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Staff Report regarding a resolution approving purchase agreements for Water Quality Control Plant process chemicals. (Brian Schumacker, Water Quality Control Plant Superintendent and Nick Talbot, Assistant Plant Superintendent).
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RECOMMENDATION
Recommendation
Staff recommends that the City Council adopt a resolution approving the purchase agreements for the furnishing of bulk process chemicals for wastewater treatment for fiscal year 2023-24 and authorize the City Manager to execute the necessary agreements.
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BACKGROUND/DISCUSSION
The South San Francisco-San Bruno Water Quality Control Plant (WQCP) routinely uses bulk chemicals in several different processes to treat wastewater. These bulk chemicals include disinfectants used to remove potential pathogens, coagulants used to remove solids, and chemicals used to neutralize chlorine. The City's practice is to procure these chemicals at the beginning of the fiscal year to establish guaranteed competitive prices for the entire fiscal year. Bulk suppliers deliver chemicals as needed to meet treatment demands.
Section 4.04.040 of the South San Francisco Municipal Code (SSFMC) authorizes the City to take advantage of valid contract terms that have been negotiated by another governmental agency, where that agency had used a quote or bid process substantially conforming with SSFMC Chapter 4.04 and State law. The WQCP became a member of the Bay Area Chemical Consortium (BACC) in 2012, along with over sixty participating public agencies. The BACC follows an open bid process for the combined purchase of bulk chemicals that substantially conforms to SSF’s practice. Each member agency of the BACC receives a benefit of large quantity purchase pricing by integrating the volume of their agency's chemical needs with the needs of the rest of the consortium. Due to the combined bid solicitations for these agencies, each agency can purchase the chemicals at a lower price than if each agency solicited bids separately. Staff cannot precisely calculate as to the savings an agency receives by ongoing participation in the consortium; however, new members have generally reported a savings of up to 20 percent on chemical purchases after becoming a member of the BACC. Consistent with SSFMC 4.04.040, the City can rely on BACC collective bidding for this procurement.
The BACC recommends awarding bulk chemical purchase agreements to the following companies based on competitive bidding, city staff has reviewed these price quotes and concurs with the BACC recommendations.
Lowest Bidder Item Unit Cost
Kemira Inc. Ferric Chloride (40 percent), $3.42/gallon
Hasa, Inc. Sodium Hypochlorite (12.5 percent), $2.91/gallon
Univar USA, Inc. Sodium Bisulfite (25 percent), $1.845/gallon
The BACC no longer facilitates the bidding process for the polymer. Plant management successfully negotiated a bulk rate discount for polymer into FY 2023-24 for Polymers WE-527, WE-984 and WE-2204. Polydyne continues to provide competitive bulk polymer pricing.
Vendor Item Unit Cost
Polydyne Polymer WE-527 $15.310/gallon
Polydyne Polymer WE-984 $13.470/gallon
Polydyne Polymer WE-2204 $15.310/gallon
RELATIONSHIP TO THE STRATEGIC PLAN
The Water Quality Control Plant (WQCP) Division promotes public health and environmental stewardship. Continuing to fund bulk chemical purchases positively affects the quality of life for South San Francisco residents by protecting public health and safety.
FISCAL IMPACT
Plant management includes the cost for the purchase of bulk chemicals in the WQCP's annual operating budget. Specific quantities of bulk chemicals vary depending upon the occurrence of winter storms and fluctuation of plant loadings. Plant management based chemical use forecasts on historical peak demand. The anticipated total cost for bulk chemicals (including sales tax) for FY 2023-24 is $3,693,271 (please see Attachment One for the cost breakdown).
CONCLUSION
The WQCP routinely utilizes bulk quantities of chemicals for the treatment of wastewater. The WQCP is a member of the BACC and participates in bidding for the purchase of three chemicals necessary for the treatment of wastewater. Following the BACC's recommendations, the WQCP has drafted purchase agreements to procure the chemicals for FY 2023-24. Approval of the attached resolution will allow for the execution of the contracts and the continued reliable operation of the WQCP.
Staff recommends that the City Council adopt a resolution approving the purchase agreements for the furnishing of bulk process chemicals for wastewater treatment for fiscal year 2023-24 and authorize the City Manager to execute the necessary agreements.
Attachments:
1. Attachment One - Cost Breakdown for Bulk Chemicals