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Home My WebLink About8A AMRS Contract Approval Report Phone 952.447.9800 / Fax 952.447.4245 / www.cityofpriorlake.com 4646 Dakota Street SE Prior Lake, MN 55372 CITY COUNCIL AGENDA REPORT MEETING DATE: JUNE 4, 2017 AGENDA #: 8A PREPARED BY: JASON WEDEL, PUBLIC WORKS DIRECTOR/CITY ENGINEER PRESENTED BY: JASON WEDEL AGENDA ITEM: CONSIDER APPROVAL OF A RESOLUTION ACCEPTING THE REVISED PROPOSAL AND AUTHORIZING THE MAYOR AND CITY MANAGER TO EXECUTE THE CITY’S STANDARDIZED CONSTRUCTION CONSTRACT FOR THE 2018 AMRS REPLACEMENT PROJECT DISCUSSION: Introduction The City’s existing Automatic Meter Reading System (AMRS) was installed in 2002. The life expectancy of the Meter Transmitter Units (MTUs) within that system is 20 years. The City is experiencing many of these MTU batteries already expiring, which is making the collection of data for water billing purposes difficult. It is therefore necessary to move forward with a full city-wide replacement. The City included funds in the 2018 budget for this work. City staff sent out Requests for Proposals (RFP’s) to three different vendors that provide these types of improvements. The City Council selected Ferguson as the preferred vendor at the May 7, 2018 City Council meeting and directed staff to negotiate with Ferguson on the final contract amount and bring the contract back for consideration of approval and authorization to proceed with the work at a future meeting. History The City of Prior Lake’s water meter MTUs are reaching the end of their useful lives. In 2002 the City installed an AMRS system consisting of MTUs, and centralized data collecting units (DCUs). Readings collected by the meter registers are transmitted to the central database once per day through a fixed radio system. Prior to the AMRS, City staff would travel to each billing address once every two months to collect meter reading data. This would take four staff members an entire week to complete. The current AMRS collects meter reading data multiple times every day. However, there are meters that are not currently detected. The City has 14 DCUs spread throughout the City that read the signals coming from the MTUs at each billing address. Unfortunately, some locations remain undetectable to our DCUs. The options for picking up these locations is adding more DCUs or having an alternative method for obtaining readings from those locations such as a drive-by detection unit. Due to the scattered nature of our missing meter reads, staff would prefer a drive-by option. Unfortunately, our current Aclara system does not offer a drive-by option. The City has had a long history of issues with the current Aclara AMRS. When the City reports a problem to the company, City staff must spend many hours of labor and weeks or months of support requests before Aclara will acknowledge and resolve the problem. In some instances, the problems are as simple as updating a script or data library, but in other cases the source of the error has been a complete hardware design failure. The significant investment in the AMRS infrastructure makes it difficult for the City to cut its ties with Aclara, but these failures have cost the City a substantial amount of money in lost staff productivity. With the increasing number of existing MTUs failing every day it was necessary to initiate the proposal process for their replacement this year. Delaying their replacement would put the City in a position where we cannot keep up with daily MTU replacements, which results in meters that go unread requiring Utility Billing to make estimates on the amount of water used by those accounts. Current Circumstances The City received three proposals. The proposers included the City’s current provider Aclara as well as Winwater and Ferguson. The City Council selected Ferguson based on several factors including overall cost for MTU and water meter replacement, the company being local, and they were the only provider that offered a drive-by option for meter reading. The total proposed cost for both MTU and water meter replacement was as follows: Ferguson $2,079,079.22 Aclara $2,834,885.00 Winwater $2,699,520.38 Ferguson was significantly less expensive than the other two providers when including water meter replacement due primarily to the fact that they do the water meter replacement with their own staff and the other two providers were proposing to use subcontractors for that work. The City’s budget for the AMRS project is $1,700,000. Therefore, the City Council directed staff to work with Ferguson to negotiate a final contract amount that is consistent with the allocated funding. ISSUES: Staff recommended that the City Council include the water meter replacement alternative along with the MTU replacement. There is an additional cost for doing this; however, there are several benefits for doing both at the same time. First, replacing the older water meters will result in more accurate water meter readings which will provide more revenue to the City due to older meters under reporting water usage. Second, replacing the water meters now will allow us to only inconvenience our residents once. If we only replace the MTUs now we will be back in approximately 5 years replacing the water meters. Each replacement requires making appointments and having residents at home to allow us access to their property to make the changes. Third, the benefit for City staff will be having one consistent water system throughout the City. It will therefore be much more efficient to maintain, because we will only have to stock one model of parts and we only need to train our staff on how to service one type of product. Finally, it is more cost effective to replace the MTUs and the water meters at the same time. FINANCIAL IMPACT: As stated above, the original proposal from Ferguson for both MTU and water meter replacement was $2,079,079.22. Staff worked with Ferguson to take a harder look at the number of DCUs that would be needed to obtain the meter readings as well as the actual number of water meters that would need to be replaced. The result was that we were able to reduce the number of DCU’s from 20 to 13 and we were able to reduce the number of water meters being replaced by approximately 2,200. The reduction in DCUs is based on a revised propagation study. Once the system is installed we will know if the study was accurate. There is a possibility that we might need to add one or two more DCUs. The cost for a DCU is approximately $20,000. The reduction in water meters was possible because Ferguson has proposed using Neptune water meters. The City began using Neptune water meters several years ago, so there are already approximately 2,200 Neptune water meters in place that will not need to be replaced. The reduction in DCUs and water meters resulted in a revised proposal cost of $1,476,324.07. The budget for this work is $1,700,000 so the current proposal is $223,675.93 below budget. In addition to being below budget, the City will have an ongoing annual savings due to the current budgets including $190,000 for water meter replacements. Once this work is completed that annual expense will be significantly reduced. ALTERNATIVES: 1. Approve a Resolution accepting Ferguson’s revised proposal and authorize the Mayor and City Manager to execute the City’s Standardized Construction Contract for the 2018 AMRS Replacement Project. 2. Deny this item for a specific reason and provide staff with direction. 3. Table this item until some date in the future. RECOMMENDED MOTION: Alternative #1 4646 Dakota Street SE Prior Lake, MN 55372 RESOLUTION 18-___ A RESOLUTION ACCEPTING PROPOSAL AND AUTHORIZING THE EXECUTION OF THE CITY’S STANDARD CONSTRUCTION CONTRACT FOR THE 2018 AMRS REPLACEMENT PROJECT (WTR17-000004) Motion By: Second By: WHEREAS, The replacement of the City’s AMRS was identified in the 2018 Capital Improvement Program; and WHEREAS, Proposals were received, opened, and tabulated according to law; and WHEREAS, The following proposals were received: COMPANY MTU ONLY MTU & METER FERGUSON $1,744,461.50 $2,079,079.22 ACLARA $1,620,046.49 $2,834,885.00 WINWATER $1,502,835.51 $2,699,520.38 and; WHEREAS, Ferguson is the lowest responsible vendor for replacement of both the MTUs and the water meters; and WHEREAS, The City directed staff to renegotiate costs with Ferguson and the revised proposal amount is $1,476,324.07 for both MTU and water meter replacement. NOW THEREFORE, BE IT HEREBY RESOLVED BY THE CITY COUNCIL OF PRIOR LAKE, MINNESOTA as follows: 1. The recitals set forth above are incorporated herein. 2. Ferguson is the lowest responsible vendor. 3. The Mayor and the City Manager are authorized to execute the City’s Standardized Construction Contract with Ferguson for an amount of $1,476,324.07. 4. Funding for this work will be split equally from Accounts 601-49400.00-55530.00 and 604-49450.00- 55530.00. PASSED AND ADOPTED THIS 4TH DAY OF JUNE 2018. VOTE Briggs McGuire Thompson Braid Burkart Aye ☐ ☐ ☐ ☐ ☐ Nay ☐ ☐ ☐ ☐ ☐ Abstain ☐ ☐ ☐ ☐ ☐ Absent ☐ ☐ ☐ ☐ ☐ ______________________________ Frank Boyles, City Manager