The City Manager recommends waiving, by 5/7ths vote, the competitive bidding requirement, finding said waiver to be in the best interest of the City, and approving Amendment No. 4 to the Agreement between City of Miami Beach and LSF for turnkey trolley operation and maintenance services.
 
Amendment No. 4 provides for the addition of one bi-directional South Beach Trolley route and service plan, using low-floor trolley vehicles sparsely throughout all City routes, and increasing the cost of the Agreement, in the amount not to exceed $12,000,000 annually; authorizing the City Manager to approve the purchase of additional optional equipment for the low-floor trolley vehicles, as may be needed in the Administration’s discretion and subject to funding availability; and authorizing the City Manager to terminate the current Interlocal Agreement with Miami-Dade County for the South Beach Local Service in connection with the negotiation of a new Interlocal Agreement for the South Beach trolley route; and further authorizing the Mayor and City Clerk to execute the final negotiated Interlocal Agreement and Amendment No. 4. Waiving competitive bidding for the low floor trolley vehicles will allow them to be deployed across all existing routes. If another vendor were selected, the low floor vehicles could only be used on the South Beach trolley route. 

On April 30, 2014, the City Commission approved the award of Invitation to Bid (ITB) No. 2014-154-SR for Turnkey Trolley Operations and Maintenance Services to Limousines of South Florida, Inc. (LSF). The ITB contemplated multiple trolley routes throughout the City. While this Agreement allowed for the operation of the existing North Beach Trolley service only, it included provisions for incorporation of additional routes at the City’s sole discretion. The cost of the original Agreement associated with the operation of North Beach Trolley service only was estimated to be $1,624,000 annually. Addition of new services/routes would require an Amendment to the Agreement and such addition would increase the total cost of the Agreement. The North Beach Trolley service started on October 29, 2014. Since its inception, the service is very well accepted by the residents and ridership has been steadily increasing. Currently, the average daily ridership on the North Beach Trolley route is over 2,500 passengers.

On October 21, 2015, the Mayor and City Commission adopted Resolution No. 2015-29194, authorizing the Mayor and City Clerk to execute Amendment No. 3 to the Agreement with LSF, increasing the scope of the Agreement to include the addition of the operation and maintenance services for two new routes in Middle Beach (the Middle Beach loop and the Collins Link).

On January 13, 2016, the City Commission adopted Resolution No. 2016-29269 approving the South Beach route and service plan and authorizing the City Manager to negotiate an Interlocal Agreement, subject to approval by the City Commission. An Interlocal Agreement for the South Beach trolley route would require the termination of the existing South Beach Local service being provided by Miami-Dade County. Any City funding currently used to fund the South Beach Local service will then be used to fund the South Beach trolley route.

On May 11, 2016, during the discussion on South Beach Circulator Options, the City Commission directed the Administration to proceed with the implementation of the previously approved South Beach Trolley route and further directed the Administration to competitively procure Turnkey Trolley Operations and Maintenance Services for the South Beach Trolley route using low-floor trolley vehicles.

At the July 13, 2016 City Commission meeting, during the discussion on High-Floor Trolley Vehicle Order Cancellation Impact and Options to Consider, the City Commission directed the Administration to move forward with an amendment to the existing Agreement with LSF to add the South Beach Trolley service (see Attachment A for the route map) and purchase 12 low-floor trolley vehicles while moving forward with production of all 14 modified/kneeling high-floor/rear-end wheelchair lift trolley vehicles originally ordered for the Middle Beach Loop, Collins Link and North Beach Loop. The low-floor vehicles would be sparsely used on all trolley routes to improve accessibility for wheelchair passengers. Additionally, this option requires the waiver of the competitive bidding requirement, as the term of the South Beach Trolley route, which will be sixty (60) months from the roll-out date of the South Beach Trolley service will exceed the current term of the Agreement. The cost of the Amendment No. 4 is estimated to not exceed $5,300,000 and the total cost of the Agreement including an Amendment No. 4 was estimated to not exceed $12,000,000 annually.

The current Agreement with LSF provides that the hourly rate shall be negotiated if the change in service is increased or reduced by more than 20%. It is important to note that the addition of the South Beach Loop would represent an increase of approximately 67%, from approximately 97,000 to 162,000 total operating hours per year. The hourly rate proposed by LSF for low-floor trolley vehicles during the negotiations in October 2015 for the Middle Beach Trolley service was $78.39. As a result of more recent negotiations for the South Beach trolley service, the final hourly operating rate for low-floor trolley vehicles was reduced to $77.35 (based upon a sixty (60) month term), which represents approximately $67,000 in annual savings as compared to the previously negotiated hourly rate. During the initial ITB process, LSF was the lowest bidder and it is the current largest operator of trolley services in the area. LSF has performed satisfactorily during its operation of the Alton-West Loop and North Beach Loop, and has provided the City with a lower hourly operating rate than previously negotiated during the negotiations relating to the Middle Beach routes.

The following material changes to the current Agreement with LSF are included in Amendment No. 4 (substantially in the form attached as Attachment B):

1. New Route - the addition of the trolley operation and maintenance services for the new bi-directional South Beach route, which extends from South Pointe Drive on south side to 17 and 20 Street on north and from Washington Avenue on east to Alton Road and Belle Isle on west. Ten (10) trolley vehicles will be providing service along bi-directional South Beach route.

2. New Vehicles - the addition of twelve (12) new low-floor trolley vehicles for use in connection with the operation of the South Beach route, North Beach route, and Middle Beach routes (the Middle Beach loop and the Collins link). These vehicles would roll-out upon all being delivered, simultaneously with the commencement of the South Beach route, but would be used sparsely on all trolley routes to improve accessibility for wheelchair passengers. Conversely, some of the high floor vehicles originally designated for the North and Middle Beach routes would be re-assigned to the South Beach route.

3. Term – the term of the Agreement is being extended to terminate 60 months as of the roll-out date of the South Beach route in order to afford LSF sufficient time to amortize the 12 new low-floor trolley vehicles to be acquired.

4. Hourly Rate for low-floor vehicles – the negotiated new hourly rate commensurate with the cost of said new low-floor trolley vehicles and associated additional services. The final hourly rate proposed by LSF for service using low-floor trolley vehicles is $77.35. This rate is $11.54 higher than the service using either type of high floor trolley vehicle. While the City concurs that the low-floor vehicles have increased maintenance and fuel costs and are more expensive to purchase, staff was not provided with supportive documentation for review.

Operating Cost - If approved by the City Commission, this Amendment will result in the addition of the South Beach trolley service and acquisition/incorporation of 12 low-floor trolley vehicles to be assigned proportionally to the North Beach Trolley loop, Middle Beach Trolley loop, Collins Link and South Beach Loop to specifically improve accessibility for wheelchair passengers along all trolley routes. It is anticipated that if all 12 low-floor trolleys are in operation during all hours of operation the annual operating cost of these vehicles only would be approximately $6 million. Under this scenario, there would be a reduction of high-floor trolley vehicles in use as the total number of trolley vehicles in operation at any one time is 25. This scenario would result in the highest annual operating cost in the amount not to exceed $12,000,000 including optional equipment for 12 new low-floor trolley vehicles and special events.

Optional Equipment - This Amendment will include a provision giving authority to the City Manager to increase the cap as needed in order to secure the purchase and installation of optional equipment for new vehicles and service including, but not limited to, the GPS trackers, modems, automatic passenger counters, monitors, video system, and automated voice information systems. The increase will be subject to budget availability.

*assumes up to 12 low-floor trolley vehicles and 13 high-floor trolley vehicles are in operation during all hours of operation and includes capital and operating cost of the optional equipment including, but not limited to, the GPS trackers, modems, automatic passenger counters, monitors, video system, and automated voice information systems, and special events service

Funding Source – Funding for the above costs will be provided from the Transportation Fund and People’s Transportation Plan (PTP) Fund and will be appropriated in the FY2016/17 budget if approved by the City Commission.