Title
MOTION TO APPROVE THE PURCHASE OF REPAIR PARTS FOR CITY WASTEWATER LIFT STATIONS ON AN AS NEEDED BASIS FROM SMITH & LOVELESS, INC. IN AN ANNUAL AMOUNT NOT TO EXCEED $325,000.00, PURSUANT TO SECTION 38.18(C) OF THE CITY’S CODE OF ORDINANCES.
Summary Explanation and Background
PROCUREMENT PROCESS TAKEN:
- Chapter 35 of the City’s Code of Ordinances is titled “PROCUREMENT PROCEDURES, PUBLIC FUNDS.”
- Section 35.18 of the City's Code of Ordinances is titled "COMPETITIVE BIDDING OR COMPETITIVE PROPOSALS REQUIRED; EXCEPTIONS."
- Section 35.18(C) states that "Only the following situations are exempt from the competitive bid and competitive proposal requirements of this section:"
- Section 35.18(C)(3) states that "City standard, single-source and sole- source commodities or services. City standard, single- source and sole-source commodities or services are exempt from this section."
- Section 35.18(C)(7)(d) states that "Maintenance service and repair of equipment. When considered to be in the best interest of the city and recommended by the using department and the services to be performed are by the equipment manufacturer, manufacturer’s service representative or a distributor of the manufacturer’s equipment, the services may be procured without following the competitive sealed bid process;"
- Section 35.21 of the City's Code of Ordinances is titled "AWARD OF CONTRACT."
- Section 35.21(A) of the City's Code of Ordinances is titled "City Commission approval."
- Section 35.21(A)(1) states, "An initial purchase of, or contract for, commodities or services, in excess of $25,000, shall require the approval of the City Commission, regardless of whether the competitive bidding or competitive proposal procedures were followed."
SUMMARY EXPLANATION AND BACKGROUND:
1. The City’s sewer collection and transmission system includes 198 pumping stations that pump wastewater from homes, businesses, and parks either to the City’s Wastewater Treatment Plant or to the City of Hollywood for treatment. Each of these stations incorporate numerous mechanical, structural, and electrical parts that require routine maintenance and, eventually, repair or replacement.
2. On December 15, 1999, City Commission approved the City’s Engineering Standards Manual that requires all lift stations must be manufactured by Smith & Loveless, Inc. (S&L), thereby establishing a City standard for lift stations. A single manufacturer was chosen for uniformity of spare parts and efficiency of maintenance. These stations continue to provide satisfactory service when properly maintained.
3. The Utilities Department is responsible for the afore-mentioned routine maintenance and repair, via the City’s contracted utilities operator, Jacobs-OMI.
4. Staff has determined that directly purchasing lift station parts and equipment for maintenance and repair of these stations is in the City’s best interest, in order to avoid the expense of sales tax.
5. Smith & Loveless, Inc. has supplied a letter stating they are the manufacturer of a full line of wastewater pumping, headwork, screening, and treatment equipment. Smith & Loveless only sells its proprietary equipment and proprietary parts directly to end-users or through sole-source representatives. Smith & Loveless pump stations have a long useful life. For instance, the first S&L pump station sold in 1946 is still in operation today. Because of this long equipment life cycle, Smith & Loveless spends large portions of its resources in not only providing spare parts but maintaining the knowledge of which parts are now used for every piece of S&L equipment. Smith & Loveless has developed proprietary parts, which can only be purchased with records of the part information kept by S&L through a unique S&L serial number system. Procuring directly from the manufacturer, Smith & Loveless, gives the City a discount.
6. The City’s recently adopted Fiscal Year 2024 budget includes $325,000.00 based on last year's usage for lift station repair parts and equipment. The tax savings for this full budget amount is estimated to be $22,750.
7. Staff recommends City Commission approval of the purchase of lift station repair parts and equipment, on an as needed basis throughout Fiscal Year 2023-2024, from Smith & Loveless, Inc., in an annual amount not to exceed $325,000.00, pursuant to Section 38.18(C) of the City’s Code of Ordinances.
Reviewed by Commission Auditor.
Financial Impact
FINANCIAL IMPACT DETAIL:
a) Initial Cost: $325,000.00
b) Amount budgeted for this item in Account No: Funds are available in account # 471-535-6021-546250-0000-000-0000 (R&M Equipment)
c) Source of funding for difference, if not fully budgeted: Not Applicable.
d) 5 year projection of the operational cost of the project:
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Current FY |
Year 2 |
Year 3 |
Year 4 |
Year 5 |
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Revenues |
$0.00 |
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|
|
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Expenditures |
$325,000.00 |
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|
|
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Net Cost |
$325,000.00 |
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e) Detail of additional staff requirements: Not Applicable.
FEASIBILITY REVIEW:
A feasibility review is required for the award, renewal and/or expiration of all function sourcing contracts. This analysis is to determine the financial effectiveness of function sourcing services.
a) Was a Feasibility Review/Cost Analysis of Out-Sourcing vs. In-House Labor Conducted for this service? Not Applicable.
b) If Yes, what is the total cost or total savings of utilizing Out-Sourcing vs. In-House Labor for this service? Not Applicable.