COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Department of Public Works

DATE:

July 2, 2008

BOARD MEETING DATE:

July 22, 2008

SPECIAL NOTICE/HEARING:

None

VOTE REQUIRED:

Majority

TO:

Honorable Board of Supervisors

FROM:

James C. Porter, Director of Public Works

SUBJECT:

HEARING TO CONSIDER AN ENERGY SERVICE CONTRACT WITH ABAG ENERGY WATCH DIRECT INSTALL LIGHTING PROGRAM CONTRACTOR, ABI SERVICES, INC. TO RETROFIT LIGHT FIXTURES IN TWENTY COUNTY OWNED AND LEASED FACILITIES

RECOMMENDATION:

Hold a public hearing, receive any and all comments, close the hearing and then adopt a resolution authorizing execution of an agreement with ABAG Energy Watch direct install lighting program contractor ABI Services to retrofit light fixtures in twenty County owned and leased facilities for a total amount of $589,176.18, and authorizing the Director of Public Works to approve expenditures up to an additional $25,000 for project costs related to the Hall of Justice.

VISION ALIGNMENT:

Commitment: Responsive, effective, and collaborative government.

Goal 20: Government decisions are based on careful consideration of future impact, rather than temporary relief or immediate gain.

Commitment: Ensure basic health and safety for all.

Goal 7: Maintain and enhance the public safety of all residents and visitors.

Your Board’s adoption of the proposed resolution will result in cost savings and a net reduction in carbon dioxide emission associated with providing lighting in twenty County owned and leased facilities, and will further demonstrate your Board’s continuing commitment to conserve energy and practice environmental stewardship.

BACKGROUND:

Previous Board Action

1.

In 1993 the Board authorized the County’s participation in the Environmental Protection Agency’s Green Lights Program, a Federal program which commits the participating agencies to replace building lighting systems with more energy efficient systems.

2.

In November 2005 the Board authorized the County’s participation in the Sustainable Silicon Valley Initiative and commitment to reducing carbon dioxide (CO2) emissions.

3.

In October 2007 the Board adopted the Cool Counties Declaration, which committed the County to developing a greenhouse gas emissions (GHG) inventory for County operations and an emissions reduction action plan. The County also committed to supporting regional GHG reduction targets, measuring progress toward those goals and advocating for federal action on climate change.

4.

On June 17, 2008, the Board adopted a resolution setting a time and date for a public hearing to consider the agreement with ABI Services.

Lighting retrofit projects are a widely accepted method of reducing energy costs. The County has recently completed lighting retrofit projects at County Office Building I, County Office Building II, and the East Palo Government Center Building. The Energy Watch Direct Install Program confirmed that retrofitting lights at the other twenty facilities identified for the project would be cost effective for the County.

DISCUSSION:

Government Code Section 4217.12 provides that notwithstanding any other provision of law, a public agency may enter into an energy service contract on terms that its governing body determines are in the best interests of the public agency. The term “energy service contract” includes "conservation measures," which include maintenance, load management techniques and equipment, or other measures to reduce energy use or provide for a more efficient use of energy. The decision must be made at a regularly scheduled public hearing, public notice of which is given at least two weeks in advance. This agreement will find that the cost for energy and the amortizing of the capital expense under this contract will be less than the anticipated marginal cost of energy that would otherwise have been consumed. It is anticipated that the County will fully recover its financial investment within 4.5 years. This short recovery period has made it also cost effective to include certain leased County facilities in the Program, where the County is expected to continue its occupation of the building for longer than 4.5 years.

Staff is recommending that your Board hold the public hearing and enter into an agreement with ABI Services, Inc. which was selected through the ABAG Energy Watch Direct Install Lighting Program. ABAG facilitates the receipt of financial incentives from Pacific Gas and Electric (PG&E) for local entities to implement conservation measures by contracting with pre-selected contractors. Under the terms of the proposed agreement, ABI Services will audit, design, and install lamps and ballasts at various County buildings as listed on Attachment A. A complete copy of the ABI Proposal that identifies the specific work to be performed on each of the buildings is on file and available for review at the Clerk of the Board of Supervisors Office.

Through participation in the Direct Install Lighting Program, the County will maximize PG&E rebate/incentives by four (4) times the normal amount for these projects. The County is also saving on the installation cost by utilizing the ABAG program vendor. ABI Services has been the low bidder on three (3) previous lighting projects and staff has verified that ABI Services pays its workers the prevailing wage.

The estimated annual energy cost savings is projected to be $108,000. In terms of environmental benefits, the increased efficiency of the proposed lamps and ballasts will offset approximately 172 tons of carbon-dioxide emissions each year.

A resolution has been approved as to form by County Counsel.

FISCAL IMPACT:

The total cost for these projects is $589,176.18. Of this amount the County’s share under this contract shall not exceed $439,176.18 and a PG&E rebate of $150,000 will be paid directly to the contractor, thereby making up the difference of the total project cost. The total cost includes a 20% contingency ($98,196) for unanticipated costs related to this project. This additional amount can only be expended after written authorization is provided by the Public Works Director and specifies the work to be performed and payment amount. The Director of Public Works will also be authorized to approve expenditures up to an additional $25,000 for project costs related to the Hall of Justice. This project is included in the 2008-09 Capital Projects Budget. Based on the projected energy cost savings, the County will recover its investment in 4.5 years and will continue to accrue energy cost savings.

The portion of the work under this contract that relates to the Courts facilities will be contingent upon their providing reimbursement to the County for their portion of the projects. The Public Works Director is authorized to remove any of the Courts facilities from the project list that will not be fully reimbursed by the Courts.

Attachment:

Attachment A