A22102.SR.JD
CITY OF SIMI VALLEY
MEMORANDUM
N
ovember 7, 2022
TO
: City Council
F
ROM: Department of Public Works
S
UBJECT: APPROVAL OF SECOND CONTRACT AMENDMENTS FOR THE
PURCHASE OF CHEMICAL SUPPLIES FOR THE CITY OF SIMI
VALLEY’S WATER QUALITY CONTROL PLANT (WQCP),
SPECIFICATION NO. SV 22 -04, AND APPROVAL OF SUPPLEMENTAL
BUDGET REQUEST
STAFF RECOMMENDATION
I
t is recommended that the City Council:
1. A
pprove a second contract amendment with Olin Corporation, dba Olin Chlor Alkali Products and Vinyls (Olin) for the purchase of Sodium Hypochlorite in the amount of $190,000, for a total contract amount of $330,000 for FY 2022-23; and,
2. A
pprove a second contract amendment with Univar Solution USA, Inc. (Univar) for the purchase of Sodium Bisulfite in the amount of $123,000, for a total contract amount of $323,000 for FY 2022-23; and,
3. A
pprove the Supplemental Budget Request in the amount of $313,000, in the Sanitation Fund (Fund 700).
BACKGROUND AND OVERVIEW
O
n August 23, 2021, the City Council awarded contracts to Olin and Univar for the purchase of chemical supplies for the Water Quality Control Plant (WQCP), and authorized the City Manager to approve subsequent contract amendments to incorporate future budgeted funds to the contract amount , as well as extend the contract by up to four (4) additional one -year terms. On June 23, 2022, the City Manager approved the first contract amendment to extend the contract term for one year from July 1, 2022 to June 30, 2023. However, similar to many vendors, Olin and Univar have had significant cost increases related to pricing due to market conditions, and were unable to offer the City the unit pricing that was set in the contract which included an 8.5% CPI unit price increase for each extension term.
As the chemicals are necessary for the City to continue to operate the WQCP, the City extended the contracts at higher unit prices with the knowledge that additional funding would be necessary for the remainder of FY 2022-23.
AGENDA ITEM NO.
Consent (6)
A22102.SR.JD
FINDINGS AND ALTERNATIVES
For FY 2022-23, Olin's current contract amount is $140,000. Due to higher unit prices, staff is requesting the City Council approve a second contract amendment with Olin to increase this year's contract by $190,000, for a total amount of $330,000. Univar's current contract amount is $100,000, and staff is requesting the City Council approve a second contract amendment with Univar to increase this year's contract by $123,000, for a total contract amount of $223,000.
A total amount of $553,000 is needed to fully fund the contracts with Olin and Univar for this fiscal year. The FY 2022-23 Sanitation budget contains $240,000 for the purchase of Sodium Hypochlorite and Sodium Bisulfite. An additional $313,000 is needed this fiscal year for chemicals and staff is requesting approval of a supplement budget request. This budget increase will be taken from the Sanitation Division’s reserve fund.
If the second contract amendments are approved, the two year (FY 2021- 22 and FY 2022-23) contract total for Olin will be $470,000, and for Univar the two year (FY 2021- 22 and FY 2022-23) total will be $323,000.
Staff plans to re-bid the contracts for chemicals prior to FY 2023-24.
The following alternatives are available to the City Council:
1. Approve a second contract amendment with Olin for the purchase of Sodium Hypochlorite in the amount of $190,000, for a total contract amount of $ 330,000 for FY 2022-23; and,
2. Approve a second contract amendment with Univar for the purchase of Sodium Bisulfite in the amount of $123,000, for a total contract amount of $323,000 for FY 2022-23; and,
3. Approve the Supplemental Budget Request in the amount of $313,000 in the Sanitation Fund (Fund 700).
4. Provide staff with other direction.
Staff recommends Alternative Nos. 1, 2, 3.
SUGGESTED CITY COUNCIL MOTION
I move to approve a second contract amendment with Olin Corporation for the purchase of Sodium Hypochlorite in the amount of $190,000, a pprove a second contract amendment with Univar Solutions USA, Inc. for the purchase of Sodium Bisulfite in the amount of $123,000, and a pprove a Supplemental Budget Request in the amount of $313,000 in the Sanitation Fund, (Fund 700).
2 A22102.SR.JD
SUMMARY
On August 23, 2021, the City Council awarded a contract to Olin and Univar, for the purchase of chemical supplies. On June 23, 2022, the City Manager approved the first contract amendment to extend the contract term for one year. Olin and Univar had significant cost increases related to pricing due to market conditions. Staff is requesting the City Council approve a second contract amendment with Olin in the amount of $190,000, with Univar in the amount of $123,000, and approve a supplement budget request i n the amount of $313,000 in the Sanitation Fund (Fund 700). ___
_________________________________
Ronald K. Fuchiwaki
Public Works Director
P
repared by: Matt Mckenna, Senior Management Analyst
I
NDEX Page
Olin Corporation – Second Contract Amendment ............................. 4 Univar Solutions, USA, Inc. – Second Contract Amendment ............ 6 Attachment A – Original Contract (Olin) ............................................. 8 Attachment B – First Contract Amendment (Olin) ............................ 24 Attachment C – Original Contract (Univar) ....................................... 29 Attachment D – First Contract Amendment (Univar) ........................ 45 3 A22102.CON-OLIN.JD
Specification No. SV 22-04
SECOND AMENDMENT TO CONTRACT BETWEEN THE CITY
OF SIMI VALLEY AND OLIN CORPORATION, DBA OLIN
CHLOR ALKALI PRODUCTS AND VINYLS FOR THE
PURCHASE OF SODIUM HYPOCHLORITE FOR THE CITY OF
SIMI VALLEY’S WATER QUALITY CONTROL PLAN (WQCP),
SPECIFICATION NO. SV 22-04
THIS SECOND AMENDMENT TO CONTRACT is made and entered into in the City of Simi Valley on this 7th day of November, by and between the CITY OF SIMI VALLEY, a municipal corporation, hereinafter referred to as CITY, and OLIN CORPORATION, DBA OLIN CHLOR ALKALI PRODUCTS AND VINYLS, a Virginia Corporation, hereinafter referred to as CONTRACTOR.
I. Recitals
A. CITY and CONTRACTOR entered into a written contract ("CONTRACT") executed by the parties on August 23, 2021, for the purchase of chemical supplies, which is incorporated herein by reference. Thereafter, the Parties entered into a First Amendment to the CONTRACT (“First Amendment”), executed by the parties on June 23, 2022. Both the CONTRACT and its First Amendment are incorporated herein by reference.
B. In accordance with paragraph 4 of the CONTRACT, the parties desire to increase the not to exceed amount of the CONTRACT as further set forth below. Due to increases in the costs of materials and funding limitations , the parties agree that the not to exceed amount will be increased for the current term of the CONTRACT through June 30, 2023.
NOW, THEREFORE, in consideration of their mutual promises, obligations , and covenants hereinafter contained, the parties hereto agree as follows:
II. Amendment
1. Section 4. Compensation and Payment,
Subsection A from the First
Amendment are deleted in their entirety and replaced with the following:
“A. In no event shall the total amount paid for this Second Amendment to the Contract exceed $19 0,000.00, for a total not to exceed amount of the CONTRACT of $470,000.00, unless otherwise agreed to by the parties in writing. The CONTRACTOR shall keep a tally of the cost for the work ordered by CITY. The CONTRACTOR shall not accept work orders from the CITY if the cost for the work will exceed the amount indicated above unless otherwise agreed to by the parties in writing. The CITY shall be obligated to pay CONTRACTOR based upon the unit and/or lump sum prices quoted by CONTRACTOR, multiplied by the actual CITY - authorized quantities received and accepted by CITY ; such unit and/or lump sum prices as contained in Exhibit “B” in the First Amendment to the Contract.
2. Mailing Address . The mailing address of each party to this Second Amendment to the Contract is as follows:
4 A22102.CON.JD
Specification No. SV 22-04
CITY Department of Public Works
2929 Tapo Canyon Road
Simi Valley, CA 93063
Staff Contact: Albert Sexton
Deputy Public Works Director (Sanitation)
(805) 583-6462
CONTRACTOR Olin Corporation,
Dba Olin Chlor Alkali Products and Vinyls
26700 Banta Road
Tracy, CA 95304
Staff Contact: John M. Schabacker, Business Director
(209) 835-7204
3. Except as herein amended, all other terms and conditions of the CONTRACT shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed the day and year first above written.
Attest: City of Simi Valley, A Municipal Corporation
By:
Lucy Blanco, City Clerk Brain Paul Gabler, City Manager
Approved as to Form: Olin Corporation, dba Olin Chlor Alkali Products and Vinyls
By:
David L. Caceres, City Attorney
Print Name:
Approved as to Content: Title:
By:
Carolyn Johnson
Administrative Services Director Print Name:
Title:
Ronald K. Fuchiwaki
Public Works Director
5 A22102.CON-UNIVAR.JD
Specification No. SV 22-04
SECOND AMENDMENT TO CONTRACT BETWEEN THE CITY
OF SIMI VALLEY AND UNIVAR SOLUTIONS USA, INC. FOR
THE PURCHASE OF SODIUM BISULFITE FOR THE CITY OF
SIMI VALLEY’S WATER QUALITY CONTROL PLAN (WQCP),
SPECIFICATION NO. SV 22-04
THIS SECOND AMENDMENT TO CONTRACT is made and entered into in the City of Simi Valley on this 7th day of November 2022, by and between the CITY OF SIMI VALLEY, a municipal corporation, hereinafter referred to as CITY, and UNIVAR SOLUTIONS USA, INC. a Washington Corporation, hereinafter referred to as CONTRACTOR.
I. Recitals
A. CITY and CONTRACTOR entered into a written contract ("CONTRACT") executed by the parties on August 23, 2021, for the purchase of chemical supplies, which is incorporated herein by reference. Thereafter, the Parties entered into a First Amendment to the CONTRACT (“First Amendment”), executed by the parties on June 27, 2022. Both the CONTRACT and its First Amendment are incorporated herein by reference.
B. In accordance with paragraph 4 of the CONTRACT, the parties desire to increase the not to exceed amount of the CONTRACT as further set forth below. Due to increases in the costs of materials and funding limitations, t he parties agree that the not to exceed amount will be increased for the current term of the CONTRACT through June 30, 2023.
NOW, THEREFORE, in consideration of their mutual promises, obligations , and covenants hereinafter contained, the parties hereto agree as follows:
II. Amendment
1. Section 4. Compensation and Payment,
Subsection A from the First
Amendment are deleted in their entirety and replaced with the following:
“A. In no event shall the total amount paid for this Second Amendment to the Contract exceed $12 3,000.00, for a total not to exceed amount of the CONTRACT of $323,000.00, unless otherwise agreed to by the parties in writing. The CONTRACTOR shall keep a tally of the cost for the work ordered by CITY. The CONTRACTOR shall not accept work orders from the CITY if the cost for the work will exceed the amount indicated above unless otherwise agreed to by the parties in writing. The CITY shall be obligated to pay CONTRACTOR based upon the unit and/or lump sum prices quoted by CONTRACTOR, multiplied by the actual CITY - authorized quantities received and accepted by CITY ; such unit and/or lump sum prices as contained in Exhibit “B” in the First Amendment to the Contract.
2. Mailing Address . The mailing address of each party to this Second Amendment to the Contract is as follows:
6 A22102.CON-UNIVAR.JD
Specification No. SV 22-04
CITY Department of Public Works
2929 Tapo Canyon Road
Simi Valley, CA 93063
Staff Contact: Albert Sexton
Deputy Public Works Director (Sanitation)
(805) 583-6462
CONTRACTOR Univar Solutions USA, Inc.
8201 S 212
th Street
Kent, WA 98032
Staff Contact: Jennifer Perras, Municipal
(253) 872-5000
3. Except as herein amended, all other terms and conditions of the CONTRACT shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed the day and year first above written.
Attest: City of Simi Valley, A Municipal Corporation
By:
Lucy Blanco, City Clerk Brain Paul Gabler, City Manager
Approved as to Form: Univar Solutions USA, Inc.
By:
David L. Caceres, City Attorney
Print Name:
Approved as to Content: Title:
By:
Carolyn Johnson
Acting Deputy Administrative Services Director Print Name:
Title:
Ronald K. Fuchiwaki
Public Works Director
7 ATTACHMENT A
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18 19
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22 23
ATTACHMENT B
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26 27
28 ATTACHMENT C
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ATTACHMENT D
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