REPORT TO COUNCIL
SUBJECT
Title
Authorize the Issuance of a Purchase Order for Asphaltic Materials and Pavement Reinforcement Fabric (F18-171)
Report
REPORT IN BRIEF
Approval is requested to authorize the issuance of a purchase order to Reed & Graham of San Jose in an amount not to exceed $1,304,850 for asphaltic materials and pavement reinforcement fabric. Approval is also requested to delegate authority to the City Manager to renew the purchase order for up to two additional years, subject to available funding and acceptable pricing and services.
EXISTING POLICY
Pursuant to Section 2.08.040 of the Sunnyvale Municipal Code, City Council approval is required for procurements of goods and services exceeding $100,000 in any one transaction.
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(b)(5) in that it is a governmental organizational or administrative activity that will not result in direct or indirect changes in the environment.
BACKGROUND AND DISCUSSION
Asphaltic materials are used by Public Works Operations for regular and project-related pavement maintenance repair work on City streets and parking lots. Public Works supports the Environmental Services Department by providing pavement repairs related to water main breaks and small scale sewer repairs that disrupt currently paved areas. To complete these projects, the City requires emulsion oils, asphaltic concrete, pavement reinforcement fabric and various filler/sealer materials.
Bid specifications were prepared by Public Works and Purchasing staff and Invitation for Bids (IFB) No. F18-171 was directly emailed to three known asphaltic materials suppliers in the Bay Area and advertised to potential suppliers through the City’s DemandStar public procurement network. Sealed bids were publicly opened on January 3, 2018.
Three responsive bids were received, from Reed & Graham, Graniterock, and Maxwell Products. As evidenced on the Bid Summary in Attachment 1, Reed & Graham has the greatest proportion of low bid items and has provided pricing for every item.
Staff recommends awarding contracts to all three bidders, based on bid pricing and the importance of establishing primary and backup contracts. Short-term asphalt and baserock plant closures are common, and availability of multiple vendors for the immediate purchase of bulk materials is required. In establishing contracts with primary and backup suppliers, the City creates flexibility in obtaining these materials to ensure the highest level of availability and meet operational needs as they arise. Therefore, in addition to the recommendation that City Council authorize the issuance of a Purchase Order to Reed & Graham, staff wishes to inform the City Council that the City Manager will separately issue two purchase orders under $100,000, which is within his awarding authority, to Graniterock Company of Redwood City and Maxwell Products of Salt Lake City and that does not require Council action.
FISCAL IMPACT
Materials costs for a 12-month Purchase Order are estimated to total $1,304,850. Over the next fiscal year, approximately $1.5 million in budgeted funding is anticipated to be available in Operating Program 120 (Pavement Maintenance, Traffic Signs and Markings), $3.0 million in Capital Project 825290, Pavement Rehabilitation and approximately $95,000 in budgeted funding is available in Operating Programs 360 (Water Resources) and 367 (Wastewater Collection Systems).
Funding Source
Pavement funding is funded by a combination of the General Fund, Gas Tax Funds, and Vehicle Registration Fee revenue. Pavement repair related to the City’s Water and Wastewater systems is funded by each respective Enterprise Fund.
PUBLIC CONTACT
Public contact was made by posting the Council agenda on the City's official-notice bulletin board outside City Hall, at the Sunnyvale Senior Center, Community Center and Department of Public Safety; and by making the agenda and report available at the Sunnyvale Public Library, the Office of the City Clerk and on the City's website.
RECOMMENDATION
Recommendation
1) Authorize the City Manager to issue a purchase order, excluding sales tax, to Reed & Graham Company in an amount of $1,304,850, in substantially the same form as the Attachment 2 to the report; and 2) Delegate authority to the City Manager to renew the Purchase Order for two additional one-year periods, subject to available funding and acceptable pricing and services.
Staff
Prepared by: Gregory S. Card, Purchasing Officer
Reviewed by: Timothy J. Kirby, Director of Finance
Reviewed by: Wayne Tanda, Interim Director of Public Works
Reviewed by: Teri Silva, Assistant City Manager
Approved by: Kent Steffens, City Manager
ATTACHMENTS
1. Bid Summary
2. Draft Purchase Order