Consideration and Approval of Contract:  Roads & Streets Operations and Maintenance Efficiency Study RFP 2015-70 (Approve contract with LA Consulting, Inc. in the amount of $197,769).

Award the contract for the Roads & Streets Operations and Maintenance Efficiency Study RFP 2015-70 to LA Consulting, Inc. of Manhattan Beach, CA in the amount of $197,769. 

The Road & Streets Operations and Maintenance Efficiency Study will provide a full evaluation and needs assessment for these activities in the City and County Public Works Departments.  LA Consulting has performed more than 80 such studies and has a track record of improving client productivity.  Modernization of management systems will be implemented and areas for further cooperation between the agencies explored.  Funding is provided through the Flagstaff Metropolitan Planning Organization.  Contract management will be performed by the City Public Works Department.

The cost of the contract is $197,769. Funds are through a federal grant to the Flagstaff MPO. The process will take approximately 17-months to complete because of the extensive field work and intensive implementation regime.  The prospects for improved efficiency are unknown at this time.  Real-world examples of saving hundreds of thousands of dollars annually and more exist resulting in a high probability that the pay-back period on this investment will be short.

The Council made no previous decision on this.  This is the first study of its kind for the City and County Public Works Departments.

1.  Award the contract to LA Consulting, Inc. as recommended.
2.  Remand the project to the FMPO Executive Board for further consideration.  The City through the Council acts as the fiscal agent for the FMPO.  The FMPO Executive Board set the work program and authorized the expenditure.  The City could ask the Board to de-fund the project.  The City and County Public Works Departments would continue business as usual or embark on internal efforts to improve efficiency.  The FMPO funds would be de-obligated and programmed to different purposes.
3.  Remand the project to the selection committee for further consideration.  A team of seven individuals considered proposals from six firms.  Two firms were interviewed.  A strong consensus in support of LA Consulting, Inc. was reached. 

The FMPO is charged with monitoring the conditions of regional roads and streets as well as for long-term capital transportation project planning.  Inherent to that charge is assuring that investment of federal dollars in capital projects will be protected by appropriate upkeep. Roads and streets operations and maintenance (O&M) is a significant expense for the City and County.    Because funding sources for capital construction and maintenance are often the same and capital plans are to be fiscally constrained, it is a necessity to understand the impacts of O&M expenses on the fiscal ability to deliver capital projects.  Conversely, O&M needs are increased by additional lanes, new trails and new roads and traffic signals as well as the increase in traffic created by growth.  The data needs between O&M and Capital overlap significantly.

During the recession, the City and County saw large decreases in the Highway User Revenue Fund, the state gas tax that is the traditional source of O&M funding.  In response, the City and County decreased staff size, deferred vehicle replacement and, in some instances, decreased service.  The idea for this study was born from these challenging circumstances:  How can we do more with less?

Simultaneously, the City and County explored new funding sources.  In November 2014 City and County voters passed propositions 403 and 406 providing sales tax revenue for improving roads and streets and O&M support.  This study was deferred until after that election and is now of value to ensure the public trust is well met.

In April of 2015, the City's Purchasing Section conducted a Request for Proposals (RFP). There were a total of six (6) proposal responses that were evaluated by a committee comprised of five (5) evaluators who evaluated and scored each proposal according to the evaluation criteria outlined in the RFP document. LA Consulting ended up being the highest scoring Proposer whose proposal was determined to be the most advantageous to the City taking into consideration the evaluation criteria set forth in the RFP document.

Meeting Public Expectations:  The City and County received a vote of public confidence to meet the very real need of safe and well-maintained roads & streets.  Employing best practices within the resources available will assure that trust is held.
Consultant Accountability/Return on Investment:  The contract is structured to allow agency review after the needs assessment phase to determine if the consultant is performing as expected and that the scale of the needs justify the investment in the implementation phase.
Prospect for Additional Expenses:  There are prospects for additional expenses in two arenas:  Management Software Procurement and Implementation. The project schedule aligns with budget calendars making consideration of additional funds more manageable and will have available an order of magnitude benefit to be derived from those expenses.  The City and County both own Cartegraph that can issue work orders and help organize and streamline management activities.  Both have stated a strong preference that it be utilized. The needs assessment may indicate areas where Cartegraph is not capable of serving the needs of one or both agencies.  In that case, the respective Public Works departments may approach the Council (or Board of Supervisors) for the purchase of a new system or module. LA Consulting does not advocate for or represent any particular management software.  The introductory and needs assessment phases will cost approximately $60,000 leaving the bulk of the contract for implementation. LA Consulting's success lies in a very hands-on approach to getting staff engaged in using and responding to the new management systems.  Until the needs assessment is complete, the size of this effort is unknown.  Further, the needs of the City versus the County may prove to be very different.  The respective departments may desire focused attention on one or more areas at additional expense.  In those cases, the will approach the Council (or Board) with a budget request.
Impacts on Staff Time:  The consultant will be relying on staff to provide financial and other data.  The consultant will expect staff to be available for interviews and evaluation of field activities. LA Consulting's schedule is comparatively long to account for observations over a variety of seasonal conditions and the time it takes for busy staff to collect information.

Management software, if needed, can cost more than $200,000.

The community will benefit from an efficient use of taxpayer dollars.  Assuming efficiencies are found, they will benefit from improved levels of operations and maintenance service. Transparency will increase as data and related reporting are more reliably produced.  This will also help in making budgeting, staffing and procurement decisions as the likely effect of those investments can be more readily seen.

Inform - this is largely an internal effort.  However, performance targets and other matters will eventually be discussed before Council and the public will generally be made aware of these efforts.