City of Sacramento
City Council - 5PM Report
915 I Street Sacramento, CA 95814
www.cityofsacramento.org
File ID: 2023-00416 5/2/2023 Consent Item 11.
Contract: Cummins Original Equipment Manufacturer (OEM) Parts and Repair Services File ID: 2023-00416
Location: Citywide
Recommendation: Pass a Motion: 1) waiving the Local Business Enterprise (LBE) requirement in lieu of issuing a second Invitation for Bid; 2) awarding a one-year contract with four one-year renewal options to Riverview International Trucks LLC for the purchase of Cummins Original Equipment Manufacturer (OEM) Parts and Repair Services in an amount not to exceed $750,000; and 3) authorizing the City Manager or the City Manager’s designee to execute the contract and renewal options specified above provided that sufficient funds are available in the budget adopted for the applicable fiscal year.
Contact: Bobbie Small, Program Specialist, (916) 808-6711, [email protected]; Alison Kerstetter, Fleet Manager, (916) 808-1163, [email protected]; Department of Public Works
Presenter: None
Attachments:
1-Description/Analysis
2-Agreement
Additional Description/Analysis
Issue Detail: While the City Budget includes funding to pay for repairs for City vehicles, City Code requires approval of contracts that exceed $250,000. This requires competitive bidding to award to the lowest qualified bidder and requires participation by Local Businesses to promote local business opportunities. The City’s requirements for a Local Business Enterprise (LBE) includes businesses in the City of Sacramento and the unincorporated county. Deviations from these requirements requires approval by the City Council or City Manager. From time to time, there are not local companies available or interested in providing specific services or parts so the City waives the LBE requirements.
The Department of Public Works (DPW), Fleet Management Division, has an ongoing need to
File ID: 2023-00416 5/2/2023 Consent Item 11.
purchase Cummins parts and repair services for the City’s fleet. Cummins engines are a common engine used in heavy-duty vehicles such as dump trucks, fire engines, and refuse trucks.
The City issued a bid for services and received two bids, but neither qualified as a local business.
Rather than request new bids, staff would like to enter into an agreement with the lowest bidder that did submit, which would require a waiver of competitive bidding. Staff has reviewed the costs and they are consistent with industry standards. This company is located in West Sacramento, so while it does not quality as an LBE, it is located nearby.
Policy Considerations: City Code 3.56.230.A provides that competitive bidding shall not apply to bids for supplies or nonprofessional services of $250,000 or more, when, after advertising for bids as required, no valid bids are received.
Economic Impacts: None
Environmental Considerations:
California Environmental Quality Act (CEQA): No environmental review is necessary because the recommendations in this report involve the purchase of parts and repair services and are not considered to be a project in accordance with Section 15378(b)(2) of the California Environmental Quality Act guidelines.
Sustainability: Not Applicable.
Commission/Committee Action: None.
Rationale for Recommendation: Under City Code Section 3.60.270, when the City establishes a minimum participation level for Local Business Enterprise (LBE) on a contract, no contractor shall be considered responsive unless its bid or proposal meets the minimum LBE participation level required.
On February 8, 2023, the Department of Public Works (DPW) Fleet Management Division, in accordance with City Code Chapter 3.56, issued Invitation for Bid No. B23153311005 (IFB) for Cummins OEM Parts and Services. The IFB established a minimum participation level for Local Business Enterprise. The only two submissions that were received were not valid as neither vendor was a Local Business Enterprise (LBE).
Rather than issue another IFB, staff recommends that the City waive the LBE participation requirement and authorize the City to exclusively negotiate with the lowest bidder rather than put out a new bid, consistent with what is allowed under City Code Section 3.56.230.A.
The City may waive or reduce the LBE participation requirements on procurement opportunities prior to acceptance of bids or proposals upon authorization from the City Manager. Because bids have already been received in response to the IFB, staff now seeks Council authorization to waive LBE requirements in light of the fact that no LBE responded to the IFB.
Fleet Management recommends awarding a contract to Riverview International Trucks, LLC. as they
File ID: 2023-00416 5/2/2023 Consent Item 11.
were the lowest priced business that provided a response to the IFB for Cummins OEM Parts and Services.
Financial Considerations: The contract provides for a not-to-exceed amount of $750,000 per year.
Sufficient funding exists in the Department of Public Works fiscal year 2022/23 operating budget (Fleet Fund, Fund 6501) to purchase parts and repair services through June 30, 2023. Purchases made after June 30, 2023, are subject to funding availability in the adopted budget of the applicable fiscal year.
Local Business Enterprise (LBE): Riverview International Trucks LLC is in West Sacramento and therefore does not meet City LBE requirements.