ADMINISTRATIVE REPORT


                                                   Date:  September 6, 1995
                                                     Division File D837-N33


     TO:       Vancouver City Council

     FROM:     Manager of Non-Market Housing

     SUBJECT:  Food Services Contract, Evelyne Saller Centre



     CONSIDERATION

          A.   THAT  City  Council authorize  negotiation  of  a five  year
               contract  with  Versa  Services with  terms  and  conditions
               satisfactory to the Director of Legal Services.

               OR

          B.   THAT City  Council authorize formal notice be given to Versa
               Services   to  terminate  the   current  contract   and,  in
               consultation with the Manager  of Purchasing Services, go to
               proposal call for selection of a contractor and  report back
               to Council.


     GENERAL MANAGER'S COMMENTS 

          The  General  Manager  of  Community Services  notes  that  Versa
          Services is  providing satisfactory  food service at  the Evelyne
          Saller Centre, as well as at Cordova House and Taylor Manor.  Its
          charges are competitive  and Versa has kept  the cost of food  at
          1991 levels without  compromising quality.  The service  was last
          tendered  in   1991  and  market  conditions   have  not  changed
          appreciably  in that  time.   There are  costs associated  with a
          proposal call  to the City,  as well  as to the  bidders.   There
          would  be  an  undesirable   disruption  to  employees  should  a
          different  contractor  be  hired.    Negotiation  with  Versa  is
          acceptable to the Province which funds this service, and would be
          preferred by Evelyne Saller management.

          Accordingly, I RECOMMEND approval of "A".


     COUNCIL POLICY

     The  policy  of Council  is to  award  contracts for  the  purchase of
     equipment,  supplies and  services that  will give  the highest  value
     based  on quality, service  and price, except where  an allowance of a
     maximum of 5%  is given to  those bidders whose tender  reflects local
     content.  Contracts with a value over $200,000 are referred to Council
     for award.



     PURPOSE

     The purpose of this report is to seek Council's direction in extending
     the current food service  contract with Versa Services or  calling for
     proposals.


     BACKGROUND

     The  Evelyne Saller Centre is  a community resource  centre located at
     320 Alexander Street in the downtown eastside of Vancouver.

     The  Centre  is  operated  by  the  City  of  Vancouver  under  shared
     provincial,  federal  and  City  funding agreements.    The  cafeteria
     operation is  100% funded  by the  provincial government  (Ministry of
     Social Services).   There is no direct  cost to the City  for the food
     service operation.   Currently  the Centre's cafeteria  averages 1,094
     meals per day, the 1995 food service budget is $1,101,435.00,  and the
     profit to Versa is 2% or $22,100.00.

     Versa Services has  managed the  food services at  the Evelyne  Saller
     Centre since September, 1990.  In 1990, a Request for Proposal was put
     out  for food services, and an  evaluation was done with the objective
     of providing a good,  high volume food  service at a reasonable  cost.
     Versa  was  selected  as the  company  which  had  the most  extensive
     experience in the health  field, and which would provide the best food
     service  for an  institutional food  operation requiring  large volume
     production.  The province accepted the City's recommendation.

     In  the 5  years since  Versa Services began  operations, a  number of
     initiatives have been jointly undertaken by Versa and the Centre.

     1.   A continuous  quality  improvement program  has been  implemented
          with audits being  done regularly,  checking such  items as  food
          temperature, sanitation, occupational health, and menu planning.

     2.   Versa staff sit on the Centre's joint OH & S  committee to ensure
          uniformity in addressing health and safety issues in the Centre.

     3.   Versa has  supported hiring personnel from  the Downtown Eastside
          where their  skills and abilities meet qualifica-tions to work in
          the food service industry.

     4.   Policies and  procedures have been  developed to ensure  that all
          staff  perform  to  a  standard  and  conduct  themselves  in  an
          appropriate  manner.   Policies and  procedures developed  by the
          Centre to  meet required  standards of  service are  supported by
          Versa management and staff.

     5.   Versa introduced  and maintains Food Safe  Level I certifi-cation
          for its staff.

     6.   Versa has provided expert advice to the Centre in develop-ing the
          kitchen equipment  replacement  program which  has enhanced  food
          preparation, and servicing.   Over a five- year period,  12 large
          equipment items have been acquired.

     7.   Versa has consistently been under budget for food opera-tions  by
          making cost-effective purchases from a network of food suppliers.

     8.   Menus  have been routinely upgraded  to supply a  wide variety of
          selections, as well  as nutritious  and hearty meals.   A  recent
          Centre survey indicated client response to the cafeteria services
          was positive.


     Options for Evelyne Saller Centre

     Two options are advanced for Council's consideration:

          A.   Negotiate the contract with Versa Services or
          B.   Issue a Request for Proposal.

     With option A,  the City would  not go to  proposal call but  continue
     with Versa Services, which  has proven to be effective  in providing a
     high volume of meals to the Centre on a daily basis.

     Food costs, excluding labour,  have remained stable for the  past five
     years.


     Versa  Services,  management  and  staff, has  worked  well  with  the
     Centre's management  in serving a difficult  clientele by co-operating
     in the  implementation  of  fair  policies and  practices  to  support
     disadvantaged people.

     Versa Services has  responded positively to requests  for changes that
     improve the meal service to clients.  Versa will even cater to a home-
     bound  client  with  special  needs.    Versa  also  provides frequent
     supervisory  inspections and  consultation  to the  management of  the
     Evelyne Saller Centre.

     The Ministry of Social  Services which funds 100% of the Centre's meal
     service  operations supports  negotiation of  the contract  with Versa
     Services.

     With  option B, Council would  be authorizing notice  to terminate the
     current contract with Versa Services and  go to proposal call.   Versa
     Services would,  in turn, notify  their employees of  possible layoffs
     and or transfers, where qualification and seniority permits.



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