Document elcerrito_gov_doc_421174fc27

AGENDA BILL Agenda Item No. 5(G) Date: August 19, 2014 To: El Cerrito City Council From: Garth Schultz, Operations + Environmental Services Division Manager Yvetteh Ortiz, Public Works Director/City Engineer Subject: Agreement with Liberty Fleet Care, Inc. For Fleet Management and Maintenance Services ACTION REQUESTED Adopt a resolution authorizing the City Manager to execute an agreement with Liberty Fleet Care, Inc. in an amount not to exceed $127,900 per fiscal year for fleet maintenance and parts, effective January 1, 2014 through June 30, 2016. BACKGROUND AND ANALYSIS On October 15, 2013, the City Council approved a Sixth Amendment to the City’s Franchise Agreement with East Bay Sanitary Company (EBS) that expanded EBS’s fleet management and maintenance operations for the City (Resolution No. 2013-57). Prior to adoption of the Sixth Amendment, EBS had performed more limited fleet maintenance operations on behalf of the City, as per the terms of the Fifth Amendment, which was negotiated after a thorough review of the EBS’s operations, including its fleet maintenance functions. Prior to having EBS provide fleet maintenance services, the City utilized a combination of in-house labor and independent contractors to perform maintenance services to collection vehicles. While this approach had served the City adequately in the past, it had not adequately provided for optimal operation of the City’s newer recycling collection vehicles, which prompted the City to seek full-fleet management and maintenance services. Per the Sixth Amendment, the City and EBS agreed that EBS would form a separate corporation that would function as the City’s independent fleet manager and maintenance operator for the vehicles covered by the Sixth Amendment, including all of the services defined in the Sixth Amendment. It was stipulated that, upon formation of the separate corporation, the City would enter into a separate maintenance agreement with the newly formed company, the terms of which would supersede and terminate the Sixth Amendment. EBS formed Liberty Fleet Care, Inc. (LFC) on October 19, 2013 to function as the City’s independent fleet manager and maintenance operator for the City’s vehicles covered by the Sixth Amendment including management, scheduling, provision for all preventative maintenance services and all other required vehicle maintenance and repair ---PAGE BREAK--- Agenda Item No. 5(G) Page 2 services, and all associated record keeping and reporting requirements. LFC has been performing these functions for the City since January 1, 2014, and is owed $67,648 for parts and services rendered from January 1 through June 30, 2014. Staff is recommending that the proposed agreement with LFC be retroactive to January 1, 2014 in recognition of the fact that LFC has been providing all fleet maintenance services promised to the City by the EBS in the Sixth Amendment. City staff has been pleased with EBS’s performance and (starting January 1, 2014) LFC’s fleet management and maintenance services. El Cerrito’s recycling collection vehicles have experienced many fewer breakdowns since EBS/LFC began providing full maintenance services in July 2013. Any breakdowns that do occur are fixed more quickly than had been the case with other maintenance providers in past years. LFC has, as promised in the Sixth Amendment, also been providing fleet management and maintenance services to other City maintenance vehicles. LFC has been responsive to on-road emergency calls, in-yard urgent calls, and management inquires regarding the status of vehicles receiving service. STRATEGIC PLAN CONSIDERATIONS Approval of the proposed agreement is consistent with Goal A (Deliver exemplary government services) of the City’s Strategic Plan, adopted March 2013. Specifically, approval of the proposed agreement will maintain a cost-effective relationship between the City and EBS/LFC with respect to fleet maintenance matters, which is consistent with the “Develop and strengthen relationships with public and private partners” strategy listed in Goal A. ENVIRONMENTAL CONSIDERATIONS Approval of the proposed agreement will maintain the level of environmental benefits realized from the Sixth Amendment, including decreased vehicle miles travelled for maintenance needs, more efficient operations, and longer useful vehicle lifetimes. FINANCIAL CONSIDERATIONS Approval of the proposed agreement will continue the payment terms stipulated in the Sixth Amendment, which increased maintenance expenditures by about $75,000 per year. The current IWM Fees, which were adopted by the Council on November 19, 2013 and became effective January 1, 2014, did not include a corresponding increase in revenues to offset the additional maintenance expenses incurred by the Sixth Amendment because these increased expenses were offset by a combination of one-time increases in donation revenues (not subject to Council appropriations) and one-time expense decreases that were anticipated – and realized – in Fiscal Year (FY) 2013-2014. However, staff had anticipated that IWM Fees would need to be increased to cover these expenses in the long-term. Currently, staff estimates the fees will need to be increased by approximately $0.77 per month (for 95% of residential customers) effective January 1, 2015, in order to cover IWM operating expenses as adopted in the FY 2014-15 Budget, which include the ongoing maintenance costs associated with this agreement. Projected revenue increases as described above were also included in the adopted FY 2014-15 Budget; this is standard practice, wherein staff proposes IWM Fee revenues during the budget adoption process, and then proposes any necessary IWM Fee ---PAGE BREAK--- Agenda Item No. S(G) adjustments to be effective mid-fiscal year. In keeping with this standard IWM Fee adjustment process, staff will be preparing annual adjustments to the IWM Fees and EBS collection and processing rates for Council consideration prior to January, 2015. Funding of $67,648 for services and parts provided in FY 2013-14 is available in the City's adopted FY 2013-14 budget in an allocation from the Integrated Waste Management Fund and $107,900 for Vehicle Maintenance Services is appropriated in FY 2014-15 in allocations from the Integrated Waste Management Fund ($102,505) and General Fund ($5,395). Funding of $10,000 for parts provided in FY2014-15 is appropriated in allocations from the Integrated Waste Management Fund ($8,000) and General Fund ($2,000) Staff will seek Council approval of a mid-year adjustment for services if LFC's seeks a cost increase per the Agreement, and/or if the cost of parts exceeds the $10,000 allocation noted here. LEGAL CONSIDERATIONS The City Attorney has reviewed and commented on draft Agreement. The final Agreement will be substantially in the form attached and approved by the City Attorney Reviewed by: Attachments: 1. Accompanying Resolution 2. Draft Agreement with Liberty Fleet Care, Inc. Page 3 ---PAGE BREAK--- Agenda Item No. 5(G) Attachment 1 RESOLUTION 2014–XX A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF EL CERRITO AUTHORIZING THE CITY MANAGER TO EXECUTE AN AGREEMENT WITH LIBERTY FLEET CARE, INC. FOR FLEET MAINTENANCE SERVICES WHEREAS, the City of El Cerrito (City) and East Bay Sanitary Company, Inc. (Company) have entered into that certain Franchise Agreement originally dated September 2, 1997 and most recently amended on October 16, 2013 (Franchise Agreement); and WHERAS, the City Council approved the October 16, 2013 Sixth Amendment to the Franchise Agreement by Resolution No. 2013-57,which established a requirement for the Company to provide fleet maintenance services for the City; and WHEREAS, per the terms of the Sixth Amendment, the City and Company agreed that the Company would form a separate corporation that would function as the City’s independent fleet manager and maintenance operator to provide services for the vehicles covered by the Sixth Amendment; and WHEREAS, per the terms of the Sixth Amendment, the City agreed that upon formation of a separate corporation, the City would enter into a separate maintenance agreement with the newly formed company; and WHEREAS, on October 19, 2013, the Company formed a separate corporation named “Liberty Fleet Care, Inc.,” to function as the City’s independent fleet manager and maintenance operator for the City’s vehicles described in the Sixth Amendment, including management, scheduling, and provision for all preventative maintenance services, and all other required vehicle maintenance and repair services, and all associated record keeping and reporting requirements; and WHEREAS, the newly formed Liberty Fleet Care, Inc. has been providing all fleet maintenance services promised to the City by the Company per the terms of the Sixth Amendment to Franchise Agreement since January 1, 2014; and WHEREAS, Liberty Fleet Care, Inc. shall maintain the City’s vehicles to the highest professional standards in accordance with all manufacturers’ servicing recommendations necessary to maintain the full benefit of all associated manufacturers’ warranties and in compliance with all applicable laws and regulations; and WHEREAS, funding of $67,648 for services and parts provided in FY 2013-14 is available in the City’s adopted FY 2013-14 budget in an allocation from the Integrated Waste Management Fund, and $107,900 for Vehicle Maintenance Services is appropriated in FY 2014-15 in allocations from the Integrated Waste Management Fund ($102,505) and General Fund ($5,395). Funding of $10,000 for parts provided in FY 2014-15 is appropriated in allocations from the Integrated Waste Management Fund ($8,000) and General Fund ($2,000); ---PAGE BREAK--- Page 2 NOW THEREFORE BE IT RESOLVED, by the City Council of the City of El Cerrito, that it hereby authorizes the City Manager to execute the Maintenance Agreement between the City of El Cerrito and Liberty Fleet Care, Inc., effective January 1, 2014 in an amount not to exceed $127,900 per fiscal year for fleet maintenance and parts, effective January 1, 2014 through June 30, 2016, in substantially in the form presented. BE IT FURTHER RESOLVED, that this Resolution shall become effective immediately upon passage and adoption. I CERTIFY that at a regular meeting on August 19, 2014 the City Council of the City of El Cerrito passed this Resolution by the following vote: AYES: COUNCILMEMBERS: NOES: COUNCILMEMBERS: ABSENT: COUNCILMEMBERS: IN WITNESS of this action, I sign this document and affix the corporate seal of the City of El Cerrito on August X, 2014. Cheryl Morse, City Clerk APPROVED: Janet Abelson, Mayor 2314455.1 ---PAGE BREAK--- Maintenance Agreement Page 1 MAINTENANCE AGREEMENT BETWEEN CITY OF EL CERRITO AND LIBERTY FLEET CARE, INC. This Maintenance Agreement by and between the CITY OF EL CERRITO, a municipal corporation and LIBERTY FLEET CARE, INC., a California corporation, who agree to be legally bound as set forth herein: RECITALS This Agreement is entered into on the basis of the followings facts, understandings, and intentions of the Parties: A. The City of El Cerrito and East Bay Sanitary Company entered into a Sixth Amendment to Franchise Agreement on October 16, 2013 for fleet maintenance services. B. In the Sixth Amendment to Franchise Agreement, the City of El Cerrito and East Bay Sanitary Company agreed that East Bay Sanitary Company would form a separate corporation that would function as the City’s independent fleet manager and maintenance operator for the vehicles covered by the Sixth Amendment, including all services defined in the Sixth Amendment. C. The City agreed that upon formation of a separate corporation, the City will enter into a separate maintenance agreement with the newly formed company, the terms of which would supersede and terminate the Sixth Amendment to Franchise Agreement. D. The newly formed company, Liberty Fleet Care, Inc., which was incorporated on October 19, 2013, shall maintain the City’s vehicles covered by this Agreement to the highest professional standards in accordance with all manufacturers’ servicing recommendations necessary to maintain the full benefit of all associated manufacturers’ warranties and in compliance with all applicable laws and regulations. E. Liberty Fleet Care, Inc. has been providing all fleet maintenance services promised by East Bay Sanitary Company, Inc. via the Sixth Amendment to Franchise Agreement since January 1, 2014. As such, this Agreement shall be effective January 1, 2014. SECTION ONE - DEFINITIONS 1.1 “Annual Compensation” means the annual compensation due Company as calculated pursuant to paragraph 2.1. 1.2 “2014 Annual Compensation” is defined in Paragraph 2.2. 1.3 “City” means the City of El Cerrito, a municipal corporation. 1.4 “City Vehicles” means all vehicles owned or leased by the City which vehicles are to be maintained by Company and which are identified by Exhibit A attached and which are identified in an Agenda Item No. 5(G) Attachment 2 ---PAGE BREAK--- Maintenance Agreement Page 2 amended Exhibit A each year hereafter until this Agreement expires or is terminated. “City Vehicle” refers to any single vehicle included within the City Vehicles. City Vehicles include Other Vehicles and Recycling Vehicles as defined herein. 1.5 “Company” means Liberty Fleet Care, Inc., a California corporation. 1.6 “Company Operating Margin” means the sum due the Company in addition to the Company’s actual cost of providing the Services, which actual costs shall include wages, benefits and insurance. 1.7 “Maintenance Agreement” means this Maintenance Agreement. 1.8 “Other Vehicles” means any vehicle owned by the City other than Recycling Vehicles. 1.9 “Parties” means collectively the City and the Company. “Party” means individually the City or the Company. 1.10 “Recycling Vehicles” means all recycling collection vehicles operated by the City. 1.11 “Services” means all means all fleet maintenance and management services described herein, including the following services to Recycling Vehicles and Other Vehicles: managing, tracking, scheduling coordinating, performing and following up on all regular preventative maintenance work, repairs, and other concerns involving recycling collection vehicles (including the recommendations issued in the Company’s Fleet Evaluation), and; managing, tracking, scheduling coordinating, performing and following up on all regular preventative maintenance work, repairs, and other concerns as requested for other City Vehicles, and all services to City Vehicle maintenance and management services as described in Section Three. SECTION TWO – COMPENSATION AND TERM 2.1 Annual Compensation. City shall compensate Company for the services received by the City from the Company. The Annual Compensation includes all labor costs, the Company Operating Margin, the direct cost of all parts utilized during maintenance activities, and additional insurance premiums paid by Company as a result of performing Services. 2.2 Adjustment of Annual Compensation. The Company shall be entitled to maintain the Operating Margin and the City agrees to adjust the Annual Compensation annually or sooner as the cost of wages, benefits and insurance increase. The City shall receive thirty (30) days’ notice of any adjustment of the Annual Compensation. 2.3 2014 Annual Compensation for Fleet Services. Subject to the terms, conditions, limitations and adjustments allowed herein, the City agrees that the 2014 Annual Compensation shall be $107,900 for Services rendered by the Company per the following calculation. In calendar years after 2014, if the cost of Wages, Benefits and/or Liability & Damage Insurance increases the Annual Compensation shall be adjusted on the Quarterly Billing after such increase. The agreed upon nine and one-half percent (9.5) Operating Margin shall also be adjusted based on the increase of Wages and/or Benefits. Wages $68,064 Benefits $22,345 ---PAGE BREAK--- Maintenance Agreement Page 3 Sub-Total $98,409 Operating Margin $9,491 Liability & Damage Insurance $8,000 Total Annual Compensation (before parts) $107,900 Estimated Annual Parts Expenses $20,000 2.4 Limited Number of Vehicles. The 2014 Annual Compensation is based on, and limited to the City Vehicles listed on Exhibit A attached and incorporated herein by this reference. The City shall provide Company with an amended and updated list of City vehicles prior to any renewal date and at any time a vehicle is added or deleted during the term of any renewed or extended Agreement. 2.5 Quarterly Billing. The Company shall bill the City quarterly for all Services – including parts, tires and supplies at the Company’s cost – performed by the Company per the terms of this Maintenance Agreement. The City shall pay the Company within 30 days after receipt of the Quarterly Billing. 2.6 Term and Termination. The Services provided under this Maintenance Agreement commenced on January 1, 2014, and shall terminate on June 30, 2016, unless the City gives ninety (90) day written notice of its intent to terminate the terms of service in this Section. This Agreement may be renewed in writing with consent of both the City and the Company. SECTION THREE – SERVICE REQUIREMENTS AND LIMITATIONS 3.1 General Requirement. The Company shall maintain the City Vehicles included in this Maintenance Agreement to the highest professional standards in accordance with all manufacturers’ servicing recommendations necessary to maintain the full benefit of all associated manufacturers’ warranties and in compliance with all applicable laws and regulations. 3.2 Recycling Vehicle Priority. The City requests that services to Recycling Vehicles are a priority and Services to Other Vehicles are of secondary priority, and will be performed only upon completion of required Services to Recycling Vehicles. The City acknowledges that based on this preference for Recycling Vehicles required by City, Services on Other Vehicles may be delayed until all Services on Recycling Vehicles have been completed. Even if Services on Recycling Vehicles becomes necessary after Service becomes required on an Other Vehicle, the Recycling Vehicles will be advanced and will be moved ahead of any Other Vehicle Services. 3.3 Other Vehicles Maintenance. To the extent those Services can be provided without the Company incurring any additional labor expense, Services shall be provided on Other Vehicles at no additional labor cost to the City. 3.4 Staffing Requirement. The Company shall devote the equivalent of one full time mechanic to the performance of Services provided to the City. Minimum 40 hours/week, with holidays, sick days, vacation time and other days off as required by any union agreement. 3.5 Parts. The Company is required to provide labor only. Any and all parts required in the course of the Company’s providing the Services shall be the responsibility of the City and shall be billed to the City in the Company’s quarterly billing to the City and shall be paid by the City within 30 ---PAGE BREAK--- Maintenance Agreement Page 4 days of receipt by the City. The quarterly billing will include copies of the parts invoices paid by Company. If the documentation for the parts is, for any reason, not acceptable to the City, the City must notify the Company in writing regarding the documentation required by the City. Absent such notice from the City, the report prepared by the Company shall satisfy this requirement. 3.6 Pre-Existing Conditions. The City is responsible for any and all pre-existing conditions of any and all City Vehicles. The Company will not be liable for any pre-existing violations, citations, claims, liabilities, lawsuits, causes of action, damages, litigation, judgments, settlements, losses, costs, liens, inspections, re-inspections, or expenses whether known or unknown to the City, that occurred before December 1, 2012.. 3.7 Third Party Vendor. If any City Vehicle requires a repair beyond the Services the Company is required to provide pursuant to this Maintenance Agreement, such repairs shall be the sole responsibility of the City. The Company will, without any liability for doing so, assist the City in identifying an entity able to perform such repairs. The other entity shall be retained by City to perform and complete such repairs and the City shall be solely responsible for any and all costs of such other repairs. 3.8 Approval Required. The Company shall seek City approval for all discretionary repairs totaling $5,000 per vehicle or more in parts and supplies, and for any work the Company requested be performed by a third party vendor. 3.9 On-Road Mechanical Emergencies. If it is safe to do so, the Company shall provide emergency repairs of Recycling Vehicles which become non-operational on the road. However, the Company shall not be required to do so if the location of the Recycling Vehicle creates a health or safety hazard to any employee of the Company. Additionally, the City acknowledges that the ability of the Company to make repairs on the road is limited and may require that a Recycling Vehicle may require towing to the location of the Company’s repair facility. Any and all towing and/or other charges and costs required transporting a Recycling Vehicle to the Company’s maintenance and repair location is entirely a responsibility of the City. 3.10 Reporting Requirement. The Company shall provide the City with a report containing repair requirements and recommendations applicable to any City Vehicle which the Company believes are necessary to prevent mechanical breakdowns, including but not limited to: Damaged components in engine compartment; Damaged components, missing parts in chassis; Damaged components in hydraulic system, including hoses, pumps, switches, leaks and oil changes, packer blades, operating handles, wear-and-tear; and Damage related to electrical issues and codes from on-board computers. The Company will prepare a report that the Company believes satisfies this requirement. If the format and contents of the report prepared by the Company is, for any reason, not acceptable to the City, the City must notify the Company in writing regarding the form and contents of the report required by the City. Absent such notice from the City, the report prepared by the Company shall satisfy this requirement. 3.11 Quarterly Reporting Requirement. The Company shall provide the City with a quarterly ---PAGE BREAK--- Maintenance Agreement Page 5 report 30 days after the final day of March, June, September and December for the annual quarter ending on each of these. The quarterly report shall inform the City of all Services provided to the City during the previous quarter. Upon request from the City, the Company shall provide the City with a complete report of all repairs performed on any specific City Vehicle. The Company will prepare a report that the Company believes satisfies this requirement. If the format and contents of the report prepared by the Company is, for any reason, not acceptable to the City, the City must notify the Company in writing regarding the format and contents of the report required by the City. Absent such notice from the City, the report prepared by the Company shall satisfy this requirement. 3.12 Maintenance Logs. The Company shall maintain a log of all brake checks, adjustments, and BIT inspections. The Company shall provide the log to the City upon request by the City. 3.13 Repair Time. With the understanding by the City that other priorities or circumstances may take precedence and that the Company does not absolutely guarantee, the Company will attempt to, schedule services such that: Recycling Vehicles requiring Service will be returned to the City within 48 hours of receiving vehicles; All Services will be completed on Recycling Vehicles within 48 hours of receiving vehicles for servicing; Other Vehicles requiring Service will be returned to the City within 72 hours of receiving vehicles; and All Services will be completed on Other Vehicles within 72 hours of receiving vehicles for servicing. 3.14 General Service Requirements. Services by the Company shall: Comply with all safety, environmental and other applicable regulations, including all required recordkeeping and reporting related to such compliance; Occur at the Company’s maintenance facility, or at other designated locations such as the Recycling + Environmental Resource Center, Corporation Yard, other City facility, or in the field as needed; Be in compliance with all applicable laws and regulations; Satisfy all maintenance requirements to preserve the full benefit of all vehicle and equipment warranties; Be as required to ensure the maximum useful life of all vehicles, when taking into account vehicle replacement schedules and available maintenance budgets; and Be consistent with best management practices for the specific City Vehicle. Shall include: i. All Services required to maintain compliance with all applicable laws and regulations. ii. All those required to maintain the full benefit of all vehicle and equipment warranties. iii. All Services required to ensure the maximum useful life of all vehicles, when taking into account vehicle replacement schedules and available maintenance budgets. ---PAGE BREAK--- Maintenance Agreement Page 6 iv. All Services generally considered best management practices for vehicle maintenance, including but not necessarily limited to those listed in this Agreement. 3.15 Service Requirements. The Company shall perform brake checks and BIT inspections including the following or as needed: Inspection and adjustment of all brake slack adjusters on front and rear axles for all collection vehicles; Check air compressor system, brake pads, and all other components of braking system and repair as needed; and Full BIT inspection of all collection vehicles. 3.16 Quarterly Service Requirements. The Company shall perform preventative maintenance services including the following quarterly or as needed: Complete vehicle inspection; Oil change and oil crankcase filter replacement; Fuel filter replacement; Coolant filter replacement; Hydraulic filter replacement; and Air filter replacement; 3.17 City Vehicle Maintenance Services. The Company shall provide Services on all Other Vehicles as follows: Lubrication and greasing of all zerk points on body and chassis; Check PTO pump mechanism and repair/recommend as needed; Check coolant system/radiator and repair/recommend as needed; Check welds and repair/recommend as needed; Check and change oil and filters of automatic transmission when required or need and recommend interval for this service; Check and repair exhaust system, DPF filter and related components; consultation, recommendation, and repair of mechanical breakdowns, including but not limited to the following: i. Damaged components in engine compartment. ii. Damaged components, missing parts in chassis. iii. Damaged components in hydraulic system, including hoses, pumps, switches, leaks and oil changes, packer blades, operating handles, wear- and-tear. iv. Troubleshoot electrical issues and codes from on-board computers, and repair/recommend as needed. v. On-road emergencies as requested. vi. Provide complete report of all repairs to the City. Company reserves the right to utilize third party vendors as Company determines necessary, subject to written City approval. The City will pay approved costs for work provided by third party vendors directly; and The City agrees to follow and implement all Company recommendations regarding ---PAGE BREAK--- Maintenance Agreement Page 7 Recycling Vehicle operation and ongoing maintenance requirements for recycling collection vehicles; such recommendations will be followed and implemented in a manner that is in keeping with available budgets. 3.18 Exclusion of Some Services. Due to the variety of City Vehicles, some of the Services listed in this Section, may not apply to or be required by some of the City Vehicles. Thus, the Company will not provide each and every listed Service to each and every City Vehicle. The City acknowledges this fact and confirms that it was considered in negotiating the Annual Compensation. The City shall not be entitled to any reduction in the Annual Compensation due to the Company’s inability to provide the inapplicable Services to some City Vehicles. SECTION FOUR – INSURANCE AND LIABILITY 4.1 Violation Assessment. The Company shall pay to the City $250 for each failure to conduct and accurately document Services required in this Maintenance Agreement. 4.2 Citation Liability. The Company shall pay to the City the actual cost of any citation, fine or other monetary penalty to the City up to $10,000 per incident for failure to maintain the City’s Vehicles and/or any associated reporting requirements in accordance with the terms and conditions of this Agreement. Company will not be liable for any preexisting violation that existed prior to January 1, 2014. 4.3 Warranty Assessment. The Company shall pay to the City the actual cost incurred for required parts for any instances of failure to maintain the City’s Vehicles in accordance with the requirements necessary to provide the full benefits of the manufacturers’ warranties. 4.4 Insurance. Company shall secure and maintain, in full force and effect during the Term, adequate insurance that shall be the types and amounts of insurance coverage listed below. Insurers must provide Company and the City with thirty (30) calendar days’ notice of any cancellation or reduction in coverage and name the City as an additional insured. Company shall supply a certificate of insurance and additional insured endorsement. The terms and obligations of this section shall survive termination of this Agreement. 4.5 Workers’ Compensation Insurance. Company shall take out and maintain during the life of this Agreement, Workers’ Compensation and Employer’s Liability insurance for all of its employees working on this project. In lieu of evidence of Workers’ Compensation insurance, the City will accept a Self-Insuring Certificate from the State of California. 4.6 Comprehensive Automobile and General Liability Insurance. Company shall take out and maintain during the life of this Agreement General Liability insurance in the amount of one million dollars ($1,000,000) for combined single limit coverage for bodily injury, personal injury and property damage and umbrella coverage of up to ten million dollars ($10,000,000). The following coverages or endorsements must be indicated on the certificate: The City, its directors, officers and employees are additional insureds in the policy as to the work being performed; regards to Company’s negligence, The coverage is primary to any other insurance carried by the City; Thirty (30) days prior written notice shall be given to the City in the event of cancellation or ---PAGE BREAK--- Maintenance Agreement Page 8 non-renewal of the policy. 4.7 Amounts of Insurance. The amounts of insurance shall be the following: General Liability – one million dollars ($1,000,000) per occurrence Auto Liability – one million dollars ($1,000,000) per occurrence Worker’s Compensation – State statutory limit 4.8 Delivery of Proof of Coverage. Simultaneously with the execution of this Agreement, Company shall furnish City certificates of insurance required hereunder, in form and substance satisfactory to the City. Such certificates shall show the type and amount of coverage, effective dates and dates of expiration of policies and shall have all required endorsements. Renewal certificates will be furnished periodically to the City to demonstrate maintenance of the required coverages throughout the term. 4.9 Other Insurance Requirements. In the event any services are delegated to a subcontractor, Company shall require such subcontractor to provide statutory workers’ compensation insurance and employer's liability insurance for all of the subcontractor’s employees engaged in the work in accordance with this section. The liability insurance required by this section shall cover all subcontractors or the subcontractor must furnish evidence of insurance provided by it meeting all of the requirements of this section. 4.10 Company shall comply with all requirements of the insurers issuing policies. The carrying of insurance shall not relieve Company from any obligation under this Agreement. If any claim exceeding the amount of any deductibles or self-insured reserves is made by any third Person against Company or any subcontractor on account of any occurrence related to this Agreement, Company shall report the facts in writing to the insurance carrier. 4.11 If Company fails to procure and maintain any insurance required by this Agreement, the City may take out and maintain, at Company’s reasonable expense, such insurance as it may deem proper and deduct the cost thereof from any monies due Company. SECTION FIVE – INDEMNIFICATION 5.1 Indemnification by Company. To the fullest extent allowable by law, Company shall indemnify, defend (with counsel reasonably acceptable to the City) and hold harmless the City and its council members, officers, directors, employees, administrators, and agents for its share of any and all loss, liability, penalty, forfeiture, fine, claim, demand, damages, expense costs (including attorney’s fees), action, proceeding or suit of any and every kind and description, whether judicial, quasi-judicial or administrative in nature, including, but not limited to, personal injury, bodily injury, interference with third party contract, or for damage to property or resources arising out of, or resulting from any act, error or omission of Company and/or any employee of the Company in connection with Company’s performance of this Agreement, including but not limited to, compliance with applicable laws or legal requirements, or breach of representations and obligations set forth in this Agreement, and excepting the active negligence or willful misconduct of the City, its council members, officers, directors, employees, administrators, and agents. This indemnification and defense shall survive the expiration or earlier termination of this Agreement. ---PAGE BREAK--- Maintenance Agreement Page 9 5.3 City Indemnification for Operator Error. The City agrees to defend and indemnify the Company (and their respective officers, directors, shareholders consultants, predecessors, successors, assigns, agents, representatives, employees, parent and subsidiary companies, affiliates, and each of them) from and against any and all claims, demands, causes of action, liabilities, judgments, settlements, losses, costs, damages, and/or expenses in law or equity, contract or tort, of every kind and nature whatsoever to the extent they arise out of or relate to operator error, as defined below, or to the extent they arise out of or relate to the negligence or willful misconduct by any operator of any City vehicle that is the subject this Agreement when the operator of the City vehicle is not an employee of the Company. Operator error includes driving errors, failure to follow written recommendations by the Company or East Bay Truck Maintenance, Inc., and failure to report vehicle deficiencies to the Company or East Bay Truck Maintenance, Inc., when required by state law. SECTION SIX – GENERAL PROVISIONS 6.1 Entire Agreement. This Agreement constitutes the whole and entire agreement of the City of El Cerrito and Liberty Fleet Care, Inc., with respect to the subject matter of this Agreement. This Agreement replaces and supersedes all prior written and oral agreements between the City of El Cerrito and Liberty Fleet Care, Inc., related to the Maintenance Agreement, and supersedes the Sixth Amendment to Franchise Agreement with East Bay Sanitary, Company, dated October 16, 2013. 6.2 Ambiguities. The City of El Cerrito and Liberty Fleet Care, Inc., agree that any rule of construction to the effect that ambiguities in a document are to be resolved against the drafting party shall not apply in the interpretation of this Agreement or any amendments or Exhibits hereto. 6.3 Law and Venue. This Agreement shall be construed and enforced in accordance with the internal laws of the State of California. Venue shall be Contra Costa, California. 6.4 Severability. If any provision of this Agreement is determined by any court of competent jurisdiction or arbitrator to be invalid, illegal, or unenforceable to any extent, that provision shall, if possible, be construed as though more narrowly drawn, if a narrower construction would avoid such invalidity, illegality, or unenforceability or, if this is not possible, such provision shall, to the extent of such invalidity, illegality, or unenforceability, be severed, and the remaining provisions of this Agreement shall remain in full force and effect. 6.5 Context. Whenever used in this Agreement, the singular shall include the plural, the plural shall include the singular, and the neuter gender shall include the male and female as well as a trust, firm, company, or corporation, all as the context and meaning of this Agreement may require. 6.6 Additional Documents. The Parties to this Agreement shall execute and deliver any and all additional documents, instruments, notices, and other assurances, and shall do any and all other acts and things, reasonably necessary in connection with the performance of their respective obligations under this Agreement and to carry out the intent of the Parties. 6.7 Headings. The headings, section, and paragraph titles and headings contained in this Agreement are inserted as a matter of convenience and for ease of reference only and shall be disregarded for all other purposes, including the construction or enforcement of this Agreement or any ---PAGE BREAK--- Maintenance Agreement Page 10 of its provisions. 6.8 Amendments. This Agreement may be altered, amended, or repealed only by a writing signed by all of the Parties. 6.9 Notices. All Quarterly Billings, notices, approvals, disapprovals or elections required or permitted to be given under this Agreement shall be in writing and shall be delivered by any of the following methods chosen by the notifying party: Personally which shall be deemed consummated upon actual personal delivery to the intended recipient; or By mail, which shall be deemed consummated upon the date of actual receipt or refusal of delivery as evidenced by the return receipt; or Sent Federal Express or other reputable overnight delivery service to the Parties at the addresses listed below which shall be deemed given upon the next business day as evidenced by the courier's delivery confirmation or receipt; or By Fax by faxing to the Fax Number provided by the City and/or Company, respectively for this purposes which shall be deemed consummated on the date sent if before 5:00 p.m. on a business day and if not on a business day or if after 5:00 p.m. then on the next business day; or Via e-mail and/or e-mail attachment by e-mailing to the e-mail address provided by the City and/or Company, respectively for this purposes which shall be deemed consummated on the date sent if before 5:00 p.m. on a business day and if not on a business day or if after 5:00 p.m. then on the next business day. 6.10 Mediation and Arbitration. Client and Firm agree to submit any and all disputes, claims, controversies, and other adverse actions, including claims of legal malpractice, to mediation and if mediation is not successful, to arbitration. However, either Party is entitled to file a judicial action to protect a statute of limitations or for equitable protection such as, but not limited to, an order of attachment, receivership, injunction, or other provisional remedies but in such case, the matter shall proceed via mediation and, if unsuccessful via arbitration, without further action in the Court regarding the underlying dispute. A judicial action may be filed if necessary to depose or subpoena any person, or person most knowledgeable. 6.11 Mediation. Mediation must occur prior to arbitration unless waived by all Parties. If Client or Firm does not participate in mediation, in good faith, the Party not participating in good faith shall pay the entire cost of mediation including attorney’s fees and all costs of the Party that does participate in good faith. Before the mediation begins, the Parties agree to sign a document consistent with Evidence Code Section 1152.5 thereby preventing the admissibility in arbitration or any civil action of anything said, any admission made, and any documents submitted related to the mediation. Each Party shall bear their own cost of mediation if the matter is resolved in mediation. However, if the matter is not resolved in mediation, the cost of mediation may be added as a cost by the arbitrator. 6.12 Waiver of Jury Trial. By agreeing to arbitrate, you are waiving any right to a jury trial and to have the matter decided by an arbitrator instead of a judge and/or a jury. You are also waiving any right to an appeal, excepted in very limited situations, none of which may apply to this matter. This includes waiver of a trial and/or an appeal based on claims against your attorney related to the services he provided, including but not limited to, legal malpractice, and/or professional negligence. 6.13 Arbitration. If mediation is not successful or is waived, the Parties shall proceed to arbitration ---PAGE BREAK--- Maintenance Agreement Page 11 as follows: Selection of Arbitrator and Payment. The dispute shall be submitted to a recognized arbitration service such as JAMS, ADR or a similar arbitration service. Such service shall provide each Party with the resume of three possible arbitrators. The three possible arbitrators must be either attorneys or retired judges with not less than 15 years of legal experience in the area to be arbitrated. Each Party may reject one of the three arbitrators. If only one un-rejected arbitrator remains, he/she shall be the arbitrator. If more than one arbitrator remains un-rejected, the administrator of the arbitration service shall select the arbitrator from the remaining un-rejected arbitrators. Each Party shall pay to the arbitration service one-half of the fee required by the arbitration service for the arbitration. However, the fee shall be an awardable cost to the prevailing Party of the arbitration. 6.14 Attorney’s Fees and Costs. In the event a lawsuit, arbitration or mediation is initiated by either party, the party against whom a judgment or award is entered shall also be liable for costs of suit and reasonable attorneys' fees as set by the court or arbitrator. 6.15 Counterparts and Electronic Signatures. This Agreement shall be effective when signed below or in counterpart. Escrow Holder and all Parties agree that a signed and faxed or signed, scanned and e-mailed copy of this Agreement shall bind the parties as if an original and may be relied upon by Escrow Holder in confirming satisfaction of any and all terms, conditions and requirements contained in this Agreement. IN WITNESS WHEREOF, the Parties hereby have executed this Maintenance Agreement on the day first above written: City By Printed Title Date: August 2014 Company By Mark Figone, CEO Date: August___, 2014 APPROVED AS TO FORM: By Printed City Attorney Date: August 2014 ATTEST By Printed City Clerk Date: August 2014 S:\LFI777\Maintainance Agr\14.0603.docx ---PAGE BREAK--- Exhibit A to Maintenance Agreement - Vehicle Listing Year Vehicle ID Plate # Make Model Department 1081721 Ford Ranger Pickup Truck Custodial 1281908 Chevy Silverado 2500HD Pickup Truck Custodial 1325662 Chevy Silverado 2500HD Pickup Truck Custodial 903229 Ford Ranger Pickup Truck Custodial 1973 E642142 John Deere Tractor Maintenance 1987 E098453 Ford Bucket Truck Maintenance 1989 E326097 Woodchuck Chipper Maintenance 1989 32 E266472 Chevy 3500 Dump Truck Maintenance 1991 35 E338706 Ford F350 Pickup Truck Maintenance 1991 30 E207909 Ford F700 Box Truck, with Chipper Maintenance 1996 NA Caterpillar 416B Backhoe Maintenance 1998 NA John Deere Gator Maintenance 2000 1071549 Ford Expedition Maintenance 2001 E333956 Bigte Trailer Maintenance 2003 23 1168354 Chevy 3500 Van Maintenance 2003 1168401 Chevy Silverado 2500HD Pickup Truck Maintenance 2010 1191449 Ford F250 Pickup Truck Maintenance 2010 1314250 Ford F650 Pickup Truck Maintenance 1047880 Ram 1500 Van Maintenance 1314258 Ford F650 Dump Truck Maintenance 1997 SB 1081725 Ford F450 Stake Struck Recycling 2002 E1159998 GEM Cart Recycling 2004 CNG 1113364 Ford F150 Pickup Truck Recycling 2007 Linde NA Linde Forklift Recycling 2008 R1 1314370 Crane Carrier / Labrie Recycling Truck Recycling 2008 R2 1314371 Crane Carrier / Labrie Recycling Truck Recycling 2008 C1 1309697 Crane Carrier / Heil Recycling Truck Recycling 2010 C2 1343823 Crane Carrier / Heil Recycling Truck Recycling 1998 F1 NA Toyota Forklift Recycling 2005 F2 NA Toyota Forklift Recycling 1989 NA Clubcar Electric Golfcart 1991 E334072 Ford Pickup Truck 2010 E1194250 Ford F250 Pickup Truck 2000 E1066318 Ford E-350 Mini Bus Senior Center Meas. J 2007 E1274133 Ford E-450 Mini Bus Senior Center Meas. J 2008 1223933 Chevy Up lander Van Senior Center 1999 B1 1022987 Ford Ranger XLT Pickup Truck Building 2000 54 1047861 Ford Crown Victoria Code Enforcement