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City of Puyallup

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AI- 3490   16.    
City Council Agenda
Meeting Date: 02/05/2013  
Subject:    CIP Prioritization Program
Presenter: Mark Palmer
Department: Public Works  

Information
Recommended Action
Authorize the City Manager to execute a contract with HDR Engineering, Inc. in the amount of $82,150 for development of a CIP prioritization program.
Background
The Capital Improvement Program (CIP) project list for the City's utilities and streets contains over 230 projects with an estimated construction cost of several hundred million dollars. With limited funding resources available, it is important to ensure that we expend our efforts and resources on those projects which are most critical to maintaining our infrastructure. The development of a CIP prioritization program, which will assess the risk and costs of mitigation for each project, will assist us in objectively determining which of the projects should be completed first, and, just as importantly, which projects can be safely deferred until later or can have their service life prolonged by measures other than capital replacement.

Staff's intention is to develop a program (with the assistance of HDR Engineering in the initial set-up phase) that will leverage our current computerized maintenance management software (CMMS), is easily adaptable to changing data availability, and is able to be maintained by City staff in future years. We also desire this program to be expandable as we move from this first step to a more comprehensive asset management system for the City's infrastructure. The program will encompass all the City's infrastructure, to include parks, buildings, and fleet in addition to sanitary sewers, water, stormwater, streets and bridges.
Previous Actions (Discussions/Presentations)
The CIP prioritization program was approved by Council as part of the CIP budget for 2012 in the streets, water, sewer and stormwater budgets.

A brief introductory email on the CIP prioritization program was provided to the City Council on January 4, 2013.
Summary of Proposal
The prioritization process will be built around a business case approach using a combination of business processes and software configuration. HDR will conduct a series of workshops to fully involve staff in the development of the CIP processes and to educate staff on the methodology of both risk-based prioritization and how to  develop business case evaluations. HDR will then document the CIP prioritization and data management business processes as a written methodology. This will include developing system functional requirements, documenting business activities as workflow diagrams, and preparing the Software Requirements Specification (SRS) for configuring the CIP prioritization tool and the CMMS.
Alternatives/Options
Consultant Selection: 

This project utilized the Municipal Research and Service Center's (MRSC) consulting services roster, which allows the City to send notifications to all consultants registered with the service that have experience in the area of expertise required and have expressed an interest in working with the City of Puyallup. The MRSC roster was used to satisfy state law requirements that contracts be awarded based on a competitive process. HDR Engineering was selected from MSRC's list of pre-qualified professional service providers based on HDR's expertise in asset management, cooperation, and efficiency in accomplishing necessary tasks on other projects to date and after competitive interviews with two firms.

Alternatives to Consultant Contract: 

City staff currently does not have either the availability or all the necessary skills to create this program internally. HDR has done this type of work for multiple organizations with similar functional needs, thus utilizing their experience prevents the city from "reinventing the wheel."  HDR's approach is to provide best practices that have been developed by other organizations, educate staff on business analytics needed to support the program, and help staff configure the city's existing software systems to automate the processes as much as possible.

The Benefit

Staff recommends this contract as a good investment towards achieving improvements in measurement, analysis, and the CIP process, and also as a means of developing a future system that will help make the most effective use of the community’s capital investments.

Fiscal Impact
Amount Budgeted: 200,000
Bid Amount: 82,150
City Funding Needed for Project: 82,150
Funds from Other Sources: N/A
Ongoing Staff Costs: See Below
Fiscal Impacts:
This investment creates an objective, vigorous evaluation tool for setting capital projects priorities. It will provide an improved process for assessing utility, street, facilities, fleet and parks budget needs for capital projects. Currently, this project's budget is equally shared by Streets, Sewer, Water and Stormwater. Although HDR's fee for this work is well below the amount budgeted, the potential exists for additional costs related mainly to the selection of the software for the program. Additional expenses might also be incurred to execute the required software specifications. At this time, staff expects that the total project cost will fall well within the budgeted amount.

Even with a consultant, substantial staff effort will be required to develop the data needed to fill gaps in the information systems, as those gaps are identified. One of the objectives of the program is to collect only the amount of data necessary to make prudent decisions on the maintenance and replacement of City infrastructure. This information will be recorded in the City's CMMS program on a routine basis where it will be retrievable anytime by all levels of staff.
Attachments
HDR Scope & Fee

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