HomeMy WebLinkAboutCSD-09-054 - Regional Maintenance ContractREPORT
REPORT TO:
Community Services Committee
DATE OF MEETING:
October 5, 2009
SUBMITTED BY:
Jim Witmer, Director of Operations
PREPARED BY:
Jim Witmer, Director of Operations
WARD(S) INVOLVED:
All
DATE OF REPORT: September 25, 2009
REPORT NO.:
CSD-09-054
SUBJECT:
REGIONAL MAINTENANCE CONTRACT
RECOMMENDATION:
That the Mayor and Clerk be authorized to execute and extend/renew the Maintenance
Agreement, subject to the satisfaction of the city solicitor, with the Regional Municipality
of Waterloo for the maintenance of Regional Roads within the municipal limits, as
outlined in CSC Report CSD-09-054.
EXECUTIVE SUMMARY:
The general maintenance of Regional roads in the Cities of Cambridge, Kitchener and Waterloo
has been provided by the three local municipalities since the inception of the Region in 1973.
This service was paid for on a “time and material” basis for the years 1973-2005 and currently
for 2009 and under a Maintenance Agreement (MA) for 2006 to 2008. Regional staff and staff
from the three Cities have been having discussions on how to proceed with the maintenance for
2010 and beyond and have reached an agreement as outlined in this report. The Region’s
Transportation Committee is recommending that an agreement be entered into with the
respective area municipalities to maintain the Regional roads in the three Cities commencing
January 1, 2010.
REPORT:
The Region of Waterloo has a road system comprised of approximately 1700 lane kilometers
and includes a mixture of both urban and rural roads. Since the inception of the Region in 1973,
general maintenance of Regional roads within the municipal boundaries of Cambridge,
Kitchener and Waterloo has been provided by the local municipalities through funding provided
by the Region. The total length of Regional roads maintained by the local municipalities is
approximately 815 lane kilometers. Specialized maintenance such as signals, signs and
pavement marking is provided by the Region in the three Cities.
Prior to 2006, the Region issued purchase orders to the three Cities that included an estimated
budget amount and specifications/performance standards for the maintenance activities and
final payment to the Cities was on a “time and material” basis plus an overhead charge of 7%.
Regional Council and the three City Councils approved entering into a MA for a three year
period commencing on January 1, 2006 and ending on December 31, 2008 and payment for
this agreement was based on a lump sum amount per lane kilometer. This MA was similar in
content and concept to agreements that MTO and other various municipalities have with their
contracted service providers and included a clause to extend the Agreement for an additional
two (2) years.
Staff from the three Cities and the Region commenced discussions in September 2008 for
renewing the agreement for 2009 and beyond. The three Cities expressed concerns that the
current agreement was not covering their actual costs for the 3 year period of 2006 to 2008 and
requested some changes to the agreement.
Regional and City staff have had ongoing discussions regarding a new MA that would start on
January 1, 2010 and have reached agreement at this time where both Regional and City staff
are recommending approval of the agreement to their respective Councils.
The attached MA is similar to the previous MA however the key differences are noted below:
The contract would be for a 5 year term instead of 3 years and renewal of the agreement
would be automatically done unless either party provides written notification of cancelling
the agreement before the agreement expires.
Summer and winter maintenance payment would be dealt with differently under the
agreement.
Winter payment would be based on a “baseline Average” (BA) of the actual winter
maintenance costs for each City for the five years of 2004 to 2008 and this will include a 7%
overhead charge amount on labour, equipment and material (inflated to 2010).
The Region will pay the Cities individually based on their actual winter costs up to 100% of
the BA and any costs exceeding the BA up to 105% of the BA would be paid 100% by the
Cities. Any costs exceeding 105% of the BA would be paid by the Region.
The BA amount would be adjusted annually for the duration of the agreement as per annual
adjustment method noted in the agreement.
Summer payment will be based on a “lump sum amount” of $1873 per lane kilometer (2010
price) and this amount includes the 7% overheard component.
The summer “lump sum amount” will be adjusted annually for the duration of the agreement
as per the annual adjustment method noted in the agreement.
Regional and City staff believe that this agreement represents a fair and equitable solution for
all parties and is recommending their Council’s endorsement. Through time, issues will likely
arise that had not been foreseen and will have to be dealt with to the satisfaction of all parties.
FINANCIAL IMPLICATIONS:
The cost to the Region for the maintenance of its Regional roads in the City of Kitchener, based
on the terms of the MA noted above, is estimated to be in 2010 dollars. This
$2,241,259.65
translates into an approximate cost of per lane kilometer.
$5,861.69
ACKNOWLEDGED BY:
Pauline Houston, General Manager, Community Services Department