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HomeMy WebLinkAboutStaff Report 2403-2709CITY OF PALO ALTO CITY COUNCIL Special Meeting Monday, April 01, 2024 Council Chambers & Hybrid 5:30 PM     Agenda Item     5.Approval of Contract Amendment Number 1 to Contract Number S24190818 with Integrated Design 360 in the Amount of $82,200 for a total not to exceed $132,200 and Extension of the Contract Term through December 30, 2024 for development of a “One Margin” Reach Code. CEQA Status: Exempt Under CEQA Guidelines Section 15308 Title Updated, Supplemental Report added, Consent Questions City Council Staff Report From: City Manager Report Type: CONSENT CALENDAR Lead Department: Planning and Development Services Meeting Date: April 1, 2024 Staff Report: 2403-2709 TITLE Approval of Contract Amendment Number 1 to Contract Number S24190818 with Integrated Design 360 in the Amount of $82,200 and Extension of the Contract Term through December 30, 2024 for development of a “One Margin” Reach Code. CEQA Status: Exempt Under CEQA Guidelines Section 15308 RECOMMENDATION Staff recommends that the City Council approve and authorize the City Manager or designee to execute Amendment No. 1 to Contract S24190818 with Integrated Design 360 (Attachment A) for development of a “One Margin” Reach Code in an amount not to exceed $82,200 and extend the term of the contract through December 30, 2024. This amendment results in a revised total contract not-to-exceed $132,200. BACKGROUND On February 26, 2024, in light of the Ninth Circuit decision in California Restaurant Association v. City of Berkeley, the Council adopted a moratorium on enforcement of certain provisions in Title 16 (Building Regulations) of the Palo Alto Municipal Code requiring that new construction and substantial remodels utilize all-electric design, which had been adopted November 2022 and had been effective since January 2023. Council also directed staff to pursue a replacement Reach Code using the “One Margin” approach, choosing a single policy approach rather than the consideration of multiple options in order to expedite development. Council directed staff to return on a timeline that would allow for ordinance adoption by the end of June 2024. ANALYSIS Following the February 26, 2024 staff executed a $50,000 consulting contract with Integrated Design 360 to immediately begin work on development of a “One Margin” Reach Code. The initial contract scope is insufficient to complete the entire work effort, however. The consulting work required for the project includes the following: •Review of State cost-effectiveness studies supporting a new Reach Code and any additional cost-effectiveness analysis required •Assisting staff evaluate design alternatives for the code •Evaluation of example Palo Alto building types under the code •Adaptation of model codes to Palo Alto •Staff report and ordinance drafting •Assisting staff submit the code to the California Energy Commission (CEC) •Meetings and communications in support of these efforts •Drafting of outreach material about both the moratorium and the new code proposals Integrated Design 360 has quoted $132,200 to complete the entire project scope, $82,200 of which covers the proposed contract amendment. The Municipal Code generally requires a competitive solicitation process for professional services contracts valued greater than $50,000. However, the Municipal Code provides an exemption in cases where the competitive solicitation process would result in additional costs to the City and substantial interference with a required city operation. PAMC 2.30.360(b)(2). Here, failure to adopt a replacement Reach Code on a rapid timeline will hinder the City’s ability to complete its Sustainability and Climate Action Work Plan. It would also result in more new construction using natural gas lines, which will raise costs long term for both residents and the City's gas utility as more and more of the community electrifies and these leftover gas lines need to be maintained or abandoned despite declining gas system revenues. To avoid these long-term costs Council has directed staff to bring back a replacement code before the Council break, which gives staff seven to eight weeks to draft the code and route it for internal review. An exemption from solicitation is requested to get the necessary consulting resources on board quickly to meet this timeline. Integrated Design 360 LLC is the firm best positioned to assist with this activity because they consulted for the City of San Jose in development of its Reach Code. San Jose’s code is the first example of what is now being referred to as a “One Margin” code. Integrated Design 360 is also subcontracting with TRC for the analytical work. TRC is the engineering firm that completed the 2022 statewide cost-effectiveness studies that the City of San Jose relied on in developing its code and which Palo Alto intends to rely on in developing theirs. Both Integrated Design 360 and TRC were involved in the development of the City of Palo Alto’s Reach Code in 2022 and are very familiar with the City’s operational and regulatory history. Onboarding a different consulting firm would make it impossible for staff to meet the Council timeline. FISCAL/RESOURCE IMPACT The professional services contract for Integrated Design 360 related to development of a “One Margin” Reach Code proposal will have a total not-to-exceed amount of $132,200 if Council approves this amendment. These costs are being split evenly between general consulting budgets previously approved for the Planning and Development Services and Utilities departments in the FY 2024 budget. STAKEHOLDER ENGAGEMENT No stakeholder engagement was performed with respect to this contract amendment. With respect to the Reach Code amendment itself, per Council direction at its February 26, 2024 meeting, the “One Margin” Reach Code proposal should reach Council with enough time to allow Council to adopt an ordinance by the end of June 2024. Council further noted that if stakeholder engagement will delay that timeline Council would accept a proposed ordinance without prior stakeholder engagement. Staff will consider possible stakeholder engagement opportunities that do not impact that timeline and may or may not find such opportunities. ENVIRONMENTAL REVIEW Council action on this item is categorically exempt from review under the California Environmental Quality Act (CEQA) because the One Margin Reach Code would be a regulatory action taken for the protection of the environment (CEQA Guidelines section 15308). ATTACHMENTS Attachment A: Amendment to Contract S24190818 with Integrated Design 360 APPROVED BY: Jonathan Lait, Director of Planning and Development Services Vers.: Aug. 5, 2019 Page 1 of 11 AMENDMENT NO. 1 TO CONTRACT NO. S24190818 BETWEEN THE CITY OF PALO ALTO AND INTEGRATED DESIGN 360, LLC. dba ID360 This Amendment No. 1 (this “Amendment”) to Contract No. S24190818 (the “Contract” as defined below) is entered into as of April X, 2024, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and INTEGRATED DESIGN 360, LLC. dba ID360, a California corporation, located at 809 Laurel Street, #308, San Carlos, California 94070 (“CONSULTANT”). CITY and CONSULTANT are referred to collectively as the “Parties” in this Amendment. R E C I T A L S A. The Contract (as defined below) was entered into by and between the Parties hereto for the provision of updates to Title 16 of the Palo Alto Municipal Code, as detailed therein. B. The Parties now wish to amend the Contract in order to add scope of work, tasks 3 through 4 and increase compensation by Eighty-Two Thousand Two Hundred Dollars ($82,200) from Fifty Thousand Dollars ($50,000) to a new total not to exceed compensation of One Hundred Thirty Eight Thousand Dollars ($132,200). NOW, THEREFORE, in consideration of the covenants, terms, conditions, and provisions of this Amendment, the Parties agree: SECTION 1. Definitions. The following definitions shall apply to this Amendment: a. Contract. The term “Contract” shall mean Contract No. S24190818 between CONSULTANT and CITY, dated March 7, 2024. b. Other Terms. Capitalized terms used and not defined in this Amendment shall have the meanings assigned to such terms in the Contract. SECTION 2. Section 4. “NOT TO EXCEED COMPENSATION” of the Contract is hereby amended to read as follows: “The compensation to be paid to CONSULTANT for performance of the Services shall be based on the compensation structure detailed in Exhibit C, entitled “COMPENSATION,” including any reimbursable expenses specified therein, and the maximum total compensation shall not exceed One Hundred Twenty-Six Thousand Eight Hundred Ninety-Nine Dollars ($126,899). The hourly schedule of rates, if applicable, is set out in Exhibit C-1, entitled “SCHEDULE OF RATES.” Any work performed or expenses incurred for which payment would result in a total exceeding the maximum compensation set forth in this Section 4 shall be at no cost to the CITY. DocuSign Envelope ID: 8BB13764-1590-4D5A-8909-BADF70245A1D Vers.: Aug. 5, 2019 Page 2 of 11 Optional Additional Services Provision (This provision applies only if checked and a not-to-exceed compensation amount for Additional Services is allocated below under this Section 4.) In addition to the not-to-exceed compensation specified above, CITY has set aside the not-to-exceed compensation amount of Five Thousand Three Hundred and One Dollars ($5,301) for the performance of Additional Services (as defined below). The total compensation for performance of the Services, Additional Services and any reimbursable expenses specified in Exhibit C, shall not exceed One Hundred Thirty-Two Thousand Two Hundred Dollars ($132,200), as detailed in Exhibit C. “Additional Services” means any work that is determined by CITY to be necessary for the proper completion of the Project, but which is not included within the Scope of Services described at Exhibit A. CITY may elect to, but is not required to, authorize Additional Services up to the maximum amount of compensation set forth for Additional Services in this Section 4. CONSULTANT shall provide Additional Services only by advanced, written authorization from CITY as detailed in this Section. Additional Services, if any, shall be authorized by CITY with a Task Order assigned and authorized by CITY’s Project Manager, as identified in Section 13 (Project Management). Each Task Order shall be in substantially the same form as Exhibit A-1, entitled “PROFESSIONAL SERVICES TASK ORDER”. Each Task Order shall contain a specific scope of services, schedule of performance and maximum compensation amount, in accordance with the provisions of this Agreement. Compensation for Additional Services shall be specified by CITY in the Task Order, based on whichever is lowest: the compensation structure set forth in Exhibit C, the hourly rates set forth in Exhibit C-1, or a negotiated lump sum. To accept a Task Order, CONSULTANT shall sign the Task Order and return it to CITY’s Project Manager within the time specified by the Project Manager, and upon authorization by CITY (defined as counter-signature by the CITY Project Manager), the fully executed Task Order shall become part of this Agreement. The cumulative total compensation to CONSULTANT for all Task Orders authorized under this Agreement shall not exceed the amount of compensation set forth for Additional Services in this Section 4. CONSULTANT shall only be compensated for Additional Services performed under an authorized Task Order and only up to the maximum amount of compensation set forth for Additional Services in this Section 4. Performance of and payment for any Additional Services are subject to all requirements and restrictions in this Agreement.” SECTION 3. Section 12. “SUBCONTRACTING” of the Contract is hereby amended to read as follows: “Subcontracts Authorized: Notwithstanding Section 11 (Assignment) above, CITY agrees that additional subcontractors may be used to complete the Services with prior approval, documented in writing, including Scope of Services, cost, and schedule of performances. The use DocuSign Envelope ID: 8BB13764-1590-4D5A-8909-BADF70245A1D Vers.: Aug. 5, 2019 Page 3 of 11 of subcontractors cannot increase compensation pursuant to Section 4 of this Agreement. At the time of this amendment, CONTRACTOR has identified the following SUBCONTRACTOR, which is authorized by the CITY: TRC Engineers, Inc 6 Executive Circle, Suite 200 Irvine, CA 92614 CONSULTANT shall be responsible for directing the work of any subcontractors and for any compensation due to subcontractors. CITY assumes no responsibility whatsoever concerning compensation of subcontractors. CONSULTANT shall be fully responsible to CITY for all acts and omissions of subcontractors. CONSULTANT shall change or add subcontractors only with the prior written approval of the City Manager or designee.” SECTION 4. The following exhibit(s) to the Contract is/are hereby amended and added, as indicated below, to read as set forth in the attachment(s) to this Amendment, which are hereby incorporated in full into this Amendment and into the Contract by this reference: a. Exhibit “A” entitled “SCOPE OF SERVICES”, AMENDED, REPLACES PREVIOUS. b. Exhibit “B” entitled “SCHEDULE OF PERFORMANCE”, AMENDED, REPLACES PREVIOUS. c. Exhibit “C” entitled “COMPENSATION”, AMENDED, REPLACES PREVIOUS. SECTION 5. Legal Effect. Except as modified by this Amendment, all other provisions of the Contract, including any exhibits thereto, shall remain in full force and effect. SECTION 6. Incorporation of Recitals. The recitals set forth above are terms of this Amendment and are fully incorporated herein by this reference. (SIGNATURE BLOCK FOLLOWS ON THE NEXT PAGE.) DocuSign Envelope ID: 8BB13764-1590-4D5A-8909-BADF70245A1D Vers.: Aug. 5, 2019 Page 4 of 11 SIGNATURES OF THE PARTIES IN WITNESS WHEREOF, the Parties have by their duly authorized representatives executed this Amendment effective as of the date first above written. CITY OF PALO ALTO City Manager APPROVED AS TO FORM: City Attorney or Designee INTEGRATED DESIGN 360, LLC Officer 1 By: Name: Melanie Jacobson Title: Principal Officer 2 (Required for Corp. or LLC) By: Name: Cindy Mack Title: Administrative Leader Attachments: Exhibit A – Scope of Services, Amendment No.1 (Added, Replaces Previous) Exhibit B – Schedule of Performance, Amendment No.1 (Added, Replaces Previous) Exhibit C – Compensation, Amendment No.1 (Added, Replaces Previous) DocuSign Envelope ID: 8BB13764-1590-4D5A-8909-BADF70245A1D Vers.: Aug. 5, 2019 Page 5 of 11 Exhibit A SCOPE OF SERVICES, AMENDMENT NO.1 (AMENDED, REPLACES PREVIOUS) Task 1 - Program Initiation & Project Management (Amendment No.1, Revision) CONSULTANT will organize and attend a project definition conference call with CITY staff to discuss strategy and overall project. CONSULTANT will prepare a meeting agenda, attend the meeting, and deliver meeting minutes and a project schedule. Project Kick-off CONSULTANT will organize and attend a project Kick off with CITY staff to discuss the project scope, goals, timeline, and deliverables. CONSULTANT will prepare a meeting agenda, presentation, attend meeting, and deliver meeting minutes. Progress Meetings CONSULTANT will attend up-to 12 check-in and working meetings with CITY staff virtually or in person to discuss progress to date on the workplan and address any coordination items and technical requirements. Task 2 - Develop Draft Policy Criteria (Amendment No.1, Revision) CONSULTANT will create the outline of the policy language to be used as a baseline. The document will house the details of the possible model code language, the interested community organizations, educational aspects, compliance process, and related municipal code sections. The document will contain the relevant cost effectiveness results. Policy Development, Cost-Effectiveness & Research Support CONSULTANT will coordinate project content to align with the results of the cost-effectiveness study. SUBCONTRACTOR (CONSULTANT’s contractor) will complete a cost-effectiveness study. CONSULTANT or SUBCONTRACTOR will perform policy research to support the changes to the policy criteria in the local municipal code. CONSULTANT or SUBCONTRACTOR will perform State and Federal policy research for amendment to the State code within the municipal code. CONSULTANT or SUBCONTRACTOR will communicate with State and Federal agency staff, as needed, regarding the evolving policy development direction. Task 3 - Local Policy Adoption & State Agency Approval (Amendment No.1, Added) CONSULTANT will deliver the Final Technical Policy Language to the project team and attend one meeting virtually or in-person with City Staff to finalize the regulation requirements in DocuSign Envelope ID: 8BB13764-1590-4D5A-8909-BADF70245A1D Vers.: Aug. 5, 2019 Page 6 of 11 coordination with the cost-effectiveness SUBCONTRACTOR. CONTRACTOR assumes and CITY agrees that the final code will be written and approved by the CITY’s Attorney. CONSULTANT will provide technical writing support to assemble the staff report for model code language and provide a presentation for the public hearing meeting. CONSULTANT will one City Council meeting in person and provide presentation support to CITY staff for code adoption. CONSULTANT assumes and CITY agrees that staff report is due six weeks prior to the public hearing meeting. CONSULTANT assumes the presentation is due two weeks prior to the public hearing meeting. CONSULTANT will provide technical writing support to assemble a cover letter to be sent by CITY staff to the California Energy Commission (CEC). CONSULTANT will work with staff to obtain a wet signature to the City Council approved ordinance. The submittal to the CEC shall include the cover letter, staff report, ordinance with wet signatures, and the cost-effectiveness study. CONSULTANT will remain in regular communication with the CITY’s Chief Building Official regarding obtaining notice of receipt from the CEC. CONSULTANT will work with staff to request assignment of a public comment period and preliminary CEC business meeting date. CONSULTANT will provide technical support to CITY staff during the 15-day public comment period administered by the California Energy Commission. CONSULTANT will address, in writing, specific questions posed by the CEC and public during the comment period and before the Business Meeting. CONSULTANT will attend the CEC Business Meeting, via conference call, to witness approval of local code and to be available to CEC staff immediately following the Business Meeting to address questions. Once approved by CEC, CONSULTANT will work with CITY staff to obtain formal letter from CEC for submission to the Building Standards Commission. CONSULTANT was to make CITY aware that it may take up to three (3) months to appear on California Energy Commission Business Meeting agenda. CONSULTANT assumes and CITY agrees that it may take up to ninety (90) days to complete this task to include waiting time to get on agenda. Task 4 - Program Material Update (Amendment No.1, Added) CONSULTANT will make updates to the program material and process guides for the 2022 Building Code Cycle. The program material to be updated is listed below. CONSULTANT will update the Green Building & Energy Reach Code Verification forms. CONSULTANT will maintain two (2) Green Building Verification forms and two (2) Energy Reach Code Verification forms to reflect the 2022 state code changes and the local municipal code requirements. CONSULTANT will update the technical documents, consult with CITY staff on any requested updates, working with CITY staff to get the documents published, and consult with the Chief Building Official or designee for approval. CONSULTANT assumes and CITY agrees to one (1) round of revisions. CONSULTANT will deliver these electronically to CITY staff in PDF and Microsoft Excel formats. DocuSign Envelope ID: 8BB13764-1590-4D5A-8909-BADF70245A1D Vers.: Aug. 5, 2019 Page 7 of 11 CONSULTANT will update the Residential and Non-Residential GB-1 Sheets for 2022 Code Cycle. CONSULTNAT will update the six (6) existing GB-1 sheets to incorporate the one margin code changes for the following project types: 1) Residential CalGreen Mandatory; 2) Residential CalGreen Tier 1; 3) Residential CalGreen Tier 2; 4) Non- Residential CalGreen Mandatory; 5) Non- Residential CalGreen Tier 1; 6) Non-Residential CalGreen Tier 2. CONSULTANT will provide technical updates, layout and formatting updates, and customizing each sheet to CITY staff requirements. CONSULTANT will deliver these electronically to CITY staff in PDF and Microsoft Excel formats. CONSULTANT will update Residential and Non-Residential Standard Conditions for 2022 Code Cycle. CONSULTANT will provide technical updates to the Standard Conditions document for all revisions to the 2022 Green Building Code and the local municipal code. CONSULTANT will provide technical revisions, quality control, work with CITY staff to get the documents published on CITY’s website and review any changes with CITY staff. CONSULTANT will deliver these electronically to CITY staff in PDF and Microsoft Excel formats. CONSULTANT will update the Frequently Asked Questions document. CONSULTANT will update the technical content for the Frequently Asked Questions on the CITY’s Green Building webpage. CONSULTANT will confer with CITY staff on any new Frequently Asked Questions requests. CONSULTANT will answer an addition of eight to ten (8-10) new questions that reflect new Frequently Asked Questions based on the 2022 code changes. CONSULTANT will deliver these electronically to CITY staff in Microsoft Word document and to support CITY staff to publish to the CITY’s webpage. CONSULTANT will provide updates to other program material for 2022 Building Code Cycle. CONSULTANT will make updates that include reference to new local or state code municipal code sections in the following documents only: Energy Reach Code Infeasibility Guidelines, GB-3 Non- Residential Commissioning Owners Project Requirements & Basis of Design, GB-4 Commissioning Plan, and EVSE Compliance Calculator. Task 5 - Cost-Effectiveness Analysis (Amendment No.1, Added) CONSULTANT to manage and coordinate between CITY and SUBCONTRACTOR for the completion of a cost-effectiveness analysis. SUBCONTRATOR will complete up to ten (10) simulations of building files including a mix of single family, accessory dwelling units, and low-rise multi-family building types. CONSULTANT and SUBCONTRACTOR maintain appropriate characteristics already modeled and may need to make minor adjustments, and that the analysis effort will check for feasibility of reaching the required source energy margins, not re-evaluating the cost- effectiveness, as re-evaluation could be a separate project, with a separate scope of services and additional costs. CONSULTANT and SUBCONTRACTOR will analyze multifamily and nonresidential results from existing statewide studies to identify Energy Policy and Conservation Act feasible source energy DocuSign Envelope ID: 8BB13764-1590-4D5A-8909-BADF70245A1D Vers.: Aug. 5, 2019 Page 8 of 11 margins for the CITY. CONSULTANT and SUBCONTRACTOR will provide writing and review support for the staff report, support for review/suggested changes to the draft ordinance language and support for CITY Council and CEC (if necessary) approval process. DocuSign Envelope ID: 8BB13764-1590-4D5A-8909-BADF70245A1D Vers.: Aug. 5, 2019 Page 9 of 11 EXHIBIT B SCHEDULE OF PERFORMANCE, AMENDMENT NO.1 (AMENDED, REPLACES PREVIOUS) CONSULTANT shall perform the Services so as to complete each milestone within the number of days/weeks specified below. The time to complete each milestone may be increased or decreased by mutual written agreement of the Project Managers for CONSULTANT and CITY so long as all work is completed within the term of the Agreement. Task Month/Year Completion or As Specified Below 1. Program Initiation & Project Management Ongoing/Daily 2. Develop Draft Policy Criteria May 2024 3. Local Policy Adoption & State Agency Approval August 2024 4. Program Material Update July 2024 5. Cost-Effectiveness Analysis June 2024 Optional Schedule of Performance Provision for On-Call or Additional Services Agreements. (This provision only applies if checked and only applies to on-call agreements per Section 1 or agreements with Additional Services per Section 4.) The schedule of performance shall be as provided in the approved Task Order, as detailed in Section 1 (Scope of Services) in the case of on-call Services, or as detailed in Section 4 in the case of Additional Services, provided in all cases that the schedule of performance shall fall within the term as provided in Section 2 (Term) of this Agreement. DocuSign Envelope ID: 8BB13764-1590-4D5A-8909-BADF70245A1D Vers.: Aug. 5, 2019 Page 10 of 11 EXHIBIT C COMPENSATION, AMENDMENT NO.1 (AMENDED, REPLACES PREVIOUS) CITY agrees to compensate CONSULTANT for Services performed in accordance with the terms and conditions of this Agreement, and as set forth in the budget schedule below. Compensation shall be calculated based on the rate schedule attached as Exhibit C-1 up to the not to exceed budget amount for each task set forth below. CITY’s Project Manager may approve in writing the transfer of budget amounts between any of the tasks or categories listed below, provided that the total compensation for the Services, including any specified reimbursable expenses, and the total compensation for Additional Services (if any, per Section 4 of the Agreement) do not exceed the amounts set forth in Section 4 of this Agreement. CONSULTANT agrees to complete all Services, any specified reimbursable expenses, and Additional Services (if any, per Section 4), within this/these amount(s). Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth in this Agreement shall be at no cost to the CITY. BUDGET SCHEDULE TASK NOT TO EXCEED AMOUNT Task 1 (Program Initiation & Project Management) $14,134 Task 2 (Develop Draft Policy Criteria) $30,565 Task 3 (Local Policy Adoption & State Agency Approval) $20,200 Task 4 (Program Material Update) $20,000 Task 5 (Cost-Effectiveness Analysis) $42,000 Sub-total for Services $126,899 Reimbursable Expenses (if any) $0.00 Total for Services and Reimbursable Expenses $126,899 Additional Services (if any, per Section 4) $5,301 Maximum Total Compensation $132,200 REIMBURSABLE EXPENSES CONSULTANT’S ordinary business expenses, such as administrative, overhead, administrative support time/overtime, information systems, software and hardware, photocopying, telecommunications (telephone, internet), in-house printing, insurance and other ordinary business expenses, are included within the scope of payment for Services and are not reimbursable expenses hereunder. Reimbursable expenses, if any are specified as reimbursable under this section, will be DocuSign Envelope ID: 8BB13764-1590-4D5A-8909-BADF70245A1D Vers.: Aug. 5, 2019 Page 11 of 11 reimbursed at actual cost. The expenses (by type, e.g. travel) for which CONSULTANT will be reimbursed are: NONE up to the not-to-exceed amount of: $0.00. A. Travel outside the San Francisco Bay Area, including transportation and meals, if specified as reimbursable, will be reimbursed at actual cost subject to the City of Palo Alto’s policy for reimbursement of travel and meal expenses. B. Long distance telephone service charges, cellular phone service charges, facsimile transmission and postage charges, if specified as reimbursable, will be reimbursed at actual cost. All requests for reimbursement of expenses, if any are specified as reimbursable under this section, shall be accompanied by appropriate backup documentation and information. DocuSign Envelope ID: 8BB13764-1590-4D5A-8909-BADF70245A1D 4 3 7 7 City Council Supplemental Report From: Jonathan Lait, Planning & Development Services Meeting Date: April 1, 2024 Item Number: 5 Report #:2403-2826 TITLE Approval of Contract Amendment Number 1 to Contract Number S24190818 with Integrated Design 360 in the Amount of $82,200 for a total not to exceed $132,200 and Extension of the Contract Term through December 30, 2024 for development of a “One Margin” Reach Code. CEQA Status: Exempt Under CEQA Guidelines Section 15308 Title Updated BACKGROUND To be consistent with the recommendation, the Staff Report title has been amended to: “Approval of Contract Amendment Number 1 to Contract Number S24190818 with Integrated Design 360 in the Amount of $82,200 for a total not to exceed $132,200 and Extension of the Contract Term through December 30, 2024 for development of a “One Margin” Reach Code. CEQA Status: Exempt Under CEQA Guidelines Section 15308” APPROVED BY: Lauren Lai, CFO/Administrative Services Director Dear Mayor and Council Members, On behalf of City Manager Ed Shikada, please see staff responses below for questions from Council Member Tanaka on the Monday, April 1 Council Meeting. Item 5: Approval of Contract Amendment Number 1 to Contract Number S24190818 with Integrated Design 360 in the Amount of $82,200 and Extension of the Contract Term through December 30, 2024 for development of a “One Margin” Reach Code. CEQA Status: Exempt Under CEQA Guidelines Section 15308 1. What specific numerical measure or quantitative description can be used to determine whether the increase in compensation for the contract aligns with the increase in the scope of work for Integrated Design 360's contract, excluding the increase in financial compensation, compared to the initial scope of the contract? Staff Response: This scope was prepared using a deliverables-based approach. To expedite work, staff prepared an initial contract with ID360. Recent Council direction to expedite and expand the initial scope requires the subject amendment. Should there be an interest in using an alternative measure of quantitative approach to renegotiate hourly rates or total costs, this action will take time and delay returning to Council before the summer recess. 2. How do you plan to introduce these reach codes amid the growing concerns raised by city council members, developers, and residents regarding the potential increase in housing costs and the construction industry, especially in the context of Silicon Valley's existing housing crisis? Staff Response: This contract amendment advances prior, unanimous, City Council direction from February 26, 2024. With the contract amendment staff will continue its Council- directed analysis of the One Margin standard. It is anticipated that in June, the City Council will have an opportunity to balance identified policy questions with the City’s expressed sustainability and carbon reduction interests. 3. What steps is the city taking to lessen the initial financial burden of the new building codes on ADUs and affordable housing, and to address concerns about the electrical grid and the higher costs of electric appliances? Staff Response: (Please see the staff response to Question 2). This contract amendment advances prior, unanimous, City Council direction from February 26, 2024. With the contract amendment staff will continue its Council-directed analysis of the One Margin standard. It is anticipated that in June, the City Council will have an opportunity to balance identified policy questions with the City’s expressed sustainability and carbon reduction interests. Item 6: Approval of Amendments with Professional Account Management LLC, dba Duncan Solutions for Contracts C17164727 and C19171363A for a Combined Additional Amount of $60,000 (Total not to exceed of $860,000 and $767,000 respectively) and to Extend the Contract Terms to December 31, 2024 (total term of eight and five years respectively), for Parking Permitting and Citation Management Services; CEQA Status – Not a Project. 1. Considering the significant impact of parking citation processing and collection services on our community members, what specific actions, if at all, has the city taken to engage constituents in the decision-making process regarding the extension of Duncan Solutions' contract? Staff Response: Historically, contract extensions requiring council approval, related to regular ongoing city operations, are reported on the City Council meeting agenda ten days in advance of the public meeting along with a staff report with context. The City uses the standard engagement process for community members to write in about the agenda topics or speak during public comment for these kinds of matters. As written in the staff report, the City is currently in the process of releasing a request for proposal to consolidate parking citation services to a single payment portal in the future. 2. How has the city ensured that our residents' and businesses' feedback and concerns have been adequately considered and addressed before moving forward with this extension? Staff Response: (Please see the staff response to Question 1). Historically, contract extensions requiring council approval, related to regular ongoing city operations, are reported on the City Council meeting agenda ten days in advance of the public meeting along with a staff report with context. The City uses the standard engagement process for community members to write-in about the agenda topics or speak during public comment for these kinds of matters. As written in the staff report, the City is currently in the process of releasing a request for proposal to consolidate parking citation services to a single payment portal in the future. 3. Given the importance of ensuring value and efficiency in public contracts, particularly in parking management services where companies like Duncan Solutions and its numerous competitors operate, explain the rationale behind the city's decision-making process for not engaging in a competitive bidding process for this contract extension. Staff Response: As written in the staff report, contract extensions recommended relate to extending existing engagements and align the end dates for the two contracts to provide sufficient time to implement the next contract for a consolidated engagement. The City is currently in the process of releasing a request for proposal to consolidate parking citation services to a single payment portal in the future. 4. What data and empirical evidence can residents of Palo Alto rely on to ensure confidence that this approach secures the best possible deal for our constituents, considering the potential for technological innovation, service quality, and cost-effectiveness offered by other firms in the industry? Staff Response: As written in the staff report, not approving the extensions would jeopardize the City’s ability to enforce its parking polices and issue parking citations having an operational and financial ramifications. These limited extensions of less than one year provide sufficient time to implement the next contract for a consolidated engagement. The City is currently in the process of releasing a request for proposal to consolidate parking citation services to a single payment portal in the future which includes a solicitation process through a web-based solicitation platform followed by a regimented evaluation process. Item 8: SECOND READING: Adopt a Revised Interim Ordinance to Extend the Interim Parklet Program to July 31, 2024 (from March 31, 2024) and Phase-in Enforcement of the Ongoing Parklet Program through November 1, 2024; and Extend Parking Lot Eating/Drinking Uses to December 31, 2024; CEQA Status- Categorically Exempt (Sections 15301 and 15304(e)) (FIRST READING: March 11, 2024 PASSED 7-0) 1. Given the importance of maintaining traffic flow and ensuring prompt access for emergency services, how does the city plan to mitigate the potential negative impacts on local traffic and emergency response times and public space availability resulting from the increased use of street spaces for dining and retail activities, especially in areas where parklets might significantly reduce road width or obstruct emergency vehicle routes? Staff Response: The parklet areas are limited to the existing parking spaces and do not encroach on the travel lanes, therefore they are not expected to impact traffic flow or access for emergency services. 2. What plans are in place to address situations where emergency vehicles cannot navigate densely populated parklet areas, which could be exacerbated in emergency scenarios not fully anticipated by the current planning process? Staff Response: As stated in the response to Question #1, parklet areas on streets that have car traffic are limited to the existing parking spaces, so emergency vehicles will continue to have access. On the portion of Ramona Street that is closed to vehicular traffic and the parklet program applies, an emergency access lane has been painted down the center to allow access for emergency vehicles. 3. How does the city plan to ensure fairness and equal opportunity for all businesses under the proposed parklet program extension, especially for those businesses that lack immediate access to outdoor spaces or are situated in areas where setting up parklets is not feasible due to space constraints, zoning regulations, or other logistical challenges? Staff Response: The use of street parking spaces for parklets or sidewalks for outdoor dining is enabled through the issuance of encroachment permits allowing the use of the City’s public right of way (ROW). Although outdoor dining benefits restaurants and the Palo Alto community, these benefits must be balanced with prioritizing the primary uses of the public ROW, which are to enable the safe passage of vehicles, bikes, and pedestrians; site essential street infrastructure such as streetlights, traffic signals, and signs; and allow access to utilities, fire hydrants, and emergency vehicles. Not every business location is suitable for siting a parklet, which is reflected in the guidelines. Some businesses unable to build parklets may be able to explore alternatives such as limited use on the sidewalk. The City is also currently working on long-term improvements which will not only allow more outdoor dining opportunities but also create a vibrant walkable downtown that will attract more patrons for all downtown businesses. 4. What specific measures or support mechanisms are being considered to assist these businesses in overcoming the inherent disadvantages posed by the policy, ensuring that the economic benefits of outdoor operations are distributed more equitably across the community? Staff Response: As noted in the response to question 3, the City is currently working on long-term improvements which will not only allow more outdoor dining opportunities but also create a vibrant walkable downtown that will attract more patrons for all downtown businesses.