CITY OF SIMI VALLEY
MEMORANDUM
Jul
y 17, 2023
TO
: City Council
F
ROM: Department of Administrative Services
S
UBJECT: AWARD OF CONTRACT TO AMAZON SERVICES, LLC (AMAZON
BUSINESS) FOR USE OF ONLINE MARKETPLACE FOR
PURCHASES OF VARIOUS GOODS UTILIZING THE OMNIA
PARTNERS COOPERATIVE CONTRACT NO. R-TC-17006
STAFF RECOMMENDATION
I
t is recommended that the City Council:
1. Authorize the City to enter into an agr eement with Amazon S ervices, LLC, utilizing the Omnia Partnership Cooperative Contract (page 5) for a not-to- exceed amount of $300,000, for the purchase of various goods retroactively effective as of July 1, 2023, through January 18, 2024.
2. Authorize the City Manager or his designee to negotiate and exec ute any forms and amendments including an option to extend the term of the contract for two (2) additional two (2) year terms, ending January 18, 2028, provided the Cooperative Agreement is in effect.
BACKGROUND AND OVERVIEW
T
he City is a member of Omnia Partners, a cooperative purchasing organization in public procurement . As a member, the City can piggyback off public contracts competitively bid by other government agencies and benefit from similar or better pricing. In June 2019, the Support Services Division launched Amazon Business (“Amazon”) Citywide, through the Omnia Partners (Omnia) Cooperative Contract (“Cooperative Contract”). This allowed staff to shop for better pricing on various goods such as supplies, tools, and electronics. The City is reaching its five (5) year allowable term and has an aggregate annual spend since June 2019 of over $150,000. Per the City’s Purchasing Ordinance, any form of contract with a period longer than five (5) years, including any optional renewals, regardless of the amount, shall be approved by the City Council. Over time, Amazon usage has increased dramatically Citywide.
Therefore, staff requests approval from the City Council to continue with Amazon under the Omnia Cooperative Contract so that staff can utilize this online platform to purchase various goods.
AGENDA ITEM NO.
Consent (5)
2 FINDINGS AND ALTERNATIVES
The Omnia Cooperative Contract was competitively bid by Prince William County Public Schools (PWCS), VA, and was awarded to Amazon Business in 2017. The initial term of the contract was awarded from January 2017 through January 2022 with the option to renew for thr ee (3) additional two (2)-year periods (January 2028). In October 2021, PWCS r enewed its contract to extend the contract term through J anuary 18, 2024.
Since the City has reached its five (5) year allowable term, staff requests to continue using Amazon through the Cooperative Contract as of July 1, 2023, through January 18, 2024, with an option to extend through January 18, 2028.
Amazon use has grown and is widely popular among staff due to its convenience and competitive pricing. Amazon online purchases are projected to grow in future years.
In FY 2019, the City spent $5,838.24. In FY 2020, the onset of COVID-19, the City’s total spending was $46,550.37, a 300% increase compared to the previous year .
While the City does not expect similar increases, it expects continued growth in use and cost given current market conditions.
Amazon Business Prime (“Business Prime”) is also included with the Cooperative Contract. The benefits of Business Prime include unlimited free two-day shipping on over 100 million eligible items, free same -day or one-day delivery on eligible orders, fast and easy purchasing, back -office account management, as well as access to discounted rates on goods the City procures the most. The City will accept a free annual trial membership to maximize the plan perquisites, effective July 1, 2023, as part of this agreement. After the trial period, the Business Prime membership will cost $3,500 per year for an unlimited number of account users. In reviewing the history of shipping and handling charges, the City’s average yearly spending since June 2019 is $2,860. However, this was for standard shipping; it did not include same- day or one-day shipping. Thus, the benefits of Business Prime on shipping and handling alone outweigh the membership cost.
To accommodate the continued need and growth in the City’s usage of Amazon, staff is requesting a not-to-exceed amount of $300,000 throughout the initial contract term.
As is the current practice, the Departments will continue using their operating budgets and project funding to purchase various goods from Amazon Business.
In order to benefit from the pricing as a Participating Public Agency of the Omnia Cooperative Contract, the City must use a purchase order as a method of contracting in lieu of the City’s customary Wrapper Agreement as Amazon Business does not accept alternative agreements than those already in place under the Cooperative Contract. Under the City’s Purchasing Ordinance § 2-9.110 (g) the City may utilize purchase orders as a method of contracting and the Purchasing Agent may specify further parameters and limits for each contracting method with approval of the City Manager.
3 The City encourages the growth of its local economy so that the community will continue to thrive. It is thus important to note that there are currently many local Amazon sellers in the City, which qualify as local business es. Therefore, using Amazon Business will benefit the City economically as it will continue to promote its local sellers.
T
he following alternatives are available to the City Council:
1. A
uthorize the City to enter into an agreement with Amazon Services, LLC, utilizing the Omnia Cooperative Contract retroactively effective as of July 1, 2023, through January 18, 2024, for a not-to-exceed amount of $300,000 for the initial term, authorize the City Manager to negotiate and execute any further forms and amendments including an option to extend the term of the contract for two (2) additional two (2) year terms, ending January 18, 2028, to the extent the Cooperative Agreement is in effect.
2. D
o not award at this time.
S
taff recommends Alternative No. 1.
SUGGESTED CITY COUNCIL MOTION
I mov
e to authorize the City to enter into an agreement with Amazon Services, LLC utilizing the Omnia Cooperative Contract retroactively effective as of July 1, 2023, through January 18, 2024, for a not to exceed amount of $300,000 via a purchase order for the initial term, authorize the City Manager to negotiate and execute any further forms and amendments including an option to extend the term of the contract for two (2) additional two (2) year terms, ending January 18, 2028, to the extent the Cooperative Agreement is in effect.
SUMMARY
T
he Support Services Division launched Amazon Business in the City in June 2019, incorporating the Omnia Partners C ooperative Contract No. R -TC-17006. This allowed staff to shop for better pricing on various goods such as supplies, tools, and electronics. Amazon usage, has increased dramatically throughout the years. Since the City will reach its five (5) year allowable term, staff is requesting the City Council approve the continued use of Amazon Business under the Omnia Partners Cooperative Contract No. R-TC-17006.
It i
s recommended that the City Council authorize the City Manager or his designee to negotiate and execute any forms and amendments , including an option to extend the term of the contract for an amount not-to-exceed $300,000 of the initial contract term and retroactively approve the City’s acceptance of the Amazon Business Prime offer effective July 1, 2023.
___
______________________________
Carolyn J. Johnson
Administrative Services Director
Prepar
ed by: Maria R. Mondala-Duncan, Senior Management Analyst INDEX Page
Omnia Cooperative Contract No. R-TC-17006 ................................. 5 Omnia Cooperative Contract No. R-TC-17006 Renewal .................. 9 4 1~,~~~~un.
CONTRACT NUMBER: R-TC-17006
This Contract entered into this 19th day of January 2017 by, Amazon Services. LLC, Amazon Business, 325 gt• Avenue N .• Seattle, WA 98109. hereinafter referred to as the "Contractor" and Prince Will/am Countv School Board. P.O. Box 389, Manassas, VA 20108. hereinafter referred to as the "Prince William County Public Schools~ 'Purchasing Agency• or "PWCS".
WITNESSETH that the Contractor and PWCS, in consideration of the mutual covenants, promises and agreements herein contained, agree as follows:
1. SCOPE OF CONTRACT: Contractor shall provide an On-Line Marketplace for the Purchase of Products and Services in accordance with the statement of Needs.
General Terms and Conditions and Special Terms and Conditions stated herein.
2. CONTRACT DOCUMENTS: The contract documents shall consist of the following:
2.1. This signed Contract document;
2.2. Memorandum of Negotiations dated January 19. 2017.
3. CONTRACT TERM AND RENEWAL:
3.1. The initial term of this contract shall be from the date of award, January 19 2017 to January 18. 2022, with the option to renew for three (3) additional two (2)-one-year periods, upon mutual written consent of the parties lo the contract. Proposed prices shall remain firm for the Initial term of the contract.
4. CONTRACT ADMINISTRATOR/PROJECT MANAGER: The following PWCS employees are identified to use all powers under the contract to enforce its faithful performance:
4.1. CONTRACT ADMINISTRATOR: As the Contract Administrator, the following individual. or his/her designee, shall serve as the interpreter of the conditions of the contract and shall use all powers under the contract to enforce its faithful performance.
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5 4.2. PROJECT MANAGER: The following Individuals shall work directly with the Contractor in scheduling and coordinating work, answering questions in connection with the scope of work, and providing general direction under the resulting contract:
5. TIME OF PERFORMANCE: In accordance with Contractor's proposal, Section 4.2.2. and 5.3.2.
6. PRICING; In accordance with Contractor's proposal, Section 4.2.1.
7. PAYMENT TERMS: In accordance with Contractor's proposal, Section 5.3.6.
Prince William County does not discriminate against faith-based organizations in accordance with the Code of Virginia, §2.2-4343.1 or against a bidder or offeror because of race, religion, color, sex, national origin, age, disability, or any other basis prohibited by state law relating to discrimination in employment.
This contract shall constitute the whole agreement between the parlies. There aro no promises, terms and conditions, or obligations other than those contained herein, and this contract shall supersede all previous communications, representations, or agreements, written or verbal, between the parlies heroto related to the provision of goods (including leases thereof), seNioes and/or insurances described herein.
IN WITNESS THEREOF, the parties have caused this Contract to be executed by the following duly authorized officials:
CONTRACTOR:
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Authorized Signature
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Type Name '
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Supervisor of Purchasing
Title
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MEMORANDUM OF NEGOTIATIONS
R-TC-17006
Dated: January 19, 2017
Prince William County Schools (hereinafter called PWCS) and Amazon Services, LLC (hereinafter called the Contractor) hereby agree to the following in the execution of Contract R-TC-17006 for On-Line Marketplace for the Purchases of Products and Services. The final Contract contains the following documents listed in the order of precedence:
a. Contractor's proposal dated October 14, 2016;
b. Contractor's response to Clarification Questions dated October 31, 2016, attached;
c. PWCS's Request for Proposal, R-TC-17006 and all Addendum #1; d. Contractor's Business Accounts Terms and Conditions (currently available at https:l/www.amazon.com/gp/help/customer/display.html?nodeld=201613180), attached;
e. PWCS's General Terms and Conditions, Section 11 (RFP - Revised 12/16/16), attached;
f. This Memorandum of Negotiations;
g. Any subsequent modifications to the Contract.
1. The contract term shall remain as originally issued in the RFP, as follows:
9.1. The initial term of this contract shall be five years (5) from the date of award to December 30, 2021, with the option to renew for three-two (2) year periods, upon mutual written consent of the parties to the contract.
2. Amazon Whispercast is not being offered upon award but will remain in scope for future offerings by the Contractor. In addition, all new Amazon business opportunities may be modified to the Contract by mutual agreement between the Contractor and PWCS.
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7 Memorandum of Negotiations
R-TC-17006
Page2
3. The following provision is added to PWCS Special Terms and Conditions:
10.7 NOTICE OF DEFERRAL UNDER FEDERAL GRANT UNIFORM GUIDANCE:
As permitted under the rule published at 80 FR 54407, Prince William County Schools is electing to defer until July 1, 2017, the implementation of the procurement provisions of the Uniform Guidance, as detailed in 2 CFR 200 subsections .317 through .326. During this period, we will continue to operate under the guidance of44 C.F.R. § 13.36(a)-(i} (States, Local and Tribal governments} and 2 C.F.R. 215.40-48 (Institutions of Higher Education, Hospitals, and Private Non-Profits). This provision shall constitute the documentation of this decision as required, and shall be deemed incorporated into our internal procurement policies.
4. Contractor's response to Clarification Questions dated October 31, 2016, Question #1: The State of Iowa is hereby removed as an excluded state and allowed use of the Master Agreement award.
ACCEPTED BY:
Contractor Authorized Signature
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Date
1 Tille
Jim Totty, O
Supervisor o g
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8 9
MASTER INTERGOVERNMENTAL COOPERATIVE
PURCHASING AGREEMENT
This Master Intergovernmental Cooperative Purchasing Agreement (this "Agreement") is entered into by and between those certain government agencies that execute a Principal Procurement Agency Certificate ("Principal Procurement Agencies") with National Intergovernmental Purchasing Alliance Company, a Delaware corporation d/b/a OMNIA Partners, Public Sector, Communities Program Management, LLC, a California limited liability company d/b/a U.S.
Communities, and/or NCPA LLC, a Texas limited liability company d/b/a National Cooperative Purchasing Alliance (collectively, "OMNIA Partners"), in its capacity as the cooperative administrator, to be appended and made a part hereof and such other agencies ("Participating Public Agencies"), as defined in each Master Agreement (as defined below), who register to participate in the cooperative purchasing programs administered by OMNIA Partners and its affiliates and subsidiaries (collectively, the "OMNIA Partners Parties") by either registering on the OMNIA Partners website (www.omniapartners.com/publicsector or any successor website), or by executing a copy of this Agreement.
RECITALS
WHEREAS, after a competitive solicitation and selection process by Principal Procurement Agencies, in compliance with their own policies, procedures, rules and regulations, a number of suppliers have entered into "Master Agreements" (herein so called) to provide a variety of goods, products and services ("Products") to the applicable Principal Procurement Agency and the Participating Public Agencies;
WHEREAS, Master Agreements are made available by Principal Procurement Agencies through the OMNIA Partners Parties and provide that Participating Public Agencies may purchase Products on the same terms, conditions and pricing as the Principal Procurement Agency, subject to any applicable federal and/or local purchasing ordinances and the laws of the State of purchase; and WHEREAS, in addition to Master Agreements, the OMNIA Partners Parties may from time to time offer Participating Public Agencies the opportunity to acquire Products through other group purchasing agreements.
NOW, THEREFORE, in consideration of the mutual promises contained in this Agreement, and of the mutual benefits to result, the parties hereby agree as follows:
1. Each party will facilitate the cooperative procurement of Products.
2. The Participating Public Agencies shall procure Products in accor dance with and subject to the relevant federal, state and local statutes, ordinances, rules and regulations that govern Participating Public Agency’s procurement practices. The Participating Public Agencies 10 hereby acknowledge and agree that it is the intent of the parties that all provisions of this Agreement and that Principal Procurement Agencies’ participation in the program described herein comply with all applicable laws, including but not limited to the requirements of 42 C.F.R. § 1001.952(j), as may be amended from time to time. The Participating Public Agencies further acknowledge and agree that they are solely responsible for their compliance with all applicable "safe harbor" regulations, including but not limited to any and all obligations to fully and accurately report discounts and incentives.
3. The Participating Public Agency represents and warrants that the Participating Public Agency is not a hospital or other healthcare provider and is not purchasing Products on behalf of a hospital or healthcare provider; provided that the foregoing shall not prohibit Participating Public Agency from furnishing health care services so long as the furnishing of health care services is not in furtherance of a primary purpose of the Participating Public Agency.
4. The cooperative use of Master Agreements shall be in accordance with the terms and conditions of the Master Agreements, except as modification of those terms and conditions is otherwise required by applicable federal, state or local law, policies or procedures.
5. The Principal Procurement Agencies will make available, upon reasonable request, Master Agreement information which may assist in improving the procurement of Products by the Participating Public Agencies.
6. The Participating Public Agency agrees the OMNIA Partners Parties may provide access to group purchasing organization (“ GPO”) agreements directly or indirectly by enrolling the Participating Public Agency in another GPO’s purchasing program, provided that the purchase of Products through the OMNIA Partners Parties or any other GPO shall be at the Participating Public Agency’s sole discretion.
7. The Participating Public Agencies (each a “Procuring Party”) that procure Products through any Master Agreement or GPO Product supply agreement (each a “GPO Contract”) will make timely payments to the distributor, manufacturer or other vendor (collectively, “Supplier”) for Products received in accordance with the terms and conditions of the Master Agreement or GPO Contract, as applicable. Payment for Products and inspections and acceptance of Products ordered by the Procuring Party shall be the exclusive obligation of such Procuring Party. Disputes between Procuring Party and any Supplier shall be resolved in accordance with the law and venue rules of the State of purchase unless otherwise agreed to by the Procuring Party and Supplier.
8. The Procuring Party shall not use this Agreement as a method for obtaining additional concessions or reduced prices for purchase of similar products or services outside of the Master Agreement. Master Agreements may be structured with not-to-exceed pricing, in which cases the Supplier may offer the Procuring Party and the Procuring Party may accept lower pricing or additional concessions for purchase of Products through a Master Agreement.
9. The Procuring Party shall be responsible for the ordering of Products under this Agreement. A non-procuring party shall not be liable in any fashion for any violation by a Procuring Party, and, to the extent permitted by applicable law, the Procuring Party shall hold non- procuring party harmless from any liability that may arise from the acts or omissions of the Procuring Party.
10. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, THE OMNIA PARTNERS
PARTIES EXPRESSLY DISCLAIM ALL EXPRESS OR IMPLIED REPRESENTATIONS AND
WARRANTIES REGARDING ANY PRODUCT, MASTER AGREEMENT AND GPO CONTRACT. THE OMNIA PARTNERS PARTIES SHALL NOT BE LIABLE IN ANY WAY FOR
ANY SPECIAL, INCIDENTAL, INDIRECT, CONSEQUENTIAL, EXEMPLARY, PUNITIVE, OR
RELIANCE DAMAGES, EVEN IF THE OMNIA PARTNERS PARTIES ARE ADVISED OF THE 11 POSSIBILITY OF SUCH DAMAGES. FURTHER, THE PROCURING PARTY
ACKNOWLEDGES AND AGREES THAT THE OMNIA PARTNERS PARTIES SHALL HAVE
NO LIABILITY FOR ANY ACT OR OMISSION BY A SUPPLIER OR OTHER PARTY UNDER A MASTER AGREEMENT OR GPO CONTRACT.
11. This Agreement shall remain in effect until termination by either party giving thirty (30) days’ written notice to the other party. The provisions of Paragraphs 6 - 10 hereof shall survive any such termination.
12. This Agreement shall take effect upon (i) execution of the Principal Procurement Agency Certificate, or (ii) registration on the OMNIA Partners website or the execution of this Agreement by a Participating Public Agency, as applicable.
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