City of Sacramento
City Council - 2PM Report
915 I Street Sacramento, CA 95814
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File ID: 2024-00740 4/9/2024 Consent Item 10.
(City Council) Suspend Competitive Bidding for the Purchase of Chemicals through the Bay Area Chemical Consortium Bid Process (Two-Thirds Vote Required) File ID: 2024-00740
Location: Citywide
Recommendation: Adopt a Resolution suspending competitive bidding, in the best interests of the City, to allow the Department of Utilities (DOU) to purchase water and wastewater treatment chemicals through participation in the Bay Area Chemical Consortium (BACC) bid process.
Contact: Andrew Costan, Administrative Analyst, (916) 808-6339, [email protected]; Deanne Neighbours, Interim Logistics Manager, (916) 808-3536; [email protected]; Sherill Huun, Division Manager, (916) 808-1455, [email protected]; Pravani Vandeyar, Director, (916) 808-3765, [email protected]; Department of Utilities Presenter: None.
Attachments:
1-Description/Analysis
2-Resolution
Description/Analysis
Issue Detail: On January 26, 2016 (R2016-0027) and December 4, 2019 (R2018-0471), City Council suspended competitive bidding to allow the Department of Utilities to participate in the Bay Area Chemical Consortium (BACC) bid process for periods of 3 years and 5 years, respectively. The BACC is a group of approximately 70 public agencies located throughout the region. The prices for chemicals used in DOU’s treatment processes vary from year to year and this process has allowed DOU to obtain the most competitive bulk bid prices for chemicals.
To continue to obtain the best possible chemical bid prices, staff is recommending City Council suspend competitive bidding for a period of no more than 5 years to allow the City to purchase certain chemicals at prices obtained through the BACC bid process. Staff will return to Council for approval to award any resultant chemical purchase contracts of $250,000 or more.
File ID: 2024-00740 4/9/2024 Consent Item 10.
Policy Considerations: Using the BACC bid process instead of the City’s standard bid process requires a suspension of the standard bid process. City Code Section 3.56.230(c) authorizes the City Council to suspend competitive bidding for the purchase of supplies when, upon a two-thirds vote, the City Council determines it is in the best interests of the City to do so. City staff recommends it is in the City’s best interest to suspend competitive bidding for the purchase of water and wastewater treatment chemicals via participation in the BACC process, because the significantly larger purchasing power of the BACC agencies bidding collectively has proven to result in lower chemical bid prices than the City can obtain using a stand-alone bid process, which has saved and will continue to save the City and City ratepayers money on chemical purchases.
Economic Impacts: None.
Environmental Considerations: The use of chemicals, including Aluminum Sulfate, Hydrofluorosilicic Acid, Liquid Chlorine, Sodium Bisulfite, Sodium Hydroxide, and Sodium Hypochlorite, is an ongoing activity at the City’s water and wastewater plants. Purchasing these chemicals through the BACC bid process rather than using the City’s standard bid process will not result in any significant changes in the City’s existing operations and processes. The use of these chemicals is regulated by State permit requirements.
The Community Development Department, Environmental Services Manager has determined that the proposed activity is not a project pursuant to the California Environmental Quality Act (CEQA). CEQA Guidelines Section 15378(b). The activity is a continuing administrative or maintenance activity, such as the purchase of supplies, and is not subject to CEQA. CEQA Guidelines Section 15060(c)(3).
Sustainability: Chemicals purchased under these contracts comply with Section 8 of the City’s Sustainability Master Plan as they facilitate the continued treatment and protection of the City’s drinking water.
Commission/Committee Action: Not Applicable.
Rationale for Recommendation: In an effort to reduce its costs to purchase water and wastewater treatment chemicals, DOU joined the BACC in August 2015. City staff is recommending the City Council suspend competitive bidding to allow the DOU to continue to participate in the BACC annual competitive bidding process instead of conducting stand-alone bids. Staff is recommending that this include authorization to use the BACC bid process for a period of up to five years. The use of a cooperative purchase process like this saves time, reduces administrative costs, improves efficiency, and reduces overall chemical and treatment costs.
Financial Considerations: BACC members agree to pay a participation fee per bid to fund the BACC bidding process. This cost is based upon how many agencies participate in each bid process
File ID: 2024-00740 4/9/2024 Consent Item 10.
and the costs involved in the processing of said bids. This year the cost for BACC participation is anticipated to be $400 per bid, per agency. Funding for any contracts awarded as a result of the BACC bid process will be identified when staff returns to Council for approval of the contract awards.
Local Business Enterprise (LBE): The minimum LBE participation requirement is waived as the City has suspended competitive bidding and utilized an alternate procurement method to select vendors.
RESOLUTION NO. 2024-XXXX
Adopted by the Sacramento City Council
April 9, 2024
Suspending Competitive Bidding to Allow the Department of Utilities to Procure Water and Wastewater Treatment Chemicals Through Participation in the Bay Area Chemical Consortium Competitive Bid Process
BACKGROUND
A. On January 26, 2016 (R2016-0027) and December 4, 2019 (R2018-0471), City Council suspended competitive bidding to allow the Department of Utilities to participate in the Bay Area Chemical Consortium bid process for periods of 3 years and 5 years, respectively. The BACC is a group of approximately 70 public agencies located throughout the region. The prices for chemicals used in DOU’s treatment processes vary from year to year and this process has allowed DOU to obtain the most competitive bulk bid prices for chemicals.
B. To continue to obtain the best possible chemical bid prices, staff is recommending City Council suspend competitive bidding for a period of no more than 5 years to allow the City to purchase certain chemicals at prices obtained through the BACC bid process. Staff will return to Council for approval to award any resultant chemical purchase contracts of $250,000 or more.
C. City Code Section 3.56.230(c) authorizes the City Council to suspend competitive bidding for the purchase of supplies when, upon a two-thirds vote, the City Council determines it is in the best interests of the City to do so. It is in the City’s best interest to suspend competitive bidding for the purchase of water and wastewater treatment chemicals via participation in the BACC process, because the significantly larger purchasing power of the BACC agencies bidding collectively will result in lower chemical bid prices than the City can obtain using a stand-alone bid process, which will save the City and City ratepayers money on chemical purchases. Staff will return to Council for approval to award any resultant chemical purchase contracts of $250,000 or more.
BASED ON THE FACTS SET FORTH IN THE BACKGROUND, THE CITY COUNCIL RESOLVES AS FOLLOWS:
Section 1. In the best interests of the City, competitive bidding is suspended for the purchase of chemicals used in DOU’s water and wastewater treatment processes, to allow the purchase of these chemicals through participation in the BACC competitive bid process, for a maximum period of five years.