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Council hears $4.3M energy‑efficiency plan from Southland Industries; members request financing and per‑site costs
Summary
Southland Industries presented a bundled energy‑efficiency and deferred‑maintenance project for about 10 city buildings with a current project price of $4.285 million and estimated lifetime energy savings of roughly $3 million; council asked for per‑building cost breakdowns, alternatives, and financing plans and discouraged sole‑source procurement without competitive bids.
City staff and representatives from Southland Industries presented a proposed energy‑service contract to upgrade HVAC, lighting and other systems across roughly 10 city buildings, bundle deferred maintenance and install new rooftop solar arrays.
Mike May, introduced as an account executive for Southland Industries, said the current project price is $4,285,381 and that solar incentives and tax credits reduce the net budget figure presented to council to roughly $3.0 million. Southland estimated lifetime utility savings of more than $3 million over 23 years and a greenhouse‑gas reduction of about 625 metric tons over the project lifetime.
"This project will generate 3,000,000 in lifetime energy savings," said the presenter, and described measures such as HVAC replacements (including 23 aging units), LED lighting retrofits, updates to building controls, pump‑drive replacements and select roof replacements. The team noted the project relies in part on an investment tax credit that would be available only if portions of the work are completed before a December 2027 deadline.
Council concerns and staff guidance: Several council members pressed staff and the vendor about procurement and finance: they asked whether the contract had been put out to bid (staff described the proposal as a sole‑source option), whether banks or financing partners would require audited financials, and how the project would be staged. Council members urged competitive bidding for elements of the work, requested a per‑building cost and savings breakdown, and asked staff to pursue state energy‑efficiency grants and a low‑interest loan program (California Energy Commission) before committing to a full scope.
Next steps: Staff recommended continuing to pursue financing and reducing the overall scope to match the city’s ability to pay; council directed staff to return with detailed per‑building costs, financing scenarios and alternatives and to consider waiting for potential grant rounds in January if that improves project economics. No final contract award or authorization was recorded during the meeting.
Representative quotes:
"We took a look at a bunch of different potentials and sort of landed on two really good options…" (Southland presenter).
"I'd like to make sure that we have financing… audited financials are scaring out what type of rates they're gonna offer us," a council member said, urging caution.
