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Home My WebLink About12/12/2000, C6 - AUTHORIZATION OF SOLICITING REQUEST FOR PROPOSALS FOR THE OPERATIONS AND MAINTENANCE FOR SLO TRANSIT SERVICES Council j acEnba nEpont '®Cte CITY OF SAN LUIS OBISPO FROM: Mike McCluskey, Director of Public Works Prepared By: Austin O'Dell, Transit Manager SUBJECT: AUTHORIZATION OF SOLICITING REQUEST FOR PROPOSALS FOR THE OPERATIONS AND MAINTENANCE FOR SLO TRANSIT SERVICES CAO RECOMMENDATION Approve a Request For Proposals for the Operations and Maintenance for Public Transit Fixed Route Services and authorize soliciting of proposals. DISCUSSION Background The current contract with Laidlaw Corporation for operations and maintenance for public transit fixed route services expires on June 30, 2001. As a result, the City of San Luis Obispo is required to solicit proposals for operations and maintenance services beginning on July 1, 2001. The request for proposals (RFP) includes a contract for operation and maintenance services for a base term of three years from July 1, 2001 through June 30, 2004 with two one year options Focus During the term of the current Contract, several issues have arisen surrounding safety, quality of service, and accountability. The new contract includes an expanded scope of work, which is designed to increase safety, quality of service, and accountability of the Contractor to the City. Staff is confident, by focusing on these issues, SLO Transit will have the ability to better manage the contract, which will result in better service to our passengers. In addition, the RFP has been structured to more closely resemble current industry standards for operation requirements when contracting of transit services. Major Components of the Request for Proposals(RFP) With the focus on safety, quality of service, and accountability, the new contract will include the following major components: 1. Contractor's requirement to maintain minimum standards of performance; 2. Contractor subject to incentives and penalties in accordance to these performance standards; 3. Contractor's management structure that will instills best practices in the transit industry; C6-1 Council Agenda Report— 1crP for Transit Services Page 2 4. Contractor's clear understanding of roles and expectations. The current contract does not require the Contractor to maintain minimum levels of performance. The result has been that the City lacks teeth in exercising any recourse in the event of poor performance. The new contract will include provisions for minimum standards of performance that the Contractor will be required to uphold. In the event that the Contractor fails to perform at the acceptable levels, the City may assess penalties for failing to perform at minimum standards of performance. It is important to be clear that the intention of assessing penalties on the Contractor is by no means a strategy for the City to earn additional revenue from the Contractor; but rather, to: (1) financially encourage the Contractor to develop, implement, and maintain procedures and policies that preserves the City's minimum standards of performance; and (2) correct the any performance deficiencies. The Contract will also include incentives that reward the Contract for excellent performance. Examples of the performance standards are, but not limited to, the following: total revenue miles between preventable accidents, roadcalls between revenue miles, 95% on-time performance, missed passengers, missed trips, etc. The new contract also suggests key contract staff positions with the goal to enable the Contractor to better focus on overall operations, service reliability, safety, and quality of service. The RFP, however, does allow the opportunity for the Contractor to propose and justify an alternative management structure that will accomplish the City's goal. The new contract clearly defines the roles, expectations, and duties that the Contractor is to perform during the term of the Contract. This is accomplished by thoroughly explaining the City's expectation for each task. In addition, the Contractor required to submit various operational plans and procedures they anticipate using in providing service to the City. This will allow the City to gain insight of the Contractor's experience and ability to perform. Staff is confident that this Contract will provide the successful Contractor with sufficient direction to perform to the expectation of the City, customers, and our community. The schedule for this procurement is illustrated in the below table: Table I Task Date Issue R uest for Pro osals (RFP) December 13, 2000 Pre-Pro osal Conference (2:00 p.m.PST) - January 9, 2001 _ Submit Questions &Clarifications(4:00 .m. PST) January 17, 2001 Proposals Due(4:00 p.m.PST) February 9, 2001 Pre-Award Survey and Screening February 9, 2001- March 7, 2001 Interview with Selected Contractors February 9,2001- March 7, 2001 City Council Award Contract March 20, 2001 Executes Agreement with Selected Contractor March 27, 2001 Pre-Start Up Meeting with Selected Contractor April 27, 2001 _ I Contractor Starts Service —_ July 1, 2001 �6-2 Council Agenda Report—RFP for Transit Services Page 3 Service Levels and Cal Poly Subsidized Zero Fare Issues The proposed RFP holds transit service level at current level, which is consistent with the City's Short Range Transit Plan. With an additional focus on operational improvements it is unknown if a cost increase will result from the modified RFP philosophy, however, cost will most likely be higher than the last contract just due to the nature of inflation in the past four years. The City's Agreement with Cal Poly to provide the Subsidized Zero Fare for students, faculty, and employees expires on June 30, 2001, which is the same day as the current transit contract terminates. Based upon the revised costs associated with solicitation of this RFP, the City will need to negotiate a new agreement with Cal Poly for the program to continue. FISCAL ANALYSIS There is no fiscal impact to issuing an RFP. Certainly the results of the RFP — a new transit provider/contract-- will have financial impacts. It is unknown at this point if the proposed RFP and its recommended modification to the current contract will result in additional or reduced cost to provide transit service. Cost will be a major factor in ranking proposals received for these services. However, it will not be the only factor. Because the RFP has been specifically designed to towards improving safety, quality of service, and service reliability, these issues will be as important as cost in determining the appropriate and most responsive Contractor to supply these highly visible services. Because the RFP holds service routes and service at current levels, it is staff's intention to deliver the Contract at projected costs during the entire term of the Contract. Funding for these services will be allocated from the City's annual Transportation Development Act (TDA) Fund and Federal Transit Administration funding. Because the City relies on TDA to match capital projects and TDA's volatility to the economy, it is important for the City to continue its current practice not to budget the entire TDA allocation towards operations. Table 2 illustrates the City's annual cost of purchased transportation. Table 2: Contract Costs 1998-99 1999-00 1 I Actual Actual Budgeted 1,043,117 1,216,083 1,266,300 1,304,300 CONCURRENCES Staff has reviewed the RFP with Cal Poly staff who are most interested in the possible financial impacts to them and they concur that the RFP should proceed as written. C6-3 Council Agenda Report—tir? for Transit Services Page 4 ALTERNATIVES Alternative 1. The Council may decide to delay the solicitation for operations and maintenance of public transit fixed route services. This would delay the solicitation and most likely cause the inability to award a Contract in enough time to allow the successful Contractor adequate time to prepare and begin operations by July 1, 2001. The City does not have the ability to exercise an extension to the current Contract, which terminates on June 30, 2001. NOTE: The Complete Request for Proposal is available for review in the City Clerks Office. A copy is also available in the Council Reading Room. L\Council Agenda Reports\CAR SLO Transit RFP 2001.doc C6-4