REPORT TO COUNCIL
SUBJECT
Title
Modify an Existing Purchase Agreement with Chemtrade Chemicals US LLC for Aluminum Sulfate to Increase the Not-to-Exceed Amount to $545,000 (F26-185)
Report
REPORT IN BRIEF
Approval is requested to modify an existing purchase agreement with Chemtrade Chemicals US LLC, increasing the not-to-exceed amount from $245,000 to $545,000 for Aluminum Sulfate. The increase is necessary due to higher chemical use driven by elevated pond algae levels and the need to maintain recycled-water quality in accordance with Title 22 requirements.
EXISTING POLICY
Pursuant to Section 2.08.040(d) of the Sunnyvale Municipal Code (SMC), Council approval is required for the procurement of goods and/or services greater than $250,000 in any one transaction.
Section 2.08.220(b) of the SMC authorizes the purchasing officer to direct the city’s participation with one or more governmental, public or quasi-public agencies in a cooperative agreement for the procurement of goods and/or services, provided that at least one of the agencies has solicited bids.
ENVIRONMENTAL REVIEW
The action being considered does not constitute a “project” within the meaning of the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines section 15378(a) as it has no potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment.
BACKGROUND AND DISCUSSION
Proper wastewater treatment practices protect Sunnyvale’s public health and environment and ensure compliance with the City’s many environmental permits. Various chemicals are used in bulk quantities in wastewater treatment processes, and Aluminum Sulfate (alum) is one such chemical. A tertiary treatment process at the Water Pollution Control Plant (Plant) uses alum to remove pond algae prior to filtration and disinfection, and the treated water is discharged to the environment or reused as recycled water. Depending on operating conditions, alum is delivered to the Plant in 5,000-gallon bulk tankers about twice weekly. This critical treatment process ensures that the Plant discharges well-treated process water, meets all regulatory effluent limitations, and protects public safety and environmental health in the receiving waters.
The Bay Area Chemical Consortium (BACC) solicited bids for alum in February 2025. Chemtrade Chemicals US LLC (Chemtrade) was the lowest responsive bidder in this region (see Attachments 1 and 2 to the report). The BACC leverages volume purchasing power for over 60 water and wastewater agency members across the Bay Area. Bulk chemical purchases facilitated by the BACC create bidding efficiencies for participating agencies by offering volume pricing discounts during the bidding process. The identified chemicals that meet the City’s requirements are available through a BACC cooperative agreement, and it is in the City's best interest to purchase through this contract. Accordingly, a purchase agreement in the amount of $245,000 with Chemtrade was established under the City Manager’s authority.
It was originally estimated that the original agreement amount would be sufficient to purchase the appropriate amount of Alum for the FY 2025/26 contract period. However, chemical use increased significantly due to elevated pond algae levels and also the additional alum needed to produce Recycled Water in compliance with Title 22 regulations. Pond algae levels are a function of atmospheric temperature (not controllable) and nutrient levels (hard to control). As such, staff expect usage will potentially be more than double the original estimate. Therefore, staff request an additional $300,000 to cover alum costs this fiscal year, for a total of $545,000. Once the new secondary treatment plant that is currently under construction as part of the Clean Water Program is online, currently estimated to be in 2028, our reliance on the ponds will decrease significantly and chemical usage is expected to also drastically decrease.
FISCAL IMPACT
Budgeted funds are available in Fund 6080 - Wastewater Management Fund under Program 14600 - Wastewater Treatment.
PUBLIC CONTACT
Public contact was made by posting the Council meeting agenda on the City's official-notice bulletin board at City Hall, at the Sunnyvale Public Library and in the Department of Public Safety Lobby. In addition, the agenda and this report are available at the City Hall reception desk located on the first floor of City Hall at 456 W. Olive Avenue (during normal business hours), and on the City's website.
RECOMMENDATION
Recommendation
Take the following actions:
- Authorize the City Manager to modify the existing Purchase Agreement with Chemtrade Chemicals US LLC for aluminum sulfate, increasing the not-to-exceed amount from $245,000 to $545,000;
- Authorize the City Manager to execute the agreement when all necessary conditions have been met; and
- Authorize the City Manager to modify the purchase agreement, subject to available budget, if additional aluminum sulfate is required and pricing and service remain acceptable to the City.
Levine Act
LEVINE ACT
The Levine Act (Gov. Code Section 84308) prohibits city officials from participating in certain decisions regarding licenses, permits, and other entitlements for use if the official has received a campaign contribution of more than $500 from a party, participant, or agent of a party or participant in the previous 12 months. The Levine Act is intended to prevent financial influence on decisions that affect specific, identifiable persons or participants. For more information see the Fair Political Practices Commission website: www.fppc.ca.gov/learn/pay-to-play-limits-and-prohibitions.html
An “X” in the checklist below indicates that the action being considered falls under a Levine Act category or exemption:
SUBJECT TO THE LEVINE ACT
___ Land development entitlements
___ Other permit, license, or entitlement for use
_X_ Contract or franchise
EXEMPT FROM THE LEVINE ACT
__ Competitively bid contract*
___ Labor or personal employment contract
___ Contract under $50,000 or non-fiscal
___ Contract between public agencies
___ General policy and legislative actions
* "Competitively bid" means a contract that must be awarded to the lowest responsive and responsible bidder.
Staff
Prepared by: David Battaglia, Purchasing Officer
Reviewed by: Matthew Paulin, Director, Finance
Reviewed by: Ramana Chinnakotla, Director, Environmental Services Department
Reviewed by: Sarah Johnson-Rios, Assistant City Manager
Approved by: Tim Kirby, City Manager
ATTACHMENTS
1. BACC Standard Agreement
2. BACC Award & Bid Summary