Loading...
HomeMy WebLinkAbout1997-287ORDINANCE NO q07-A V AN ORDINANCE ACCEPTING A COMPETITIVE SEALED PROPOSAL AND AWARDING A CONTRACT FOR THE PURCHASE OF MATERIALS, EQUIPMENT, SUPPLIES OR SERVICES, PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFORE, AND PROVIDING FOR AN EFFECTIVE DATE WHEREAS, the City has solicited, received and tabulated competitive sealed proposals for the purchase of necessary materials, equipment, supplies or services in accordance with the procedures of state law and City ordinances, and WHEREAS, the City Manager or a designated employee has reviewed and recommended that the herein described proposals are the best responsible proposals for the materials, equipment supplies or services as shown in the "Proposals" submitted therefor, and WHEREAS, the City Council has provided in the City Budget for the appropriation of funds to be used for the purchase of the materials, equipment, supplies or services approved and accepted herein, NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS SECTION i That the numbered items in the following numbered bids for materials, equipment, supplies, or services, shown in the "Proposals" attached hereto, are hereby accepted and approved as being the best responsible proposal for such items RFSP ITEM NUMBER NO, VENDOR AMOUNT 2086 ALL R W BECK, INC $34,500 00 SECTION IT That by the acceptance and approval of the above numbered items of the submitted proposals, the City accepts the offer of the persons submitting the proposals for such items and agrees to purchase the materials, equipment, supplies or services in accordance with the terms, specifications, standards, quantities and for the specified sums contained in the Invitations, Proposals, and related documents SECTION IIT That should the City and persons submitting approved and accepted items and of the submitted proposals wish to enter into a formal written agreement as a result of the acceptance, approval, and awarding of the proposal, the City Manager or his designated representative is hereby authorized to execute the written contract which shall be attached hereto, provided that the written contract is in accordance with the terms, conditions, specifications, standards, quantities and specified sums contained in the Proposal and related documents herein approved and accepted SECTION iV That by the acceptance and approval of the above numbered items of the submitted proposals, the City Council hereby authorizes the expenditure of funds therefor in the amount and in accordance with the approved proposal or pursuant to a written contract made pursuant thereto as authorized herem SECTION V That this ordinance shall become effective immediately upon its passage and approval PASSED AND APPROVED tlus"day of 1997 JA C LER, MAYOR ATTEST JENNIFER WALTERS, CITY SECRETARY BY �Lra� APPROVED AS TO LEGAL FORM HERBERT L PROUTY, CITY ATTORNEY 2 DATE SEPTEMBER 23, 1997 TO Mayor and Members of the City Council FROM Kathy DuBose, Assistant City Manager of Finance SUBJECT RFSP # 2086 - ELECTRIC SERVICE FUNCTIONAL UNBUNDLING ELECTRIC COST OF SERVICE AND ELECTRIC RATE DESIGN RECOMMENDATION: We recommend Phase I of the above referenced RFSP be awarded to R W Beck, Inc in the amount of $34,500 00, and that Phase II be considered at a later date SUMMARY This RFSP is to conduct an electric cost of service/function unbundling in Phase I and a rate design study in Phase II This study is required to support overall Electric Strategic Planning The study is intended to provide the detailed analysis of functional and customer cost necessary to redesign rates Phase I consists of the following tasks - Forecast Revenue Requirements for a three year period - Conduct a Functional Unbundling of costs, to include at a minimum generation, transmission, distribution and administrative costs - Conduct a Cost of Service study which allocates costs to each appropriate customer class, as determined by the Consultant - Review the applicability of current cost accounting methodology and make recommendations for improvements - Project future electric revenue requirements over a minimum of three years, giving consideration to potential deregulation of the industry - Analyze and identify short and long run marginal costs and their components The study contract has been divided into two phases to allow delay of the rate design effort until a review of Electric strategies has been completed Phase I is scheduled to be completed within 75 days of contract award (early December, 1997), and the award of Phase II may be delayed up to 90 days (to early March, 1998) if necessary This two-phase approach gives the City significant flexibility to match the Phase II rate design with any revisions in strategies The City has also reserved the right to not award Phase II of the contract PROGRAMS, DEPARTMENTS OR GROUPS AFFECTED: City of Denton Utilities FISCAL IMPACT: Funds for Phase I of this study are available from 1996/97 budget funds Account # 610-105-1057-9300-8502 Attachment List of Respondents Memorandum from R E Nelson to Council dated September 23, 1997 Respe tfully s mitteLi Kdth\k_DuB0e Assistant City Manager of Finance Appr ed flameTom D Shaw, Title Purchasing Agent 933 AGENDA THE FOLLOWING FIRMS RESPONDED TO THE RFSP 4 2086 Reed -Stowe and Co , Inc Burns & McDonnell R W Beck, Inc Black and Veatch 4 CITY of DENTON, TEXAS MUNICIPAL BUILDING o 215 E McKINNEV • DENTON, TEXAS 76201 (817) 566 8200 • DFW METRO 434 2529 To Mayor and Members of the City Council Through* Ted Benavides, City Manage From Sharon Mays, Director, Electric Utility Date September 19, 1997 Subject CONTRACT WITH R W BECK FOR AN ELECTRIC COST OF SERVICE/FUNCTIONAL UNBUNDLING RATE STUDY Four consulting firms submitted proposals to perform the electric utility cost of service/functional unbundling and rate design study, separated into two phases The two highest priced proposals were reviewed and eliminated after determining the services to be provided were obtainable at lower costs from the remaining two low bidders A recommendation to award the bid to R W Beck versus Black & Veatch was made after reviewing the proposals in detail and discussing their technical emphasis and approach to Denton's needs with the Public Utility Board The request for proposal clearly stated the technical proposal submitted would be given primary consideration in awarding the contract Staff and the Public Utility Board are in agreement that Denton would be best served using R W Beck Major areas of comparison with comments between the R W Beck and Black & Veatch proposals are discussed below by functional categories Price Phase 1 Phase 2 R W Beck $34,500 $23,600 Black & Veatch $37,400 $15,800 Key Personnel The R W Beck team has much greater electric utility experience than B&V's team Beck will utilize electric regulatory and cost of service/rate design staff with extensive electric utility backgrounds, specialists in deregulation and rate design B&V placed members on their team, including the client liaison, with major backgrounds in water/wastewater utility services Familiarity Issues Beck worked on the Greenville transmission cost of service filing, and is extremely familiar with the deregulatory environment in Texas B&V's familiarity is national in scope, with little specific exposure to the Texas environment Beck has designed an Electric Reliability Council of Texas (ERCOT) "Dedicated to Quarry Service" assessment model which forecasts the impact of deregulation This information will be available for use in the Denton analysis Revenue Requirement Beck proposed to take into account the impact of deregulation and retail wheeling scenarios in developing revenue requirements B&V proposed no analysis of deregulation or retail wheeling scenarios Functional Unbundling Beck's proposal was more complete and detailed in identifying functional categories that need to be unbundled in the study Several additional cost unbundling functions were identified that will enable Denton to obtain a better analysis of the current service costs in place B&V took a more traditional approach, based on the way things have been done in the past Cost Accounting Methodology Beck discussed activity based cost accounting and emphasized the need to utilize activity based accounting for cost analysis in the current environment Beck will review all electric utility cost documents and provide comments on their recommended utilization and/or additional implementation plans B&V did not address this issue other than one sentence, which indicated their approach would not meet Denton's needs Marginal Costs Beck has proposed providing a spreadsheet program for utilization in this area, and which we can continue to utilize as conditions change Beck will develop marginal costs with existing facilities and loads as well as with new facilities or other arrangements to serve additional loads This cost information will be extremely valuable in pricing electric services under varying environmental conditions B&V will provide a more limited analysis of marginal costs based upon existing conditions during the three year forecast period Rate Design Beck will develop and provide a computer model utilizing the current on-line billing records during their rate design process to ensure there are no surprises after rate implementation Rates will be designed in con3unction with our marketing strategy, strategic plans, and the competitive environment Comparisons will be provided for other public and private utilities in the area and state B&V will develop rates but were not as complete in their discussion of what would be provided or their willingness to include Denton staff input throughout the process Software Availability Both firms will provide all software, with Beck providing one day of training using their models and marginal cost spreadsheet PROFESSIONAL SERVICES AGREEMENT FOR CONSULTING SERVICES PERTAINING TO nENTON MUNICIPAL ELECTRIC UTILITY COSTS ST` rE OF TEXAS § COUNTY OF DENTON § THIS AGREEMENT is made and entered into as of the 23rd day of September , 1997, by and between the City of Denton, a Texas Municipal Corporation, with its principal office at 215 E McKinney Street, Denton, Texas 76201 (hereinafter "OWNER") and R W BECK, a Corporation, with its office at Bank One Building, Suite 1900, 1125 Seventeenth Street, Denver, Colorado, (hereinafter "CONSULTANT") acting herein, by and through their duly authorized representatives WITNESSETH, that in consideration of the covenants and agreements herein contained, the parties hereto do mutually AGREE as follows ARTICLE I EMPLOYMENT OF CONSULTANT The OWNER hereby contracts with CONSULTANT, as an independent contractor, and the CONSULTANT hereby agrees to perform the services herein in connection with the Project as stated in the articles to follow, with diligence and in accordance with the highest professional standards customarily obtained for such services in the State of Texas The professional services set out herein are in connection with the following described project Consulting Services Pertaining To Denton Municipal Electric Utility Costs -Phase I (the "Project") ARTICLE II SCOPE OF SERVICES The CONSULTANT shall perform the following services in a professional manner A To perform all those services set forth in CONSULTANT'S proposed "Scope of Work" which is attached hereto and incorporated herewith by reference as Attachment A B CONSULTANT shall perform all those services set forth in any individual task orders which shall be attached to this Agreement and made a part hereof for all purposes as separate agreements C If there is any conflict between the terms of this Agreement and the Attachments attached to this Agreement, the terms and conditions of this Agreement will control over the terms and conditions of the Attachments or task orders ARTICLE III PERIOD OF SERVICE This Agreement shall become effective upon execution by the OWNER and the CONSULTANT and upon issuance of a notice to proceed by the OWNER, and shall remain in force for the period which may reasonably be required for the completion of the Project, and any required extensions approved by the OWNER This Agreement may be sooner terminated in accordance with the provisions hereof Time is of the essence in this Agreement The CONSULTANT shall make all reasonable efforts to complete the services set forth herein as expeditiously as possible and to meet the schedule established by the OWNER, acting through its City Manager or his designee PAGE 2 ARTICLE IV COMPENSATION A COMPENSATION TERMS "Direct Non -Labor Expense" is defined as that expense (based upon actual cost) for any assignment incurred by the CONSULTANT for air fare, taxi fare, lodging, meals while traveling, parking fees, tolls, automobile rental (when required), ground transportation, long-distance telephone charges, printing and reproduction costs, and other incidental expenses incurred in connection with the Project B BILLING AND PAYMENT For and in consideration of the professional services to be performed by the CONSULTANT herein, the OWNER agrees to pay based on the cost estimate detail at an hourly rate shown in Attachment B, which is attached hereto and incorporated by reference herewith, a total fee including reimbursement for direct non -labor expense not to exceed $34,500 00 Partial payments to the CONSULTANT will be made on the basis of detailed monthly statements rendered to and approved by the OWNER through its City Manager or his designees, however, under no circumstances shall any monthly statement for services exceed the value of the work performed at the time a statement is rendered The OWNER may withhold the final 10% of the contract amount until completion of the Project Nothing contained in this Article shall require the OWNER to pay for any work which is unsatisfactory as reasonably determined by the City Manager or his designee or which is not submitted in compliance with the terms of this Agreement The City shall not be required to make any payments to the CONSULTANT when the CONSULTANT is in default under this Agreement PAGE 3 It is specifically understood and agreed that the CONSULTANT shall not be authorized to undertake any work pursuant to this Agreement which would require additional payments by the OWNER for any charge, expense or reimbursement above the maximum not to exceed fee as stated without first having obtained written authorization from the OWNER C PAYMENT If the OWNER fails to make payments due the CONSULTANT for services and expenses within forty-five (45) days after receipt of the CONSULTANT'S undisputed statement thereof, the amounts due the CONSULTANT will be increased by the rate of one percent (1%-) per month from the said forty-fifth (45th) day, and in addition, the CONSULTANT may, after giving seven (7) days' written notice to the OWNER, suspend services under this Agreement until the CONSULTANT has been paid in full all amounts due for services, expenses and charges Provided, however, nothing herein shall require the OWNER to pay the late charge of one percent per month (1%) as set forth herein, if the OWNER reasonably determines that the work is unsatisfactory, in accordance with this Article IV, Compensation ARTICLE V OBSERVATION AND REVIEW OF THE WORK The CONSULTANT will exercise reasonable care and due diligence in discovering and promptly reporting to the OWNER any defects or deficiencies in the work of the CONSULTANT or any subcontractors or subconsultants PAGE 4 ARTICLE VI OWNERSHIP OF DOCUMENTS All documents prepared or furnished by the CONSULTANT (and CONSULTANT's subcontractors or subconsultants) pursuant to this Agreement are instruments of service and shall become the property of the OWNER upon the termination of this Agreement The CONSULTANT is entitled to retain copies of all such documents The documents prepared and furnished by the CONSULTANT are intended only to be applicable to this project and OWNER'S use of these documents in other projects shall be at OWNER'S sole risk and expense In the event the OWNER uses the Agreement in another project or for other purposes than specified herein any of the information or materials developed pursuant to this agreement, CONSULTANT is released from any and all liability relating to their use in that project ARTICLE VII INDEPENDENT CONTRACTOR CONSULTANT shall provide services to OWNER as an independent contractor, not as an employee of the OWNER CONSULTANT shall not have or claim any right arising from employee status ARTICLE VIII INDEMNITY AGREEMENT The CONSULTANT shall indemnify and save and hold harmless the OWNER and its officers, agents, and employees from and against any and all liability, claims, demands, damages, losses and expenses, including but not limited to court costs and reasonable attorney fees incurred by the OWNER, and including without limitation damages for bodily and personal injury, death and property damage, resulting from the negligent acts or omissions of the CONSULTANT or its officers, shareholders, agents, or employees in the execution, operation, or performance of this Agreement PAGE 5 Nothing in this Agreement shall be construed to create a liability to any person who is not a party to this Agreement and nothing herein shall waive any of the party's defenses, both at law or equity, to any claim, cause of action or litigation filed by anyone not a party to this Agreement, including the defense of governmental immunity, which defenses are hereby expressly reserved ARTICLE IX INSURANCE During the performance of the Services under this Agreement, CONSULTANT shall maintain the following insurance with an insurance company licensed to do business in the State of Texas by the State Insurance Commission or any successor agency, that has a rating with Best Rate Carriers of at least an "A-" or above A Comprehensive General Liability Insurance with bodily injury limits of not less than $500,000 for each occurrence and not less than $500,000 in the aggregate, and with property damage limits of not less than $100,000 for each occurrence and not less than $100,000 in the aggregate B Automobile Liability Insurance with bodily injury limits of not less than $500,000 for each person and not less than $500,000 for each accident and with property damage limits for not less than $100,000 for each accident C Worker's Compensation Insurance in accordance with statutory requirements and Employers' Liability Insurance with limits of not less than $100,000 for each accident D Professional Liability Insurance with limits of not less than $1,000,000 annual aggregate E The CONSULTANT shall furnish insurance certificates or insurance policies at the OWNER's request to evidence such PAGE 6 coverages The insurance policies shall name the OWNER as an additional insured on all such policies to the extent legally possible, and shall contain a provision that such insurance shall not be canceled or modified without 30 days prior written notice to OWNER and CONSULTANT In such event, the CONSULTANT shall, prior to the effective date of the change or cancellation of coverage, serve copies of any substitute policies furnishing the same coverage to OWNER ARTICLE X ARBITRATION AND ALTERNATE DISPUTE RESOLUTION The parties may agree to settle any disputes under this Agreement by submitting the dispute to arbitration or other means of alternate dispute resolution such as mediation No arbitration or alternate dispute resolution arising out of or relating to, this Agreement involving one party's disagreement may include the other party to the disagreement without the other's approval ARTICLE XI TERMINATION OF AGREEMENT A Notwithstanding any other provision of this Agreement, either party may terminate by giving thirty (30) days advance written notice to the other party B This Agreement may be terminated in whole or in part in the event of either party substantially failing to fulfill its obligations under this Agreement No such termination will be affected unless the other party is given (1) written notice (delivered by certified mail, return receipt requested) of intent to terminate and setting forth the reasons specifying the nonperformance, and not less than 30 calendar days to cure the failure, and (2) an opportunity for consultation with the terminating party prior to termination C If the Agreement is terminated prior to completion of the ser- PAGE 7 vices to be provided hereunder, CONSULTANT shall immediately cease all services and shall render a final bill for services to the OWNER within 30 days after the date of termination The OWNER shall pay CONSULTANT for all services properly rendered and satisfactorily performed and for reimbursable expenses to termination incurred prior to the date of termination in ac- cordance with Article IV, Compensation Should the OWNER sub- sequently contract with a new CONSULTANT for the continuation of services on the Project, CONSULTANT shall cooperate in providing information The CONSULTANT shall turn over all documents prepared or furnished by CONSULTANT pursuant to this Agreement to the OWNER on or before the date of termination but may maintain copies of such documents for its use ARTICLE XII RESPONSIBILITY FOR CLAIMS AND LIABILITIES Approval by the OWNER shall not constitute nor be deemed a release of the responsibility and liability of the CONSULTANT, its employees, associates, agents, subcontractors and subconsultants for the accuracy and competency of their designs or other work, nor shall such approval be deemed to be an assumption of such responsibility by the OWNER for any defect in the design or other work prepared by the CONSULTANT, its employees, subcontractors, agents and subconsultants ARTICLE XIII NOTICES All notices, communications, and reports required or permitted under this Agreement shall be personally delivered or mailed to the respective parties by depositing same in the United States mail at the address shown below, certified mail, return receipt requested unless otherwise specified herein Mailed notices shall be deemed communicated as of three days mailing PAGE 8 To CONSULTANT R W Beck Attn 1125 Seventeenth Street Bank One Bldg , Suite 1900 Denver, CO 80202-2615 To OWNER City of Denton Attn Ted Benavides Title City Manager 215 E McKinney Denton, Texas 76201 All notices shall be deemed effective upon receipt by the party to whom such notice is given or within three days mailing ARTICLE XIV ENTIRE AGREEMENT This Agreement consisting of thirteen (13) pages and two (2) Attachments constitutes the complete and final expression of the Agreement of the parties and is intended as a complete and exclusive statement of the terms of their agreements and supersedes all prior contemporaneous offers, promises, representations, negotiations, discussions, communications and agreements which may have been made in connection with the subject matter hereof ARTICLE XV SEVERABILITY If any provision of this Agreement is found or deemed by a court of competent jurisdiction to be invalid or unenforceable, it shall be considered severable from the remainder of this Agreement and shall not cause the remainder to be invalid or unenforceable In such event, the party shall reform this Agreement to replace such stricken provision with a valid and enforceable provision which comes as close as possible to expressing the intention of the stricken provision ARTICLE XVI COMPLIANCE WITH LAWS The CONSULTANT shall comply with all federal, state, local PAGE 9 laws, rules, regulations, and ordinances applicable to the work covered hereunder as they may now read or hereafter be amended ARTICLE XVII DISCRIMINATION PROHIBITED In performing the services required hereunder, the CONSULTANT shall not discriminate against any person on the basis of race, color, religion, sex, national origin or ancestry, age, or physical handicap ARTICLE XVIII PERSONNEL A The CONSULTANT represents that it hag or will secure at its own expense all personnel required to perform all the services required under this Agreement Such personnel shall not be employees or officers of, or have any contractual relations with the city CONSULTANT shall inform the OWNER of any conflict of interest or potential conflict of interest that may arise during the term of this Agreement B All services required hereunder will be performed by the CONSULTANT or under its supervision All personnel engaged in work shall be qualified and shall be authorized and permitted under state and local laws to perform such services ARTICLE XIX ASSIGNABILITY The CONSULTANT shall not assign any interest in this Agreement and shall not transfer any interest in this Agreement (whether by assignment, novation or otherwise) without the prior written consent of the OWNER PAGE 10 ARTICLE XX MODIFICATION No waiver or modification of this Agreement or of any covenant, condition, limitation herein contained shall be valid unless in writing and duly executed by the party to be charged therewith No evidence of any waiver or modification shall be offered or received in evidence in any proceeding arising between the parties hereto out of or affecting this Agreement, or the rights or obligations of the parties hereunder, and unless such waiver or modification is in writing, duly executed, and, the parties further agree that the provisions of this section will not be waived unless as herein set forth ARTICLE XXI MISCELLANEOUS A The following Attachments are attached to and made a part of this Agreement 1 Attachment A - Scope of Work 2 Attachment B - Fee Schedule B CONSULTANT agrees that OWNER shall, until the expiration of three (3) years after the final payment under this Agreement, have access to and the right to examine any directly pertinent books, documents, papers and records of the CONSULTANT involving transactions relating to this Agreement CONSULTANT agrees that OWNER shall have access during normal working hours to all necessary CONSULTANT facilities and shall be provided adequate and appropriate working space in order to conduct audits in compliance with this section OWNER shall give CONSULTANT reasonable advance notice of intended audits C Venue of any suit or cause of action under this Agreement shall lie exclusively in Denton County, Texas This Agreement shall be governed by and construed in accordance with the laws of the State of Texas PAGE 11 D For the purpose of this Agreement, the key persons who will perform most of this work hereunder shall be Joseph A Mancinelli, Project Director However, nothing herein shall limit CONSULTANT from using other qualified and competent members of their firm to perform the services required herein E CONSULTANT shall commence, carry on, and complete any and all projects with all applicable dispatch, in a sound, economical, efficient manner, and, in accordance with the provisions hereof In accomplishing the Project, CONSULTANT shall take such steps as are appropriate to ensure that the work involved is properly coordinated with related work being carried on by the OWNER F The OWNER shall assist the CONSULTANT by placing at the CONSULTANT's disposal all available information pertinent to the project, including previous reports, any other data relative to the Project and arranging for the access to, and make all provisions for the CONSULTANT to enter in or upon, public and private property as required for the CONSULTANT to perform services under this Agreement G The captions of this Agreement are for informational purposes only and shall not in any way affect the substantive terms or conditions of this Agreement IN WITNESS WHEREOF, the City of Denton, Texas has caused this Agreement to be executed by its duly authorized City Manager, and CONSULTANT has executed this Agree�me�n�t through its du y authorized undersigned officer on this the a � day of D 1997 "CITY" CITY OF DENTON, TEXAS By TED BENAVIDES, CITY MANAGER PAGE 12 ATTEST JENNIFER WALTERS, CITY SECRETARY By APPIWVED AS TO LEGAL FORM HERBERT L PROUTY, CITY ATTORNEY By �V' U�v� L ATTEST . \..\M....... PAGE 13 "CONSULTANT" R W B^ , a Corporatio BY Name .oc nh A_ Manc,m+ll, T3.tle Executive Analyst