Title
A Resolution Of The City Commission Of The City Of Hollywood, Florida, Approving And Authorizing The Appropriate City Officials To Execute Construction Work Order No. 2 For Audit Work Order No. 2 For Various Energy Conservation Measures In Accordance With The Energy Services Agreement With Noresco, LLC.
Strategic Plan Focus
Infrastructure & Facilities
Body
Staff Recommends: Approval of the attached Resolution.
Explanation:
On July 2, 2022, the City Commission approved Resolution No. R-2022-206 approving the execution of the Energy Services Agreement with Noresco, LLC (“Noresco”) dated July 29, 2022 (“Agreement”) to perform investment grade audits and comprehensive energy management and energy-related capital improvement services for various City buildings, structures, lighting and facilities for the City’s energy performance program, financed through guaranteed cost savings achieved from the improvements (“Energy Performance Services”).
The Energy Performance Services include the evaluation of all City facilities and resources to recommend and potentially implement energy savings associated with streetlights, HVAC units, electrical systems, EV chargers and other energy efficient adjustments to other City assets; and
Audit Work Order No. 1, pertaining to the Citywide LED Streetlight Upgrade Project, authorized Noresco to study and perform an investment grade audit on the City-owned streetlight network.
The investment grade audit, performed under Audit Work Order No. 1, resulted in the proposed LED conversion of over 2,000 City-owned streetlights, excluding those located in the Beach and Downtown Community Redevelopment Agency; and
Over the 20-year period of performance for the Agreement, the projected guaranteed cost savings equates to $4,178,355.00.
The total project cost for Construction Work Order No. 1 is $4,570,000.00, of which the City’s contribution in the amount of $2,000,000.00 was previously approved.
Audit Work Order No. 2 enabled Noresco to study various energy conservation measures throughout the City, with expenses in the amount of $332,300.00 due to Noresco upon completion of the audit; however, those costs were waived because the City will pursue moving forward with the audit results and the resulting Construction Work Order No. 2 in the amount of $6,558,692.00 to be paid in monthly progress payments throughout completion of the project.
Over the 20-year period of performance for the Agreement, the projected guaranteed cost savings equates to $10,485,413.00.
Construction Work Order No. 2 includes permitting, material and equipment procurement, installation and commissioning of interior and exterior lighting improvements, HVAC system replacements, building automation system upgrades and park exterior lighting and athletic field lighting improvements; and
The Director of the Department of Design and Construction Management and the Director of the Office of Procurement and Contract Compliance recommend that the City Commission approve and authorize the execution of Construction Work Order No. 2 under the Energy Services Agreement with Noresco.
Fiscal Impact:
The annual debt service will be budgeted in future fiscal years budgets subject to approval of the City Commission. The annual debt service is estimated to be approximately $382,580.00 in year one growing to approximately $676,565.00 in year twenty, for an average annual debt service payment of approximately $516,352.00 over the 20-year term. The guaranteed cost savings achieved from the project implementation will pay the annual debt service.
A companion item for authorizing the execution and delivery of a master equipment lease-purchase agreement with Banc of America Public Capital Corp will be presented to the City Commission.
Recommended for inclusion on the agenda by:
Otis Thomas, Director, Office of Procurement and Contract Compliance
Jose Cortes, Director, Department of Design and Construction Management
Adam Reichbach, Assistant City Manager