HomeMy WebLinkAbout02/16/1988, 4 - AWARDING THE FURNISHINGS CONTRACT FOR 955 MORRO REMODELING PROJECT IIII MEETING DATE
41101I11111 city of San lU OBISpo February16
ITEM NUMBER
oft COUNCIL AGE OA REPORT
FROM: David F. Romero [%/ Prepared by: Dave Elliott
Public Works Director Administra ve al st
SUBJECT:
Awarding the furnishings contract for 955 Morro Remodeling
Project
CAO RECOMMENDATION:
Adopt the resolution awarding the furnishings contract to L A
Interior Systems
BACKGROUND:
(Attached is a document called "Questions and Answers About the 955
Morro Remodeling Project" . Originally prepared last fall and
recently updated, it provides a good overview of the project,
including a discussion of systems furniture and its advantages. )
On December 1, 1987 the city clerk opened the following bids on the
furnishings contract for the 955 Morro Remodeling project:
Group A Group B
Furnishings Furnishings Total
The Office Mart $104,424. 84 no bid $104 , 424 .84
(bid based on Steelcase
Movable Walls (*)
systems furniture)
L A Interior Systems $116,783 .00 $ 9, 552 .47 $126, 335.47
(bid based on Haworth
Unigroup systems furniture)
The Office Mart $118, 696. 68 no bid $118, 696. 68
(bid based on Steelcase
Series 9000 systems
furniture)
(*) an unqualified line of systems furniture
After carefully evaluating the low bid from The Office Mart, staff
and the City's interior designers recommended rejecting the low bid
because it was not completely responsive to the City's
specifications. Staff then recommended awarding the contract to
L A Interior Systems, the second low bidder.
The council considered awarding this contract at its meetings on
January 19 and February 2, 1988. On both occasions the council
felt it needed more information before awarding the contract.
Particularly, the council asked two questions:
1) What makes the Unigroup line (bid by L A Interior Systems) more
responsive and desirable than the Movable Walls line (bid by
The Office Mart) ?
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COUNCIL AGENDA REPORT
Furnishings Contract - 955 Morro
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2) Are the features of the Unigroup line worth $12 , 000 more than
the Movable Walls line?
UNIGROUP VS. MOVABLE WALLS
To answer question 1: The Unigroup line is more responsive and
desirable because it meets the City's explicit and implicit
specifications. The Movable Walls line does not.
The City's explicit specifications are the detailed performance
standards listed in the procurement documents. For example,
Section IV.D.6 on page 13 of the procurement documents states:
"Each panel shall include a raceway that can accommodate the
equivalent of at least five 25-pair data/telecom cables. "
The City's implicit specifications lie in Section IV.B. 1 on page 10
of the procurement documents which states:
"The City has qualified five lines of systems furniture which will
meet the City's needs as shown on the plans and will meet the
City's standards for durability, flexibility, variety, and value.
The City will accept bids on only the following manufacturers and
lines of systems furniture:
a. Haworth - Unigroup
b. Herman Miller - Action Office Encore
c. Steelcase - 9000 Series
d. Sunarhauserman - Design Option/Cameron
e. Westinghouse - Wes-Group"
These five lines are commonly referred to in the interior design
profession as "Grade All systems furniture lines. Because they
share a high level of design innovation, material quality and
manufacturer reliability, they are cost effective choices for the
long term.
Other lines with an inferior level of innovation, quality and
reliability are referred to "Grade B" system furniture lines.
The Movable Walls line seems to fall somewhere between the
"Grade All and "Grade B" lines -- maybe as a "Grade B+11 line. It
offers the durability and value of the "Grade All lines but lacks
their flexibility and variety. Because of the City's constantly
changing office environment, the procurement documents contain
explicit and implicit specifications to ensure a level of
flexibility and variety common among the "Grade All lines.
Following is a point by point discussion of where the Movable Walls
line fails to meet these specifications.
city Of San tu,., OBISp0
Nii% COUNCIL AGENDA REPORT
Furnishings Contract - 955 Morro
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1) The Movable Walls pedestals (the boxes suspended under
worksurfaces which contain drawers) , worksurface supports and
paper management components are righthanded and lefthanded.
When offices are rearranged these components mounted on the
righthand side of a worksurface or workstation cannot be
switched to the left side. This feature limits flexibility and
directly contradicts Section IV.J.2 of the procurement
documents which states:
"Drawers shall be generally interchangable from the righthand
to the lefthand side of a workstation. "
The Unigroup pedestals, worksurface supports and paper
management components can be freely switched from one side to
another.
2) The Unigroup pedestals are formed by stacking individual drawer
modules which can be disassembled and reconfigured to meet
different needs. Although this feature is not explicitly
specified in the procurement documents, it is typical of the
flexibility implied in qualifying the "Grade All lines. The
Movable Walls pedestals are single rigid units which cannot be
changed.
3) Systems furniture panels are linked and aligned with connecting
devices. The Unigroup line uses a single, continuous universal
hinge which can link panels of different heights and can link
panels at almost any angle. Again, this feature- is not
explicitly specified, but it provides a level of convenience
and flexibility common among the "Grade All lines. The Movable
Walls line uses several different bracket combinations for
different applications. With Movable Walls if a particular
bracket were not available in the City's parts inventory, an
office reconfiguration would be delayed. Also, the Movable
Walls brackets are rigid and do not allow minor changes in
angle sometimes necessary to clear a column, post or other
obstruction.
4) Often an office rearrangement becomes more practical when one
panel can be linked to the middle area of a second panel. This
procedure is called "T-mounting". Because the Movable Walls
panels are not designed for T-mounting, it cannot be done
without permanently damaging the panel surface. The Unigroup
panels are designed for T-mounting without risk of damage.
5) The computers and communications equipment in City offices
require protected electrical circuits which are dedicated for
those uses. The Movable Walls line can provide dedicated
circuits but switching circuits is cumbersome and requires a
new receptacle. Maintaining and purchasing receptacles create
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COUNCIL AGENDA REPORT
Furnishings Contract - 955 Morro
page 4
an inventory problem, particularly because receptacles must be
ordered in cartons of six. The circuits in the Unigroup line
are programmable through a switch next to the receptacle.
Changing the Unigroup circuits requires simply sliding the
switch to the correct circuit number.
6) The Movable Walls panels have certain load restraints which
limit the size and weight of components suspended from them.
Also, under certain conditions loads on one side of a panel
must be balanced with loads on the opposite side. Obviously
these conditions limit the possibilities for future office
rearrangment. The Unigroup panels do not have such restrictive
load restraints.
7) High-quality systems furniture can provide the best combination
of openness and privacy while reducing noise distractions with
acoustically absorptive materials. Because noise causes the
ctreatest disruption to productivity, the procurement documents
specify that tall panels be acoustical panels. Further,
Section IV.C. 6 of the procurement documents states:
"Acoustical panels shall be certified to meet or exceed a noise
reduction coefficient of .75. "
The optional acoustical panels in the Movable Walls line have a
noise reduction coefficient of .65, substantially below the
minimum specified. In the Unigroup line, acoustical panels are
standard and have a noise reduction coefficient of .80,
comfortably above the minimum specified.
Another acoustical rating not specified in the procurement
documents is the sound transmission class (STC) . The Movable
Walls acoustical panels have an STC of .20, developing the bare
minimum sound transmission loss which contributes to speech
privacy. The Unigroup panels have an STC of . 29.
VALUE OF THE FEATURES IN THE UNIGROUP LINE
To answer question 2: The features of the Unigroup line are worth
more than $12, 000.
Would the City actually save $12, 000 cash on future systems
furniture orders if the contract were awarded to L A Interior
Systems? Maybe, maybe not -- it depends on the size and
composition of the orders. But that is really the wrong question
to ask here.
The right question is: Will the features of the Unigroup line
result in $12,000 worth of additional productivity?
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COUNCIL AGENDA REPORT
Furnishings Contract - 955 Morro
page 5
The question and answer document attached to this report
illustrates the tremendous productivity leverage gained by using
systems furniture. If the City realizes just average gains in
productivity by using systems furniture at 955 Morro Street, the
investment in systems furniture will be recovered in only 13
months.
The point here is that even small investments in additional
features and higher performance can return huge dividends in
productivity over a very short time. That is why staff and the
City's interior designers specified the features provided by the
"Grade A" systems furniture lines. But the additional features and
performance provided by the "Grade All lines, including Unigroup,
aren't small -- they're substantial.
WARRANTY AND SERVICE
The representative from The Office Mart emphasized the following
points:
1) The Movable Walls line has a 10-year warranty while other lines
have only 1-year warranties.
2) The Office Mart is a local firm with local service.
First, the Movable Walls line does have a 10-year warranty for some
fixed components, but there is a 5-year warranty for -operating
components (drawers, doors, locks, keyboard pads, etc. ) and
electrical components, and there is a shorter warranty for chairs,
panel fabrics and casters. Also, as of the time this report was
prepared, officials at Steelcase's Michigan headquarters could not
confirm whether the warranty on Movable Walls includes parts only
or includes parts and labor. If it pays for parts only, the
customer must pay for any labor and ancillary costs to remove and
replace defective parts.
The Unigroup line has a general 5-year warranty on all parts and a
shorter warranty for chairs, panel fabrics and casters. This
warranty pays for parts and labor.
Second, The Office Mart is a Santa Barbara firm with a small branch
office in San Luis Obispo to serve office supplies customers. Any
systems furniture service would probably be dispatched from Santa
Barbara, not San Luis Obispo. On the other hand, L A Interior
Systems will have a full-service office and warehouse in Camarillo,
from where its systems furniture service would be dispatched. In
any case, rapid response time here is not as important as it would
be for computers, copiers, blueprint machines and other office
equipment.
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COUNCIL AGENDA REPORT
Furnishings Contract - 955 Morro
page 6
SUMMARY
The City needs the durability, flexibility, variety, and value
inherent in the "Grade All systems furniture lines. Buying those
qualities now makes the best economic sense over the long term.
Steelcase has a well-deserved reputation for manufacturing
high-quality furniture products. The Steelcase Series 9000 line of
"Grade An systems furniture sets a high standard in the industry,
and in fact, the City's plans and specifications were based on
Series 9000 features.
Steelcase's Movable Walls line, though, was an obsolete and
neglected product recently revived and upgraded to provide a
low-cost alternative to the Series 9000 line. Its dated design has
precluded incorporating many of the modern innovations which help
systems furniture boost productivity and adapt to constantly
changing office arrangements. While it might be cheaper than the
"Grade A" lines to buy, it might be more expensive to own over the
long term.
Haworth's Unigroup line is a solid, well-conceived, well-designed
product. It is durable and particularly well fits the City's needs
for flexibility, convenience and variety.
CONSEQUENCE OF NOT TAKING THE RECOMMENDED ACTION
If the council decides not to award the contract to L A Interior
Systems (to install the Haworth Unigroup systems furniture) , it can
take two alternative actions:
1) Award the contract to The Office Mart (to install the Steelcase
Movable Walls systems furniture) . Although $12,000 could be
saved by taking this action, the council would have to waive
substantial deviations from specifications. Dealers of "Grade
B" systems furniture lines could construe this action as unfair
because they might have been able to bid competitively with the
same waivers. Also, The Office Mart bid a 95 day delivery and
installation period. If it received the contract it would not
be obligated to deliver and install the furnishings until at
least two weeks after the construction contract was completed.
2) Readvertise the contract. This alternative presents potential
schedule and financial problems. First, the construction
contract now underway will be completed during the second week
of May, and ideally the furnishings installation should be
coordinated with the construction. Usually, eight to twelve
weeks lead time is required by systems furniture dealers. (L A
Interior Systems bid a 63 day delivery and installation period;
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COUNCIL AGENDA REPORT
Furnishings Contract - 955 Morro
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The Office Mart bid a 95 day delivery and installation
period. ) Second, the city's experience in readvertising
contracts shows that most of the time the bid prices come in
higher. the second time around.
STAFF RECOMMENDATION
The original staff recommendation stands: Adopt the resolution
awarding the furnishings contract to L A Interior Systems.
attach: "Questions and Answers about the 955 Morro Remodeling
Project"
RESOLUTION NO. (1988 SERIES)
A RESOLUTION OF THE COUNCIL OF THE CITY OF SAN LUIS OBISPO
AWARDING A CONTRACT TO L A INTERIOR SYSTEMS FOR
THE PROJECT TO PROCURE FURNISHINGS FOR 955 MORRO STREET
WHEREAS, the City of San Luis Obispo advertised for bids on a
contract for the project to procure furnishings for 955 Morro
Street (City Plan No. M50D) ; and
WHEREAS, L A Interior Systems submitted the lowest responsive
bid at $126,335.47; and
WHEREAS, the architects estimate for this contract work was
$253,000.00;
NOW THEREFORE BE IT RESOLVED by the Council of the City of San
Luis Obispo to:
1. award the contract to L A Interior Systems for the project to
procure furnishings for 955 Morro Street;
2. authorize the mayor to execute the contract documents; and
3. direct the finance director to transfer $136,000.00 from the
capital outlay fund CRP appropriation to account number
040-9422-091-573 .
On motion of seconded by
and on the following roll call vote:
AYES:
NOES:
ABSENT:
the foregoing resolution was passed and adopted this day
of , 1988.
MAYOR
ATTEST:
CITY CLERK
APPROVED:
CITY AX�MINISTRA OFFICER CITY A ORNE
.FINANCE DIRECTOR PUBLIC WORKS DIRECTOR ¢ Q
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QUESTIONS AND ANSWERS
ABOUT
THE 955 MORRO REMODELING PROJECT
Q: Why are we doing this project?
A: To provide additional short-term office, meeting and storage
space for city hall activities. There are serious overcrowding
problems at city hall, notably in finance department, personnel
department and the engineering division of public -works
department, and this overcrowding hurts productivity.
Long-range solutions to these problems are at least three or
four years away, but the people in finance and engineering
particularly can't wait that long; they need relief as soon as
possible.
Q: Did we consider other alternatives for short-term space?
A: Yes, but either the cost was too high or we couldn't develop
the property fast enough. For example, the upstairs portion of
the Pacific Bell building at Mill and Osos was available, but
only for lease at $1.20 per square foot per month. Leasing
6, 000 square feet (equivalent to the area available at 955
Morro) for four years would cost $345,600.
Q: The construction contract for this project will cost $253 , 000.
What's included at that price?
A: The whole building needs a thorough refurbishment to make it
usable for permanent occupancy. Proposed improvements include:
1) replacing the roof
2) installing a new electrical service and major circuits
3) installing a heating, ventilation and air conditioning
system
4) installing new rough plumbing, including waste lines
5) installing new toilets
6) sandblasting the interior brick
7) cleaning up and painting the exterior
8) installing new floor coverings
9) installing window treatments
Q: The furnishings contract will cost $126,000. What's included
there?
A: Some of it is for items like steel shelves, flat plan files,
drawing cabinets and a light table, but most of it is for
systems furniture.
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Q&A - 955 Morro Street
page 2
Q: What exactly is systems furniture?
A: Systems furniture uses panels of various sizes which can be
linked together to form office and meeting spaces. These
panels are far more than the flimsy room dividers we often see
in offices, though. The panels in high-quality systems
furniture lines are designed to:
1) support work stations, files and shelves off the floor.
2) acoustically absorb and deaden sound
3) incorporate ambient and task lighting
4) protect and route all communication and power cables
through built-in conduits and raceways
Q: What are some typical systems furniture components?
A: Panels are the vertical surfaces of various heights which form
"walls" and define office and meeting spaces.
Power Panels contain built-in power cables and receptacles to
carry electrical power to the spaces.
Worksurfaces are horizontal surfaces like desktops which are
usually suspended from panels.
Overhead Shelves are suspended from panels and may have racks,
organizers or doors attached.
Pedestals contain drawers of various sizes and are usually
suspended underneath worksurfaces.
Q: This systems furniture sounds pretty expensive. What are the
benefits and are they worth the cost?
A: The chief benefits of systems furniture are flexibility,
efficiency and productivity. Let's talk about each one in
turn.
1) Flexibility. Nothing is static at city hall, and as
organizations change and grow, new office arrangements are
needed. Right now every time we want to rearrange space (and
it seems to happen every year or two) we call in contractors to
tear down old walls, punch out new doorways, put up new walls,
install new cabinets and counters and install new electrical
conduits, phone lines and computer links. Each time we do it,
it costs thousands of dollars and disrupts work for a week or
two. With systems furniture, we could instead call in Phil Leo
and Dave Smith, who could disassemble and reassemble panels in
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Q&A - 955 Morro Street
page 3
a few hours with little more than a couple of allen wrenches.
Because the electrical wiring and communications conduits are
built into the panels, there would be no demolition and no
complicated rewiring tasks. Also, a complete move to a new
location could be planned and accomplished in days rather than
weeks and months, because everything is self-contained in the
systems furniture.
2) Efficiency. Efficiency here means efficiency in using
space. Because work stations, files and shelves hang from the
panels, they take up much less floor space than freestanding
furniture does. Also, in order to ensure stability,
freestanding furniture is often wider and deeper than it needs
to be to accommodate a given task. Studies have demonstrated
that systems furniture uses on average about it percent less
floor space than other currently available freestanding
furniture. (The percentage would be much higher if systems
furniture were compared to older furniture, which is even less
space efficient. ) The building and proposed improvements at
955 Morro are worth about $640, 000, so an 11 percent gain in
space efficiency would be worth about $70,400.
3) Productivity. Systems furniture increases productivity by
reducing noise, reducing visual distraction, providing better
task lighting and providing the best combination of privacy and
openness. Systems furniture also makes other productivity
improvements work better. For example, the value of a computer
terminal at a worker's desk is compromised if that terminal
sits at an inconvenient location and at the wrong height.
Systems furniture is designed to accommodate office equipment
and systems to their best advantage. A report by the American
Productivity Center demonstrated that high quality systems
furniture coupled with good temperature control boosted work
output among organizations surveyed by an average of 11. 6
percent. The annual direct payroll cost for the employees who
will occupy 955 Morro Street is about $1, 000, 000. An 11. 6
percent increase in work output would amount to $116,000 worth
of additional work per year.
So -- are the benefits of systems furniture worth the costs?
Assuming an initial cost of $126,000 for systems furniture and
other furnishings and assuming average improvements in work
output (annual gain of $116,000) , the calculated payback period
for the furnishings would be only 13 months -- much, much less
than their expected useful life. (And this calculation does
not even consider average improvements in space
utilitization. ) In addition we would gain unparalleled
flexibility and small but demonstrated reductions in staffing
requirements, work errors, absenteeism, and turnover.
Q&A - 955 Morro Street
page 4
Q: Haven't we already invested a lot of time, money and effort
into improving employee productivity?
A: Yes, and it's paying off, but there's more we can do.
Productivity improvements can be directed toward three areas:
people, tools and the work environment. Although good results
can be gained by focusing on these areas individually, a
synergistic effect occurs when all three are addressed. We've
made several recent efforts to improve our workers and their
tools, such as:
-emphasizing team building
-presenting the "Working" program
-starting the wellness program
-instituting performance pay for managers and mid-managers
-purchasing a new phone system
-purchasing personal computer networks with word-processing and
data management software.
-purchasing mini-computers for finance and records management
The one area we've neglected is the work environment, and the
signs of that neglect are most obvious in finance and
engineering. Straightforward improvements such as systems
furniture, adequate lighting, and temperature control can
correct current problems, boost productivity and enhance
existing productivity efforts.
Q: What employees will occupy the new offices at 955 Morro Street?
A: The utilities administration section and the engineering
division of public works department.
Q: What employees will occupy the space vacated upstairs at city
hall by the utilities administration section?
A: The data processing division of finance department.
Q: What employees will occupy the space vacated downstairs at city
hall by the engineering division?
A: Part of the space will be used by four new employees in
community development department. We would also try to set up
another conference room downstairs for use primarily by finance
department.
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Q&A - 955 Morro Street
page 5
Q: If the 955 Morro Remodeling is a short term solution to city
hall space needs, what will be done with the building and
furnishings in the long term?
A: As long term solutions are implemented, the building can serve
as temporary quarters for city employees during other
remodeling or construction projects. After that, the building
would be available to lease or sell.
The systems furniture offices are designed to be dismantled and
reassembled at new locations and in different configurations.
They are part of the long term solution.
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