HomeMy WebLinkAbout2000-06-22 City CouncilCity of Palo Alto
C ty Manager’s Report
TO:HONORABLE CITY COUNCIL 5
FROM:CITY MANAGER DEPARTMENT: UTILITIES
DATE:
SUBJECT:
JUNE 22, 2000 CMR:317:00
RECOMMENDATION TO REJECT THE SINGLE PROPOSAL
~RECEIVED FOR DESIGN AND CONSTRUCTION OF THEFIBER
TO THE HOME PROJECT, AND TO DIRECT STAFF TO
RECIRCULATE REQUEST FOR PROPOSALS.
RECOMMENDATION
Staff recommends that Council rejects the proposal received on June 6, 2000 for the
design and construction of the Fiber to the Home (FTTtt) Project, and direct staff to re-
circulate the RFP, after making any revisions designed to ensure a more successful
response.
DISCUSSION
Project Description
On April 5, 1999 the City Council authorized staff to proceed with a FTTH trial,
delivering Internet access services to approximately 69 customers in the Community
Center Neighborhood. The proposed service would have data rates of 10 or 100 Mbps
and be delivered over an Ethernet local area network (LAN). Construction costs were
estimated at $380,000 (with contingency funding) and were to be fully recovered in 5
years through a contract arrangement.
On May 10, 1999, Council adopted a Budget Amendment Ordinance (CMR:228-99) for
$380,000 and created the Fiber to the Home Capital Improvement Program (CIP #9916)
Staff returned to the City Council on August 2, 1999 with a staff report requesting
Council direction regarding pricing, payback period and commitment period for the
FTTH Trial. At this meeting the Council approved the options below:
CMR:317:00 Page 1 of 3
Service Speed 10 Mpbs 100 Mpbs
# of Customers 85 15
Sign-up Fee $500
Service Connection Fee $700
$500
$1900
Monthly Service Fee
Commitment Period
$45 $100
2.5 Years 2.5 Years
Since this approval, 107 customers have signed up, 87 for 10 Mpbs and 20 for 100 Mpbs.
Selection Process
Staff sent a request for proposals (RFP) to 33 firms on May 1, 2000 for design and
installation of the FTTH trial. The proposal period was 37 days. A mandatory pre-
proposal meeting was held on May 16, 2000; 11 firms attended the meeting. Only one
firm submitted a proposal on June 6, 2000. The proposal quoted a not-to-exceed cost of
$1,430,570. Those firms not responding indicated that they did not submit a proposal
because of lack of time for submitting proposals or unwillingness to perform a turnkey
project.
Staff isrecommending fhat the proposal be rejected because the proposal exceeds the
approved budget of $380,000 by $1,050,570. Staff also recommends that Council direct
staff to re-circulate the RFP, after making the following revisions:
1.Redefine layout to include more fusion splicing.
2.Limit the amount of cable at the houses served.
3.Allow additional types of fiber optic cable.
4.Call for simpler switch cabinet.
5.Lengthen construction time.
6.Remove responsibility for customer notification and contact from the contractor.
CMR:317:00 Page 2 of 3
PREPARED BY: Roland Ekstrand, Tomm Marshall, Larry Starr
DEPARTMENT HEADAPPROVAL:
[CH
~irector of Utilities
CITY MANAGER APPROVAL:
HARRISON
Assistant City Manager
CMR:317:00 Page 3 of 3