Item 4 - Agreement btwn. City of Poway & Cloud 9 Shuttle AGENDA REPORT SUMMARY
TO: Honorable Mayor and Members of,~the City Council
FROM: James L. Bowersox, City Mana~:~.\'~'~::) ~
INITIATED BY: Robert A Clark, Director of Community Services'
Jennifer Johnson, Senior Management Analyst(~
DATE: April 15, 2003
SUBJECT: Agreement Between the City of Poway and Cloud 9 Shuttle, Inc., for the Poway
Airporter Service and Alternate Ground Transit Services
ABSTRACT
On October 22, 2002, the City Council approved amendment of the County Transit System
divestiture agreement to waive the Poway Airporter Transit Development Act (TDA) subsidy
and service administered by the Metropolitan Transit Development Board (MTDB). Cloud 9
Shuttle, Inc., (Cloud 9) has been the Poway Airporter provider for over eight years. The
agreement between Cloud 9 and MTDB expired on December 7, 2002. Cloud 9 expressed an
interest in continuing the Poway Airporter service. The City and Cloud 9 signed a letter of
agreement to continue the rates and service while a new agreement was reached.
ENVIRONMENTAL REVIEW
This item is not subject to CEQA review.
FISCAL IMPACT
The City will provide inkind publicity for the Poway Airporter service. Sufficient funds exist in
the Community Relations account (0200-4904).
ADDITIONAL PUBLIC NOTIFICATION AND CORRESPONDENCE
Additional notification sent to John Hawkins, President/CEO, Cloud 9; and Elaine LaPlaca-
Heston, Sales Manager, Cloud 9.
RECOMMENDATION
It is recommended that the City Council authorize an agreement with Cloud 9 Shuttle, Inc., for
a one-year demonstration program, with an additional two-year option, and authorize the
City Manager to execute the agreement.
ACTION
I of 11 April 15, 2003 Item
o..ow^
AGENDA REPORT
TO: Honorable Mayor and Members~ City Coun~
FROM: James L. Bowersox, City Man~r ~
DATE: April 15, 2003
SUBJECT: Agreement Between the City of Poway and Cloud 9 Shuttle,
Inc., for the Poway Airporter Service and Alternate Ground
Transit Services
BACKGROUND
On October 22, 2002, the City Council approved amendment of the County Transit
System divestiture agreement to waive the Poway Airporter Transit Development
Act (TDA) subsidy and service administered by the Metropolitan Transit
Development Board (MTDB). Cloud 9 Shuffle, Inc., (Cloud 9) has been the Poway
Airporter provider for over eight years. The agreement between Cloud 9 and MTDB
expired on December 7, 2002. Cloud 9 expressed an interest in continuing the
Poway Airporter service. The City and Cloud 9 signed a letter of agreement to
continue the rates and service while a new agreement was reached.
FINDINGS
From 1994 through December 7, 2002, the Poway Airporter Service was a
subsidized transportation alternative provided to residents of the City of Poway.
Cloud 9 Shuffle provided door-to-door shared dde shuttle service to and from
San Diego International Airport, Santa Fe Depot, and the Cruise Ship Terminal at a
reduced rate. Since 1994, the agreement with Cloud 9 had been administered by
the County Transit System (CTS), later divested to MTDB. The Metropolitan Transit
Development Board (MTDB), through City of Poway Transportation Development
Act (TDA) funds, subsidized the fare differentials to Cloud 9. To help balance its
fiscal year 03 budget, the MTD Board took action to discontinue the TDA subsidy for
the Poway Airporter. On October 22, 2002, the Poway City Council approved
amendment to the CTS/MTDB Divestiture Agreement to waive the Poway Airporter
subsidy and authorized staff to negotiate a new agreement between the
City of Poway and Cloud 9.
Staff has met and reached agreement with Cloud 9 to continue the Poway Airporter
Service without the TDA subsidy. Cloud 9 has offered to provide competitive rates
for the Poway Airporter service in exchange for the City continuing to provide
2 ofll April 15, 2003 Item # _~
Approve Agreement Between ~ City of Poway and Cloud 9 Shuttle, Inc., fo,~the Poway Airporter Service
and Alternate Ground Transit /ices
April 15, 2003
Page 2
-- "in kind' publicity. Poway residents benefit from this arrangement by having a
reduced rate compared to neighboring communities. For example, a one-way fare
from Rancho Bernardo is $36, from Rancho Penasquitos is $34, and from Scripps
Ranch the fare is $31 compared to the $27 that Poway residents will pay with the
new agreement. The table below shows the shuttle rate comparisons by zip code:
Cloud 9
proposal $27 $32 $37 $42 $47
$5 increase for each additional passenger
Rancho
Penasquitos $34 $45 $52 $59 $66
92129
Rancho
Bernardo $36 $47 $54 $61 $68
92127,
92128
Scripps
Ranch $31 $42 $49 $56 $63
92131
_ In addition to the shared ride Poway Airport shuttle service, Cloud 9 is offering alternate
ground transportation options. These services include scheduled service, chartered
service, and exclusive service. Exhibit A explains pricing for each service.
Scheduled service is defined as one-way transfers from a designated location in
Poway to the San Diego Airport on a pre-established pickup schedule. This service
will operate Monday through Friday beginning at 4:20 a.m. with the last pickup at
7:40 a.m. This time frame is designed to accommodate flight departures from the
San Diego Airport that begin at 6:15 a.m. For $15, this service would have one
designated pickup location with scheduled pickup times and would only be available
to San Diego Airport, not from the airport. The proposed location for scheduled
service is at the Twin Peaks/Community Road Park and Ride. Two additional
pickup locations can be considered during the one year demonstration program. It
should be noted that the times for scheduled service are approximate and can be
adjusted if additional pickup locations are implemented at a later date.
Cloud 9 is also offering their charter service, which is any destination to and from any
locations that do not include ports of entry for San Diego. The charter service applies
to all of Cloud 9's fleet to include extended passenger vans, limousines and sedans, lift-
equipped accessible vehicles, mini-buses, and full-size motor coaches. Charter service
pricing will be at a 10% discount for all pickups originating within the 92064 zip code.
Exclusive service is defined as direct, nonstop service in a private vehicle, originating
from one location to and from San Diego Airport, the cruise ship terminals, the Santa Fe
Depot, home or office. Exclusive pricing is for the entire vehicle and prearranged
reservations are required.
3 of 11 April 15, 2003 Item ~__ ~
Approve Agreement Betweer, '"e City of Poway and Cloud 9 Shuttle, Inc., ' - the Poway Airporter Service
and Alternate Ground Transit .~rvices
April 15, 2003
Page 3
This new alternate ground transportation package is designed to give residents and
business travelers alike a total transportation solution at a price that benefits the Poway
traveler and assists in reducing vehicle trips to or from the San Diego Airport, Santa Fe
Depot, or cruise ship terminals. Cloud 9 considers this program a "cooperative
partnership" with the City of Poway and looks forward to the City's participation in
publicizing the services provided by Cloud 9 for Poway residents and businesses.
The agreement between the City and Cloud 9 includes the services described for a
one-year demonstration program. If the City determines that the initial one-year term is
successful, the agreement can be automatically extended for an additional two years.
Fare increases related to any extensions will be determined through negotiations
between the City and Cloud 9. Either party can terminate the agreement with 30 days
written notice. Additionally, Cloud 9 will provide community service hours (i.e., use of
vehicle(s) for parades, shuttles, displays, etc.) not to exceed 60 hours per year at no
cost to the City. Cloud 9 will continue to provide $1 million in commercial general
liability, automobile, and workers' compensation liability insurance and name the City as
additional insured.
The City will provide marketing of the Poway Airporter service which currently includes:
transit flyers, Cloud 9's information listed on the City's website and electronic bulletin
board; and signs on Espola and Poway Roads. Additional marketing will include:
Poway Today articles; press release announcements; water bill insert; facilitate Cloud 9
becoming a member of the Poway Chamber of Commerce, and Poway Business Park
Association; and inform Cloud 9 of community events.
Cloud 9 has been building its reputation on quality, service, and safety since 1994.
Cloud 9 has received numerous awards for their forward thinking, innovative business
practices, and civic-minded approach to the transportation business. The success of
these long-term innovative approaches has been recognized and honored through
various awards. Specifically: the "Most Enterprising Business Award" (Bank of
America); "Blue Chip Enterprise Initiative Award" (Mass Mutual, U.S. Chamber of
Commerce); "Best Practices Awards" for Technology and Strategic Alliances (Arthur
Anderson); "Best Company to Work for in San Diego" and the "Total Excellence In
Management" (San Diego Business Journal); "Help On The Move Award" (Travelers Aid
Society). Supporting Cloud 9's fleet operations is a fully automated dispatching,
routing, GPS vehicle tracking, and drive cam monitors mounted inside the vehicles for
extra customer safety. Quality control tools are used daily to deliver safe, on time
performance, by highly trained drivers in the industry. Cloud 9 also meets all
Americans with Disability Act (ADA) requirements and provides lift equipped vans to
serve disabled passengers upon request at no additional charge.
ENVIRONMENTAL REVIEW
This item is not subject to CEQA review.
4ofll April 15, 2003 Item
Approve Agreement Between the City of Poway and Cloud 9 Shuttle, Inc., for-Jhe Poway Airporter Service
and Alternate Ground Transit ', /ices
April 15. 2003
Page 4
- FISCAL IMPACT
The City will provide inkind publicity for the Poway Airporter service. Sufficient funds
exist in the Community Relations account (0200-4904).
PUBLIC NOTIFICATION AND CORRESPONDENCE
Additional notification sent to John Hawkins, President/CEO, Cloud 9; and
Elaine LaPlaca-Heston, Sales Manager, Cloud 9.
RECOMMENDATION
It is recommended that the City Council authorize an agreement with Cloud 9
Shuttle, Inc., for a one-year demonstration pilot program, with an additional two
year-option, and authorize the City Manager to execute the agreement.
JLB:RAC:JCJ
Attachment A: Agreement
5 of 11 April 15, 2003 Item
AGREEMENT BETVVEEN THE CITY OF POWAY
AND CLOUD 9 SHUTTLE, INC.
FOR THE POWAY AIRPORTER SERVICE
AND ALTERNATE GROUND TRANSIT SERVICES
This agreement made this day of Apdl, 2003, by and between
Cloud 9 Shuttle, Inc., hereinafter referred to as "CONTRACTOR", and the City of
Poway, a public body, corporate and politic, hereinafter referred to as "CITY";
WHEREAS, CITY desires to reduce the cost of transportation services for
City residents traveling between the City of Poway and San Diego International
Airport, Cruise Ship Terminal, and Santa Fe Depot, by providing "in-kind"
promotional opportunities regarding CONTRACTOR'S services; and
Whereas, CONTRACTOR has represented that it has the necessary
expertise, personnel, and other resources, and is qualified to perform such
services.
NOW, THEREFORE, it is agreed by and between the parties hereto as
follows:
1. DESCRIPTION
1.1 CONTRACTOR will provide shared ride service, scheduled
service, charter service, and exclusive service to the
residents and business community within the CITY.
1.2 Shared ride (Poway Airporter Service) is defined as multiple
pickups from a maximum of four different locations
originating either outside or inside the Poway community
with a common destination to or from the San Diego
International Airport, cruise ship terminals, and Santa Fe
Depot. This service operates 24 hours a day, 7 days a
week, 365 days a year. Shared ride pricing is scaled to a
per passenger fare originating from the same pickup (see
Exhibit A). Shared ride service includes a guaranteed 30-
minute response time for customers requiring an ADA
accessible van.
1.3 Scheduled service is defined as one way transfers from a
designated location in Poway to the San Diego Airport on a
pre-established pick up schedule. This service will operate
Monday through Friday beginning at 4:20 a.m. with the last
pick up at 7:40 a.m. This timeframe is designed to
accommodate flight departures from San Diego Airport that
begin at 6:15 a.m. This service will have one designated
6 of 11 Attachment A April 15, 2003 Item
- pickup location and scheduled pickup times. This service is
only available to San Diego Airport, not from. The initial pick
up location and times will be the Park and Ride lot at
Community and Twin Peaks Roads (4:30 a.m., 5:30 a.m.,
6:30 a.m., and 7:30 a.m.). Two additional locations may be
determined by mutual agreement of the CITY and
CONTRACTOR. Times may be adjusted depending upon
implementation of two additional locations.
1.4 Charter Service is defined as any destination to and from
any locations that do not include port of entries for San
Diego. Charter service applies to all of CONTRACTOR'S
fleet to include (extended passenger vans; limousines and
sedans; lift equipped accessible vehicles; mini-buses; and
full size motor coaches). Charter service pricing will be at a
10% discount for all pick ups originating within the 92064 zip
code.
1.5 Exclusive transportation service is defined as direct non-stop
service, in a private vehicle, originating from one location to
and from (San Diego Airport, the cruise ship terminals, the
Santa Fe Depot, home or office). Exclusive pricing is for the
__ entire vehicle. Pre-arranged reservations are required.
2. TERM
2.1 The term of this Agreement shall be for a period of one year
commencing on April __, 2003.
2.2 Should CITY detemine that the initial one-year term is
successful, this Agreement may be automatically extended
for additional successive two-year periods. Fare
adjustments related to any such extensions shall be
determined through negotiations between CITY and
CONTRACTOR. This Agreement shall be deemed
automatically extended unless either party provides thirty
(30) days written notice to the other party of its intent to not
extend.
2.3 Either party to this Agreement can terminate this Agreement
upon thirty (30) days written notice.
7 of 11 April 15, 2003 Item
3. USER FEES
3.1 Except under conditions stated in Section 3.2, passengers
shall not be charged an amount greater than those listed in
Exhibit A.
3.2 Cloud 9 Shuttle reserves the right to implement a temporary
fuel surcharge during periods of time when fuel prices
increase in excess of 25% above standard rates of $1.60 per
gallon (or in excess of $2.00 per gallon) for periods of
greater than one month. Once prices stabilize back to pre-
crisis rates, the surcharge will be discontinued.
4. AMENDMENTS
4.1 This Agreement may be amended to change the scope,
terms, or conditions by mutual written agreement of both
parties.
5. ADVERTISING AND MARKETING
5.1 CITY shall provide advertising and marketing of the Poway
Airporter transportation service, which may include: transit
flyers; Contractor's information listed on City's Website and
electronic bulletin board; signs on Espola and Poway Roads;
Poway Today article; press release announcements; water
bill insert; facilitate CONTRACTOR becoming a member of
the Poway Chamber of Commerce, and Poway Business
Park Association; and inform CONTRACTOR of community
events. CiTY will have final approval on all marketing plans
and materials.
5.2 Upon request by City, CONTRACTOR will provide
community service hours (i.e. use of vehicle(s) for parades,
shuttles, displays, etc.) not to exceed 60 hours per year at
no cost to the CITY.
5.3 After completion of one year initial demonstration program
period, and if CITY is satisfied with CONTRACTOR'S
performance, CITY may be requested to provide
CONTRACTOR with a letter of support regarding the
private/public partnership with CONTRACTOR and state the
benefit to Poway residents and the Poway community (OR)
a CITY representative may be asked to appear before other
groups stating the benefit of the partnership to Poway
residents and the Poway community.
8 of 11 April 15, 2003 Item
5.4 CONTRACTOR will monitor success of the program and
provide quarterly ridership numbers and comparisons to
CITY in order to update the City Council on the success of
the program.
6. INSURANCE
6.1 Dudng the term of this Agreement, CONTRACTOR shall
obtain and maintain in full force and effect the following
insurance coverages:
Commercial General Liability.
CONTRACTOR shall maintain coverage in the amount of $1
million dollars ($1,000,000) per occurrence naming the City
of Poway, its elected and appointed boards, officers, agents,
and employees as additional insureds with respect to this
contract with CITY. This coverage shall include
premises/operations, contractual, and personal injury
coverage.
_ Automobile Liability. CONTRACTOR shall maintain
coverage in the amount of $1 million dollars ($1,000,000) per
occurrence for all owned, nonowned or hired vehicles and
naming the City of Poway, its elected and appointed boards,
officers, agents, and employees as additional insureds.
Workers' Compensation. CONTRACTOR shall maintain
coverage in statutory amount and employer's liability
coverage for no less than $1 million dollars ($1,000,000) per
occurrence for all employees of Contractor engaged in
services or operations under the Agreement.
7. NOTICES
7.1 All notices, certificates, requests or other communications
hereunder shall be in writing and shall be sufficiently given
when delivered or mailed by certified mail, postage prepaid,
to the parties at their respective business as follows:
TO THE CITY TO THE CONTRACTOR
City of Poway Cloud 9 Shuttle, Inc.
Attn: James L. Bowersox Attn: John Hawkins
~. City Manager PresidentJCEO
13325 Civic Center Drive 3520 Kurtz Street
Poway, CA 92064 San Diego, CA 92110
9ofll April 15, 2003 Item
8. APPLICABLE LAWS
8.1 CONTRACTOR warrants that in performance of this
Agreement, CONTRACTOR will comply with all lawful
federal, state, and local orders, rules, regulations, and/or
requirements such as the American with Disabilities Act of
1990, the California Department of Motor Vehicles "pull-
notice system" for drivers, San Diego Unified Port Distdct
requirements for airport ground transportation service and
any other matters that impact safety or other relevant areas.
8.2 CONTRACTOR shall ensure that all services are provided to
the public without regard to race, color, creed, sex, age,
national origin, ethnic group identification or disability
including Acquired Immune Deficiency Syndrome (AIDS)
and/or AIDS related complex (ARC).
8.3 CONTRACTOR shall test both pre-employment and random
for any substance abuse of all employees and management.
9. NO ASSIGNMENTS
9.1 Neither any part nor all of this Agreement may be assigned
or subcontracted, except as otherwise specifically provided
herein, or to which City, in its sole discretion, consents to in
advance thereof in writing. Any assignment or
subcontracting in violation of this provision shall be void.
This Agreement shall constitute the entire understanding between
CONTRACTOR and CITY relating to the terms and conditions of the services to
be performed by CONTRACTOR.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement on the date first above written.
Dated: City of Poway
By:.
Its:
Dated: Cloud 9 Shuttle, Inc.
By:.
Its:
10 of 11 April 15, 2003 Item # /'~
11 of 1t April 15, 2003 Item