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HomeMy WebLinkAboutItem 12g - Outgoing Mail ServicesDATE: June 4, 2024 TO: Honorable Mayor and City Council FROM: Henry Chen, Interim Administrative Services Director SUBJECT: THREE-YEAR CONTRACT EXTENSION WITH SOCAL MAILING SERVICES FOR OUTGOING MAIL SERVICES IN AN AMOUNT NOT TO EXCEED $115,000 ANNUALLY CEQA: Not a Project Recommendation: Approve SUMMARY The City’s contract for outside mail service expires on June 30, 2024. SoCal Mailing Services is willing to extend the contract with an increase of $5 per daily pickup and minor increases in processing costs. It is recommended that the City execute a three- year contract extension with SoCal Mailing Services for outgoing mail services in an amount not to exceed $115,000 annually, which consists of $21,000 for labor and $94,000 for postage. DISCUSSION The City currently has an average mail volume of 200 pieces daily that require folding, stuffing of inserts, and sealing. The mail service vendor picks-up, meters, and delivers the mail to the Post Office. Additionally, monthly, the mail service vendor also folds, inserts, and meters approximately 6,500 water bills. The City has contracted with SoCal Mailing Services since October 2018, when they assumed the contract from Target Mailing Services. The City has not had any issues with SoCal’s services since they assumed the contract. Since SoCal Mailing Services was awarded the contract in 2018, the City has issued a Request for Proposal (“RFP”) for outgoing mail service on two occasions. Each time, only one bid was received, and it was from SoCal Mailing Services. Given the limited response history, it would be more effective to request an extension to the contract at this time. The low response rate may be attributable to the required pickup services at City Hall; it seems to be cost effective and profitable only for vendors that are near Arcadia’s City Hall. Contract Extension with SoCal Mailing Services for Outgoing Mail Services June 4, 2024 Page 2 of 3 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 300 pieces of mail; this downward trend is expected to continue. During the current contract, the labor costs were around $19,000 and the postage was $93,000 annually. SoCal Mailing Services has indicated that they are willing to extend the contract with an increase of $5 per daily pickup and minor increases in processing costs. Under the proposed extension, which was calculated based on the current average volume of 200 daily pieces of mail and 6,500 monthly water bills, the costs are estimated to be $21,000 for labor and $94,000 for postage. It is recommended that the City Council authorize and direct the City Manager to execute a three-year contract extension with SoCal Mailing Services for outgoing mail services, in an amount not to exceed $115,000 annually. ENVIRONMENTAL ANALYSIS The proposed action does not constitute a project under the California Environmental Quality Act (“CEQA”), as it can be seen with certainty that it will have no impact on the environment. FISCAL IMPACT The total outgoing mail services contract, including postage, shall not exceed $115,000 annually. Funds have been budgeted in the Fiscal Year 2024-25 Operating Budget for this purpose. Pick up costs 50.00$ Each time 55.00$ Each time Processing costs 0.100$ Each piece Annual Service Costs Each Per day costs Each Per month costs 150 pieces of 0-2 ounces 0.680$ 102.00$ 0.680$ 4,420.00 50 pieces of 2-3 ounces 1.160$ 58.00$ Annual Postage Costs ESTIMATED TOTAL COSTS FOR ONE YEAR $115,000 200 Pieces of Daily Mail & 6,500 Monthly Water Bills $94,000 Postage Service Costs Monthly Water BillsDaily Mail $21,000 Contract Extension with SoCal Mailing Services for Outgoing Mail Services June 4, 2024 Page 3 of 3 RECOMMENDATION It is recommended that the City Council determine that this action does not constitute a project under the California Environmental Quality Act (“CEQA”); and authorize and direct the City Manager to execute a three-year contract extension with SoCal Mailing Services for outgoing mail services, in an amount not to exceed $115,000 annually.