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HomeMy WebLinkAbout4.2 Library Utilities Cost Sharingor 19 82 /ii � 111 DATE: TO: STAFF REPORT CITY COUNCIL March 18, 2014 Honorable Mayor and City Councilmembers FROM: Christopher L. Foss, Acting City Manager " SUBJECT: Library Utilities Cost Sharing Agreement Prepared by Roger Bradley, Assistant to the City Manager EXECUTIVE SUMMARY: CITY CLERK File #600 -40 The City Council will consider approving an amendment to the agreement with the Library, placing the PG &E bill in the City's name and establishing a reimbursement mechanism with the Library to ensure that the savings from the energy improvements conducted by the City at the Library realized by the City.. FINANCIAL IMPACT: The impact of the amendment will be budget neutral for the City as the revenue received from the Library will offset the new utility expenses and lease obligations from the Library energy improvements completed in Fiscal Year 2013 -2014. Without the passage of this amendment, the City would be subsidizing Library operations by an estimated amount of $75,000 per year. Should the City Council approve the amendment, funding for this program will be presented as part of the budget process. RECOMMENDATION: Staff recommends that the City Council authorize the Amendment to the Agreement with Alameda County for Maintenance and Operations of the Dublin Library. Submitted By-' Assistant to the City Manager DESCRIPTION: \ Reviewed By Acting Assistant City Manager As part of the City's Energy Upgrade Project, the City of Dublin has conducted significant environmental improvements to the Dublin Library facility, which includes the installation of solar photovoltaic panels, interior and exterior lighting efficiency upgrades, lighting controls, HVAC efficiency improvements, and low flow urinals. These improvements are designed to reduce energy consumption at the Library by approximately 75 percent as well as conserve valuable water during this time of drought. The Library improvements were a part of a comprehensive Page 1 of 3 ITEM NO. 4.2 city -wide effort to improve energy efficiency, save money, and be more environmentally sustainable. The City's energy efficiency project is designed so that the savings in energy costs are used to pay for the project's lease obligations and have no negative impact on the City's General Fund. As such, the City needs to garner the energy savings from each improvement effort in order to pay back the obligation. The Agreement between the City and the County regarding the maintenance and operation of the Dublin Library however provides that the County is responsible for the electrical utility costs within the building. This presented somewhat of a dilemma for the City and County as both organizations needed to work out a cost sharing agreement to ensure that the City realizes the energy savings from the project in a way that does not negatively impact the County. City and Library staff worked collaboratively to find a way to transfer the needed savings to the City without creating an impact on the Library. The proposed solution is to amend the current agreement (Attachment 1) with the Library where the City places the PG &E bill in its name, ensuring that the administrative burden with reporting and monitoring savings performance, as well as the processing of multiple payments, does not fall on the Alameda County Library. From the Library's perspective, it will be business as usual and all that will be required is to budget and pay for PG &E services as it always has done, with the caveat that the City will receive and manage the payments to PG &E. Further, the Library will be invoiced by the City once annually for utility services, which will include two components: an Energy Consumption Component and an Energy Savings Component. The Energy Consumption Component billed to the Library will be the actual consumption and cost of PG &E services for the Library (i.e., the basic PG &E bill). The Energy Savings Component is the reduction in costs from the improvements that have been installed, which will be calculated in two ways: solar generation and all other energy reduction efforts. The Energy Savings Component will be determined using the performance monitoring equipment installed with the existing improvements and using estimates provided by Chevron. The Energy Consumption Component will be a pass through amount that the City will use to pay the PG &E bill, and the Energy Savings Component will be used to pay for the Library Energy Upgrade improvements. Additionally, Staff negotiated the following deal points as part of the amendment: 1) City and Library staff will work together annually to finalize the invoiced amount the Library will receive from the City with invoices being delivered in May /June of each year, and all information and calculation methodologies will be shared to the satisfaction of both parties; 2) The invoiced amount will be reduced each year by the City contribution to exterior lighting in an amount of $6,600 (this is an existing agreed upon condition); and 3) The annual true up period for the energy bills will be adjusted to conclude April 30 of each year. Without the proposed amendment, the City would be subsidizing the County's cost of operating the Dublin Library by an estimated amount of $75,000 or more each year, while the City would be left to pay off the lease obligation for the improvements, not from energy savings, but from its General Fund. Thus, the passage of the proposed amendment is crucial to the solvency of the Energy Upgrade Project. NOTICING REQUIREMENTS /PUBLIC OUTREACH: None. Page 2 of 3 ATTACHMENTS: 1. Second Amendment to the Agreement with Alameda County for Maintenance and Operations of the Dublin Library Page 3 of 3 SECOND AMENDMENT TO AGREEMENT This Second Amendment to Agreement ( "Second Amendment ") is made by the County of Alameda ( "County ") and City of Dublin, ( "Contractor") with respect to that certain agreement entered by theirs on October 8, 2002 (referred to herein as the "Contract') pursuant to which Contractor. provides Maintenance and Operation of Dublin Library services to County. County and Contractor agrees as follows: 1) For valuable consideration, the receipt and sufficiency ofwhich are hereby acknowledged, County and Contractor agree to amend the Agreement in the following respects: Section 1. The existing Section 6 of the Agreement is deleted and a new Section 6 is added to read as follows: 6. Utilities: Utility charges shall be paid as follows; a. Water: County shall pay for water for the building only; City shall pay for water for the landscaping and grounds. b. Gas and Electricity: City will pay for gas and electricity and invoice the County for the cost of these services, subject to the below terms and conditions: 1. County will be invoiced by the City once annually for gas and electricity services, which will be the summation of two components: an Energy Consumption Component and an Energy Savings Component. 2. The Energy Consumption Component will be the actual consumption and cost of gas and electricity services for the Dublin Library. This is a pass through amount and shall be taken directly from the utility service provider's bill. 3. The Energy Savings Component is the reduction in costs from those certain energy saving improvements that have been installed by the City at the Dublin Library, which shall be calculated in two ways: Solar Generation Element and Energy Reduction Element, a. T h e Solar Generation Element is monitored and reported to the City directly by the utility service provider and by the performance monitoring equipment installed with the solar system. The solar energy produced and sold to the grid as well as to the utility's energy consumed onsite is derived directly from the annual True -up Statement, which the City will share with the Library. The value of solar energy consumed on site is estimated fiiom the average per kWh value from the True -up Statement for PG&E energy consumed on site and the solar system's monitoring equipment, b. The Energy Reduction Element refers to those improvements, such as more efficient lighting, that reduce energy consumption at the facility. Such improvements only show up on the annual bill a s a r e d u c t i o n i n consumption and ultimately as c o s t savings. Energy Reduction Element measures are designed to reduce annual consumption by 39% at the Library for a reduction of 1 89,909 kWh per year, which shall be a stipulated savings amount annually. The Energy Reduction Element annual savings shall be derived by multiplying 189,909 kWh by the cost per kWh of energy within any given year, which rate shall be a blended rate as determined from the solar true up bill by the total summation of kWh produced and consumed divided by the total dollar values for each, 4. City and County will work together annually to finalize the invoiced amount the County will receive from the City. Such invoices will be delivered in May /June of each year, and all information and calculation methodologies will be shared to the satisfaction of both parties. 5. The amount the County will be invoiced by the City will be reduced each year by the City's contribution to the Library's exterior lighting in the amount of $6,600. c. Telephone Services: County shall pay for all telephone charges from the building, including charges related to long distance service, telephone maintenance and repair, and telephone equipment purchases, except that the City shall pay any charges for a telephone or telephones placed in the Community Room and managed by the City, d. Garbage Disposal: City shall pay for garbage disposal. Section 2, All other provisions of the Agreement shall remain in effect. Section 3. In the event of a conflict between the Agreement and this Amendment, this Amendment will control. Except to the extent inconsistent with this Amendment, the Parties ratify and confirm all of the terms and conditions of the Agreement. 2) Except as otherwise stated in this second Amendment, the terms and provisions of this Amendment will be considered to be effective as of the date this second Amendment is executed by the County ("Effective Date "), 3) DEBARMENT AND SUSPENSION CERTIFICATION: a. By signing this second Amendment , Debannent and Suspension Certification, Contractor /Grantee agrees to comply with applicable federal suspension and debarment regulations, including but not limited to 7 Code of Federal Regulations (CFR) 3016,35, 28 CFR 66.35, 29 CFR 97.35, 34 CFR 80.35, 45 CFR 92,35 and Executive Order 12549. b. By signing this agreement, Contractor certifies to the best of its knowledge and belief, that it and its principals; 1. Are not presently debarred, suspended, proposed for debarment, declared ineligible, or voluntary excluded by any federal department or agency; 2. Shall not knowingly enter into any covered transaction with a person who is proposed for debarment under federal regulations, debarred, suspended, declared ineligible, or voluntarily excluded from participation in such transaction, Except as expressly modified by this second Amendment, all of the terms and conditions of the Agreement are and remain in full force and effect, IN WITNESS WHEREOF, the parties hereto have executed this Amendment to the Agreement as of the day and year first above written. COUNTY OF ALAMEDA By: Signature Name:_ (Printed) CONTRACTOR/COMPANY NAME By: Signature Naine:_ (Printed) Title: President of the Board of Su ervisors Title: Date: Approved as to Form: County Coun Signature Date: By signing above, signatory warrants and represents that he /she executed this Agreement in his/her authorized capacity and that by his/her signature on this Agreement, he /she or the entity upon behalf of which lie /she acted, executed this Agreement