City of Sacramento
City Council - 5PM Report
915 I Street Sacramento, CA 95814
www.cityofsacramento.org
File ID: 2022-02259 1/24/2023 Consent Item 8.
Agreement: Omnia Cooperative Agreement with W.W. Grainger for Purchase of MRO Products [Published for 10-Day Review on 01/12/2023]
File ID: 2022-02259
Location: Citywide
Recommendation: Pass a Motion: 1) approving the continued use of Omnia Partners’ cooperative purchasing agreement No. 192163 with W.W. Grainger, for the purchase of maintenance, repair, and operations (MRO) products through the final expiration date of the contract on December 31, 2024; and 2) increase the amount not-to-exceed by $2 million for a total of $4.75 million.
Contact: Audrey Ficker, Contract & Compliance Specialist, (916) 808-5744, [email protected], Department of Finance
Presenter: None.
Attachments:
1-Description/Analysis
2-Omnia Cooperative Contract No. 192163
3-Sample of Grainger Purchase Order
Description/Analysis
Issue Detail: On December 10, 2019, Motion 2019-0412 authorized departments to use Omnia Cooperative purchasing agreement No. 192163 with W.W. Grainger for MRO products through January 31, 2023 at a not-to-exceed amount of $2.75 million. Omnia Partners has renewed the agreement through December 31, 2023 and has one final option to extend for an additional one-year period through December 31, 2024. The procurement division makes every effort to accurately forecast citywide spend when setting a not-to-exceed amount for a citywide contract, however, unanticipated projects and other factors can impact spending. City departments have utilized the contract more than originally anticipated, averaging $720,000 in expenditures annually, with total spend currently at $2,167,761.
YEAR TOTAL EXPENDITURES
2019 $ 8,056.67
2020 $ 1,067,740.74
2021 $ 747,742.52
2022 $ 344,221.30
TOTAL: $ 2,167,761.23
File ID: 2022-02259 1/24/2023 Consent Item 8.
YEAR TOTAL EXPENDITURES
2019 $ 8,056.67
2020 $ 1,067,740.74
2021 $ 747,742.52
2022 $ 344,221.30
TOTAL: $ 2,167,761.23
If department expenditures continue in this pattern, the City will exceed the current approved not-to- exceed amount of $2.75 million. The City seeks approval to continue utilizing the contract through the final expiration date on December 31, 2024 and to add an additional $2 million to the not-to- exceed amount to cover the estimated $720,000 expenditures annually and allow for additional authority to cover unanticipated projects and emergencies.
Policy Considerations: The recommendations in this report are in accordance with City Code Section 3.56.240 which authorizes the City Manager, when it’s advantageous to the City, to use cooperative purchasing agreements approved by the Council to purchase supplies or nonprofessional services through legal contracts of other governmental jurisdictions or public agencies, eliminating the need to perform additional competitive bidding by the City of Sacramento.
The Sacramento City Code Section 4.04.020 and Council Rules of Procedure (Chapter 7, Section E.2.d.) mandate that unless waived by a 2/3 vote of the Council, all labor agreements and all agreements greater than $1 million shall be made available to the public at least ten (10) days prior to council action. This item was published for 10-day review on January 12, 2023, in compliance with the City Code.
Economic Impacts: None.
Environmental Considerations:
California Environmental Quality Act (CEQA): This report concerns administrative activities and governmental fiscal activities that do not constitute a “project” as defined by the CEQA Guidelines Sections 15378(b)(2) and 15378(b)(4) and are not subject to the provisions of CEQA (CEQA Guidelines Section 15060(c)(3)).
Sustainability: W.W. Grainger offers a catalog of green products through this recommended agreement. Under the City of Sacramento’s Climate Action Plan, all applicable “green” alternatives will be considered prior to the purchase of their products.
Commission/Committee Action: Not applicable.
Rationale for Recommendation: To maximize cost savings and staff resources, many governmental jurisdictions or public agencies combine their contracting efforts through cooperative purchase
File ID: 2022-02259 1/24/2023 Consent Item 8.
agreements which increases pricing competitiveness and lowers operating costs through significant volume discounts. When comparing the administrative costs required, such as product research, vendor research, advertising, awarding, and creating the contract, it’s often more cost-effective to make purchases through a cooperative purchase agreement. The pricing terms and conditions for this agreement were determined through a competitive solicitation that was conducted by the City of Tucson, Arizona. The City of Sacramento has been using this agreement since its inception in 2019 and intends to continue use throughout the life of the contract. The original motion approved the use of this agreement through January 31, 2023. Staff is requesting approval to continue the use of the cooperative agreement throughout the contract’s final expiration date on December 31, 2024 and an additional $2 million be added to the not-to-exceed amount to cover potential expenditures over the life of the contract.
Financial Considerations: Departments will use their operating budgets and project funding to purchase these MRO products as required and as budget allows. Each division will submit their own purchase orders to authorize the purchases as required.
Local Business Enterprise (LBE): W.W. Grainger is not a local business enterprise.