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HomeMy WebLinkAboutStaff Report 2403-2714CITY OF PALO ALTO CITY COUNCIL Special Meeting Tuesday, June 18, 2024 Council Chambers & Hybrid 4:00 PM     Agenda Item     4.Approval of Amendment Number 5 to Contract Number C20176363 With Magellan in the Amount of $1,122,121 to Incorporate Additional Design and Technical Services for the Fiber-to-the-Premises (FTTP) Pilot Project for a Revised Total Not-to-Exceed of $6,807,412 Over a Five-and-a-Half-Year Term; CEQA Status – Not a Project Consent Questions City Council Staff Report From: City Manager Report Type: CONSENT CALENDAR Lead Department: Utilities Meeting Date: June 18, 2024 Staff Report: 2403-2714 TITLE Approval of Amendment Number 5 to Contract Number C20176363 With Magellan in the Amount of $1,122,121 to Incorporate Additional Design and Technical Services for the Fiber-to- the-Premises (FTTP) Pilot Project for a Revised Total Not-to-Exceed of $6,807,412 Over a Five- and-a-Half-Year Term; CEQA Status – Not a Project RECOMMENDATION Staff recommends that the City Council approve and authorize the City Manager or their designee to execute Amendment No. 5 to contract No. C20176363 with Magellan (Attachment A) for make-ready power engineering work, advanced permitting services, and network operations and technical support for FTTP, in an amount not to exceed $1,122,121 through December 31, 2025. This amendment results in a revised total contract not-to-exceed amount of $6,807,412 over the five-and-a-half-year term. EXECUTIVE SUMMARY On June 19, 2023, the City Council approved the FY 2024 CIP Budget with the new Grid Modernization for Electrification Project (EL-24000, $250 million) and FTTP project (FO-24000, $20 million). Staff is deploying a pilot to determine how to align the grid modernization with FTTP to help minimize utility engineering pole make-ready work, pole replacements, noise disruption, and construction activity in neighborhoods. With hundreds of miles of overhead and underground construction activity between electric grid modernization and FTTP, the purpose of the pilot is to determine the feasibility of engineering designs and construction methods and implement best practices to facilitate the most cost-effective deployment of resources. On June 10, 2024, staff recommended the City Council approve a series of contract amendments (Staff Report 2312-23181) to leverage existing on-call construction and engineering contracts to perform the engineering design, overhead and underground construction, and installation for 1 Staff Report 2312-2318 https://www.cityofpaloalto.org/files/assets/public/v/1/agendas-minutes- reports/reports/city-manager-reports-cmrs/2024/06-10-24-sr-2312-2318.pdf the pilot area (approximately 409 poles and 1,224 homes) and reduce the construction timeline by 6 – 9 months, which would otherwise undergo the prolonged process of issuing multiple invitation for bids (IFBs) to perform the work for grid modernization and overlapping FTTP work. The pilot area will be treated as a testbed to design and construct both projects in parallel to minimize community disruption and reduce shared construction costs. Magellan specializes in fiber and broadband networks and their partners have experience in power engineering which creates added synergy in engineering design for the FTTP and grid modernization pilot. BACKGROUND On December 19, 2022, City Council considered three courses of action for a City-owned FTTP service and directed staff to proceed with the phased build approach. Under this approach, FTTP will be built out in selected areas of the city using $20 million from the Fiber Fund and the project will expand gradually from there as Council approves, with the goal to eliminate the need for debt financing (Staff Report #148002). On May 1, 2023, City Council approved Amendment Number 4 to Contract Number C20176363 with Magellan for Fiber program management, organizational change management, network operations and technical support, and utility pole electric make-ready engineering (Staff Report 2303-12153). Although the phased build approach to FTTP will decrease the City’s financial risk and increase Council’s control over the velocity of the buildout, the City does not have the in- house staffing to fully pursue the Fiber Expansion Plan and efforts to coordinate with Electrification Grid Modernization. The new Palo Alto Fiber broadband business will require significant staffing and specialized skill sets over the next few years. While it is economically prudent to utilize available staffing resources, the City must also strategically invest in external resources for a successful roll-out. On December 11, 2023, City Council was informed of the effort to align the Grid Modernization Project for Electrification with the FTTP project to help minimize impact to the community and potentially reduce construction timelines and costs. The pilot will inform the City how well these projects may be aligned, and which construction phasing options worked best to minimize disruption, construction activity, and construction costs. Given the overlapping construction and make-ready work for both projects, staff may mitigate internal resource constraints by covering shared work for both projects in parallel and leveraging existing contracts. This contract amendment will provide additional civil engineering construction design, utility pole make-ready work, and technical customer support to implement the FTTP pilot. 2 Staff Report 14800 https://www.cityofpaloalto.org/files/assets/public/v/1/agendas-minutes- reports/reports/city-manager-reports-cmrs/2022/12-19-2022-id-14800.pdf 3 Staff Report 2303-1215 https://www.cityofpaloalto.org/files/assets/public/v/1/agendas-minutes- reports/reports/city-manager-reports-cmrs/2023/05-01-2023-id-2303-1215.pdf ANALYSIS The design of the pilot area strategically covers initial test area plans for grid modernization, and a core portion of the Phase 1 FTTP area. The pilot area is bounded by West Bayshore, Embarcadero Road, Louis Road, and Colorado Ave). The fiber hut required for FTTP will be located near the Colorado power station, with predominantly aerial construction in the grid modernization pilot area. FTTP build out must be constructed in a manner that provides a pathway from the fiber hut to the areas of higher interest. Magellan will provide consulting on the engineering design and will review as-built construction maps of the FTTP pilot. They will also assist with civil engineering permit applications for underground construction. Staff recommends amending the final year of the contract with Magellan to provide expanded services for the pilot. •Civil engineering style permit documents required by the City of Palo Alto for street crossing and underground utilities. Design of the cross section or profile showing the proposed vertical alignment for the fiber conduits and the crossing of existing underground utilities. •Power make-ready engineering design including load calculation for both power and telecom of 409 poles situated in the pilot area. Engineering design for 4/12kV conversion on overhead distribution lines. • Tier 1 and 2 customer support includes deployment support, troubleshooting of access equipment, service restoration, and trouble tickets. The expanded services will be billed based on unit cost and labor hours. This amendment will provide the City with an external vendor option for these critical tasks. It will also enable staff to evaluate whether these services should be performed internally, or via contract service provider. The FTTP pilot will inform the City the best mix of insource (internal staff) and outsource (contractors) to operate the new municipal Palo Alto fiber internet business. FISCAL/RESOURCE IMPACT Budget for Amendment #5 is available in the FY 2024 Capital Improvement Fiber-to-the- Premise CIP (FO-24000). As of May 21, 2024, there is a remaining balance of $2,069,807 under the Magellan contract which will either be used to support the FTTP pilot or returned to the fiber reserves at the end of the contract term December 2025. The contractual arrangement with Magellan resulted from a formal RFP conducted in 2019. The “Fiber Network Expansion” RFP sought proposals from qualified consulting firms to develop a multi-phase fiber optic expansion plan including an integrated cross-utility strategy to combine FTTP with electric or gas planning. Multiple phases of the expansion project were included however, each individual phase was to be completed and approved by City Council before the decision was made to proceed with the next phase. Magellan was the recommended provider for all phases and the summary of contract amendments below reflect this administrative strategy for this project. Magellan Term Basic Services Additional Services Total Council Report # and Date Original Jun 2020 - Sep 2020 193,192 19,319 212,511 # 11368 on Jun 1 20204 Amendment #1 Oct 2020 - Apr 2021 259,150 25,915 285,065 # 11580 on Oct 5 20205 Amendment #2 Jun 2021 - Sep 2022 2,197,050 219,705 2,416,755 # 12305 on Jun 21 20216 Amendment #3 Oct 2022 - Mar 2023 ---Term extension only Amendment #4 May 2023 - Dec 2025 2,523,600 247,360 2,770,960 #2303-1215 on May 1 20237 Amendment #5 June 2024 - Dec 2025 1,122,121 -1,122,121 Grand Total 6,295,113 512,299 6,807,412 STAKEHOLDER ENGAGEMENT Staff continues to engage with the community on these two efforts primarily through the City’s Finance Committee and Utilities Advisory Commission discussions which are open to the public to participate and share feedback. On November 7, 2023, the Finance Committee was updated on the Fiber Master Plan, which includes a pilot to align FTTP with the Electric grid modernization project. The Finance Committee provided feedback on timeline, costs, and alignment of FTTP to grid modernization (Staff Report #2309-20828). 4 #11369 on Jun 1, 2020 https://www.cityofpaloalto.org/files/assets/public/agendas-minutes-reports/reports/city- manager-reports-cmrs/year-archive/2020/id-11368-mini-packet.pdf?t=64318.92 5 #11580 on Oct 5, 2020 https://www.cityofpaloalto.org/files/assets/public/agendas-minutes-reports/reports/city- manager-reports-cmrs/year-archive/2020-2/id-11580.pdf?t=59010.48 6 12305 on Jun 21, 2021 https://www.cityofpaloalto.org/files/assets/public/agendas-minutes-reports/reports/city- manager-reports-cmrs/year-archive/2021/id-12305.pdf 7 #2303-1215 on May 1, 2023 https://cityofpaloalto.primegov.com/meeting/document/1960.pdf?name=Item%208%20Staff%20Report 8 Finance Committee staff report 2309-2082, https://www.cityofpaloalto.org/files/assets/public/v/1/agendas- minutes-reports/reports/city-manager-reports-cmrs/2023/11-7-2023_2309-2082-mini-packet.pdf In addition, staff continues to share updates through the Palo Alto Fiber project webpage9, City communications channels such as social media10, Medium.com blog11 and interactive Palo Alto Fiber Hub12. ENVIRONMENTAL REVIEW Council action on this item is exempt from CEQA review because it can be seen with certainty that there is no possibility that the scope of work covered by this contract amendment, for additional technical and design services, may have a significant effect on the environment (CEQA Guidelines, 14 CCR section 15061(b)(3)). ATTACHMENTS Attachment A: Contract with Magellan; Contract No. C20176363, Amendment No. 5 APPROVED BY: Dean Batchelor, Director of Utilities Staff: Dave Yuan, Strategic Business Manager 9 Palo Alto Fiber Webpage, https://www.cityofpaloalto.org/paloaltofiber 10 City Social Media Channels, https://www.cityofpaloalto.org/connect 11 Palo Alto Connect, https://medium.com/@paloaltoconnect 12 Palo Alto Fiber Hub, https://fiber-palo-alto.hub.arcgis.com/ Vers.: Aug. 5, 2019 Page 1 of 8 AMENDMENT NO. 5 TO CONTRACT NO. C20176363 BETWEEN THE CITY OF PALO ALTO AND MAGELLAN ADVISORS LLC. This Amendment No. 5 (this “Amendment”) to Contract No. C20176363 (the “Contract” as defined below) is entered into as of June 17, 2024, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and MAGELLAN ADVISORS LLC., a Florida limited liability company, located at 450 Alton Road 1402, Miami, FL 33139 (“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 consulting services for a multi-phase fiber optic network expansion plan including design of a Fiber to the Premises (FTTP) build-out, as detailed therein. B. The Parties now wish to amend the Contract in order to increase the compensation by $1,122,121 from $5,685,291 to $6,807,412 for permitting, make ready engineering, and technical support specified in the updated Exhibit “A” Scope of Services, to incorporate additional design and technical services needed for the FTTP Pilot Project due to coordination and alignment with the City’s Grid Modernization upgrades. 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. C20176363 between CONSULTANT and CITY, dated June 1, 2020, as amended by: Amendment No.1, dated October 5, 2020 Amendment No.2, dated May 18, 2021 Amendment No.3, dated October 1, 2022 Amendment No. 4, dated April 3, 2023 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: SECTION 4. NOT TO EXCEED COMPENSATION. 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 DocuSign Envelope ID: 2136B894-B114-42E1-9A7A-1500CDB19373 Vers.: Aug. 5, 2019 Page 2 of 8 reimbursable expenses specified therein, and the maximum total compensation shall not exceed Six Million Eight Hundred Seven Thousand Four Hundred Twelve Dollars ($6,807,412). 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. 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.) Included within the not-to-exceed compensation specified above, CITY has set aside the not- to-exceed compensation amount of Five Hundred Twelve Thousand Two Hundred Ninety-Nine Dollars ($512,299) 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 Six Million Eight Hundred Seven Thousand Four Hundred Twelve Dollars ($6,807,412), 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 DocuSign Envelope ID: 2136B894-B114-42E1-9A7A-1500CDB19373 Vers.: Aug. 5, 2019 Page 3 of 8 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. The following exhibit(s) to the Contract is/are hereby amended or added, as indicated below, to read as set forth in the attachment(s) to this Amendment, which is/are hereby incorporated in full into this Amendment and into the Contract by this reference: a. Exhibit “A” entitled “SCOPE OF SERVICES, Amendment 5”, ADDED. b. Exhibit “B” entitled “SCHEDULE OF PERFORMANCE, Amendment 5”, ADDED. c. Exhibit “C” entitled “COMPENSATION, Amendment 5”, ADDED. SECTION 4. 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 5. 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: 2136B894-B114-42E1-9A7A-1500CDB19373 Vers.: Aug. 5, 2019 Page 4 of 8 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 MAGELLAN ADVISORS LLC. By:______________________________ Name:___________________________ Title:____________________________ By:______________________________ Name:___________________________ Title:____________________________ Attachments: EXHIBIT “A”: SCOPE OF SERVICES, Amendment 5 (ADDED) EXHIBIT “B”: SCHEDULE OF PERFORMANCE, Amendment 5 (ADDED) EXHIBIT “C”: COMPENSATION, Amendment 5 (ADDED) DocuSign Envelope ID: 2136B894-B114-42E1-9A7A-1500CDB19373 Chief Operating Officer Dave Klimas SVP/Chief Management Officer Courtney Violette Vers.: Aug. 5, 2019 Page 5 of 8 EXHIBIT “A” SCOPE OF SERVICES AMENDMENT NO. 5 (ADDED) Additional Task 5 Services: Expanded Permitting Deliverables will include: • High level civil engineering style permit documents required by the City of Palo Alto. Expected effort 430 hours @ $210/hour. • High level documentation needed for public works to include the following as examples. • Design of the cross section or profile showing the proposed vertical alignment for the (N) conduits and the crossing of existing underground utilities (incl. external 3rd parties). The profile must be drawn to scale with approximate depths of (e) pipes. Expected 660 hours @ $210/hour. • Proposed conduits must be designed and installed in accordance with City Standard Detail Dwg. No. 402 for Conduit Location Detail and Telecommunications. In commercial districts the horizontal alignment of the proposed conduits shall be the centerline of the sidewalk and vertical alignment below the wastewater main or greater distance from high voltage underground duct banks or any other deep pipe. Expected 410 hours @ $210/Hour. • Existing curb & gutter, properly dimensioned • Concrete joints, field visit to obtain info • Existing trees, work with City to identify and mitigate issues • Include cross sections or profiles for street crossing and major underground utilities with field visits. Expected 500 hours @ $210/Hour Additional Task 6, 7, 8, 14 Services: Make Ready Engineering For Pilot Area including power and fiber upgrades 1. Engineering Design for 4/12kV cutover on overhead distribution Lines 2. Engineering Design for the secondary system upgrade with 6kVA per home and 4/0 AWAC 3. Engineering design to add new Fiber strands and associated anchoring on distribution poles Deliverables will include: • Before and after circuit drawings • Distribution drawings • Bill of Materials, Install and Removal • Overhead construction standards • Material specifications • Construction plan/schedule (minimizing customer shutdowns) DocuSign Envelope ID: 2136B894-B114-42E1-9A7A-1500CDB19373 Vers.: Aug. 5, 2019 Page 6 of 8 • Bid documentation o Scope of Work o Bid table • Optional item: PE stamp on PLC report Additional Task 13 Services: a. Tier 1 Help Desk Customer Support is the first contact point for customers in need of support relating to their service. This is also referenced as the Help Desk. Consultant will work with the City to develop an RFP for a Tier 1 Help Desk vendor to field calls directly from customers. The Help Desk will answer calls related to the overall service. They will create trouble tickets for each interaction and resolve the issues directly or forward trouble tickets to the appropriate internal team for resolution. This task includes: • Deliverables: RFP for Tier 1 Help Desk vendor, including development of the documents, attending pre-bid meetings, evaluating respondents and assisting with final selection b. Tier 2 Customer Support Tier 1 Help Desk escalates to Tier 2 Customer Support for customers in need of involved troubleshooting, billing issues, etc. This is also referenced as “Tier 2.” Tier 2 assists with access equipment and network issues beyond the scope of the Tier 1 to include: • Access equipment troubleshooting from the optimal network terminal back to the network • Access equipment and deployment support • Troubleshooting initial installations • Coordinate service restoration with Field Technicians DocuSign Envelope ID: 2136B894-B114-42E1-9A7A-1500CDB19373 Vers.: Aug. 5, 2019 Page 7 of 8 EXHIBIT “B” SCHEDULE OF PERFORMANCE, Amendment 5(ADDED) Task Start End Additional Task 5 Services: Expanded Permitting 4/1/24 12/31/25 Additional Task 6,7,8, 14 Services: Make Ready Engineering For Pilot Area 4/1/24 12/31/25 Additional Task 13 Services: Tier 1 Help Desk Tier 2 Customer Support 1/1/25 12/31/25 DocuSign Envelope ID: 2136B894-B114-42E1-9A7A-1500CDB19373 Vers.: Aug. 5, 2019 Page 8 of 8 EXHIBIT “C” COMPENSATION, Amendment 5 (ADDED) The CITY agrees to compensate the CONSULTANT for professional 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 hourly rate schedule attached as exhibit C-1 up to the not to exceed budget amount for each task set forth below. CONSULTANT shall perform the tasks and categories of work as outlined and budgeted below. The CITY’s Project Manager may approve in writing the transfer of budget amounts between any of the tasks or categories included in this Agreement provided the total compensation for Basic Services does not exceed the amount shown in Section 4, Not to Exceed Compensation. Task Start End Billing Type Total Additional Task 5 Services: Additional Permitting 4/1/2024 12/31/2025 Hourly $ 140,000 Additional Task 6,7,8, 14 Services: Make Ready Engineering for Pilot (450 Poles) 4/1/2024 12/31/2025 Hourly $ 663,721 Additional Task 13 Services: Tier 1 Help Desk 1/1/2025 12/31/2025 Hourly $ 160,000 Tier 2 Customer Support 1/1/2025 12/31/2025 Hourly $ 158,400 Total Not To Exceed $ 1,122,121 DocuSign Envelope ID: 2136B894-B114-42E1-9A7A-1500CDB19373 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, June 17 Council Meeting and Tuesday, June 18 Council Meeting. Monday, June 17th Council Meeting Questions Item 15: Approval of a Funding Agreement with Federal Railroad Administration to Receive $6 Million for the Preliminary Engineering and Environmental Documentation Phase for the Grade Separation Projects at Churchill Avenue, Meadow Drive, and Charleston Road crossings. CEQA status – statutorily exempt per CEQA section 15262; this funding agreement will partially fund CEQA/NEPA review of the grade separation projects. 1. Given the projected total expenditure of over $500 million, what specific measures are in place to secure the remaining funding beyond the initial $20 million? Please outline the timeline and plan for managing financial risks, including potential cost overruns, and how the city will ensure transparency and accountability in fund management. Staff response: The city plans to secure additional funding for future phases through continuous grant applications, phased funding, partnerships with VTA and PCJPB, and budget appropriations. The timeline for this funding agreement includes phased completion by June 2027 with regular updates to the Rail Committee and City Council. 2. What analyses of alternative solutions to grade separation, such as advanced traffic management systems or improved public transportation, have been conducted? Please provide detailed findings and comparative data, including the criteria and metrics used to determine that grade separation is the most viable solution. What were the key limitations or drawbacks of these alternatives? Staff response: Several years of work and analyses have been conducted and details can be found on connectingpaloalto.com. 3. With reliance on $14 million from Measure B funding, what contingency plans are in place should these funds be delayed or insufficient? How can the city avoid reallocating budgets from other critical services and projects? Additionally, what analyses have been done to assess the long-term impact on the city's overall budget and resource allocation, and how will the city ensure minimal disruption to essential services? Staff response: The $14 million from Measure B funding is already programmed into the VTA budget and $6 million in FRA funding is already committed and awarded. Contingency plans include seeking additional grants and phased implementation. Item 19: Authorization for the City Manager or Designee to Negotiate and Execute a Line of Credit totaling $31 Million to Address Regional Wastewater Treatment Fund Cashflow as Recommended by the Finance Committee; CEQA Status – Not a Project 1. While the $31 million line of credit addresses immediate cash flow issues, what are our long- term strategies to resolve the underlying financial problems causing these shortfalls? What strategies can ensure sustainable financial health? Staff response: The long-term strategy will be to continue using the low-interest rate State Revolving Fund to the greatest extent possible and leverage secondary financing when cash flow is required. Ongoing monitoring, project and fiscal planning, and stakeholder engagement enable the development of strategies for sustainable fiscal health. 2. How does this line of credit fit into Palo Alto's overall long-term financial strategy? What plans are in place to prevent similar cash flow issues in the future, and how will this LOC impact our financial sustainability over the next decade? Staff response: This LOC enables the Wastewater Treatment Enterprise Fund to leverage SRF funding, continue critical capital repairs and improvements and collaborate with partner agencies while avoiding impacts upon the City’s treasury. As a part of the 5-year CIP planning, staff works with various State program(s) and our fiscal advisor in concert with the Finance Committee and Council to develop long-term financial strategies. 3. Considering our existing debt obligations, what are the projections for how this additional $31 million line of credit will affect our future borrowing terms and costs? Can you provide a comparative analysis of borrowing scenarios with and without the LOC, and explain how we plan to justify these costs to our constituents? Staff response: The LOC debt service is around one percent or less of the Wastewater Treatment Enterprise Fund annual operating budget and is not anticipated to impact the borrowing capacity of the Wastewater Treatment Fund. The comparative scenario is to not issue the $31 million LOC and instead leverage the City’s treasury, which is not in the best interest of the City and does not align with the partner agency collaborations for this regional utility enterprise. Costs will be covered by the City and respective partner agencies for the purpose of financing utility project repairs and improvements. Item 25: Approval of a Professional Services Contract Number C24188127 with Telecommunications Engineering Associates (TEA) in an Amount Not to Exceed $834,882 for Public Safety Radio Network Maintenance and Construction for a Period of Five (5) Years; CEQA Status: Not a Project 1. Given the critical importance of communication systems for the Police and Fire Departments, elaborate on the stakeholder engagement process undertaken. What detailed feedback was gathered from these departments regarding their satisfaction with TEA’s past services, and how did this influence the decision to renew the contract? Staff response: The primary stakeholders for this contract are technical staff in Public Safety departments and Public Works. Meetings were conducted with the stakeholders and feedback was gathered by staff that work with the vendor. The feedback was one input used to evaluate the suitability of the vendor selected for the projects. Item 27: Approval of: (1) Contract No. C24187724 with LensLock, Inc (Lenslock) for replacement of the police public contact audio/video system for a five (5) year term in an amount not to exceed $1,128,225; and (2) Police Audio/Video Technology Surveillance Use Policy; CEQA status – categorically exempt 1. Given the expenditure of $1,128,225, what specific technological improvements does this system offer over our current equipment? How will these enhancements directly impact the quality and reliability of police-public interactions in measurable terms? Without explicit data, what assurances can we offer regarding the tangible benefits justifying this expenditure? Staff response: Due to extenuating circumstances, the report from staff to the City Council and public is being released on Thursday, June 13, 2024. As outlined in the report, the current technology is at the end of its useful and supported life and replacement is necessary. This new equipment ensures continued operable and supported equipment for daily business of police officers. Audio and video equipment is used for officer safety, liability and internal control, training and education, and transparency and community trust providing reliable police-public interaction recordings. Recordings are used to support investigations, prevent misconduct, and in limited instances corrective behavior as necessary including administrative reviews such as those evaluated by the Council’s Independent Police Auditor. 2. Specify the privacy protections and data security measures the new LensLock system will implement compared to our existing system. What protocols will prevent unauthorized access and ensure data integrity? What assurances can we provide that these measures will be robust and effective? Staff response: Consistent with both the Surveillance Use Policy and the Information Technology Department security policies, this provider meets required levels of security and staff have outlined access authorities as required by the surveillance use policy as well. The Constitution, state laws, City policy, and professional standards balance the use of this technology for civil liberties and privacy. PAPD also has an established policy to ensure the technology is only used for legitimate law-enforcement purposes 3. Provide evidence on how the new LensLock system will aid our police department in improving operational outcomes and meeting community needs and expectations. How will this system enhance police efficiency, public safety, and community trust compared to our current technologies? Without concrete evidence, how can we advocate for its adoption, ensuring it aligns with our community's standards and requirements? Staff response: Use of audio/video technology has evolved through policy directives driven by City Council expectations and industry policing standards. This contract authorizes the purchase of a tool, replacing an outdated legacy product, that supports the daily operations of policing in the City while ensuring community trust and alignment with the community's expectations. Tuesday, June 18th Council Meeting Questions Item 4: Approval of Amendment Number 5 to Contract Number C20176363 With Magellan in the Amount of $1,122,121 to Incorporate Additional Design and Technical Services for the Fiber-to-the-Premises (FTTP) Pilot Project for a Revised Total Not-to-Exceed of $6,807,412 Over a Five-and-a-Half-Year Term; CEQA Status – Not a Project 1. In the event of resource constraints, what criteria will be used to prioritize between FTTP and grid modernization projects? What decision-making framework and examples of successful prioritization protocols are in place? How will these decisions be communicated to stakeholders to ensure transparency and accountability? Staff response: For the pilot, grid mod will take priority over FTTP since construction work will be sequential. The electric construction contractor will perform both power and telecommunication make-ready work on the utility pole before fiber can be lashed on the poles. Some metrics of success include increased load capacity, adoption of distributed energy resources (EV, PV, energy storage), number of homes passed/served, and 100% home electrification. 2. What comprehensive plan does the city have to mitigate disruptions during FTTP and grid modernization projects? What benchmarks or metrics will measure the success of these mitigation efforts? Staff response: The project’s phased approach allows for adjustments in response to disruptions. By issuing new solicitations for subsequent phases, the City can adapt and mitigate disruptions. Success metrics can be measured by adherence to project timeline and budget, cost savings from joint work, and duration of neighborhood construction. 3. Provide examples where similar dual projects were successfully implemented. What key technical challenges were faced, particularly in integration, and how were they overcome? What specific metrics and benchmarks were used to evaluate their success? Staff response: Palo Alto’s Upgrade Downtown was a multi-phase and multi-year project including utility improvements (gas, fiber, water), traffic signal enhancements, parking wayfinding signage, and pedestrian safety improvements. Coordinating construction activities amongst the various contractors was one of the key challenges. Recurring project meetings and open communication amongst departments, contractors, and businesses were critical to keep the project within budget and timeline. Item 5: Approval of General Services Contract Number C25188309 with Cintas Corporation in the Amount of $2,124,293 to Provide for Rental and Laundering of Work Uniforms and Miscellaneous Items for a Period of Five Years; CEQA Status – Not a Project. 1. Given the expenditure of $2,124,293, how can the city simplify the price comparison process for constituents? What competitive bids were evaluated, what benchmarks and criteria were used, and how did Cintas Corporation meet these compared to other vendors? Can you justify this selection without detailed price comparison data in the staff report? Staff response: The City may take advantage of cooperative purchasing agreements per the municipal code (2.30.360). The agreement is with Omnia Partners which used a competitive bid process that ensures competitiveness. This simplifies the comparison process by using an established competitive schedule and streamlines the procurement process requiring less staff time to complete. 2. Considering Cintas Corporation’s history of customer complaints and legal challenges, what specific performance metrics from their previous contracts were reviewed? What examples of past issue resolutions can assure us that similar problems will not occur with this contract? How do we address the risk of service failures and justify this vendor choice to our constituents? Staff response: The City works closely with Cintas to ensure that the City's requirements are met. By providing timely feedback to Cintas the City ensures its requirements are met, such as when a change in delivery or uniform standard is needed. The contract allows for termination should service failures occur. 3. With the provision for an additional 20% in services potentially increasing the contract value, what financial controls are in place to monitor and approve these expenditures? What predefined criteria are used for utilizing this additional service provision, and how will we ensure rigorous oversight to prevent budget overruns? How will these financial controls be communicated to maintain transparency and fiscal responsibility? Staff response: The Cintas contract is entered into the City's enterprise resource planning (ERP) system as a purchase order (PO). The PO has automated controls that prevent expenditures from exceeding the contract amount. Invoices are paid against the PO after being reviewed by staff to ensure compliance with performance standards. These controls are communicated to staff to ensure transparency and fiscal responsibility. The PO is tied to the available budget that is reviewed and if additional services are required, an amended PO would be processed. This includes budget review and ensures fiscal control.