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Title
Clarification of construction contract with Itron, Inc. for the provision of a fully functioning Automated Metering Infrastructure (AMI) System
Presenter
Ron McCuller, Director of Public Works
Recommended Action
Approve
Analysis
The current clarification of the construction contract with Itron, Inc. for a fully functioning automated metering infrastructure system is to restate the total City commitment. The current contract with Itron, Inc. was bid with the Life Cycle cost for Itron at $11,830,921 and was used in our weighted selection process. On July 14, 2015, the City Council approved agenda item 15-4632 for the initial phase of the Itron, Inc. contract amount in the amount $5,250,000. On November 3, 2015, the City Council approved change order No. 1, agenda item 15-5081, to add $1,650,000 to the Itron, Inc. contract from the FY 2016 project funding that was approved during the budget process for the next phase. Total current amount of award to date is $6,900,000. The goal is to increase the award each year based on the approved year's budget to a maximum amount of $11,830,921. Current remaining to be awarded amount is $4,930,621.
We will be executing zero change orders to add line items and pricing for unforeseen circumstances that occur during the replacement project with the total dollar amount staying within the approved budget.
The total bid amount from Itron, Inc. was $11,830,921.
History of project:
In 2003, the City began an upgrade of its meter reading to become more efficient. This led to a "drive by" meter reading system that, as meters were changed out or new ones installed, eliminated the need for manual meter reading. This is accomplished by transmitters on the new meters that send the reading to our receiving equipment as we drive down the street.
On May 7, 2013 the Public Works Department presented a proposal to the Finance and Government Committee to proceed with an application to the Texas Water Development Board (TWDB) for financial assistance for Phase 1 of the Automated Metering Infrastructure System Project (AMI). The estimated project cost was $4 million. The Finance and Government Committee recommended moving forward with the application.
On August 6, 2013, the City Council approved a resolution to file the application for financial assistance with the TWDB. The TWDB at their November 21, 2013 Board meeting approved the $4 million funding for the project. The financial assistance from the TWDB consist of an interest rate subsidy of 1.25% at the time of the pricing of the bonds on March 11, 2014. The Finance and Government Committee at their February 4, 2014 meeting recommended moving forward with the financing and bond sale.
On March 18, 2014, the City Council approved an ordinance authorizing the issuance of Water Wastewater System Revenue Bonds, Series 2014 in the amount of $4,000,000 for the AMI project.
On July 14, 2015, the City Council approved agenda item 15-4632 for the initial phase of the Itron, Inc. contract in the amount of $5,250,000.
On November 3, 2015, the City Council approved change order No. 1, agenda item 15-5081 to add $1,650,000 to the Itron, Inc. contract from the FY 2016 approved budget.
Financial Consideration
Original Funding in the total amount of $5,250,000 was available as follows:
1. $4,000,000 was available in Grant (500892) 42514022 (TWDB 2014 AMI) 68540 construction
2. $1,250,000 was available in the Water Capital Projects Fund (500592) #01307403 (FY13 AMI Meter Project) 90408-transfer to Grant (500892) 42514022 (TWDB 2014 AMI).
Change order No. 1 funding in the total amount of $1,650,000 was available as follows:
1. $1,250,000 was approved in the FY 2015/2016 budget (500892) 42514022 (TWDB 2014 AMI) 68540 construction
2. $400,000 was approved from 361010 68280 for warehouse inventory/additional equipment.
Funding for future fiscal years will be paid from that year's approved budgets until all systems were completed.