perform-certain tasks at .his/her sole discretion. Time Schedule This contract shall terminate on June 30, 2001. However, this contract may be renewed, upon mutual agreement, for two additional one-year periods. EXHIBIT "B" FEE SCHEDULE The maximum compensation due and payable to CONTRACTOR, whose hourly rates also are set forth in this Exhibit "B", is subject to CITY’s budget of $75,000 per year established for the award of one or more contracts pursuant to CITY’s Request for Proposal No. 91104 and CITY’s appropriations for these service contracts. No representation or warranty is made by CITY that CONTRACTOR shall be entitled to a minimum amount of compensation under this Contract. The following persons have been selected under RPF No. 91104, and their total compensation is subject to the $75,000 annual budget: Resource Management International, Inc. RESOURCE MANAGEMENT INTERNATIONAL, INC. 1999 Professional and support services, except for testimony, shall be billed at the following rates: Managing Director Managing Executive Consultant Principal Executive Consultant Executive Consultant Principal Consultant Supervising Consultant Senior Consultant Associate Professional Analyst Research Assistant Technician Office Services $203 per hour $180 per hour $162 per hour $154 per hour $141 per hour $126 per hour $114 per hour $100 per hour $87 per hour $66 per hour $57 per hour $53 per hour The above rates shall be adjusted each year, commencing January 1, 2000, to reflect the change in rates officially established by RMI. Testimony shall be billed at not less than eight (8) hours per day. Reproduction, printing, communications, computer services, and other miscellaneous support services shall be billed at rates for such services as determined from time to time and officially established by RMI. All travel, food, lodging, and miscellaneous expenses, except automobile mileage, associated with the provision of services hereunder shall be billed at cost plus ten (10) percent. Automobile mileage will be billed at the rate approved by the Internal Revenue Service. Client shall reimburse RMI for any applicable sales tax imposed on services rendered by RMI to Client.