| | | | | | | | Agenda Item - 5.h.
City of Garden Grove
INTER-DEPARTMENT MEMORANDUM
| To: | Scott C. Stiles
| From: | William E. Murray
| | Dept.: | City Manager
| Dept.: | Public Works
| | Subject: | Authorize an increase to the purchase order with Home Depot Credit Services for the purchase of materials and supplies. (Amount: $50,000) (Action Item) | Date: | 12/14/2021 |
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| | | | | | | | OBJECTIVE
For the City Council to authorize an increase to a blanket purchase order with Home Depot Credit Services for an additional $50,000 to purchase 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, painting and various tools/equipment. Home Depot has agreed for the City to purchase its hardware supplies through the Home Depot store located in Garden Grove with the sales credit going directly to the store. |
| | | | | | | | DISCUSSION
In April 2020, City Council approved a blanket purchase order in the amount of $150,000 through the U.S. Communities/OMNIA Partners competitive bid, Contract #16154-RFP that will expire this December. This blanket purchase order helps to ensure no interruptions in the day-to-day operations of City services. Since then, this contract has been renewed and extended through December 31, 2026. Within the past year, prices have increased due to supply chain issues, raw material shortages, labor shortages and transportation challenges. Therefore, staff recommends increasing the purchase order by $50,000 for a total of $200,000 annually for the remaining term. |
| | | | | | | | FINANCIAL IMPACT
The financial impact is an additional $50,000 for a total of $200,000 for a purchase order with Home Depot Credit Services using a combination of funds from the General Fund, Water Enterprise and Sewer Enterprise. Based on previous expenditure patterns, the estimated cost breakdown is the following:
General Fund- 60%
Water Enterprise Fund- 30%
Sewer Enterprise Fund-10%
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 Home Depot Credit Services for an additional $50,000 for the purchase of building materials and supplies.
By: Les Ruitenschild, Water Distribution Supervisor
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