Item - 2021.IE23.15

The Infrastructure and Environment Committee:

1. In accordance with Section 195-8.4 of Toronto Municipal Code Chapter 195 (Purchasing), authorized the General Manager, Transportation Services to negotiate, enter into, and execute an agreement with each of the following two successful Suppliers based on the terms and conditions set out in Negotiated Request for Proposal Doc2865468161 and any other terms and conditions satisfactory to the General Manager, Transportation Services and in a form satisfactory to the City Solicitor:

a. Black & McDonald Limited for the provision of Traffic Electrical Maintenance and Emergency Services for Service Area A (Etobicoke, North York, Toronto / East York) as defined in the Negotiated Request for Proposal, for a contract term of four (4) years from date of execution of the agreement in the amount of $65,443,155 net of all applicable taxes and charges, including contingency plus annual escalation adjustment of three (3) percent to account for Consumer Price Index inflation adjustment ($66,594,954 net of Harmonized Sales Tax recoveries, including contingency), with the option to renew at the discretion of the General Manager Transportation Services for an additional one (1) year period in the amount of $17,438,435 net of all applicable taxes and charges, including contingency plus annual escalation adjustment of three (3) percent to account for Consumer Price Index inflation adjustment, ($17,745,351 net of Harmonized Sales Tax recoveries, including contingency) for a total potential  contract value including all option years of $82,881,589 net of all applicable taxes and charges, $84,340,305 net of Harmonized Sales Tax recoveries; and

b. TM3 Inc. for the provision of Traffic Electrical Maintenance and Emergency Services for Service Area B (Scarborough only) as defined in the Negotiated Request for Proposal, for a contract term of four (4) years from date of execution of the agreement in the amount of $21,375,038 net of all applicable taxes and charges, including contingency plus annual escalation adjustment of three (3) percent to account for Consumer Price Index inflation adjustment ($21,751,239 net of Harmonized Sales Tax recoveries, including contingency), with the option to renew at the discretion of the General Manager Transportation Services for an additional one (1) year period in the amount of $5,750,463 net of all applicable taxes and charges, including contingency plus annual escalation adjustment of three (3) percent to account for Consumer Price Index inflation adjustment, ($5,851,671 net of Harmonized Sales Tax recoveries, including contingency) for a total potential  contract value including all optional years of $27,125,501 net of all applicable taxes and charges, $27,602,910 net of Harmonized Sales Tax recoveries. 

2. In accordance with Section 195-8.4 of Toronto Municipal Code Chapter 195 (Purchasing), authorized the General Manager, Transportation Services to enter into and execute an agreement  with each of the four (4) top-ranked prequalified Suppliers that will form the Traffic Electrical Planned Capital Works Roster, whereby each individual project (work assignment) will have a value less than $500,000, all in accordance with the terms and conditions as set out in Negotiated Request for Proposal Doc2865468161 and in a form satisfactory to the City Solicitor, as follows:

a. TM3 Inc. for a contract term of three (3) years from date of execution of the agreement in the amount of $15,186,846 net of all applicable taxes and charges, including contingency plus annual escalation adjustment of three (3) percent to account for Consumer Price Index inflation adjustment ($15,454,134 net of Harmonized Sales Tax recoveries, including contingency) with the option to renew at the discretion of the General Manager Transportation Services for an additional two (2) separate one (1) year periods in the amount of a total additional $4,707,707 net of all applicable taxes and charges, including contingency plus annual escalation adjustment of three (3) percent to account for Consumer Price Index inflation adjustment, ($4,790,563 net of Harmonized Sales Tax recoveries, including contingency) for a total potential contract value including all optional years of $19,894,553 net of all taxes and charges ($20,244,697 net of Harmonized Sales Tax recoveries);

b. Beacon Utility Contractors Limited for a contract term of three (3) years from date of execution of the agreement in the amount of $15,186,846 net of all applicable taxes and charges, including contingency plus annual escalation adjustment of three (3) percent to account for Consumer Price Index inflation adjustment ($15,454,134 net of Harmonized Sales Tax recoveries, including contingency) with the option to renew at the discretion of the General Manager Transportation Services for an additional two (2) separate one (1) year periods in the amount of a total additional $4,707,707 net of all applicable taxes and charges, including contingency plus annual escalation adjustment of three (3) percent to account for Consumer Price Index inflation adjustment, ($4,790,563 net of Harmonized Sales Tax recoveries, including contingency) for a total potential contract value including all optional years of $19,894,553 net of all taxes and charges ($20,244,697 net of Harmonized Sales Tax recoveries);

c. Black & McDonald Limited for a contract term of three (3) years from date of execution of the agreement in the amount of $15,186,846 net of all applicable taxes and charges, including contingency plus annual escalation adjustment of three (3) percent to account for Consumer Price Index inflation adjustment ($15,454,134 net of Harmonized Sales Tax recoveries, including contingency) with the option to renew at the discretion of the General Manager Transportation Services for an additional two (2) separate one (1) year periods in the amount of a total additional $4,707,707 net of all applicable taxes and charges, including contingency plus annual escalation adjustment of three (3) percent to account for Consumer Price Index inflation adjustment, ($4,790,563 net of Harmonized Sales Tax recoveries, including contingency) for a total potential contract value including all optional years of $19,894,553 net of all taxes and charges ($20,244,697 net of Harmonized Sales Tax recoveries); and

d. Guild Electric Limited for a contract term of three (3) years from date of execution of the agreement in the amount of $15,186,846 net of all applicable taxes and charges, including contingency plus annual escalation adjustment of three (3) percent to account for Consumer Price Index inflation adjustment ($15,454,134 net of Harmonized Sales Tax recoveries, including contingency) with the option to renew at the discretion of the General Manager Transportation Services for an additional two (2) separate one (1) year periods in the amount of a total additional $4,707,707 net of all applicable taxes and charges, including contingency plus annual escalation adjustment of three (3) percent to account for Consumer Price Index inflation adjustment, ($4,790,563 net of Harmonized Sales Tax recoveries, including contingency) for a total potential  contract value including all optional years of $19,894,553 net of all taxes and charges ($20,244,697 net of Harmonized Sales Tax recoveries).

The purpose of this report is to advise on the results of the Negotiated Request for Proposal Doc2865468161 for the provision of Traffic Electrical Maintenance and Emergency Services; and Traffic Electrical Planned Capital Works Roster (Capital Works Roster), and to request authority for the General Manager, Transportation Services to enter into agreements with the top-ranked Suppliers meeting the requirements set out in the Negotiated Request for Proposal . There are essentially three components comprising this Negotiated Request for Proposal .

The first two components will allow the City to retain two qualified electrical contractors responsible for the purposes of traffic signal maintenance and state-of-good-repair as well as maintenance and state-of-good-repair for the City's existing RESCU traffic management infrastructure including traffic cameras, expressway variable message signs and automatic traffic counting systems. Each contractor would be assigned to geographic areas of responsibility for either Etobicoke, North York, Toronto/East York (Service Area A) or Scarborough (Service Area B). Each Service Area will have a contract term of four (4) years from date of execution of the contract with the option to renew for one (1) additional year at the sole discretion of the City and subject to budget approval(s). The total potential contract award including all option years for Service Area A is $82,881,589 net of all applicable taxes and charges, $84,340,305 net of Harmonized Sales Tax recoveries.  The total potential contract award including all option years for Service area B is $27,125,501 net of all applicable taxes and charges, $27,602,910 net of Harmonized Sales Tax recoveries. 

The third component of this Negotiated Request for Proposal will allow the City to create a Capital Works Roster of qualified electrical contractors that will be utilized to deliver and install the City's new traffic control devices in support of Vision Zero, electronic signal components in support of cycling infrastructure (e.g. bike heads), as well as various electronic components associated with the City's recent MoveTO congestion management plan related to Smart Signal deployment and Intelligent Intersections (eg. pedestrian and bike detection) supporting all road users, City wide. It is anticipated that having a Capital Works Roster of qualified electrical contractors ready to undertake the work will reduce the overall time for delivery of new traffic control devices by six months relative to the traditional procurement process. The Capital Works Roster will have a contract term of three (3) years with an option in favour of the City to extend for two (2) additional one (1) year periods at the sole discretion of the City and subject to budget approval(s). The total potential contract award including all option years for the Capital Works Roster is $79,578,212 net of all applicable taxes and charges, $80,978,789 net of Harmonized Sales Tax recoveries.

This Negotiated Request for Proposal was developed as a strategic sourcing initiative led by the Purchasing and Materials Management Division's Category Management and Strategic Sourcing (CMSS) unit working with the Transportation Services staff and with external consultant support.

As a result of this sourcing initiative, the City will benefit from an increased Supplier base for the provision of traffic signal and RESCU electronic system maintenance for the two (2) Service Areas and to provide planned capital work through a prequalified group of Suppliers (Capital Works Roster) in support of Transportation Services Vision Zero, Cycling Infrastructure and MoveTO key initiatives. Benefits will also include access to live GPS to improve accountability, and key performance metrics to hold Suppliers accountable in terms of contract requirements.

Furthermore, there is a quantifiable total projected benefit consisting of cost reduction and cost avoidance. This includes all option years of 10 percent for Service Area A, 8 percent for Service area B and 14 percent for Capital Works Roster below the pre-solicitation engineering estimate, respectively. This represents a projected average annual benefit of $1,910,828 (net of all applicable taxes and charges) for Service Area A, $440,112 (net all applicable taxes and charges) for Service Area B, and $2,644,770 (net all applicable taxes and charges) for the Capital Works Roster.