November 20, 2008

REPORT OF THE BUILDING AND OPERATING COMMITTEE

Honorable Board of Directors
Golden Gate Bridge, Highway
  and Transportation District

Honorable Members:

A meeting of the Building and Operating Committee was held in the Board Room, Administration Building, Toll Plaza, San Francisco, California, on Thursday, November 20, 2008, at 10:20 a.m., Chair Eddie presiding.

Committee Members Present (8): Chair Eddie; Vice Chair Reilly; Directors Boro, Cochran, Pahre, Sobel and Stroeh; President Moylan (Ex Officio). Directors Cochran, Pahre and Sobel were appointed Committee Members Pro Tem for this meeting only.

Committee Members Absent (3): Directors Ammiano, Hernández and McGlashan

Other Directors Present (1): Newhouse Segal

Staff Present: General Manager Celia G. Kupersmith; District Engineer Denis J. Mulligan; Auditor-Controller Joseph M. Wire; Secretary of the District Janet S. Tarantino; Attorney David J. Miller; Deputy General Manager, Bridge Division Kary H. Witt; Deputy General Manager, Bus Division Teri W. Mantony; Deputy General Manager, Ferry Division James P. Swindler; Deputy General Manager, Administration Z. Wayne Johnson; Public Affairs Director Mary C. Currie; Procurement and Retail Operations Director Lori Murray; Director of Planning Alan R. Zahradnik; Communication Systems Project Manager David Cruise; Business Systems Implementation Manager Marvin Miller; Executive Assistant to the General Manager Amorette Ko; Assistant Clerk of the Board Karen B. Engbretson

Visitors Present: John Lynch, Wright Environmental Services, Inc.; John Kaltenstein, Friends of the Earth

     
1. Approve Actions Relative to Request for Proposals (RFP) No. 2008-MD-1, Advanced Communications and Information System:
  a. Award a Contract to GE Transportation Global Signaling, LP, Relative to RFP 2008-MD-1; and,
  b. Authorize the General Manager to Exercise the Option for Phase 3 of the Professional Services Agreement with Booz Allen Hamilton, Inc., Relative to RFP No. 2007-BT-1, Consultant to Provide Design Services for Radio Replacement and Intelligent Transportation System
     
 
In a memorandum to Committee, Communication Systems Project Manager David Cruise, Director of Planning Alan R. Zahradnik, Deputy General Manager, Administration Z. Wayne Johnson and General Manager Celia Kupersmith reported on staff’s recommendation to authorize award of a contract relative to Request for Proposals (RFP) No. 2008-MD-1, Advanced Communications and Information System (ACIS), and to authorize the General Manager to exercise the option for Phase 3 Project Management Services in the Professional Services Agreement with Booz Allen Hamilton, Inc., (BAH) to assist during the implementation of the ACIS project.

The report stated that the Board of Directors, by Resolution No. 2007-076 at its meeting of August 24, 2007, authorized a competitive negotiation process for the procurement of a modern radio system and intelligent transportation system, to replace the District’s aging communications infrastructure. The District’s existing radio system, used for daily communications by the Bridge, and the Bus and Ferry Transit Divisions, is over 15 years old and relies on obsolete equipment. The report noted that keeping the multi-modal transportation systems of the District operational requires a secure, effective and efficient communications system, with the ability to easily communicate between the operations, maintenance and security personnel of all three operating divisions. In addition, new intelligent transportation system technologies afford the District an opportunity to improve information gathering, use and distribution, which could increase service performance and enhance customer service.

The report described the ACIS project, which will include the following components: (1) a new District-wide radio communications system; (2) automatic vehicle location; (3) new mobile data terminals installed on the transit fleet; (4) new computer-aided bus dispatch systems; (5) real-time information systems for customers; (6) new software for planning, scheduling, and customer services; and, (7) integration of all new services with the existing systems and information network infrastructure within the District.

The report also stated that on April 15, 2008, the District issued RFP No. 2008-MD-1. The RFP notification was posted to the web site and advertised in local newspapers, as well as various transportation and public safety trade publications. In addition, the RFP documents were sent to 28 prospective proposers. By the due date of July 15, 2008, the Office of the District Secretary received six proposals for RFP No. 2008-MD-1. The Proposals were reviewed by the Evaluation Panel, consisting of representatives from the District and Alameda-Contra Costa Transit, as well as three non-voting members from the BAH consultant team. Two of the proposers were invited to participate in interviews, and the Evaluation Panel evaluated and ranked the proposals based on the selection criteria, which included the following: (1) experience and qualifications, including financial stability and references, of the proposer and all subcontracting team members; (2) experience and qualifications of key personnel; (3) project approach and understanding; and, (4) cost. The Evaluation Panel determined that GE Transportation Global Signaling, LP (GE), was the top ranked firm, despite the fact that GE’s cost was higher than the second-ranked firm, ACS Transportation Management Solutions. The report stated that during the evaluation and interview process, it was determined that the GE team had a substantially better understanding of the current District environment with regard to existing radio site infrastructure and regional terrain for radio coverage. Moreover, the evaluation panel found that the GE Transportation project team members offered exceptional experience and flexibility in its technology and integration strategy.

The report stated that following the evaluation process, staff entered into negotiations with GE, which resulted in a final proposal cost of $15,455,187, approximately $6.8 million less than GE’s original proposal cost. Staff and the District’s Attorney find that GE has properly submitted all required documents and that its proposal is technically responsive to the RFP. In accordance with District and Federal Transit Administration (FTA) requirements, staff conducted a price analysis and determined that the bid price submitted by GE Transportation is fair and reasonable.

The report noted that no contract-specific Disadvantaged Business Enterprise (DBE) goal was established for this federally-assisted contract. However, proposers were required to document their activities in the solicitation and selection of subcontractors and suppliers to ensure that this process was carried out in a non-discriminatory manner. The DBE Program Administrator has determined that GE has complied with the DBE requirements applicable to the contract. At this time, no DBE participation is anticipated during the performance of this contract. It is recommended that award of a contract to GE relative to RFP No. 2008-MD-1 be authorized, and that a contingency fund be established in the amount of $909,402.

The report further stated that since October 2006, BAH has provided consulting services relative to the ACIS project. The Professional Services Agreement with BAH included an option for Phase 3 Project Management Services to assist during the implementation of the ACIS. It is recommended that the General Manager be authorized to exercise this option at a cost not to exceed $268,442.

The report explained why a substantial budget increase was necessary, noting that during its earlier work evaluating and developing the scope of the ACIS project, BAH estimated that the total ACIS project cost would be approximately $10 million, based on similar systems implemented at other transit agencies. The report stated that upon further investigation, it was determined that these other transit agencies have in-house software development and integration capabilities that the District lacks, and as a result, the ACIS project cost exceeds the original estimated cost due to the need for these additional services. The GE proposal includes approximately $8.6 million in software development and integration services, which requires an increase in the FY 08/09 Bus Transit Division Capital Budget, in the amount of $9,343,000, to be funded with additional grant funds, in order to fully fund the ACIS project in the estimated total cost of $19,343,000. The ACIS project will be funded with a combination of the following: (1) FTA grant funds in the amount of $15,474,000; (2) Regional Measure 2 grant funds in the amount of $1,680,000; (3) Proposition 1-B Transit System Safety, Security and Disaster Response Program grant funds in the amount of $1,605,000; and, (4) District funds in the amount of $584,000. A copy of the report is available from the Office of the District Secretary and on the District’s web site.
At the meeting, Celia Kupersmith summarized the staff report, describing how the ACIS project will improve the District’s communications system. Ms. Kupersmith introduced to the Committee the ACIS project technical staff, Director of Planning Alan Zahradnik and Communication Systems Project Manager David Cruise.

Discussion ensued, including the following:

  • Director Sobel inquired as to how the amount of the ACIS project contingency fund was derived. In response, Ms. Kupersmith stated that the amount of the contingency fund was based on 10 % of the total project cost, and not based on any evaluation of potential cost overruns.

Staff recommended and the Committee concurred by motion made and seconded by Directors STROEH/REILLY to forward the following recommendation to the Board of Directors for its consideration:

RECOMMENDATION

The Building and Operating Committee recommends that the Board of Directors approve the following actions relative to Request for Proposals (RFP) No. 2008 MD-1, Advanced Communications and Information System:

  a.

Authorize the award of a contract to GE Transportation Global Signaling, LP, Blue Springs, Missouri, relative to RFP No. 2008-MD-1, in the amount of $15,455,187, plus $871,000 in options, to be exercised at the discretion of the General Manager or her designee;

  b.
Authorize a contingency fund in the amount of $909,402, equal to 10% of the contract cost, less hardware costs; and,
  c.
Authorize the General Manager to exercise the option for Phase 3 (Project Management) of the Professional Services Agreement with Booz Allen Hamilton, Inc., relative to RFP No 2007-BT-1, Consultant to Provide Design Services for Radio Replacement and Intelligent Transportation System, in an amount not to exceed $268,442;
  d.

Authorize a budget increase in the FY 08/09 Bus Transit Division Capital Budget in the amount $9,343,000, to be funded with $7,499,581 of Federal Transit Administration grant funds, $1,680,000 of Regional Measure 2 grant funds and $1,605,000 of Proposition 1-B Transit System Safety, Security and Disaster Response Program grant funds, subject to the concurrence of the Finance-Auditing Committee at its meeting of November 20, 2008.

Action by the Board at its meeting of November 21, 2008 – Resolution
NON-CONSENT CALENDAR

     
  AYES (8): Chair Eddie; Vice Chair Reilly; Directors Boro, Cochran, Pahre, Sobel and Stroeh; President Moylan (Ex Officio)
NOES (0): None
ABSENT (3): Directors Ammiano, Hernández and McGlashan
     
2.

Approve Actions Regarding Award of a Contract with IBM Global Business Services, a Unit of IBM Corporation of Armonk, New York, Relative to Request for Proposals No. 2008-MD-2, Asset and Vehicle Fluid Management Systems

In a memorandum to Committee, Business Systems Implementation Manager Marvin Miller, Director of Planning Alan R. Zahradnik, Auditor-Controller Joseph Wire and General Manager Celia Kupersmith reported on staff’s recommendation to authorize award of a contract relative to Request for Proposals (RFP) No. 2008-MD-2, Asset and Vehicle Fluid Management Systems (AVFMS).

The report stated that the Board of Directors, by Resolution No. 2003-106 at its meeting of October 10, 2003, authorized the award of contracts to Sungard/Bi-Tech, Inc., and Spear Technologies, Inc., relative to Contract No. 2003-D-1, Financial Management System and Other Related Items. One of the components of Contract No. 2003-D-1, also known as the Financial Management Information System (FMIS), was the Spear Maintenance Module. Due to corporate takeovers and personnel changes at the original vendor, Spear Technologies, Inc., the District opted to pursue a separate RFP for a maintenance management system. Subsequently, the Board of Directors, by Resolution No. 2007-088 at its meeting of October 12, 2007, authorized a competitive negotiation process for the procurement and implementation of a combined Asset Management System and Vehicle Fluid Management System. The report stated that when these systems are fully implemented, they will automate much of the tracking and recording of maintenance operations for Bus Transit Division revenue vehicles, Ferry Transit Division revenue vessels and District Division non-revenue vehicles and facilities, as well as the Bridge Division’s major Golden Gate Bridge structural repair projects.

The report described the benefits of the AVFMS project, including the following: (1) consolidation of all preventative and repair work on a particular vehicle into a single repair event in order to lower operating expenses, increase fleet utilization and equipment availability, reduce downtime and labor expenses, improve safety and reduce travel time to the central maintenance facility; (2) elimination of redundant vehicle inspections; (3) linking of preventative maintenance inspections to vehicle mileage or engine hours; (4) availability of complete repair history of each vehicle online, in order to help identify any patterns of vehicles repeatedly repaired for the same problem, and to identify problematic components; (5) availability of online analysis of vehicle and fleet repair, fuel and fluid usage and performance cost trends; (6) consolidation of all individual component warranties, providing an opportunity for a significant increase in warranty claims recovery; and, (7) better control of inventory to assure that replacement parts are available or ordered in time to support necessary maintenance projects.

The report also stated that on January 29, 2008, the District issued RFP No. 2008-MD-2. The RFP notification was posted to the web site and advertised in local newspapers. In addition, the RFP documents were sent to 44 prospective proposers. By the due date of March 18, 2008, the Office of the District Secretary received four proposals for RFP No. 2008-MD-2. The proposals were reviewed by the Evaluation Panel, consisting of District staff from all operating divisions, as well as the Auditor-Controller Department. Three of the proposers were invited to participate in interviews, and the Evaluation Panel evaluated and ranked the proposals based on oral interview presentations, client references and the selection criteria, which included the following: (1) proposed system and approach; (2) qualifications and experience of the firm; (3) qualifications and experience of the team; (4) cost; and, (5) maintenance, support and warranty. The Evaluation Panel determined that IBM Global Business Services, a unit of IBM Corporation (IBM), was the top ranked firm, and also had the lowest proposal cost. The report stated that during the evaluation and interview process, it was determined that IBM’s proposed software was best suited for the District’s needs, and that the new AVFMS system will significantly improve the purchasing and inventory modules currently in use.

The report stated that following the evaluation process, staff entered into negotiations with IBM, which resulted in a final proposal cost of $3,262,318. Staff and the District’s Attorney found that IBM has properly submitted all required documents and that its proposal is technically responsive to the RFP. In accordance with District policy and applicable federal regulations, staff conducted a price analysis and determined that the hourly rates submitted by IBM are comparable to the industry standard, and that the proposal cost is fair and reasonable.

The report noted that no contract-specific Disadvantaged Business Enterprise (DBE) goal was established for this federally-assisted contract. However, proposers were required to document their activities in the solicitation and selection of subcontractors and suppliers to ensure that this process was carried out in a non-discriminatory manner. The DBE Program Administrator has determined that IBM has complied with the DBE requirements applicable to the contract. At this time, no DBE participation is anticipated during the performance of this contract. It is recommended that award of a contract be authorized to IBM relative to RFP No. 2008-MD-2, and that a contingency fund be established in the amount of $327,000.

The report stated that a budget increase is required in the FY 08/09 District Division Capital Budget, in the amount of $2,398,000, to be funded with $234,334 of Federal Transit Administration (FTA) funds and $2,163,666 of Proposition 1-B Public Transportation Modernization, Improvement and Service Enhancement Account (Prop 1-B PTMISEA) grant funds, in order to fully fund the AVFMS project in the estimated total cost of $4,998,000. A copy of the report is available from the Office of the District Secretary and on the District’s web site.

 

At the meeting, Celia Kupersmith summarized the staff report, describing how the AVFMS project will improve the District’s maintenance and inventory systems. She noted that the AVFMS project builds off of a major technology improvement project that the District launched 10 years ago. Ms. Kupersmith introduced to the Committee the AVFMS project technical staff, Director of Planning Alan Zahradnik and Business Systems Implementation Manager Marvin Miller.

Public Comment

John Lynch, of Wright Environmental Services, Inc., addressed the Committee, expressing his concerns that IBM, the selected vendor for RFP No. 2008-MD-2, wants to replace his company with another subcontractor. He stated that in his opinion, such an action by IBM constitutes a violation of state and federal contracting laws, since his company is a Disabled Veteran Enterprise, and a qualified Disadvantaged Business Enterprise (DBE). Mr. Lynch noted that he is not filing a formal bid protest, but simply expressing his concerns. Attorney Miller responded to Mr. Lynch’s testimony, stating from a legal standpoint, the action taken by IBM does not implicate provisions of state and federal contracting laws, because RFP No. 2008-MD-2 is a technology contract, not a construction contract. Mr. Miller noted that the subcontractor forms appeared in the RFP documents not for the purpose of compliance with contracting laws, but rather to document DBE participation by the prime contractor. Mr. Miller further noted that there is no contract-specific DBE goal for RFP No. 2008-MD-2, and that Mr. Lynch’s concerns are fundamentally an issue between IBM and Mr. Lynch and not a basis on which to reject the firm that is being recommended for award.

At the conclusion of the testimony, Attorney Miller stated that a letter from AssetWorks was received in the Office of the District Secretary on November 14, 2008, which letter constitutes a formal bid protest relative to RFP No. 2008-MD-2. Mr. Miller stated that AssetWorks (also known as MAXIMUS Asset Solutions Division) was one of the competing prime contractors that submitted a proposal for RFP No. 2008-MD-2. He noted that in its letter, AssetWorks outlines the following grounds for its protest: (1) the District has not complied with the “set aside” requirements of the DBE Program, and that the proposer being recommended for award will not be utilizing any DBE resources; and, (2) the District did not afford an opportunity to AssetWorks to present a Best and Final Offer. AssetWorks was advised of its right to appear at this meeting to present its protest and inquiry was made if anyone from that company was present. There was no response. Mr. Miller stated that, in response to the above-stated protest grounds: (1) under contracting law and DBE Program rules applicable to this RFP, it is not permissible to establish a DBE set-aside, much less a contract-specific DBE Goal, and staff determined that IBM met all of the requirements of the DBE Program in terms of good faith efforts to obtain DBE participation; and, (2) while the RFP documents contain a provision for the District to entertain Best and Final Offers when the District believes it is advantageous, the District did not request Best and Final Offers with respect to RFP No. 2008-MD-2, nor was the District compelled to do so. In conclusion, Mr. Miller stated that it is his recommendation that the Committee reject the bid protest of AssetWorks for the reasons stated above, and then proceed with the rest of the recommendation.

Discussion ensued, including the following:

  • Director Stroeh noted that he had sat on the District’s Technology Subcommittee 10 years ago and that he was pleased to see the AVFMS project coming to fruition.

Staff recommended and the Committee concurred by motion made and seconded by Directors STROEH/COCHRAN to forward the following recommendation to the Board of Directors for its consideration:

RECOMMENDATION

The Building and Operating Committee recommends that the Board of Directors approve the following actions relative to Request for Proposals (RFP) No. 2008 MD-2, Asset and Vehicle Fluid Management Systems:

  a.

Reject the protest submitted by AssetWorks;

  b.
Authorize the award of a contract to IBM Global Business Services, a unit of IBM Corporation of Armonk, New York, relative to RFP No. 2008-MD-2, in the amount of $3,262,318, for a two-year contract;
  c.
Authorize a contingency fund in the amount of $327,000, equal to 10% of the contract award; and,
  d.

Authorize a budget increase in the FY 08/09 District Division Capital Budget in the amount of $2,398,000, to be funded with $234,334 of Federal Transit Administration grant funds and $2,163,666 Proposition 1-B Public Transportation Modernization, Improvement and Service Enhancement Account grant funds, subject to the concurrence of the Finance-Auditing Committee at its meeting of November 20, 2008.

Action by the Board at its meeting of November 21, 2008 – Resolution
NON-CONSENT CALENDAR

     
 
AYES (8): Chair Eddie; Vice Chair Reilly; Directors Boro, Cochran, Pahre, Sobel and Stroeh; President Moylan (Ex Officio)
NOES (0): None
ABSENT (3): Directors Ammiano, Hernández and McGlashan
     
3.

Approve Actions Relative to the Procurement of Two New High-Speed Passenger Ferries

In a memorandum to Committee, Deputy General Manager, Ferry Division James Swindler and General Manager Celia Kupersmith reported on staff’s recommendation to approve actions relative to the procurement of two new high-speed passenger ferries.

The report stated that the Board of Directors, by Resolution No. 2006-052 at its meeting of June 23, 2006, authorized staff to issue a Request for Proposals (RFP) for procurement of a new high-speed passenger vessel. Subsequently, the Board of Directors, by Resolution No. 2008-006 at its meeting of January 25, 2008, approved emission standards for the ferry, directing that the RFP include a requirement to install Tier 2-20 main engines in order to maximize emissions reduction, and also directing staff to conduct a test of biodiesel fuel within the District fleet.

The report also stated that on May 20, 2008, the District issued RFP No. 2008-FT-1, Construction of New High-Speed Passenger Vessel. The RFP was posted to the web site and advertised in local newspapers, as well as various trade publications. In addition, the RFP documents were sent to nine prospective proposers. By the due date of July 25, 2008, the Office of the District Secretary received one proposal for RFP No. 2008-FT-1, from Nichols Brothers Boat Builders (NBBB) of Freeland, WA, with a bid price of $18,618,600. The report noted that because RFP No. 2008-FT-1 was structured as a competitive negotiation process, District staff and attorneys met with NBBB over the course of two months in order to negotiate the bid price, as well as contract terms and conditions. As a result, the District was able to negotiate a bid price of $16,976,724, with anticipated financing/bonding/insurance costs of between $500,000 and $750,000. The total purchase price for one new high-speed passenger ferry is estimated to be $18,610,724.

The report further stated that during negotiations with NBBB, the District became aware of Washington State Ferries’ (WSF) desire to sell two of their high-speed ferries that have been out of use for several years. The two vessels, the M.V. Snohomish and the M.V. Chinook, are eight feet longer than the District’s M.V. Del Norte, but are of very similar design. They were built shortly after the M.V. Del Norte, but only operated for approximately three years before being removed from service, and have been inactive since September 2003. The M.V. Snohomish operated briefly in November and December 2007, providing emergency service to Port Townsend, Washington, after four aging car ferries were abruptly pulled from service. After receiving authorization from the Board of Directors, by Resolution No. 2008-079 at its meeting of September 12, 2008, District staff submitted an offer to purchase the two WSF vessels for $2,000,000 each. The offer was subject to a number of conditions, including Board approval of the final purchase. The total cost of purchase and refurbishment of the two high-speed ferries is estimated to be $23,410,000.

The report stated that staff received confirmation from WSF that the District’s conditional offer was accepted, and subsequently inspected the two ferries to confirm that the hulls are in excellent condition and have not experienced any unusual wastage of the hull plating or other major structural components. In addition, staff reviewed regulations to ensure the passenger capacity of each ferry can be increased to carry a minimum of 450 passengers, and also determined that there is sufficient space to install the necessary seating and other improvements. The report noted that staff has prepared a detailed estimate that identifies each improvement necessary to prepare the vessels for service in the District’s ferry fleet.

The report further stated that with the procurement of the two WSF ferries, the District will begin using one of the ferries in early 2009 to substitute for the M.V. Del Norte while it is being re-powered with new Tier 2 engines. The WSF ferry will be cleaned up and placed into service with its existing engines and other equipment, prior to its refurbishment. The ferry is currently certified to carry 350 passengers, but staff hopes to receive authorization from the U.S. Coast Guard to temporarily recertify the vessel to carry 390 passengers, as was done with the M.V. Del Norte several years ago. Based on the feedback received from ferry customers in 2007 when the M.V. Mendocino was re-powered, it is preferable to substitute another high-speed ferry, rather than use a Spaulding ferry to replace the M.V. Del Norte while it is being re-powered.

The report outlined the details of the vessel refurbishment to be undertaken on the two WSF ferries, noting that the first fully refurbished ferry will be delivered to the District in December 2009, with the second ferry to be delivered in July 2010. The report noted the significant advantages of purchasing the two WSF ferries, stating that the District would be able to have a back-up high-speed ferry in its fleet within one year, instead of the 18 months it would take to construct and deliver a new high-speed ferry.

The report further stated that no contract-specific Disadvantaged Business Enterprise (DBE) goal was established for RFP No. 2008-FT-1, and that NBBB complied with the DBE requirements applicable to the contract. If the option is chosen to move forward with the construction of a new passenger ferry, less than 1% DBE participation would be anticipated during the performance of the contract. If the option is chosen to the purchase the two WSF ferries, contract documents for construction/refurbishment will include the District’s standard DBE requirements and language with the hope that DBE participation will be achieved during the refurbishment phase of the project.

Based upon staff analysis of the two options, it is recommended that the District reject the bid of NBBB relative to RFP No. 2008-FT-1, and proceed with purchase and refurbishment of the two WSF ferries. The report described the fiscal impact of staff’s recommendation, noting that the original project (procurement of a single high-speed passenger ferry) was included in the FY 08/09 Ferry Transit Division Capital Budget in the amount of $12,000,000, funded with $9,600,000 Federal Transit Administration (FTA) grant funds, $2,116,322 state Proposition I-B PTMISEA grant funds and $283,678 District funds (80% FTA/17.6% State/2.4% District). A capital budget increase in the amount of $11,510,000 ($6,400,000 FTA funds and $5,110,000 from District reserves) is required to fully fund this project at the proposed budget of $23,510,000. Utilizing FTA funds to support the purchase of these two ferries and additional FTA funds to support the refurbishment of these two ferries was made possible by staff’s creative development of an efficient and effective funding proposal, and the FTA’s willingness to collaborate and achieve the best possible solution for the District. The total project will be funded as follows: $16,000,000 FTA funds, $2,116,322 state Proposition I-B PTMISEA grant funds, and $5,393,678 District funds (68% FTA/9% State/23% District). A copy of the report is available from the Office of the District Secretary and on the District’s web site.

At the meeting, Celia Kupersmith summarized the staff report, noting that the main engines to be installed on the two new high-speed passenger ferries will exceed current federal Environmental Protection Agency and state California Air Resources Board emission requirements. James Swindler described the negotiations that staff undertook with WSF, noting that staff spent considerable time developing the scope of work required to refurbish the two ferries. He also noted that it will be possible to increase the passenger capacity of the two ferries to 450 passengers without major structural modifications to the hulls of the ferries.

Public Comment

John Kaltenstein, of Friends of the Earth, highlighted comments he made in a letter to the Committee dated November 20, 2008, copies of which were distributed to the Committee. He commended the District for devising an economically advantageous solution to purchase two used ferries for the price of one new ferry. He further suggested that the District take the opportunity to further decrease ferry emissions to attain or surpass Tier 2 minus 85% emission standards, as is being done by the San Francisco Bay Area Water Emergency Transit Authority (WETA) for its new ferries. Mr. Kaltenstein further commended Mr. Swindler and his staff at the Ferry Transit Division for continuing the collaborative working relationship between Friends of the Earth and the District.

Discussion ensued, including the following:

  • Director Boro made the following comments and inquiries:
    • He noted that the WETA’s new ferries are not comparable to the District’s high-speed ferries, since they are much smaller than the District’s ferries.
    • He inquired as to why the District would need a third high-speed ferry if the District’s Larkspur ferry service will still be limited to only 42 crossings per day. In response, Ms. Kupersmith stated that the two WSF vessels will replace the two aging Spaulding ferries, and that the procurement of the ferries will not result in an increase in the number of ferry crossings between Larkspur and San Francisco.
    • He inquired as to whether the $5,110,000 required from District reserves to fund the procurement was planned for, or whether it was an unanticipated draw on reserves. In response, Mr. Swindler stated that when staff prepared the original project budget for the procurement of a new high-speed passenger ferry, it was anticipated that there would be a draw on the reserves of approximately $4 million.
    • He inquired as how staff plans to respond to the concerns expressed by the Friends of the Earth to use selective catalytic reduction (SCR) technology to further reduce emissions of the two WSF ferries. In response, Mr. Swindler stated that he has concerns with using new, untested emission control technology in the two ferries. He noted, however, that staff would continue to work with Friends of the Earth in the future to evaluate the latest ferry emission reduction technology as it becomes available.
    • He commented that once the WETA ferries are put in revenue service with the SCR technology in use, it will provide an opportunity for a practical test of this emission control technology.
    • He commended staff for devising such a creative solution to the District’s need for new high-speed passenger ferries, and expressed his appreciation for staff’s continued cooperation with Friends of the Earth regarding ferry emissions.
  • Director Pahre requested that staff provide biannual reports to the Committee regarding the latest emission control technology available in the market, for possible use in the District’s ferry fleet. In response, Mr. Swindler stated that staff would provide such a report to the Board of Directors.
  • Director Cochran inquired regarding the logistics of a replacement ferry during the time that the M.V. Del Norte will be out of service for its re-powering project. In response, Mr. Swindler explained that when the M.V. Del Norte is taken out of service, one of the WSF ferries will be used temporarily, prior to its refurbishment, as a substitute vessel. Ms. Kupersmith noted that one of the lessons learned during the re-powering of the M.V. Mendocino was that ferry passengers were not pleased that a non high-speed Spaulding ferry was used as a substitute when the M.V. Mendocino was taken out of service. She stated that with the purchase of the two WSF ferries, the District will be in a position to substitute one high-speed ferry for another during the re-powering of the M.V. Del Norte.
  • Director Stroeh inquired regarding the names of the two WSF ferries. In response, Ms. Kupersmith stated that staff will prepare a recommendation for the naming of the two ferries, noting that Napa County is the only county in the District that does not yet have a ferry vessel named after it. In addition, she stated that staff may resurrect the name of the District’s original ferry vessel, the M.V. Golden Gate. She noted that action will be taken on the naming of the two vessels at a future meeting of the Public Information and Governmental Affairs Committee.
  • Director Sobel expressed his appreciation to staff for the successful outcome of the negotiations for the purchase of the two WSF ferries, noting that it was an inspired solution to increasing the District’s high-speed ferry fleet.

Staff recommended and the Committee concurred by motion made and seconded by Directors STROEH/BORO to forward the following recommendation to the Board of Directors for its consideration:

RECOMMENDATION

The Building and Operating Committee recommends that the Board of Directors approve the following actions relative to the procurement of new two high-speed passenger ferries:

  a.

Reject the sole bid of Nichols Brothers Boat Builders relative to Request for Proposals No. 2008-FT-1, New High-Speed Passenger Ferry;

  b.
Authorize the purchase of two existing high-speed ferries from Washington State Ferries at a price of $4 million ($2 million per vessel), subject to completion of all regulatory actions required by the Federal Transit Administration;
  c.
Establish a contingency fund in the amount of $310,000 for sales/use tax that may be payable to the State of California; equal to 10% of the contract award; and,
  d.

Authorize a budget increase in the FY 08/09 Ferry Transit Division Capital Budget in the amount of $11,510,000, to be funded by $6,400,000 of Federal Transit Administration grant funds and $5,110,000 from District reserves, for a total project budget of $19.1 million.


Action by the Board at its meeting of November 21, 2008 – Resolution
NON-CONSENT CALENDAR

     
  AYES (8): Chair Eddie; Vice Chair Reilly; Directors Boro, Cochran, Pahre, Sobel and Stroeh; President Moylan (Ex Officio)
NOES (0): None
ABSENT (3): Directors Ammiano, Hernández and McGlashan
     
4.

Approve Actions Relative to the Sole Source Procurement of Marine Diesel Engines for the M.V. Del Norte

In a memorandum to Committee, Deputy General Manager, Ferry Division James Swindler and General Manager Celia Kupersmith reported on staff’s recommendation to approve actions relative to the sole source procurement of four marine diesel engines and installation support services for the re-powering of the M.V. Del Norte.

The report stated that the M.V. Del Norte was built in 1997 and has accumulated approximately 30,000 hours of service on its main diesel engines and no longer meets current U.S. Environmental Protection Agency (EPA) emissions regulations. The report also stated that staff applied for and received Carl Moyer Program grant funds in the amount of $3,173,854 to purchase four new Tier 2 ferry engines for the M.V. Del Norte, which engines will be designed and manufactured in accordance with the latest EPA and California Air Resources Board (CARB) regulations. The report also stated that the District must use the MTU 12V4000M60 engines to re-power the M.V. Del Norte, for the following reasons: (1) use of the MTU 12V4000M60 engine is a condition of the Carl Moyer grant that will fund this procurement; (2) the District re-powered the M.V. Mendocino with the same type of engine; and, (3) having similar types of marine diesel engines in the District’s high-speed ferry fleet will reduce the amount of the District’s overhead and eliminate any additional operator and maintenance staff training requirements.

The report also stated that the manufacturer of the MTU 12V4000M60 engine allows buyers to purchase engines only from a single authorized regional distributor. The only MTU distributor in the Bay Area, Valley Power Systems, Inc. of San Leandro, CA, is in a protracted labor dispute. To avoid District entanglement in this labor dispute, MTU authorized the District to procure engines, and associated installation support services, from Pacific Power Products of Kent, WA, instead of from Valley Power Systems. The total cost to purchase the engines and installation support services from Pacific Power Products is $1,388,604.00. The District has also compared the price for this procurement to the price that Pacific Power Products has recently charged its other customers and has determined that the price is fair and reasonable. The report noted that, because only a single engine type is possible for use in re-powering the M.V. Del Norte, and because the engine is only available from a single source, staff and the Attorney for the District have determined that this procurement is consistent with federal regulations and meets the requirement for a sole source procurement as set forth in the District’s Procurement Manual.

It is recommended that a sole source procurement be awarded to Pacific Power Products to provide four MTU 12V4000M60 Tier 2 marine diesel engines, as well as on-site installation, training and oversight services, for a total bid price of $1,388,604.00, and that a contingency budget in the amount of $130,000 be established. This project is included in the FY 08/09 Ferry Division Capital Budget at a total cost of $3,500,000, and is 100% grant funded with $3,173,854 Carl Moyer Program grant funds and $326,146 Federal Transit Administration grant funds. A copy of the report is available from the Office of the District Secretary and on the District’s web site.

At the meeting, Celia Kupersmith summarized the staff report, noting that there is only one supplier of the type of MTU marine diesel engine that meets the District’s needs for re-powering the M.V. Del Norte.

Staff recommended and the Committee concurred by motion made and seconded by Directors COCHRAN/STROEH to forward the following recommendation to the Board of Directors for its consideration:

RECOMMENDATION

The Building and Operating Committee recommends that the Board of Directors authorize award of a sole source procurement to Pacific Power Products, Kent, WA, in the amount of $1,388,604.00, for the purchase of four MTU 12V4000M60 Tier 2 Marine Diesel Engines for the M.V. Del Norte and installation support services; and, authorize a contingency fund in the amount of $130,000.00, equal to 10%of the purchase price, to cover sales tax, travel expenses and any unanticipated procurement costs; with the understanding that requisite funds are available in the FY 08/09 Ferry Transit Division Capital Budget.


Action by the Board at its meeting of November 21, 2008 – Resolution
NON-CONSENT CALENDAR

AYES (8): Chair Eddie; Vice Chair Reilly; Directors Boro, Cochran, Pahre, Sobel and Stroeh; President Moylan (Ex Officio)
NOES (0): None
ABSENT (3): Directors Ammiano, Hernández and McGlashan

     
5.

Status Report from District Appointees on Sonoma-Marin Area Rail Transit (SMART) Board

The Committee was provided with a copy of the agenda for the November 19, 2008, meeting and the minutes of the October 15, 2008, meeting of the Sonoma-Marin Area Rail Transit District (SMART). Copies of these items are available in the Office of the District Secretary, as well as on the District’s web site.

At the meeting, Director Pahre, one of the members of the SMART Board of Directors (SMART Board), reported on the following:

  1. At its November 19, 3008, meeting, the SMART Board celebrated the passage of Measure Q on November 4, 2008.
  2. The SMART project management team from Earth Tech has devised a three-year plan for implementation of SMART commuter train service, with the design phase commencing shortly.
  3. The SMART Board approved the hiring of a Finance Manager, as well as additional clerical staff.
  4. Director Pahre stated that there will also be close coordination in the future between the District and SMART regarding shuttle bus service to SMART train stations.

Director Boro, another member of the SMART Board, commented that with respect to hiring staff, the SMART General Manager is following a model similar to that used by San Francisco Bay Area Water Emergency Transit Authority; namely, to rely on consultants until the transit service is fully operational, and then hire permanent staff once the implementation project is completed.

Discussion ensued, including the following:

  • Celia Kupersmith noted that once the SMART train is fully operational, the District will be working closely with SMART regarding its operating staff, since SMART’s authorizing language includes provisions that links SMART’s train operators to the District’s Bus Operators represented by the Amalgamated Transit Union, Local No. 1575. She stated that staff will provide future reports to the Committee regarding this issue.
  • Director Stroeh commented on his positive experience working on the successful Measure Q campaign, noting that former Director Cynthia Murray was the campaign chair.

Action by the Board – None Required

     
     
6.

Status Report on Engineering Projects

In a memorandum to Committee, Deputy District Engineer Ewa Z. Bauer, District Engineer Denis Mulligan and General Manager Celia Kupersmith reported on current engineering projects. A copy of the report is available in the Office of the District Secretary and on the District’s web site.

Action by the Board – None Required

     
7.

Public Comment

There was no public comment.

     
8.

Adjournment

All business having been concluded, the meeting was declared adjourned at 11:15 a.m.

     


Respectfully submitted,

/s/ James C. Eddie, Chair
Building and Operating Committee