| | | | | | | | Agenda Item - 2.f.
City of Garden Grove
INTER-DEPARTMENT MEMORANDUM
| To: | Scott C. Stiles
| From: | City Manager
| | Dept.: | Wiliam E. Murray
| Dept.: | Public Works
| | Subject: | Authorize the issuance of an increase to the purchase order with Grainger for hardware supplies. (Cost: $100,000) (Action Item) | Date: | 11/9/2021 |
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| | | | | | | | OBJECTIVE
For City Council to amend existing blanket purchase order with Grainger to allocate an additional $100,000 for the purchase of materials and supplies. |
| | | | | | | | BACKGROUND
The Public Works Department provides a wide variety of repairs and renovations to all City buildings and infrastructure related to water, sewer and streets. This type of work requires the purchase of various hardware supplies. These purchases include small appliances, building materials, heating and air conditioning, irrigation equipment, plumbing supplies, safety equipment, painting and various tools/equipment. A blanket purchase order with Grainger in the amount of $50,000 was issued in October 2020. This blanket purchase order helps ensure no interruptions in the day-to-day operations of the department services.
Within the past year, prices have increased due to supply chain issues, raw material shortages, labor shortages and transportation challenges, which have resulted in the depletion of funds for this purchase order. |
| | | | | | | | DISCUSSION
U.S. Communities (Sourcewell) nationally solicits, evaluates and awards contracts through a competitive bid process. As a member of U.S. Communities, the City is able to utilize these bid awards for cooperative purchasing agreements. Staff recommends piggybacking on the results of a recent U.S. Communities competitive bid, SourceWell Contract #121416-WWG. The results deemed Grainger as the lowest responsive bid. The increase to the contract would be in the amount of $100,000 for a total of $150,000 for the remaining term that ends in February 1, 2022, unless the awarding agency places an extension. |
| | | | | | | | FINANCIAL IMPACT
The financial impact is an additional $100,000 for a total of $150,000 for a purchase order with Grainger using a combination of funds from the General Fund and Enterprise Funds. Based on previous expenditure patterns, the estimated cost breakdown is as follows:
General Fund 60%
Enterprise Fund (Water/Sewer) 40%
The cost of materials and supplies are included in the City's adopted FY 2021-22 general fund, water, and sewer budgets. |
| | | | | | | | RECOMMENDATION
It is recommended that City Council:
- Authorize the Finance Director to increase the blanket purchase order with Grainger for an additional $100,000 for the purchase of materials and supplies;
- and authorize to extend purchase order terms for any future extensions should the SourceWell contract be amended.
By: Les Ruitenschild, Water Distribution Supervisor
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