HomeMy WebLinkAbout11/15/2017 - STAFF REPORTS - 5.D. �OQ P AIM s'09
iy
0
V N
M1co '� '•
•C "wuao
4<lFO RN�P
CITY COUNCIL STAFF REPORT
DATE: November 15, 2017 NEW BUSINESS
SUBJECT: APPROVE A LIMITED TERM OF THE THIRD OF FOUR ONE-YEAR
EXTENSION OPTIONS TO THE TROLLEY SERVICES OPERATOR
AGREEMENT WITH MV TRANSPORTATION INC., RENEWING THE
PROGRAM FOR THREE MONTHS EFFECTIVE DECEMBER 19, 2017
THROUGH MARCH 18, 2018.
FROM: David H. Ready, City Manager
BY: Community and Economic Development Department
SUMMARY
Approve an interim three-month contract extension with MV Transportation, Inc., for
BUZZ Trolley Services effective December 19, 2017 through March 18, 2018.
RECOMMENDATION:
1. Approve a three-month portion of the third of four one-year extension options to
the Trolley Services Operator Agreement with MV Transportation, Inc. in an
amount not to exceed $222,075 for the first three months of the fourth year of
service.
2. Authorize the City Manager or his designee to execute all necessary documents.
STAFF ANALYSIS:
On June 18, 2014, Council approved a Trolley Services Operator Agreement with MV
Transportation, Inc., for a one-year BUZZ Trolley pilot program at a cost of $918,874.
The BUZZ service formally began on December 19, 2014 — and since that time rider
trips have totaled 644,871 (as of November 5, 2017), averaging 4,327 weekly.
The BUZZ program consists of five natural gas trolley bus-type vehicles, connecting
businesses, visitors, and residents along the lengthy Downtown/Uptown Palm Canyon
Drive corridor, including the Rivera Hotel in the north and Saguaro Hotel in the south.
The program is designed to enhance economic development by providing a new and
exciting "visitor experience" for our tourism brand. Additionally, the program helps
reduce downtown parking congestion; bridges long walking distances within the central
business district and between outlying major hotels and the Convention Center;
provides a safer alternative to drinking and driving; reduces the number of cars on the
tTEM NO. J'
City Council Staff Report
November 15, 2017— Page 2
BUZZ Trolley Operation Extension Agreement
road; and lowers carbon emissions as the trolleys are fueled by compressed natural
gas.
The agreement contains four additional one-year extension options with compensation
as follows: Year 2 - $856,985; Year 3 - $863,592; Year 4 - $888,300; and, Year 5 -
$893,222. Funding for the agreement comes from Measure J, less an annual $100,000
contribution from PS Resorts.
The proposed three-month extension of the BUZZ Trolley Operator Agreement with MV
Transportation will allow staff, at City Council's request, to present ideas and plans
relative to operational improvements/route modifications, modification of service hours
to reduce costs, opportunities for revenue sponsorships and improved marketing
strategies at the first City Council Meeting in January. At that time, City Council will
direct staff on any proposed changes and either approve the remaining nine months of
the annual contract renewal, or terminate the program.
FISCAL IMPACT:
The cost for the fourth year of operation is $888,300, a reduction from the first year of
the pilot program due to savings in start-up costs associated with the launch of the
program, training of drivers, and procurement and branding of the vehicles. The
proposed three-month extension would cost $222,075, with approximately $25,000 from
PS Resorts funding (approximately 11.25% of the annual contribution) and the balance
of$197,075 from Measure J, account 260-4500-59462.
In accordance with the MV Transportation contract, should the City elect not to extend
the trolley program at any time beyond the first year of the program, the City is obligated
to pay the difference in the depreciated value and the market value of the trolley buses.
However, the maximum per-trolley cost will not exceed $24,334 (a maximum of
$121,670 for five trolley buses).
SUBMITTED:
Diana R. Shay Jay Vira a, irector of
Redevelopment Coordinator Commun y and Economic Development
David H. Ready, Esq., P .
City Manager
Attachment: Renewal letter dated November 1, 2017 renewing a three-month portion of
the third of four one-year extension options to the Trolley Services
Operator Agreement (A6564)
02
ATTACHMENT
RENEWAL LETTER
MV TRANSPORATION, INC.
03
���Qp`MSA�rti City of Palm Springs
A.
?• e
to Community and Economic Developmenr Department
}20II E.T.dtquitz Canyon\Ca)• • Palm Springs,California 92262
TEL:(760)52S-8259 • FAX p601 422•>3325 •TDDMAI)al6-0'JS_'7
�•o .rio
eq Cnrmm�niry•Itedredopment Aguuy•Cemmunuy Dccdnpmmnt lal.w k Gram
41FOR Downtown Ikvdupnunt •Gmw;Pu 1).cdupusnc •Ilnusu.g • Pu66i Att
November 1,2017
MV Transportation, Inc.
5910 N.Central Expressway,Suite 1145
Dallas,TX 75206
Attention: Judie Smith,Area Vice-President
The City Council of the City of Palm Springs unanimously voted on December 7, 2016 to
extend the contract with MV Transportation, Inc. for operation of the BUZZ trolley for
the third year of service. We are approaching the end of year three and the City desires
to continue operation of the BUZZ trolley service into the fourth year of operation.
Please be advised that the City wishes to exercise a portion of the third one-year
extension option for a period of three-months, effective December 19, 2017 through
March 18, 2018. Due to budgetary constraints, we cannot at this time contract for the
full one-year extension term; however, the City will advise on the remaining nine-
months of the extension term on or before February 18,2018.
Thank you for the ongoing excellent services that MV is providing for operation of the
BUZZ trolley service.
Sincerely,
Diana R.Shay,Redevelopment Coordinator
AGREED: APPROVED:
MV TRANSPORTATION INC. CITY OF PALM SPRINGS
By: By:
Erin Niewinski
Its: Interim CFO Its:
Post Office BDx 2743 6 Palm Sizings, California 92263-2743 04