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HomeMy WebLinkAbout04/17/1997, 5 - CONTRACT TO FURNISH FIXED ROUTE TRANSIT SERVICES - SPECIFICATION NO. 9733 council M7f- . j agenda izEpoin CITY OF SAN LUIS 0 B I S P 0 FROM: Michael D. McCluskey,Public Works Direct&—M-W� Prepared by: Proposal Review Team Al Cablay,Public Works Manager Carolyn Dominguez,Accounting Manager David Elliott,Administrative Analyst, r7; Reinie Jones,Transportation Techn' Harry Watson,Transit Manager SUBJECT: Contract to Furnish Fixed Route Transit Services- Specification No. 9733 CAO RECOMMENDATIONS 1) Award a contract to Forsythe&Associates, Inc. to famish fixed route transit services under Specification No. 9733 2) Authorize the Mayor to execute the contract 3) Authorize transferring$50,000 from the Multi-Modal Transportation Terminal project budget to a new project budget for bus operations and maintenance yard equipment DISCUSSION Soliciting Proposals The City now contracts with Laidlaw Transit Services, Inc. to provide all vehicle operations and vehicle maintenance for SLO Transit,using City-owned buses and the City-owned bus operations and maintenanceyard. The existing contract for these services expires on June 30, 1997. On February4, 1997 the Council authorized Public Works to distribute a request for proposals to furnish transit services under the next four-year contract term,which will start on July 1, 1997 and run through June 30, 2001. On March 19, 1997 Public Works received proposals from the following six firms(listed in alphabetical order): DAVE Transportation Services,Inc. Forsythe&Associates, Inc. Laidlaw Transit Services,Inc. McDonald Transit Associates, Inc. Ryder/ATE, Inc. Santa Barbara Transportation Evaluating Proposals Public Works convened a review team(with the members listed in the heading of this report)to evaluate the proposals and rank them according to the following five weighted criteria: Cost based on the submitted price quotation 40 percent Experience based on consultation with submitted references 30 percent Maintenance commitment based on the submitted bus maintenance schedule 10 percent Financial condition based on the submitted financial statement 10 percent Conformance to the specification based on listed deviations 10 percent Council Agenda Report-Contract for Fixed Route Transit Operations Page 2 For each criterion,the team imposed a forced ranking of the firms from six points for best to one point for worst, except that failure to meet minimum requirements resulted in a zero score for that criterion. Cost scores were multiplied by four and experience scores were multiplied by three to assign the intended weights. Consequently,there were 60 points possible on the overall score. The review team's evaluation yielded the following overall ranking and scores: tie 1. Forsythe&Associates, Inc. 50 points tie 1. Laidlaw Transit Services, Inc. 50 points 2. DAVE Transportation Services, Inc. 42 points 3. Ryder/ATE, Inc. 35 points tie 4. McDonald Transit Associates, Inc. 28 points tie 4. Santa Barbara Transportation 28 points More detail on the evaluation scoring is shown in Attachment 1. There were two significant differences between Forsythe and Laidlaw,the top-rated firms. Forsythe had the edge in experience based on consultation with references, who generally gave the firm outstanding marks for responsiveness and customer service. On the other hand,Laidlaw's prices were$121,860 lower over the four year contract term(see Attachment 2), mostly because it asked for no payments to cover startup costs, while Forsythe wanted$77,138 for that purpose. The review team preferred Forsythe but realized that awarding a contract to Forsythe at its proposed prices would require reducing service in the first year. For that reason,the team asked Forsythe if it could modify its prices to avoid first year service cutbacks. Reducing For_}s jhe's Prices Forsythe responded with two revisions to its price quotation. First, it reduced total startup costs from $77,138 to $69,800 and agreed to spread this$69,800 over four years($17,450 per year). And second, it reduced by$1,708 the price per month to cover fixed costs. These changes would reduce first year cost by$80,184(from$1,111,070 to $1,030,886)and reduce total cost over the four year contract term by$89,322(from$4,422,691 to $4,333,369). Part of this price reduction is possible because of two proposed actions by the City. First,the City would pay Forsythe in advance each month for its services. This would eliminate interest expense on money borrowed to cover monthly costs pending payment. Then second,the City would purchase the following equipment items for the bus operations and maintenance yard: • shop equipment • a safe for cash fares • a telephone system • various fim ishings • a copy machine • computer equipment • fareboxes With the City furnishing this equipment, Forsythe could avoid one-time purchase costs or ongoing lease costs which would have to be passed on to the City. This approach is identical to the approach already taken by the City to purchase a passenger van, a service truck, and radio Council Agenda Report-Contract for Fixed Route Transit Operations Page 3 equipment as outlined in the February 4, 1997 agenda report. And it is particularly appropriate because the City currently has surplus money for transit which is restricted to capital outlay and cannot be used for operations. In a sense, this strategy simply levels the playing field between Forsythe and Laidlaw, because the City has already paid Laidlaw for these items in the existing contract. Recommending a Contractor The review team recommends awarding a contract to Forsythe because of its superior record of responsiveness and outstanding customer service. FISCAL UA PACT The proposed contract is structured so that each month Forsythe will be paid: • a lump-sum amount to cover fixed costs • an amount per lour operated to cover vehicle operation • an amount per mile operated to cover vehicle maintenance costs This arrangement allows the City unlimited flexibility to add or reduce service without unduly hurting or benefiting the contractor. The following table shows that there should be enough revenue in 1997-98 to cover contract costs without cutting service. Uncertainty about the level of operating assistance grants available from the Federal Transit Administration(FTA)complicates trying to forecast what level of service SLO Transit can sustain after 1997-98. If other revenue sources remain stable,Public Works estimates that service levels may drop to between 75 and 93 percent of current levels. Projected Estimated 1996-97 1997-98 Sources Available: FTA Operating Assistance Grants $440,000 $180,000 Deferred TDA Allocations from the Previous Year 436,600 221,600 TDA Allocations for Operations 131,500 605,800 Cash Fares and Pass Sales 120,800 159,800 Cal Poly In-lieu Fare Contribution 169,000 176,000 Other Sources(mostly interest) 2,600 2,600 Unused TDA Allocations from the Current Year 221,600 30,200 $12522,100 $1,376,000 Uses: Bus Operations and Maintenance Contract 9892800 $12030,900 Direct Administration 122,100 120,600 Indirect Administration 18800 194,300 TDA Allocations Deferred to the Next Year 221,600 30,200 $1,522,100 $17376,000 e53 Council Agenda Report-Contract for Fixed Route Transit Operations Page 4 About$50,000 is needed to purchase the bus operations and maintenance yard equipment. In the 199495 budget, $85,000 of Transportation Development Act(TDA)revenue was appropriated for preliminary studies on the Multi-Modal Transportation Terminal. Since then,other grants have been approved which will cover this expense. At least$30,000 of TDA revenue must remain in the project account to cover the cost environmental studies which the other grants cannot pay for. Public Works recommends transferring$50,000 from the Multi-Modal Transportation Terminal project budget to a new project budget to cover the costs of the new equipment for the bus yard. Attachments Attachment 1 -Rankings of Proposing Firms based on Evaluation Scores Attachment 2-Comparison of Costs over the Four Year Contract Term c 0 Cd O M N \G N ed Ln � C v F cy M w ` � F Q �n 3 � c� r. Cd 'v axi C en ed 1U. r- 0 O G M �o N �o �o N y ami O z o � F cl .r Q C a v -r W N C y i CA -cz s °3 y vn _ •C W �7 U oZj o b v C F M a ed � y N V s W W v R O N rte, coq ^ M �o h C N 6. 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CONTRACT TO FURNISH FIXED ROUTE TRANSIT SERVICES THIS CONTRACT is made and entered into in the City of San Luis Obispo on this day of , between the City of San Luis Obispo (the City) and Forsythe& Associates, Inc., (the Contractor). WITNESSETH: WHEREAS, on February 4, 1997 the City requested proposals to furnish fixed route transit services per Specification No. 9733; and WHEREAS, the Contractor submitted a proposal which was accepted by the City for furnishing these services; NOW THEREFORE, in consideration of the mutual promises, obligations, and covenants contained in this contract, the parties agree as follows: 1. TERM. The term of this contract shall start on July 1, 1997 and end on June 30, 2001. 2. INCORPORATION BY REFERENCE. City Specification No. 9733, the Contractor's proposal dated March 17, 1997, and the Contractor's revised price quotation dated April 2, 1997 shall be incorporated in and made a part of this contract. 3. THE CITY'S OBLIGATIONS. For performing the duties and responsibilities described in Section IV of Specification 9733, the City shall pay and the Contractor shall receive payments based upon actual quantities of work ordered and received by the City at the following prices proposed by the Contractor and accepted by the City: 7/01/97 7/01/98 7/01/99 7/01/00 to to to to 6/30/98 6/30/99 6/30/00 6/30/01 Price per Year to Cover $17,450.00 $17,450.00 $17,450.00 $17,450.00 Startup Costs Price per Month to Cover $33,318.00 $34,368.00 $35,451.00 $36,565.00 Fixed Costs Price per Vehicle Service Hour $13.70 $14.18 $14.68 $15.19 (including deadhead)to Cover Vehicle Service Costs Price per Odometer Mile $0.55 $0.57 $0.59 $0.61 Accumulated on Buses to Cover Bus Maintenance Costs 5�7 The City shall pay the Contractor on the first of each month an amount based on an estimate of the cost for the succeeding month's services. Reconciliation of any difference between the estimate and the actual cost shall be made on the next payment. 4. THE CONTRACTOR'S OBLIGATIONS. For and in consideration of the payments and contracts mentioned to be made and performed by the City, the Contractor agrees with the City to do everything required by this contract. 5. AMENDMENTS. Any amendment, modification, or variation from the terms of this contract shall be in writing and shall be effective only upon approval by the City Council of the City. 6. ACCURACY OF THE SPECIFICATION. If any dispute arises as a result of any actual or alleged ambiguity or defect in Specification No. 9733, or any other matter whatsoever, the Contractor shall immediately notify the City in writing, and the Contractor and all subcontractors shall continue to perform, whether or not the ambiguity or defect is major, material, minor, or trivial, and whether or not a change order, time extension, or additional compensation has been granted by the City. Failure to provide the described written notice within one working day of the Contractor's becoming aware of the facts giving rise to the dispute shall constitute a waiver of the right to assert the causative role of the defect or ambiguity in the specification concerning the dispute. 7. THE CITY'S REMEDIES ON BREACH. If the Contractor fails to perform the duties and responsibilities required in this contract, in addition to all other remedies provided by law the City may assume such duties and responsibilities and deduct the costs of doing so from amounts due to the Contractor. The costs to be deducted shall be the City's actual costs incurred to assume the duties and responsibilities or the contract prices,whichever are greater. 8. TERMINATION FOR CONVENIENCE. The City may terminate this contract, m whole or in part, at any time by written notice to the Contractor. The Contractor shall be paid for work performed up to the time of termination. The Contractor shall promptly subrnit its termination claim to be paid by City. If the Contractor has any property in its possession belonging to the City,the Contractor shall account for and dispose of it in the manner the City directs. 9. TERMINATION FOR DEFAULT. If the Contractor fails to perform in the manner called for in this contract or if the Contractor fails to comply with any other provisions of this contract, the City may terminate this contract for default. Termination shall be effected by serving a notice of termination to the Contractor setting forth the manner in which the Contractor is in default. The Contractor shall be paid only the contract price for work performed according to the provisions of this contract. If it is later determined by the City that the Contractor had an excusable reason for not performing, such as a strike,fire, or flood, events which are not the fault of, or are beyond the control of the Contractor,the City may allow the Contractor to continue work, or treat the termination as a tenninarion for convenience. ��8 10. COMPLETE CONTRACT. This written contract, including all writings specifically incorporated by reference, shall constitute the complete contract between the parties. No oral contract, understanding, or representation not reduced to writing and specifically incorporated shall be of any force or effect, nor shall any such oral contract, understanding, or representation be binding upon the parties. 11. NOTICE. All written notices to the parties shall be sent by United States mail, postage prepaid by registered or certified mail addressed as follows: City: Public Works Director Contractor: Forsythe& Associates, Inc. City of San Luis Obispo 100 North Barranca Avenue 955 Morro Street Suite 110 San Luis Obispo, CA 93401 West Covina, CA 91791-1600 12. AUTHORITY TO EXECUTE CONTRACT. Both the City and the Contractor covenant that each individual executing this contract on behalf of each party is a person duly authorized and empowered to execute contracts for that party. IN WTTNESS WHEREOF, the parties have caused this instrument to be executed on the last date written below. FOR THE CITY: ATTESTED: Allen Settle, Mayor Bonnie Gawf, City Clerk date FOR THE CONTRACTOR: APPROVED AS TO FORM: Authorized Representative or ity ttorney date MEETINV AGENDA DATE XS 7ITEM # �S LA / ® LAW TRANSIT SERVICES , INC . 5717 NORTH SEPULVEDA BOULEVARD,VAN NUYS,CALIFORNIA 91411 • (818) 988-7000 • FAX(818)989-3147 April 14, 1997 IeCOUNCIL ❑ 00j Dila j 'eCAO ❑ FIN DIR The Honorable Kathy Smith 4 0 ACAO ❑ FRE CHIEF Councilmember VTTORNEY IJV DIR CLERK/ORIG ❑ POUCE CHF City of San Luis Obispo ❑ MGMTTEAM ❑ REC DIR 955 Morro Street ❑ 0 READ FILE ❑ UP•L DIR San Luis Obispo, CA 93401 '7_ 0 PERS Din Dear Councilmember Smith: Laidlaw Transit Services, Inc. (formerly Mayflower) the current provider of services to San Luis Obispo Transit, respectfully requests consideration in awarding a new 4 year contract. An award to Laidlaw allows for a continuance of quality transit services. The staff has recommended Forsythe and Associates. Although the 3 references listed by Forsythe meet the basic requirements of the RFP, you must combine 2 of them to equal the size of San Luis Obispo, and the other one isn't an operation but is a brokerage service. Additionally, all three references to our knowledge were for locations outside California. We believe these references fail to meet the spirit and expectations of your procurement. In the committee report to Council, you will find Laidlaw tied with Forsythe and Associates receiving a 50 out of 60 points. The only category Laidlaw rated below Forsythe was experience. We fail to understand how the incumbent could be rated lower than another company. Since we operate over 100 municipalities and public transit agencies across the country, our experience far exceeds the experience of our competitor. Our record over the past five years demonstrates a strong commitment, quality service, as required by the City of San Luis Obispo. We believe a company with $900 million in working capital should have received a higher financial condition rating than provided by the review committee. Included is a copy of our 1996 Annual Report and 6 month results published on April 10, 1997. We are concerned that the staff report submitted for your review and consideration indicates that the recommended bidder had an opportunity to revise their costs. During the request for proposal process and bidder's conference, it was made clear that there would be no best and final and this was not a negotiated procurement. As you can see from page five of the attached Q&A summary prepared by your staff, the question was asked if a best and final would be solicited and the answer was "no". The report clearly indicates that an opportunity was provided to Forsythe and Associates to reduce their costs thus allowing the recommendation to be based on a revised bid. A LAIDLAW TRANSIT, INC.COMPANY The Honorable Kathy Smith a April 14, 1997 Page 2 We believe the fact that Laidlaw is the lowest cost provider and has demonstrated a high quality commitment to service during the past 22 months since this Council approved a contract extension again justifies the award of the contract to Laidlaw Transit Services for another four year period. Laidlaw Transit Services is $32,538 lower than Forsythe and Associates compared to the revised bid and $121,860 less than Forsythe's original proposal. We believe the revised proposal violates the RFP review process and does not properly reflect all costs. The report proposes that the City purchase various equipment to support Forsythe's efforts to reduce costs. To our knowledge, no other bidder, including Laidlaw, was provided the opportunity to revise its bid. Again, Laidlaw believes that based on our past performance, the top ranked tied score, and our lower cost there is great justification for the City Council to reject the review committee's recommendation and support the award of a contract to Laidlaw as the lowest and most responsive bidder. In addition, this will provide an opportunity for the City of San Luis Obispo to continue to work with the San Luis Obispo County Regional Transit Authority to identify potential cost savings including consolidation of facilities and operations as well as continued sharing of the management personnel in order to further reduce the cost to the City of San Luis Obispo thus providing the highest level of transit services for the City's transit riders. As a representative of Laidlaw, I will be available at the City Council meeting to answer your questions and make a brief presentation urging your support for a contract with Laidlaw Transit Services. Most sincerely, LAIDLAW TRANSIT SERVICES,INC. Irwin G. Rosenberg, Vice President, Opera In Case of Transw�ssion Difficulties, Please Call 416-863-2101 Please Deliver To: Irwin Rosenberg Vice President, Operations - Southwest LPSC L A / S L A W LAICILAW INC. 3221 NORTH SERVICE ROAD.P.O.BOX302e.SU RLI NGTON.ONTARIO.CANADA L7R 3Y9 (116)336.1900 FAX(116)3363976 News release via Canada NewsWire, Toronto 416-863-9350 Attention Business/Financial Editors: LAIDLAW SECOND QUARTER INCOME FROM CONTINUING OPERATIONS UP 95% BURLINGTON, 'Unt. , April 10 /CNW/ - Laidlaw Inc. (NYSE:LDW.B) reported income from continuing operations before a restructuring charge for its second quarter ended February 28, 1997 increased 95% to $47.7 million or 15 cents per share from the $24.4 million or 8 cents reported for the same period in fiscal 1996. Net income for the quarter increased to $578.3 million or- $l.84 per share compared with $30.2 million or 10 cents per share for the same 1996 period. Included in net income are: - a restructuring charge of $21.7 million after tax -- 7 cents per share resulting from the merger of the company's healthcare transportation unit, MedTrans, with American Medical Response (AMR) acquired in February, which includes the reidentification of ' MedTrans' equipment to the AMR brand, severance costs and redundant real estate and other assets; - a previously announced gain an the December 30, 1996, sale of the company's solid waste operations of $549.7 million (net of tax) -- $1.75 per share, and - income from discontinued operations (solid waste) for December, 1996, of $2.6 millicn -- one cent per share compared with $5.8 million two cents per share -- for the full three-month period last year. The weighted average number of shares outstanding increased 7% to 314.2 million from 294.1 million outstanding during the quarter ended February 29, 1996. Consolidated revenue (excluding solid waste) increased 21% to $694.5 million from $575.8 million one Year ago, primarily a result of the acquisitions of Scott's Hospitality Inc. 's school bus business in early August 1996 and American Medical Response whose results are included for the month of February 1997. Transportation revenue, in total, increased 31% to $538.9 million from $412. 1 million, while revenue from hazardous waste operations declined 57 to $155.6 million from $163.7 primarily due to declines in volumes to the company's industrial waste landfill in Utah. (more) . r . -2- Consolidated opPerating margins, before the restructuring charge, strengthened to 9. 7% from 9. 6%. School busing and public transit margins increased to 10. 7% from the 10% reported last year due to the inclusion of Scott 's higher margin business and generally more favourable weather conditions during the winter offset somewhat by higher year-over-year fuel costs. Healthcare transportation margins were off slightly at 11.5% compared with 11. 6%.. While efforts to correct cost structures. in two underperforming markets continued during the quarter, they were somewhat overshadowed by the anna-uncement and anticipation of the integration of MedTrans with AMR. Group and local management structures have since been designed and put in place in all markets and should yield improved results as we begin to achieve full benefits of the integration. Hazardous waste margins declined to 5. 5% from 7. 3% reflecting operating losses of more than $5.0 million at the unit 's Clive incinerator in Utah. Six Months Results - For the six months ended February 28, 1997, income from continuing operations before a restructuring chargge increased 61% to $103. 6 million -- 33 cents per share from $64. 2 million -- 22 cents per sharer reported last year. Consolidated operating margins strengthened to 11. 2% from 11.0%. Net income increased to $647.2 million or $2.06 per share compared with $80.4 million or 28 cents per share. Net income includes $15. 6 million, or five cents per share, from discontinued solid waste operations included for four months, compared with a six-month contribution of $16. 2 million or six cents per share for last year. The weighted average number of shares outstanding increased 9% to 314. 1 million from 288.9 million for the comparable 1996 fiscal period. Consolidated revenue (excluding solid waste) rose 17% to $1.397 billion compared with the $1. 195 billion for the six months ended February 29, 1996. Laidlaw's president and CEO, James R. Bullock, said, The quarter's results are on track with the company's plan. Our current major undertakings -- the integration of the largest healthcare transportation company in the U.S. , American Medical Response, and the process leading to the sale of our hazardous waste operations to Rollins Environmental Services, Inc. are both progressing as expected. "Nine additional ambulance operations were acquired during the quarter. Since February 28, a further three have been purchased in the province of Ontario, positioning us to participate in any privatization of ambulance service in Canada's most populous province. We estimate these acquisitions, in total, will contribute approximately $55 million in annual revenue. The impact of the acquisition of Vancom Inc. on February 28, 1997, a Chicago area-based school bus company, operating 3, 500 vehicles, serving 150 school districts in eight states, will begin to show during the balance of the year. Vancom's annual revenue is .approximately $130 million. ' ' (more) ' -3- Laidlaw's board of directors has declared a quarterly dividend of $0.05 (Cdn) per Class A and Class B Common Share, and declared the regular quarterly 'i.vidend of $0.25 (Cdn) per Series G First Preferred share. All dividends are yable May 15, 1997, to shareholders registered at the close of business on may 1, 1997. Dividends are converted to U.S. dollars for payment to U. S. shareholrers. Laidlaw Inc. is a major provider of transportation and environmental services to municipalities and industries throughout the United States and Canada. Shares are also listed on the Toronto and Montreal stock exchanges. (All dollar amounts are in U. S. dollars unless otherwise noted. ) (more) -4- LAIDLAW INC. CONSOLIDATED STATEMENTS OF INCOME (U. S. $millions except per share amounts) (unaudited) Three Months Ended Six Months Ended ------------------ ---------------- February February February February 28 29 28 29 1997 1996 1997 1996 -------- -------- -------- -------- Revenue Passenger services $350.0 $293.0 $737.0 $614.8 Healthcare transportation services 188.9 119. 1 315.8 219.4 Hazardous waste services 155. 6 163. 7 344. 6 360.4 -------- -------- -------- -------- Total revenue 694. 5 575.8 1, 397.4 1,194. 6 -------- -------- -------- -------- Operating expenses 508. 3 427. 6 1, 01.2.4 881.8 Selling, general and administrative expenses 44.9 38.6 84. 8 75.7 Depreciation and amortization 73.7 54. 5 143. 6 105.6 Restructuring charge 35.0 - 35.0 - -------- -------- -------- -------- Income from operations 32.6 55:1 121.6 131.5 Interest expense (33.6) (29.9) (59.4) (61.0) Interest, dividend and other income 25.0 5.7 32.5 10.7 Equity in earnings of associated company 1. 5 - 1.5 - -------- -------- -------- -------- Income from continuing operations before income taxes 25.5 30.9 96. 2 81. 2 Income taxes (0.51 6.5 14. 3 17.0 -------- -------- -------- -------- Income from continuing operations 26.0 24.4 81. 9 64. 2 Income from discontinued operations 552.3 5. 8 565. 3 16. 2 -------- -------- -------- -------- Net income for the period $578.3 $30. 2 $647. 2 $80.4 -------- -------- -------- -------- -------- -------- -------- -------- Earnings per share Continuing operations - Before restructuring charge $0. 15 $0. 08 $0. 33 $0. 22 - Restructuring charge (0.07) - (0.07) - -------- -------- -------- -------- 0.08 0.08 0.26 0.22 Discontinued operations 1. 76 0.02 1. 80 0.06 -------- -------- -------- -------- Net income for the period $1. 84 $0. 10 $2.06 $0.28 -------- -------- -------- -------- -------- -------- -------- -------- (more) -5- Cash flow per share Continuing operations $0.43 $0. 28 $0. 85 $0. 62 Discontinued operations 0.04 0. 10 0. 16 0. 22 ------ -------- -------- -------- Total $0.47 $0.38 $1. 01 $0. 84 -------- -------- -------- -------- -------- -------- -------- -------- ADDITIONAL INFORMATION Income from operations (x ) Passenger services $37. 3 $29.3 $95.3 $74.4 Healthcare transportation services 21.7 13.8 36.4 25. 1 Hazardous waste services 8. 6 12.0 24. 9 32.0 -------- -------- -------- -------- Consolidated $67.6 $55.1 $156. 6 $131.5 -------- -------- -------- -------- -- -------- -------- -------- Operating margins (x ) Passenger services 10.7 % 10.0 % 12:9 % 12. 1 Healthcare transportation services 11.5 % 11. 6 % 11. 5 % 11.4 Hazardous waste services 5.5 % 7. 3 % 7. 2 % 8.9 Consolidated ,k 9.7 % 9. 6 % 11. 2 % 11.0 ( x1 before restructuring charge Details of revenue growth Three months ended February 28, 1997 -------------- ---------------------------------------------------- Price and Foreign Volume Acquisitions Divestitures Exchange Total ------ ------------ ------------ -------- ------ Passenger services 1.4 % 18. 1 % 10. 11 % 0. 1 % 19. 5 Healthcare transportation services 1. 2 % 58. 6 % (1. 2) % - % 58. 6 Hazardous waste services (6.0) % 1.0 % - % 0. 1 % (4. 9) Consolidated (0. 8) % 21. 6 % 10. 31 % 0. 1 % 20. 6 % Six months ended February 28, 1997 ---------------------------------------------------- Price and Foreign Volume Acquisitions Divestitures Exchange Total ------ ------------ ------------ -------- ------ Passenger services 2. 5 % 17.4 % - % - % 19. 9 % Healthcare transportation services 2. 0 % 43. 3 % (1.4) % - % 43. 9 Hazardous waste services (5. 7) % 1. 3 % - % - % (4.4) Consolidated 10. 11 % 17.4 % (0. 3) % - % 17.0 (more) -6- Three months ended Six months ended ------------------------ ------------------------ February 28 February 29 February 28 February 29 1997 1996 1997 1996 ----------- ----------- ----------- ----------- Tax Rate(x ) 21.0% 21.0% 21.0% 20. 9% February 28, 1997 August 31, 1996 ------------------------ --- ---------------------- Debt/Equity 0.82: 1 0. 90: 1 Discontinued Three Months Ended Six months ended Operations - ------------------------ ------------------------ (Solid Waste) February 28 February 29 February 28 February 29 $ millions 1997 1996 1997 1996 ----------- ----------- ----------- ----------- Revenue 62. 9 177. 6 266.0 367. 8 Income from operations 6.4 16. 3 31. 8 38..4 Operating margins 10. 2% 9. 2% 12.0% 10.4% ( x ) before restructuring charge %SEOAR: 00002717EB /For further information: T. A. G. Watson, Vice President, Communications, Laidlaw Inc. , 1-800-563-6072 ext. 309; Les Haworth, Senior Vice President and C. F. O. , Laidlaw Inc. , 1-800-563-6072 ext. 208/ (LOM. A. LDM. B. LOW. A LDW.B) - 30 - MAR 04 '97 10:47AM PUBLIC WKS UTILITIES P.5i6 ai.v Transit RFP Q&A Page 3 Q: Does the contractor have to furnish the telephone system? A: Yes. /1• M • • 1 for ach. .e.wld7 aw«.nw e 1��.• �ierlwonla �. What W 'elm Wll�t.-nil(- 3V• V»ch�I"2l"4WV. ••,W\ "V.V�V 1= V YY... pedor leu'for each vehicle? A: date of kst mileage since ,fleet model dlivebwin last drivetrain 8 ear nwnrc adorer overhaul overhaul 101. 1991 cn%v ce nm 53 GO 102 1984 Rvetre I new 50,000 128 1986 Giffig 1 1994 51,000 129 1986 1 GilUA 1 1993 1 49,0001 130 1982 Orion 1993 61,000 131 .1982 Orion 1993 79,000 132 1982 Orion 1993 66,000 136 1984 Orion 1994 36,000 137 1980 Fidble 1996 7,000 139 1980 Flxible 1996 4,000 140 1992 Gillig new 112.000 141 1992 Gilli new •116,000 142 1994 Orion new 106,000 143 1994 Orion new 104,000 144 1997 Giffig new 5,000 Q: Will there be any interviews with proposing&ms? A: No. Q: Will there be any"best and final offers" solicited? A: No. n: Subparagraph IV.W.3 refers to"subparagraph 1". Is this correct? n: i•v, ii 3rvr'.%&.rv4,.. ... sub »6.�.. . 7149,ir5054 ' 4IDLAW TRANSIT SERV / 222 PO2 RPR 14 197 14:04 1.1 SwItewhere J r. 1'010 County Transit Autharin- Cin•u%Uan•r.. ('in'a f Ii itr.Sucraxr,iun ('ilr a�l!'n4c•+'s 3_50 Industrial N•a�• <'i(r�jII i>rx/lu+rd • (iuorn r+/Yoh, Woodland, CA 95776 (916)661-0816 FAX:(916)661-1732 January 27, 1997 Mr. Bill Yates,President Laidlaw Transit Services, Inc. 5360 College Boulevard Overland Park, KS 66211 RE: Commendation Dear Mr. Yates: On behalf of the Yolo County Transit Authority, I want to take this opportunity to express my appreciation of the good work Laidlaw has performed relative to the start-up of our contract operations. That quality effort continues to be seen,day-in and day-out, and the employees involved with that transition should be commended. In the 23+years I've been in this business, I have never seen such professionalism, energy, and pride applied to a system start-up as I saw here. From dealing with personnel issues, to fleet preparation, to handling the transition from the previous contractor to Laidlaw in the middle of the construction of our facility, your employees have represented the best contracting arrangement one could possibly ask for. In particular, high praise is due to: Jon Monson(District Director of Operations) , Kevin Klika(Area lManager), Bill Hawk(Operations Manager),Jim Rude(Operations Specialist), George Bauer(District Director of Maintenance), Mike Brunyansky(Shop Manager), Vera Roberts(Trainer), Carol Olthoff (District Director of Training), Dennis Morgan (Trainer), Mike diFalco(MIS Specialist), Sharon Hearn f (Yuba City Division Manager), Traci Simmons(Administrative Assistant). I am especially impressed with Kevin Klika. He has answered every challenge brought before him with great competence and expertise. If there was a way to place him on our inventory list of fixed assets, I would do so without reservation. Again, thank you for the good start-up efforts and continuing great job. Sincerely, 474 TERRY• BAS$ETT Executive Director r 7149375054 LIDLAW TRANSIT SERV 2 Pe3 APR 14 '97 14:05 Yubalutter Transit January 10, 1997 Mr. Jon Monson Laidlaw Transit Services,Inc. 14570 Mono Way Suite H Sonora CA 95370 Dear Jon: On behalf of the Yuba-Sutter Transit Board of Directors and the citizens of Yuba and Sutter Cavrities, 1 would like to recognize and thank the men and women of the Marysville Division of Laidlaw Transit Services, Inc, for their superior performance during the recent flood crisis. Even while many of their own homes and families were at risk, numerous operating and maintenance staff quickly volunteered to help in the evacuation of the area—moving over 1;000 nursing home, convalescent hospital, group home and general public residents on New Year's Day alone. Without break, they then participated in the mandatory evacuations of Yuba City and Marysville on January 2nd and Linda and Olivehurst on January 3rd while also responding to calls far assistance in East Nicolaus and Meridian.• When the water receded, many of these same individuals again made themselves available to return evacuees to their homes and facilities on January 5th and 6th. Rapid tesettlement was made possible with the assistance of Yolo County . Transit drivers and buses from the Woodland Division of Laidlaw Transit Services. Then, after our local staff worked late into the night to prepare the fleet, Yuba-Sutter Transit returned to full operation on the morning of January 7th. This process. which continued twenty four hours a day for seven days, was conducted smoothly without significant incident or mechanical failure under extremely difficult conditions. 1 also want to recognize the individual contribution of your Marysville stag. Especially noteworthy were the individual contributions of Division Manager Sharon Hearne, Maintenance Manager Lewis Malotte, Operations Supervisor Linda Martinez and Trainer Art Leonard all of whom were either on duty or immediately available for-duty(often sleeping on-site) for the entire week. Also, Regional Manager Kevin Klicka was regularly in contact with me offering his assistance to our location as•needed. As an example, when we needed cellular telephones to augment our communications system, individuals from Laidlaw's Woodland Division volunteered their personal units which were then hand delivered to our office for use during the crisis- Finally, the real heroes of this effort were the committed and dedicated group of drivers who so unselfishly placed the interest of their neighbors above their own when their community needed them most. To them we owe a great deal of thanks for a job well donel 2100 5 Street - MarysvilIe. CA 95901 - (916) 634.6880 - FAX 6346888 7149375054 ' ^TDLAW TRANSIT SERV 222 PO4 FPR 14 '97 14:05, f i Mr. Jon Monson Laidlaw Transit Services,Inc. January 10, 1997 Page 2 While we would rather that disaster conditions never occur, it was certainly a pleasure worlang so Closely with such A group ofpro&ssionals. Once again, the Marysville Division has given you and your company a reason to be proud. Thanks for your continued support. Sincerely. XETIH E. MARTIN Transit Manager KEM:rm amteMCM SAM 1 'i. 7149375054 LAIDLAW TRANSIT SERV ''22 P05 APR 14 197 14:06 i Yuba-Sutter Transit Iuly 1. 1996 Ms. Sharon Hearne Laidlaw Transit Services 2100 B Street Marysville CA 95901 Dear Sharon: Now that we are beginning to settle into our new faality. I want to take a moment to formally recognize all of the hard work that you and your staff did before, during and after our recent move. The performance of our Laidlaw contract staff was a key factor in the smooth transition to our slew quarters and I want to express both my personal thanks as writ as the thanks of our Board ofDirectors for your leadership in that process. In addition to the move, the remodeling-of our new fauliry was made easier and more effective by Laidlaw's advice and counsel doting the design and construction process. I would like to specifically recognize Lewis Malotte for the enormous amount of assistance that he.has provided over the entire five year relocation experience. Lewis. in addttion to big regular Maintenance Manager duties, provided thoughtful and wen qualified input on the maintenance portions of the facility throughout the process helping us to evaluate alternative sites.facilities and functions from a maintenance perspective. In addition to the support of our local staff, the site visit by one of Laidlaw's corporate maintenance officials, Mr. John CahM was vary much appreciated and his comments were essential to the final design of our new factgity. Thanks again to all of Laidlaw. I am looking forward to workb* with you to develop our new Ik6lity to its full potential. Sincerely, KEITH E. MARTIN Transit Mamgcr KBM:rm CC: Ion Monson Lewis Malotte 2100 5 Street Marysville, CA 95901 (916) 634-6880 rAX 634.6388 06/95/95 ION 11:53 [Tx/R1 N0 35T21 SAN LUIS OBISPO REGIONAL TRANSIT L-LUTHORITY 1150 Osos Street,Suite 206,San Luis Obispo,California 93401 (805) 781-4362 FAx(805) 781-1291 Alan Cantrell April 15, 1997 Regional Transit Manager John Bates Transit Coordinator Tom Fulks Irwin Rosenberg, Vice President RideshareCoordmator LAIDLAW Transit Services I Dear Irwin: This letter is presented to you as a recommendation for LAIDLAW Transit Services. The San Luis Obispo Regional Transit Authority (SLORTA) contracted with LAIDLAW before I became the Regional Transit Manager for SLORTA in 1992. The original contract in 1992 was with Medi-Ride, Inc., and was incorporated into LAIDLAW two years ago. This is the second consecutive three ,. i year contract between the parties. 541-CCAT LAIDLAW has proven to be a capable and concerned provider of transit services. They operate both a regional fixed route bus system with a fleet of 13 full size heavy duty diesel buses and a 9 vehicle fleet of paratransit vans. They provide ®•"T full on-site management and operations personnel, including project Rideshatsng ! administration, fleet maintenance, drivers, dispatch and office personnel services. 541-CARS They staff a telephone information system and the paratransit scheduling software t for SLORTA. Due to their professional delivery of transit services for SLORTA, we have o�dR�. experienced 10% to 17% a year growth in ridership for the past several years on 541.2544 the fixed route bus system, Central Coast Area Transit. Mechanical breakdowns are few, and complaints of poor service are also very low (less than 1 a month). Website Buses are clean and well maintained, and drivers are often commended by w,u,W,.rideshare.arg passengers for their courtesy and helpfulness. When a problem is reported to LAIDLAW by SLORTA staff or customers, they work together with us to solve the e-mail problem and prevent its reoccurrence. ipslorta®slonet.org rideshare®rideshare.org The on-site Project Team of Jason, Project Manager; Dave, Maintenance Manager, and Julie, office manager, provide a high degree of technical and The San Luis Obispo Regional operational skill to manage the day to day operation of the fleet. The former Road Towns Agthoriryisajoint Power,Agency serving Supervisor, Billie Langford, was always available to solve problems, supervise residents and visitors of: transit services and serve on committees to plan for future events. Her Arroyo Grande Atasradero replacement, Jim Bradford, is rapidly responding to his new responsibilities. Grover Reach Mono Flay Paso Robles Pismo Beach San Luis Obispo County of San Luis Obispo As of February 1, 1997 Jason has assumed the duties of Project Manager for SLORTA and SLO Transit, as a trial period until June 30. During this trial period, SLORTA has not experienced a loss of administrative responsibilities or lack of response to our requests. Additionally, both SLORTA and SLO Transit have received a $1,000 per agency per month reduction in administrative costs. If it is more fully implemented, this shared project management concept can lead to other cost saving options such as shared maintenance manager, shared maintenance facility, shared dispatcher for fixed route, shared trainer and road supervisor and shared office support staff with additional cost savings per agency. Whenever a problem or situation is called to their attention, I have been satisfied with the ability of LAIDLAW to resolve the problem to our satisfaction — quickly, efficiently, and completely. The Project Manager, Jason Gillespie, has always taken a strong role in customer service, whether the customer is a passenger, potential passenger or the client (SLORTA). I attribute our satisfaction with LAIDLAW Transit Services to two main points: • a strong contract that details each agency's duties and responsibilities; and • a personable Project Manager who can lead the staff and work cooperatively with SLORTA staff to provide quality transit and paratransit services to the residents and visitors to San Luis Obispo County. Of course, backing up this on-site project team are the resources of the corporate agency whenever they are needed. I am pleased to recommend LAIDLAW Transit Services to any organization that seeks safety, quality, cost effectiveness and professionalism. Are they perfect? No, they're human. They strive to provide the highest level of transit services to the San Luis Obispo Regional Transit Authority. Sincerely, Alan Can rell Regional Transit Manager State of California DFp' RTNrOFINDU r..' DMSION OF LABOR STAND.� � �'77ONS PETE WILSON, ARDS ENFORCEMENTGovernor 411 E.Canon Perdido,Room 3 MEETING Santa Barbara,CA 93101 DATE y_, _ 7 AGENDA ! _ Phone: (805)568-1222 -7ITEM # Fax: (805)568-1569 April 8, 1997 Y 21couNci_- ,,,/ 13 .. (;L �„ Jason Gillespie I E CAO O FIN DIR -u „Laidlaw„ rait,Services, Inc CACAO O FIRE CHIEF y 9�P do Rd. e ATT6RNEY Q-I�W DIR San Luis --O.+bispo, CA. 93401 ^DA1a': .eouCE.CHF ,.,. ... geMGNlT,TEAAA O REC DIFl ❑ C EAD Fl LL” O UP.L DIR Dear Mr. Gillespie: rf O PCfiS pin This Division is responsible for the enforcement of provisions California.Labor Code and orders of the Industrial Welfare Commission.the s Order No. 9-90, rs is which we You 'Closing by the Industrial Welfare Commission $ for your review. We have recently received allegations that Sections 11 of this order. Specifically, it was alleged othaur t meal peirm r be in od areofr hon of not authorized or permitted to your transit bus drivers. � frequently Please note that each employee must receive a meal period of not less than one-half (1/2) hour, no later than five (5) hours into each work period. U employee is relieved of all duty during the meal period, it must be considered an "on-du P Unless the "on-duty" meal period and counted as hours worked. Please review your operation to be sure that you are in com li sections described above. Failure to comply constitutes p ance with the a misdemeanor. contact this office. If You have any questions on this or any other related matter, feel free to Very truly yours, Daniel M. Cornet DMC/dc Sr. Deputy Labor Commissioner Enclosure Nn�/ LZCOUNCIL ❑ I.IL..L„- VAO ❑ FIN DIR MEETING AGENDA dACAO ❑ FIRE CHIEF 1; DATE ITEM # rj(ATTORNEY 2"'PVY DIR LERK(ORIG ❑ POUCE CHF ^ G MGMTTEAM ❑ REC( to OAREADfILL ❑ UT!L D U �j Ct eC•y Q kn kr) + .� O Q c kn 7t U p U Qukn kn 7t u Qwx . . u cd � kr) m kn 110 > Cn kf) o b ct CO cd c� v� Qaw = N d CAIH r l >I O •cs wwIc MEETING DATE •ir-7 IE # i �c AGENDA ' Forsythe &Associates, Inc. April 16, 1997 _ COUNCIL ❑ Honorable Allen K Settle 1 VCAO ❑ FIN DIR Mayor !?/ACRO ❑ FIRE CHIEF City of San Luis Obis o VATTORNEY .e-�w DIR 955 Morro Street p CKC�ERwoRIG ❑ ?PUCE CHF ❑ MGMTTEAM ❑ REC DIR San Luis Obispo, California 93401 13 C READ FITC ❑ UT L DIR Dear Mayor Settle: '- Forsythe& Associates, Inc. is pleased that City staff has recommended our firm to operate SLO Transit for the City of San Luis Obispo. We look forward to an effective partnership between the City and our company. We would like to take this opportunity to address several issues raised by Laidlaw Transit in its April 14, 1997 letter to the City. Procurement Process This procurement of services is based on a Request for Proposals, not on a low bid. There was.no `Best and Final Offer"provided in this procurement process. And, in fact, our company has never been asked to submit any`Best and Final Offer"for this contract. Rather, City staff informed us that Forsythe& Associates, Inc had been selected by the Proposal Review Team as the preferred provider of transit service, based in large part on our sterling client references. Staff then asked us if there were any creative and innovative suggestions we could make to reduce the cost of our service. We responded by suggesting cost-cutting measures for which the savings would be passed on to the City, reducing our price by$89,322. This process of identifying the preferred contractor, based on established criteria, and then asking the selected contractor to reduce its cost is one cities often use in procuring professional services. If agreement cannot be reached with the preferred contractor regarding final cost, the cities then typically move to the second-rated proposer. Laidlaw's inference of impropriety is incorrect. We know of no prohibition in State law or Federal guidelines of asking the recommended contractor to reduce their price or assist in cost reductions that accrue to the city's benefit. We have seen similar tactics used by other incumbent contractors who have lost a contract and attempt to inflate insignificant and irrelevant issues into something that will divert attention away from the issues by which they lost the business. Laidlaw is surely a fine company and can offer good service. This RFP asked for innovation and excellent service. Your staff determined that Forsythe & Associates is better suited to offer these needed services to San Luis.Obispo. . 100 North Barranca Avenue, Suite 110 Telephone 818-967-4700 Facsimile 818-915-4770 West Covina.California 91791-1600 800-531-6482 Honorable Allen K. Settle April 16, 1997 Page 2 Your City staff has acted professionally and in a straightforward manner with all members of our firm. We had no opportunity, whatsoever—other than to submit the required proposal and references—to influence your staff regarding the selection of our firm as your transit operator. As stated in Laidlaw's letter,they have been your transit contractor for the past 22 months. They could have suggested the same methods of saving the City's scarce transit operating funds over these months which Forsythe& Associates, Inc. immediately suggested after being notified of our selection as the recommended company by your stag. The fact that they have not suggested these cost-saving measures, and that we have, is evidence of our innovation which your staff is actively seeking. Cost Difference The cost difference between our-proposed contract and:Laidlaw's price is $32,538 over four years on a total price of$4,333,369. This is only 7/10 of 1%, which is insignificant by any reasonable measurement. Our approach to service quality will turn this investment by the City into better quality service, increased mobility and improved quality of both the environment and the lifestyle of your constituents. You are asking for the most cost-effective service. You have not asked for the lowest bid without regard for the quality of service. We are prepared and capable to take a good transit system to the next step. Quality of Service Our firm is committed to provide the highest possible quality service for the residents of San Luis Obispo. We are a company completely dedicated to providing excellent transportation service. I have taken the liberty to enclose letters of reference from several of our clients. Laidlaw is incorrect in its assumption that you must combine two of our references to equal the size of San Luis Obispo. Each of our existing operating contracts is of a size equivalent to SLO Transit. As a company, we have established a reputation in all our business dealings of delivering more— more than we promise, and more than our competition can deliver. Innovation — Cuts in Federal Transit Funding _ Our innovative approach and proven management skills will help the City respond to future cuts in Federal transit funding. Our innovative methods include increasing sales through better service quality, through our community involvement (through membership and participation in service clubs, the Chamber of Commerce, Downtown San Luis Obispo and other organizations), through cleaner and sparkling buses and through enhanced professionalism of the coach operators. Honorable Allen K Settle April 16, 1997 Page 3 Each and every one of our references will attest to our ability to—and history of— delivering improved service at a lower overall net cost than our competitors. We do this through innovation, establishing the highest standards in the industry and increased revenues for our client. Value Added After being notified of your selection of Forsythe& Associates,.Inc. as your recommended contractor, we have offered: • our expertise in inspecting the newly ordered Gillig buses at the plant during manufacture, at no cost to the City • our transit planning and management experience and expertise to assist in addressing transit issues, at no cost to the City • our expertise and experience in helping to successfully obtaining more than our clients' fair shares of Federal transit discretionary funds, at no cost to the City. In every contract of our company's 13-year history, we have saved our client more money than any price differential of our contract: • Transit service in Scottsdale has significantly increased under our operation in the past year • Transit service for the Regional Public Transit Authority has tripled in 10 months • Paratransit service cost for the City of Monrovia was cut by 1/4, while service quantity and quality were increased under odr management • We saved $5 million on a$15 million transportation budget for World Cup Soccer • We operated higher quality service at over 20% less cost than the previous year's tournament transportation for the NCAA Women's Final Four Basketball Championships There are many more examples of our cost-effectiveness on behalf of each and every one of our clients, and we would be happy to provide additional documentation if you desire. Competition In our work with world-class major events, it has become evident to us that no gold medal has ever been won without competition. We are fully prepared to compare our service for SLO Transit over the coming year to Laidlaw's service for SLORTA. We believe that this competition will be healthy for San Luis Obispo County, will cause both Forsythe and Laidlaw to sharpen our pencils again for the SLORTA contract competition and will result in better quality transit service for the Central Coast at a lower overall cost. Honorable Allen K. Settle April 16, 1997 , Page 4, Company Size and Strength - We acknowledge that Laidlaw is much larger than Forsythe& Associates, Inc. That fact is reflected in the rating of the Financial Condition Score in your staff report. Our financial condition is sound, as evidenced by the confidential and proprietary financial statements which were included in our proposal. Although we are much smaller than Laidlaw, we believe that our smaller size works to the advantage of San Luis Obispo. This contract does not require 7/10 of 1% of Laidlaw's stated$900 million in working capital. We can be more responsive to your needs, can respond faster with the highest corporate management attention to.San Luis Obispo issues and will devote more attention at the highest corporate level to this contract than Laidlaw's senior management can afford. We are not distracted by the urgent matters of Healthcare b'ansportatiorr services and Hazardous waste services which Laidlaw shows in its letter to you generated over $660 million of its $1.4 billionnoof its revenue in only the first half of this fiscal year. This contract is much more significant and important to a focused company of our size than it could possibly be to a Goliath-sized, Canadian-based company like Laidlaw. We are a small business, owned by a native american who lives in California. Yet we have fiduciary and management responsibility for more than $100 million of annual business on behalf of our clients. We have an international reputation for delivering world-class service while also saving our clients money. We provide references ranging from the presidents and senior executives of two major television sports networks and the president emeritus of the United States Olympic Committee to mayors and key staff of towns and cities throughout several States. Company Standards We understand that the City is particular in its selection of a transit operating company. We are likewise selective in the contracts we pursue. We only offer transit operations proposals to leaders of cities like San Luis Obispo who desire to improve transit service and are not solely interested in the lowest price. Our references testify to our effectiveness in providing effective transit.-solutions for those.cities.: We are the "Nordstrom" of our industry—always delivering higher quality service and•excellence than promised. If you examine the communities in which we operate and manage transit services, you will find an interesting similarity with San Luis Obispo. We have become ingrained into the fabric of communities that value individualized businesses with character and charm. Tempe, Arizona is a college town with a vibrant downtown village. Scottsdale, Arizona is an upscale art community with a unique downtown, southwestern ietail center. Honorable Allen K. Settle April 16, 1997 Page 5 Monrovia, California has a downtown village atmosphere That caters to distinctive businesses and restaurants. Indianapolis, Indiana has a thriving downtown retail environment and has cultivated unique pockets of village atmosphere like Broad Ripple and Keystone-at-the-Crossing. Forsythe& Associates, Inc..contributes to the quality of life of communities like San Luis Obispo—whose residents and leaders not only understand, but cultivate and embrace the benefits of providing a higher quality of life than just mega-malls and big box retail developments. ' Commitment I have committed to you, and repeat that commitment here as President& CEO of Forsythe& Associates, Inc., that our company will deliver on each and every commitment we make to the City of San Luis Obispo. As the owner of this California-based Corporation, I pledge to devote whatever resources and management attention is required to fulfill our contract with you at the highest levels of excellence and innovation possible. Just as you have seen me, along with senior executives of our firm, present at your late- night City Council meeting and at City offices, you will see me here to ensure that we are living up to your expectations. Summary We contend that there has been no irregularity in the procurement process for this contract. We are eager to demonstrate our ability to fulfill these commitments to the City of San Luis Obispo. If you are to effect a change in contractors by the date specified, a d cisi6h is necessary at"l this time. We urge you to endorse and adopt the staff recommendation to award the contract to Forsythe& Associates, Inc. Very Truly Yours, A William P. Forsythe President & CEO Enclosures A-24-1995 d:OAAM FRfM FORSYTI-_scp7- S[)ALE 90979.1 P. 2 JVI a April 16, 1997 Regional Public Mr. Mark Foster, Vice President Transportation Authority Forsythe and Associates, Inc. - 100 North Barran Avenue Suite 110 West Covina. California 91791 Ref: Operating Contracts with RPTA, Phoenix, Arizorn i Dear Mr. Foster The Regional Public Transportation Authority, Phoenix,.krizona, contracts with Forsythe and Associates, Inc., to provide regional Vallei Metro local bus service on route 81 in .3cottsdale, Tempe and Chandler, Arizona. This letter attests to the performance of your company as it pertain i to that service. RPTA is pleased with company performance overall. SI ecifically, local management staff and regional managers have provide I professional transit service operations that has met and in many cases exot eded RPTA expectations. Our pemeption of efforts indicates that cc mmitments to passenger services and safety are taken seriously and 1 iat every effort is made to provide the right combination of efficient and reliable-ransportation services. It should be noted that service your company provides if.done with a variety of agency provided equipment, from older Orion I diesel-pi wered thirty foot vehicles to new EI-Dorado National RE CNG-powered ti Dirty-two foot buses. Your success in managing those fleet resource: in our"special'climate requires a measure of extra dedication. Finally, RPTA appreciates your company support and p:uticipation in the many business and transit related organizations along with the active leadership role taken with the Arizona Transit Association which require s both time and monetary support. In just a short time, Forsythe and Associates, Inc., has r lade a positive impact on transit service in the region for Valley Metro. Sincerely Jim tckey Director of Operations 302 N.First Avenue A Sulre 700 A Phoenix,AZ 65003 A 602/262.7242♦FAX 60?/495-2002 A TDO 602/495-0936 yam raoao w a et:k+auT cv=c ,qae =of ow Rcriontl Vuw9:Trommmon o m,an& . -- "' 1-UHSYTHE.8 ASSOCIATES, INC AIAQ1ci4770 P•03 • ; 8189154770 P.02 em*1 JUNE 21 1996 MR. RQN BECK SCOTTSDALE TRANSIT FAX* 994-7971 MR. BECK IT' S SEEN QUITE SOME TIME SINCE I+ COMMENTS ON THE BUSES; $US SERVICE- ; VE TAK$N THE TIME TO MAKE ANY COMPANY AND ROUTE, :I THOUGHT THSr0A9E/OR Ag GQODErIRSTIM€IAS EVER. THE NEW BUSES ARE N WONDERFUL, CHANGE FROM WHAT WE HAD LAST YEAR, I ESPECIALLY LIKE THE NEW BLUEBIRDS. THE A/C, SD FAR, SEEMS TO 9E WORKING WEL.L., SO I GUESS WE' LL HAVE TO RETIRE THE "MOBILE 4TEAIM$ATH'U NAME OF THE PAST. �1 AS FOR THE NEW *81 SERVICE, MILL Be VERY CONVENIENT, AS A REGULAR PASSENGER I THINK IT ORE FREQUENT INTERVALS. IT SEEMS THAT THERE ARE MORE BUSES AT THIS PLEASES ME AS IT SHOULD OTHERS. DRIVERS THE I' VE IHAD VERTHE— I DONUT KNOW YOU' RE DOING HE PLEASURE 4F RIDING IT BUT THE NG WITH SINCE IT TOOK OVER ARE ABSOLUTELY THE CREAM OF THE CROP. EITHER FORSYTHE IS GIVING THEM SOME REALLY SPECIAL TRAINING OR WE' VE JUST HAD AN INFLUX OF FEMALE ' ORIENTED PEOPLE MOVE INTO THE VALLEY ANDFORSYTHE HIRED MANY; THEM. IT TAKES A SPECIAL KIND OF PERSON TO WORK WITH THE PUBLIC FOR SO MANY HOURS PER.,DAY_.AND,„�,I,,..�1iECENTLY ��RIDTNG WITFt THREE DRIVERSTHAT � I FEELHpgRgREAYVERY MELLURE EXCEPTIONAL.. I' M SORRY THAT I DON' T KNOW THE YET. I HOPE THAT THERE IS SOME WAy IR FULL NAMES AS WHO THEY ARE. THEY ARE ALL DRIVERS HOWEVR, THAT YOU WILL KNOW ON E OUT OF L. A. MALL. WALTER AND ALSO JOHN, THEY' VE HAD THE MORNING ROUTE NORTHBOUND ALSO I RODE WITH MARGIE ONE NIGHT LAST WEEK SOUTHBOUND TO THE MALL AND AGAIN THIS MORNING NORTHBOUND AT 8:00 (SCHEDULED TIME AT HAYDEN * MC DOWELL NORTH). WALTER, JOHN AND MARGIE ARE EXCELLENT, HAV£ DISPLAYED PROFESSIONAL AND CONSIDERATE FATTITUDES. TOWARD raLL ALL THREE � PASSENGERS (EVEN THE IRRATE ONES WHO NEVER SEEM TO LAVE THEIR HOMES EARLY ENOUGH TO ARRIVE AT THEIR DESTINATIONS ON TIME, AND SUBSEQUENTLY BLAME: THE DRIVERS). I HOPE THAT WE CAN MANEGE AND KEEP DRIVERS OF THE QUALITY. THANK YOU RON, AND MY THANKS TO FORSYTHE FOR MAKING PUBLIC TRANSPORTATION PLEASURABLE FOR THE PUBLIC. Sco .VLETTSD •"Most Livable City'U.S.Confcrence of Mayors May 13, 1996 TO WHOM IT MAY CONCERN: Forsythe & Associates, Inc., has operated the Scottsdale Connection fixed route bus system since April 1, 1996. Overall, we have been impressed with Forsythe's ability and commitment to assemble a top quality performance team and put a high quality of service on the road. Scottsdale Connection riders immediately noticed a dramatic service improvement on Forsythe's first day of service. The vehicles were clean and new, the operators were very impressive in their uniform of dark blue slacks, white shirt and black tie, and, the riders appreciated the long stemmed carnations that each passenger received as they stepped onto the bus during the first week of service. While there have been some minor operational challenges, we do not consider them in any way indicative of a poor start up. In fact, Forsythe has used these to demonstrate their responsiveness and positive attitude regarding problem solving and a commitment to provide a high quality service. The City of Scottsdale has worked closely with Forsythe & Associates since January of this year in order to prepare for the beginning of service. The coordination skill and attention to detail exhibited by Forsythe's start-up team gave us a sense of confidence. The entire Forsythe organization has shown a commitment to providing quality transit service to Scottsdale Connection riders. We are looking forward to a long and successful relationship. Please call me at (602) 994-7656 if you need any further information. Sincerely, Ronald S. Beck Transit Coordinator - NtransiUrbedsta=p.dorJhf CrrY OF SCOTIMALE•7447 E.INDGN SCHOOL ROAD•SCOTTSDALE,ARM rA 85751 MEETING AGENDA DATE �=ITEM # C MEMORANDUM April 16, 1997 !,P�1/CAO ❑ FIN DIR tJ ACAO ❑ FIRE CHIEF @"'ATTORNEY GrOW DIR I2(CLERK/ORIG ❑ POLICE CHF TO: City Council ❑ MGMT TEAM ❑ REC DIR IOCR D FIG ❑ UTIL DIR VIA: John Dunn O pE js DILI � r FROM: Proposal Review Team: Mike McCluskey R C E I V EZD Al Cablay David Elliott AFtI 7 45Y/ Reinie Jones H Watson CITY CLERK Harry SAN LUIS GBISr'O,CA SUBJECT: Responses to Assertions by Laidlaw Transit Services regarding Procurement of Transit Services under SpecificationNo.9733 In a letter dated April 14, 1997 Laidlaw Transit Services made assertions about the procurement for transit services under Specification No. 9733. This memorandum responds to those assertions in order to clarify or correct their content. Assertion: Forsythe's references were for relatively small operations outside California. One of the references mentioned was for a"brokerage service". Response: Forsythe submitted the requested number ofreferences and included one reference within California. The size of operations was not as important as the quality ofservice delivered. The review team was concerned that at least one reference come from California because of unique state legislation and state financing for transit. Also, "brokerage service" means simply that Forsythe oversees contractors to deliver service under some of its contracts. There is absolutely nothing unsuitable about this arrangement. In fact, the request for proposals anticipated the possibility of using subcontractors for the specified work although no firms opted for that kind of delivery. Assertion: Laidlaw operates transit service in over 100 locations. That experience far exceeds the experience of Forsythe. Response: The request for proposals clearly stated that the evaluation of experience would be based on consultation with submitted references. The review team was less concerned with the gross number of contracts or the total length of service, and far more concerned with the quality ofservice delivered for current clients. Assertion: Because Laidlaw has $900 million in working capital it should have received a higher financial condition rating. Response: The amount of working capital was only one of four major indicators used to determine financial condition. Other measures included current ratio, quick ratio, and ratio of liabilities to owners equity. Laidlaw scored very well on all of these indicators, but one of the other proposing f rms (McDonald Transit Associates) scored even better. Consequently, Laidlaw ranked second on f nancial condition. Assertion: After stating in a question-and-answer summary that it would not be soliciting"best and final offers", the City provided Forsythe an opportunity to reduce its prices"thus allowing the recommendation to be based on a revised bid". Response: Throughout it letter Laidlaw referred to "bidder", "recommended bidder", "bidder's conference", "revised bid", and "lowest and most responsible bidder", implying that this procurement was an invitation to bid. That implication was misleading and incorrect. This procurement was indisputably a request for proposals which allowed the City wide- ranging flexibility in selecting a contractor and negotiating terms. Laidlaw also characterized Forsythe's price modifications as a "best and final offer". That was also incorrect. Typically, best and f nal offers are solicited from proposing f rms be ore a f rm is recommended and selected. In this case, the review team had already determined that Forsythe was the preferred company and would have recommended Forsythe even without any price modifications. But, as mentioned in the agenda report, the team was concerned that service might have to be reduced in the first year,particularly if startup costs had to be paid at the start of the contract. For that reason, the team worked with Forsythe to modify prices and spread startup costs over the entire four year contract term. The purpose of the price modifications was not to skew the evaluation in Forsythe's favor. The review team had already determined that Forsythe was the preferred company. Assertion: Awarding a contract to Laidlaw"will provide an opportunity for the City of San Luis Obispo to continue to work with the San Luis Obispo Regional Transit Authority to identify potential cost savings including consolidation of facilities and operations . . . ." Response: Laidlaw has been the common contractor for SLO Transit and SLORTA for the last three years, and recent consolidation efforts have yielded mixed results. In particular, sharing the site manager position over the last few months has resulted in less responsiveness and only a fraction of the savings that Laidlaw could reasonably have shared. Besides, the existing SLORTA contract expires in 1998, and there is no guarantee that Laidlaw will be the next contractor there. If Forsythe gets the SLO Transit now, it could well become the common contractor next year. Even without a common contractor, though, there would still be several consolidation and cost saving options available. Attachment: April 14, 1997 letter from Laidlaw Transit Services MEETIy AGENDA DATE ITEM # LA ® ® LA W v TRANSIT SERVICES , INC . 5717 NORTH SEPULVEDA BOULEVARD.VAN NUYS.CALIFORNIA 91411 (BIB)988.7000 • FAX isle)909.3147 April 14, 1997 - IKCOUNCIL ❑ CUJ-Ul eCAO ❑ FIN DIR The Honorable Kathy Smith er`AcAo ❑ FRE CHIEF �TTORNEY Ca'P'JV DIR 1 Councilmember J CLERKORIG ❑ POLICE CHF., City of San Luis Obispo ❑ MGMTTEAAI ❑ REC DIR 955 Morro Street ❑ CRE D FILL• ❑ UT.L DIR San Luis Obispo, CA 93401 ❑ PERS om Dear Councilmember Smith: Laidlaw Transit Services, Inc. (formerly Mayflower) the current provider of services to San Luis Obispo Transit, respectfully requests consideration in awarding a new 4 year contract. An award to Laidlaw allows for a continuance of quality transit services. The staff has recommended Forsythe and Associates. Although the 3 references listed by Forsythe meet the basic requirements of the RFP, you must combine 2 of them to equal the size of San Luis Obispo, and the other one isn't an operation but is a brokerage service. Additionally, all three references to our knowledge were for locations outside California. We believe these references fail to meet the spirit and expectations of your procurement. In the committee report to Council, you will find Laidlaw tied with Forsythe and Associates receiving a 50 out of 60 points. The only category Laidlaw rated below Forsythe was experience. We fail to understand how the incumbent could be rated lower than another company. Since we operate over 100 municipalities and public transit agencies across the country, our experience far exceeds the experience of our competitor. Our record over.the past five years demonstrates a strong commitment, quality service, as required by the City of San Luis Obispo. We believe a company with 5900 million in working capital should have received a higher financial condition rating than provided by the review committee. Included is a copy of our 1996 Annual Report and 6 month results published on April 10, 1997. We are concerned that the staff report submitted for your review and consideration indicates that the recommended bidder had an opportunity to revise their costs. During the request for proposal process and bidder's conference, it was made clear that there would be.no best and final and this was not a negotiated procurement. As you can see from page five of the attached Q&A summary prepared by your staff, the question was asked if a best and final would be solicited and the answer was "no". The report clearly indicates that an opportunity was provided to Forsythe and Associates to reduce their costs thus allowing the recommendation to be based on a revised bid. A LAIDLAW TRANSIT.INC.COMPANY The Honorable Kathy Smith April 14, 1997 Page 2 We believe the fact that Laidlaw is the lowest cost provider and has demonstrated a high quality commitment to service during the past 22 months since this Council approved a contract extension again justifies the award of the contract to Laidlaw Transit Services for another four year period. Laidlaw Transit Services is $32,538 lower than Forsythe and Associates compared to the revised bid and $121,860 less than Forsythe's original proposal. We believe the revised proposal violates the RFP review process and does not properly reflect all costs. The report proposes that the City purchase various equipment to support Forsythe's efforts to reduce costs. To our knowledge, no other bidder, including Laidlaw, was provided the opportunity to revise its Again, Laidlaw believes that based on our past performance, the top ranked tied score, and our lower cost there is great justification for the City Council to reject the review committee's recommendation and support the award of a contract to Laidlaw as the lowest and most responsive bidder. In addition, this will provide an opportunity for the City of San Luis Obispo to continue to work with the San Luis Obispo County Regional Transit Authority to identify potential cost savings including consolidation of facilities and operations as well as continued sharing of the management personnel in order to further reduce the cost to the City of San Luis Obispo thus providing the highest level of transit services for the City's transit riders. As a representative of Laidlaw, I will be available at the City Council meeting to answer your questions and make a brief presentation urging your support for a contract with Laidlaw Transit Services. Most sincerely, LAIDLAW TRANSIT SERVICES, INC. Irwin G. Rosenberg, Vice President, Opera ATE MEETING AGENDA yAGENDA � C. ITEM # ,.;� MEMORANDUM April 17, 1997' TO: City.Council FROM: RFP Evaluation Team SUBJECT: Replacement reference/Experience Spreadsheet Attached is a replacement for a previous spreadsheet distributed that had a number transposed. Sony for any inconvenience that may have caused. 1 fi"COUNCIL� ❑ UJ Gil- C"CAO ❑ FIN DIR :f CAO ❑ FIRE CHIEF �i !3 ATTORNEY P-4 DIR AV K 1 I%%• ErCLERKIORIG ❑ POLICE CHF ❑ MGNIT TEW ❑ REC DIR CRY CLERK ❑ C FILE ❑ UTIL DIR ' SAN LUIS OBISPO,CA . 0 PEAS D!R k 1 . 2 ' z U .. > Cd 0 _ U ■ \ g = a � r r n M tzcr � . � Q . u Q . 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