Adopt Resolution 2023-019 authorizing the City Administrator to execute Amendment No. 4 to the Agreement with Peninsula Messenger Service for mail delivery for a not-to-exceed increase of One Hundred Seven Thousand Seven Hundred and Thirty Dollars ($107,730.00) for the term of January 1, 2023 to June 30, 2024.

The City of Carmel-by-the-Sea does not have house numbers. Nor does the community support the use of group or clustered mailboxes. Therefore, the use of post office boxes is an alternative to the United States Postal Service delivering mail directly to residential homes. The City contracts with a courier service, Peninsula Messenger Service, and pays for residential home mail delivery services for residents upon request.

On January 5, 2021, Council authorized the City Administrator to execute Amendment No. 3 to the Agreement with Peninsula Messenger Service to extend the term of the contract through December 31, 2022. In addition, Amendment No. 3 established a sliding fee scale for service based upon the number of post office boxes enrolled within the program. The purpose of this agenda item is to (1) extend the term of the Agreement through June 30, 2024 and (2) increase the not-to-exceed amount of the Agreement by One Hundred Seven Thousand Seven Hundred and Thirty Dollars ($107,730.00).

Peninsula Messenger Service has set fixed costs of operating, such as employees, vans, insurance, and post office box fees, a certain volume of accounts is required to provide this service. The number of post office box accounts from the period of July 2022 to January 2023 ranged from a low of 93 to a high of 96 with an average of 95 accounts. Peninsula Messenger Service has proposed a minimum of 25 accounts and the following fees as shown in Table 1, Proposed Fee Schedule.

Table 1: Proposed Fee Schedule

The not-to-exceed contract authorization for the Agreement and the subsequent three amendments totals Three Hundred Twenty-Four Thousand Two Hundred Dollars and covered the term of January 1, 2019 to December 31, 2022. The fourth amendment is for the term of January 1, 2023 to June 30, 2024 for a not-to-exceed amount of One Hundred Seven Thousand Seven Hundred and Thirty Dollars ($107,730.00). The not-to-exceed amount includes up to Thirty-Five Thousand Nine Hundred and Ten Dollars ($35,910.00) for January 1, 2023 to June 30, 2023 and Seventy-One Thousand Eight Hundred and Twenty Dollars ($71,820.00) for July 1, 2023 to June 30, 2024. Upon approval of the fourth amendment, the total amount of the Agreement is Four Hundred Thirty-One Thousand Nine Hundred and Thirty Dollars ($431,930.00) for the term of January 1, 2019 to June 30, 2024.

The Fiscal Year 2022-2023 Adopted Budget includes Seventy-Eight Thousand Seven Hundred and Twenty Dollars ($78,720.00) for this service. The percentage of accounts that will be determined to be eligible based on the program criteria is unknown at this time. 

1.       On January 8, 2019, the City Council adopted Resolution 2019-003 to approve an agreement with Peninsula Messenger Service for mail delivery for the term of January 1, 2019 to December 31, 2019 for a not-to-exceed amount of Seventy Thousand Two Hundred Dollars ($70,200.00) (“Agreement”).

2.       On January 7, 2020, the City Council adopted Resolution 2020-005 pertaining to the first amendment to the Agreement to (1) extend the term through December 31, 2021, (2) approve a rate increase from $39 to $41 per post office box and (3) increase the not-to-exceed amount by Seventy-Two Thousand Dollars ($72,000.00).

3.       On January 5, 2021, the City Council authorized the second amendment to the Agreement by adopting Resolution 2021-003, which extended the term through June 30, 2021 and increased the contract amount by an additional Fifty-Eight Thousand Dollars ($58,000.00).

4.       On July 7, 2021, the City Council authorized the third amendment to the Agreement by adopting Resolution No. 2021-035, which extended the term of the Agreement through December 31, 2022 and increased the contract amount by an additional One Hundred and Twenty-Two Thousand Dollars ($122,000.00).