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HomeMy WebLinkAboutItem 09f - Outgoing Mail Services DATE: October 20, 2020 TO: Honorable Mayor and City Council FROM: Hue C. Quach, Administrative Services Director By: Henry Chen, Financial Services Manager/Treasurer SUBJECT: CONTRACT WITH SOCAL MAILING SERVICES FOR OUTGOING MAIL SERVICES IN AN AMOUNT NOT TO EXCEED $112,000 ANNUALLY WITH THE OPTION OF THREE ONE-YEAR EXTENSIONS Recommendation: Approve SUMMARY A Request for Proposal (“RFP”) for outgoing mail services was sent to nine firms, published on the City’s website, and in the local newspaper during August 2020. SoCal Mailing Services, who is the City’s current mailing services provider, was the only vendor to submit a proposal. It is recommended that the City award the outgoing mail services contract to SoCal Mailing Services in the amount not to exceed $112,000 annually, which consists of $19,000 for labor and $93,000 for postage, with the option to renew the contract for three one-year extensions. DISCUSSION The City currently has outgoing mail volume average of 300 pieces daily that requires folding, stuffing of inserts, and sealing. The mail service vendor picks up, meters, and delivers the mail to the Post Office. Additionally, on a monthly basis, the mail service vendor also folds, inserts, and meters approximately 8,000 water bills. The City has contracted with SoCal Mailing Services since October 2018, when they assumed the contract from Target Mailing Services, the previous vendor. The City has not had any issues with their services since they assumed the contract. A bid request was sent to nine firms that provide similar mailing services. The bid request was also published on the City’s website and in the local newspaper for two days during the month of August. SoCal Mailing Services was the only provider who submitted a proposal in response to the bid Contract with SoCal Mailing Services for Outgoing Mail Services October 20, 2020 Page 2 of 2 request. The low response rate may be attributable to the required pickup services at the City Hall; it seems to be cost effective and profitable only for vendors that are near Arcadia’s City Hall. The volume of mail has continued to decrease over the past few years because of the growing usage of electronic mail and online platforms. When this contract was last awarded, the City’s average daily volume was about 400 pieces of mail. The trend is expected to continue. Therefore, the total contracted amount for this service is expected to not exceed $112,000 annually, which was calculated based on the current average volume of 300 daily pieces of mail and 8,000 monthly water bills. Out of the total contracted amount, only $19,000 is for labor services and the balance of $93,000 is for postage. ENVIRONMENTAL ANALYSIS The proposed action does not constitute a project under the California Environmental Quality Act (“CEQA”), under Section 15061(b)(3) of the CEQA Guidelines, as it can be seen with certainty that it will have no impact on the environment. Thus, this matter is exempt under CEQA. FISCAL IMPACT The total outgoing mail services contract, including postage, shall not exceed $112,000 annually. Funds have been included in the Fiscal Year 2020-21 Operating Budget for this purpose. RECOMMENDATION It is recommended that the City Council determine that this action does not constitute a project and is therefore, exempt under, the California Environmental Quality Act (“CEQA”); and authorize and direct the City Manager to execute a contract with SoCal Mailing Services for outgoing mail services, in an amount not to exceed $112,000 annually, with the option of three one-year extensions. Attachment: Cost Calculations Pick up costs 45.00$              Each time 50.00$             Each time Processing costs 0.080$             Each piece Annual Service Costs Each Per day costs Each Per month costs 250 pieces of 0‐2 ounces 0.575$              143.75$         0.477$             3,816.00             50 pieces of 2‐3 ounces 0.800$              40.00$            Annual Postage Costs ESTIMATED TOTAL COSTS FOR ONE YEAR $112,000 ESTIMATED TOTAL COSTS REMAINDER OF FY20‐21 (7 MONTHS) $65,000 300 Pieces of Daily Mail & 8000 of Monthly Water bills   $93,000 Postage Service Costs Monthly Water BillsDaily Mail $19,000