CC 2023-12-23_09.i. SP Maintenance Services_Street SweepingItem 9.i.
MEMORANDUM
TO: City Council
FROM: Shannon Sweeney, City Engineer/interim Public Works Director
SUBJECT: Consideration of an Award of Contract to SP Maintenance Services,
Inc. for Street Sweeping Services
DATE: December 12, 2023
SUMMARY OF ACTION:
Award a contract for street sweeping services in substantially final form throughout the
City for two years in the amount of $221,220 per year, authorize the City Manager to
award two one-year extensions upon favorable performance, at the City’s discretion, and
approve a budget amendment of $51,010 to address the anticipated budget deficit from
the increase in contract costs through the end of FY 2023-24.
IMPACT ON FINANCIAL AND PERSONNEL RESOURCES:
The FY 2023-24 budget includes $119,000 ($90,000 from Streets, and $29,000 from
Public Works Administration) for street sweeping services. The existing street sweeping
contract ends on December 31, 2023. Through the end of the existing contract,
approximately $59,400 ($9,900 per month for six months) will have been spent. Street
sweeping will cost $110,610 for the months of January through June of this fiscal year, if
this contract is approved. The new contract will result in a budget shortfall of
approximately $51,010.
These services will cost $221,220 per year in years 1 and 2, and if the available
extensions are exercised, $227,776 in year 3 and $234,332 in year 4.
City staff evaluated the option of bringing these services in-house at this time to reduce
the financial impact but determined that the City does not have adequate staff or the
necessary equipment to perform this task in-house.
RECOMMENDATION:
1) Award a contract for street sweeping services to SP Maintenance, Inc. for the next 2
years in the amount of $442,440 ($221,220/year); 2) Authorize the City Manager to
approve extensions for year 3, at $227,776, and year 4, at $234,332, upon favorable
performance in the City Manager’s discretion; 3) Approve a budget amendment of
$51,010 to address the anticipated budget deficit from the increase in contrast costs
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Item 9.i.
City Council
Consideration of an Award of Contract to SP Maintenance Services, Inc. for Street
Sweeping Services
December 12, 2023
Page 2
through the end of FY 2023-24; and 4) Find that these services are exempt from the
California Environmental Quality Act (CEQA) under the Class 4 exemption, which applies
to minor public or private alterations in the condition of land, water, and/or vegetation
where the project does not involve removal of healthy, mature, scenic trees except for
forestry and agricultural purposes. (State CEQA Guidelines, § 15304.)
BACKGROUND:
Sweeping of City streets and parking lots provides the following benefits:
Contributes to the clean and aesthetically pleasing character of the City;
Helps keep trash and pollution out of waterways such as the creeks;
Reduces maintenance by removing trash and debris before they enter the storm drain
system; and
Is a requirement of the City’s stormwater permit.
The existing street sweeping contract expires on December 31, 2023. The City does not
have the specialized equipment or staff to perform these services in -house.
An Invitation to Bid was developed and posted on the City’s website and sent to five
perspective bidders. Two bids were received by the bid due date of November 21, 2023,
2:00 PM. Bid results ranged from $904,548 to $1,364,107 for four years of service
(Attachment 2). The higher bid was received from the City’s current vendor. That vendor
submitted a letter on April 12, 2022 , indicating that we should anticipate a larger than
normal increase in service in the future because they are experiencing “higher than
normal costs.”
ANALYSIS OF ISSUES:
Significantly higher costs were expected, due to higher fuel costs, staff wage increases,
recent regulatory equipment requirements, and inflation. Additional streets associated
with new development have also been added since the previous contract was
established. The street sweeping schedule will be updated with streets associated with
new development prior to the start of the new contract.
The proposed monthly cost of the recommended contract, $18,435, is significantly greater
than the existing monthly cost of $9,900. However, the proposed monthly cost is closer
to staff estimated costs to bring the service in-house at $16,328 per month, which would
include purchase of a new sweeper at $800,000, depreciated over the equipment’s
anticipated life span of seven years, and 56 hours a month of staff time, using a fully
burdened rate of $121.50, per the City’s User Fee Study.
When considering the difficult-to-quantify costs associated with performing these tasks
in-house, such as unanticipated maintenance costs, increased liability, and administrative
issues, the proposed contract is reasonable. Local agencies of similar size contract out
this service, while some larger cities perform this service in-house.
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Item 9.i.
City Council
Consideration of an Award of Contract to SP Maintenance Services, Inc. for Street
Sweeping Services
December 12, 2023
Page 3
Year 2 has no inflation factor over Year 1. Years 3 and 4 increase by less than 3% per
year.
City staff reached out to the local agencies listed as references. The City of Pismo Beach
responded favorably regarding service and responsiveness. Staff is awaiting responses
from the other two references.
ALTERNATIVES:
The following alternatives are provided for the Council’s consideration:
1. Approve staff’s recommendations, which includes authorizing the City Manager to
proceed with the year 3 and year 4 extensions as appropriate ;
2. Approve the contract with Council-directed modifications, which could include
approval for only the first two years (which would require staff to reevaluate street
sweeping services options after that time;
3. Bring services in-house;
4. Reject all bids and restructure project; this is not recommended since existing
services end December 31, 2023, and this alternative would leave the City with no
street sweeping services for some period of time; or
5. Provide other direction to staff.
ADVANTAGES:
Proceeding with the staff’s recommendation will maintain continuity in street sweeping
services, particularly during the rainy season when such services are most important.
Authorizing the City Manager to approve extensions for years 3 and 4 reduce staff time
in rebidding the project or writing staff reports to bring the topic back to City Council. The
cost increases year-over-year are reasonable. Attempting to perform the task in-house
would result in owning an expensive piece of equipment that is used only part -time
(approximately 720 hours or 35% of the year).
Quality control provisions included in the scope of work include re-sweeping streets within
24 hours at no cost to the City if contract standards are not met. This provision of the
contract can be applied if a resident’s street is missed or if an inordinate amount of debris
remains after this paper passes through.
DISADVANTAGES:
New contract prices are significantly higher than existing contract prices. This increase in
cost was not initially budgeted for this year. General funds are needed to make up the
difference in cost.
ENVIRONMENTAL REVIEW:
These services are exempt from the California Environmental Quality Act (CEQA) under
the Class 4 exemption, which applies to minor public or private alterations in the condition
of land, water, and/or vegetation where the project does not involve removal of healthy,
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Item 9.i.
City Council
Consideration of an Award of Contract to SP Maintenance Services, Inc. for Street
Sweeping Services
December 12, 2023
Page 4
mature, scenic trees except for forestry and agricultural purposes. (State CEQA
Guidelines, § 15304.)
PUBLIC NOTIFICATION AND COMMENTS:
The Agenda was posted at City Hall and on the City’s website in accordance with
Government Code Section 54954.2.
Attachments:
1. Proposed Agreement
2. Bid Opening Log Sheet
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ATTACHMENT 1
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ATTACHMENT 2
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