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TO: Mayor Richard C. Irvin
FROM: Robert Leible, Assistant Superintendent of Water Production
DATE: November 8, 2021
SUBJECT:
A Resolution Awarding Contracts to Supply Process Chemicals for the Water Production Division (WPD) to Kemira Water Solutions, Rowell Chemical Corporation, Alexander Chemical Company, Donau Carbon, and Mississippi Lime.
PURPOSE:
To obtain City Council approval for the execution of contracts with suppliers of various process chemicals for the Water Production Division.
BACKGROUND:
Each year the Water Production Division solicits bids for process chemicals to be used at the Water Treatment Plant. These chemicals are essential and necessary to the operations of the various treatment processes such as softening, disinfection, fluoridation, and taste & odor control, as well as regulatory compliance with drinking water standards. Sealed bids for this purpose were opened on October 21, 2021.
DISCUSSION:
Most contracts are awarded to the lowest responsive, responsible bidder for a period of one year, which may be renewable for a second year when mutually agreed upon by the City of Aurora and the supplier. Bid pricing is solicited for year 1 and year 2 of the chemical supply agreement. The following suppliers are the lowest responsive, responsible bidders: liquid ferric chloride (Kemira), sodium hypochlorite (Rowell), fluorosilicic acid (Alexander), and powered activated carbon (Donau).
Alexander and Rowell submitted bid pricing for 2022 only. Donau and Kemira submitted pricing for 2022 and 2023. Chemical pricing in general has increased substantially due to several drivers including the global pandemic, transportation costs, inflationary effects, and raw material availability after the Texas winter storm and hurricanes (supply chain issues). Specifically, the following are the percent increases for the low-bid chemicals for 2022 as compared to current 2021 pricing: ferric chloride +22.2%, sodium hypochlorite +111%, fluorosilicic acid +20.6%, and powdered activated carbon +75.6%.
Mississippi Lime Company (MLC) is a major supplier of calcium oxide and is considered a prime vendor to the WPD, supplying the highest quality calcium oxide that is available regionally, as well as supplying a product that delivers the best performance within the water treatment plant based on long-term use. The current contract with MLC expires year-end. With the understanding of the information in the following paragraph, MLC was asked to provide a price for 2022 as a one-year extension rather than publicly bid calcium oxide.
The 2022 price offered by MLC is $224.38/ton, which is a +5.99% increase over the current 2021 price. Since 2019, the annual percent increases in MLC pricing have been +4.74%, +3.28%, and +3.42%. At the time of the extension offer, MLC indicated that their 2022 pricing was not finalized, but estimated that a public bid would likely result in a 10 - 12% increase. When last bid, MLC was the low bidder by a significant amount (> $60/ton less or -23%). Therefore, in consultation with the Purchasing Division, the WPD recommends a one-year contract extension with MLC for 2022.
Funds have been requested in the 2022 City Budget in Account No. 510-4058-511-65-36 in the amount of $1,921,400. The proposed budget amount is based upon the estimated usage for all process chemicals including those recommended herein. An attachment lists the recommended bidders, unit prices, and total estimated contract amounts.
IMPACT STATEMENT:
None.
RECOMMENDATIONS:
That the attached resolution be submitted to the City Council for approval so that contracts may be executed for one-year or two-year periods as indicated therein, and a one-year extension be executed with Mississippi Lime. It is further recommended that this matter be forwarded to the Infrastructure and Technology Committee for review and approval.
cc: Infrastructure and Technology Committee
CITY OF AURORA, ILLINOIS
RESOLUTION NO. _________
DATE OF PASSAGE ________________
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A Resolution Awarding Contracts to Supply Process Chemicals for the Water Production Division.
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WHEREAS, the City of Aurora has a population of more than 25,000 persons and is, therefore, a home rule unit under subsection (a) of Section 6 of Article VII of the Illinois Constitution of 1970; and
WHEREAS, subject to said Section, a home rule unit may exercise any power and perform any function pertaining to its government and affairs for the protection of the public health, safety, morals, and welfare; and
WHEREAS, bids were requested for process chemicals to be used in the treatment of the City's water supply for a two-year period (2022 - 2023) and;
WHEREAS, where applicable the initial contract will be January 1, 2022 through December 31, 2022, with an optional one year extension upon mutual consent between the vendor and City of Aurora, for which the Water Production Division and the Director of Purchasing shall have the authority to take any and all steps necessary to execute and implement the extensions stated in the contract without further approval required by City Council; and
WHEREAS, listed on the attachment, "WPD Recommended Chemical Bidders 2022 - 2023", are the lowest responsive, responsible bidders for each process chemical, at the bid amount shown, for one-year or two-year periods, and a one-year non-bid extension with Mississippi Lime; and
WHEREAS, funding for the purchase of all process chemicals is provided annually in the City Budget in Account No. 510-4058-511-65-36 with a requested 2022 budget of $1,921,400;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Aurora, Illinois, as follows: subject to the approval of this item in the 2022 budget, that the Purchasing Director is hereby authorized to enter into agreements with Alexander Chemical, Donau Carbon, Rowell Chemical Corporation, Kemira Water Solutions, and Mississippi Lime for the supply of process chemicals for the Water Production Division.