(14)AR 121807 Wesco Distribution

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ITEM #14 CITY OF COLTON AGENDA REPORT FOR COUNCIL MEETING OF DECEMBER 18, 2007 TO: HONORABLE MAYOR AND CITY COUNCIL FROM: Jeannette Olko, Electric Utility General Manager SUBJECT: Award of Bid for Annual Purchase of Medium Voltage Underground Distribution Cable for the Electric Department to Wesco Distribution DATE: December 10, 2007 BACKGROUND: The City purchases various sizes of medium voltage underground distribution cable into the Electric Stores Inventory for use by the Electric Utility on an "as required" basis. When the inventory levels reach predetermined review points, or when special projects arise, cable is reordered based on projected usage as determined by the City's Electric Utility Systems Designer. The Electric Department has identified in its Capital Improvement Plan a five-year underground replacement program. The Electric Department expects to replace a minimum of 10,000 feet of 750 MCM cable per year. Fiscal Year 07/08 is the first of the five years of the program. In addition, staff has identified the need to purchase a minimum of 2,500 feet each of 1/0 and 4/0 cable for ongoing maintenance and new development. DISCUSSION/ANALYSIS: On October 31, 2007, the Electric Department issued a Notice Inviting Bids for the Annual Purchase of Medium Voltage Underground (UG) Distribution Cable, RFB-RG-112007. The bid documents were distributed through the City's Online Bid System, BidNet. Eleven distributors and manufacturers were directly notified of the bid opportunity through BidNet and the document was accessibly by all users of the BidNet system. The bid specifications state both a minimum and a maximum quantity of cable to be purchased during a twelve month period. The City guarantees that it will purchase a minimum quantity of each of the three sizes of cable specified during that twelve month period. A maximum quantity of each cable was also specified, in the event that additional cable is needed during the year. The City does not guarantee purchase of the maximum quantity in any twelve month period. The specifications allow for the City and the vendor, upon mutual agreement, to extend the term of purchase for three additional one-year periods. A public bid opening was held at 2:30 P.M. on December 6, 2007 at the Electric Department Administrative offices. Two bids were received. However, one bid was "non-responsive" as the vendor did not complete all the required bid forms. The one remaining bidder, Wesco Distribution, included an escalation/de-escalation clause in the "Proposed Exceptions or Deviations" Section of the Bid. The price of the cable will escalate or de-escalate by the difference in the price of copper and aluminum at the closing of COMEX on December 6, 2007 and the shipment date.