Title
MOTION TO APPROVE THE SECOND AMENDMENT TO THE AMENDED AND RESTATED AGREEMENT WITH OPERATIONS MANAGEMENT INTERNATIONAL, INC. (OMI) FOR OPERATION, MAINTENANCE, AND MANAGEMENT OF THE CITY'S UTILITY SYSTEM, TO WAIVE THE POLLUTION LIABILITY INSURANCE REQUIREMENT FOR OMI SUBCONTRACTOR CRAIG A. SMITH AND ASSOCIATES, LLC.
Summary Explanation and Background
SUMMARY EXPLANATION AND BACKGROUND:
1. On April 15, 2020, the City Commission approved the Amended and Restated Agreement with Operations Management International, Inc. (OMI) for the Operation, Maintenance, and Management of the City's Utility System. The commencement date of the agreement was July 23, 2020, and is for a period of five years. The annual cost of the agreement was $8,990,915.04 for the annual fee which covers the personnel and costs associated with the personnel providing services as required under the contract documents. The agreement also includes $1,500,000 annually as a Maintenance and Repair budget.
2. On April 24, 2023, the City Commission approved the first amendment to the agreement to increase the scope of work to provide for two (2) additional Customer Service employees to better serve the utility system, after implementation of the Tyler Munis Enterprise-wide Resource Program software, at an increased annual cost of $108,501.00.
3. Section 10.3 of the OMI Agreement provides that OMI shall require all subcontractors, suppliers, and such other individuals and entities performing or furnishing any of the services under the Agreement to comply with the requirements imposed on CONTRACTOR under the Agreement.
4. In November 2024, OMI notified Utilities Department Staff that one of its subcontractors, Craig A. Smith & Associates, LLC, (CAS) does not comply with the one of the insurance requirements under Section 11.5.4 of the Agreement entitled “Contractor’s Pollution Liability Insurance. More specifically, CAS meets all of the insurance requirements, including general liability, workers’ compensation, auto, umbrella coverage, and crime insurance, but does not carry pollution liability insurance. Recognizing that, OMI is requesting the City to waive this specific insurance requirement for CAS.
5. The City’s Risk Manager has reviewed this request and the services provided by CAS and has determined that pollution liability insurance is not necessary as they do not handle any toxic chemicals. The City Attorney has likewise reviewed this request and developed the proposed Second Amendment.
6. Staff recommends Commission approve the Second Amendment to the Amended and Restated Agreement with Operations Management International, Inc. (OMI) for operation, maintenance, and management of the City's utility system, to waive the pollution liability insurance requirement for OMI subcontractor Craig A. Smith and Associates, LLC.
Financial Impact
FINANCIAL IMPACT DETAIL:
a) Initial Cost: None.
b) Amount budgeted for this item in Account No: Not Applicable.
c) Source of funding for difference, if not fully budgeted: Upon approval of this item: Not Applicable.
d) 5 year projection of the operational cost of the project: Not Applicable.
e) Detail of additional staff requirements: Not Applicable.
FEASIBILITY REVIEW:
A feasibility review is required for the award, renewal and/or expiration of all function sourcing contracts. This analysis is to determine the financial effectiveness of function sourcing services.
a) Was a Feasibility Review/Cost Analysis of Out-Sourcing vs. In-House Labor Conducted for this service? Not Applicable.
b) If Yes, what is the total cost or total savings of utilizing Out-Sourcing vs. In-House Labor for this service? Not Applicable.