REPORT TO COUNCIL
SUBJECT
Title
Authorize the Issuance of a 3-year Contract Purchase Agreement to W.W. Grainger, Inc., in the Amount of $600,000 for the Purchase of Industrial and Commercial Supplies (F25-065).
Report
REPORT IN BRIEF
Approval is requested to authorize the issuance of a 3-year Purchase Agreement to W.W. Grainger, Inc. of West Sacramento in an amount not to exceed $600,000 for the purchase of industrial and commercial supplies as required by the City, and to authorize the City Manager to increase the not to exceed amount if additional supplies are needed, subject to available budget and if service and pricing remains favorable to the City. Approval is also requested to renew the purchase order for up to two additional one-year periods if pricing and services remain acceptable to the City.
EXISTING POLICY
Pursuant to Section 2.08.040 of the Sunnyvale Municipal Code (SMC), City Council approval is required for contracts for the procurement of goods and services exceeding $250,000 in any one transaction.
Further, 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
W.W. Grainger, Inc. (“Grainger”) has been a provider of industrial and commercial supplies such as lighting, restroom fixtures and supplies, and tool attachments to the City of Sunnyvale since 2005.
Grainger and the State of Kentucky are parties to NASPO ValuePoint Master Agreement No. MA 758 2500000413 through the National Association of State Procurement Officials (“NASPO”) ValuePoint cooperative purchasing program (Attachment 2 to the report). In December 2024, Grainger and the State of California, a participant in NASPO, entered into a Participating Addendum under this NASPO ValuePoint Master Agreement (Attachment 1 to the report). The Participating Addendum is available for use by California local governments, including the City.
By participating in this cooperative arrangement, the City can access the same substantial discounts typically reserved for large-scale purchasers, even though it does not have the same purchasing volume as the State.
Before authorizing the use of a cooperative agreement initiated by another governmental entity, the following criteria need to be met: the originating parties reached a contractual agreement, the contract was awarded within twelve months of the date of authorization, the contract is for identical or nearly identical goods, and the contract resulted from a competitive bid using methods similar to those required by the City’s Methods of procurement (SMC Section 2.08.060). The NASPO ValuePoint Master Agreement with Grainger meets these criteria and therefore, it is recommended for award to the City of Sunnyvale.
FISCAL IMPACT
Budget for goods that are provided through Grainger is available in operating programs throughout various City departments, primarily in the Department of Public Works. Over the past three years, the City has averaged approximately $190,000 in annual expenses on industrial and commercial supplies from Grainger.
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 NOVA Workforce Services 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:
- Approve the Issuance of a three-year Purchase Agreement in an amount not to exceed $600,000 to Grainger for the purchase of industrial and commercial supplies in accordance with the State of California NASPO ValuePoint Master Agreement;
- Authorize the City Manager to execute the Purchase Agreement when all necessary conditions have been met;
- Authorize the City Manager to increase the not to exceed amount up to the budgeted amounts in various cost centers if additional supplies are needed and pricing and service remain favorable to the City; and
- Authorize the City Manager to renew the contract purchase agreement for up to two (2) additional one-year periods, subject to the continuation of the NASPO ValuePoint Agreement.
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
___ Contract or franchise
EXEMPT FROM THE LEVINE ACT
_X_ 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: Dennis Jaw, Acting Director of Finance
Reviewed by: Sarah Johnson-Rios, Assistant City Manager
Approved by: Tim Kirby, City Manager
ATTACHMENTS
1. State of California Participating Addendum Number 7-25-51-02
2. NASPO ValuePoint Master Agreement Number MA 758 2500000413