Staff recommends adoption of the resolution authorizing the execution of contract amendment number two with Allied Universal Corporation (AUC) providing for a five percent (5%) unit price increase.
The City has a current competitively bid contract with AUC awarded by the Commission April 27, 2009 for the purchase of chlorine gas products. The Environmental Services Department uses chlorine gas for water treatment. The contract provides for two additional one-year extensions which ultimately result in a final expiration date of September 30, 2011.
Due to the contract incorporating a multi-year term the contract included a standard governmental cost adjustment clause providing for annual cost adjustments for subsequent extension years based upon the Urban Consumers Price Index (CPU-U)(National) established by the Bureau of Labor Statistics (BLS) and stating a not to exceed amount of 5%.
In accordance with the cost adjustment clause, Allied Universal has requested a 5% unit price increase for the final performance period October 1, 2010 through September 30, 2011. A review of the current BLS Producer Price Index (PPI) report indicates the cost associated with manufacturing chlorine, compressed or liquefied, to have increased 59.9% between July 2009 and July 2010. The requested price increase by AUC is supported by the BLS information as well as several letters from their suppliers indicating a price increase to AUC.
This amendment increases the unit price for 150 lb. bottles from $63.40 to $66.57 and 2,000 lb. cylinders from $389.00 to $408.45. It should be noted the AUC price for the 2,000 lb. units are approximately $3 per unit below the 2009 bid of the next lowest competitor.
Allied Universal Corporation, or
Environmental Services has budgeted $65,000.00 for chlorine gas during the 2011 fiscal year. The actual expenditure will depend on the amount of water treatment required.
Prepared by: _ Mike Thornton________
Attachments: Yes__X__ No ________
Advertised: ____Not Required __X___
Dates: _ _____
Reviewed by: Dept. Head ________
Finance Dept. ______JB__________
Deputy C.M. ___________________
City Manager ___________________
Project No. _447015_____________
WF No. ____NA_____________
Budget : __$40,000.00_ FY2011____
A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF LEESBURG, FLORIDA, AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE A SECOND CONTRACT AMENDMENT BETWEEN THE CITY OF LEESBURG AND ALLIED UNIVERSAL CORPORATION FOR THE PURPOSES OF PROVIDING CHLORINE GAS PRODUCTS PURSUANT TO RESOLUTION 8438 AND APPROVING THE ASSOCIATED EXPENDITURE IN THE 2011 FISCAL YEAR; AND PROVIDING AN EFFECTIVE DATE.
BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF LEESBURG, FLORIDA:
THAT the Mayor and City Clerk are hereby authorized to execute an agreement with Allied Universal Corporation whose address is 3901 N.W. 115 Avenue, Miami, FL 33178; to provide chlorine gas products on an as ordered unit price basis to the City of Leesburg.
THAT this resolution shall become effective immediately.
PASSED AND ADOPTED by the City Commission of the City of Leesburg, Florida, at a regular meeting held the _27th____ day of __September_______ 2010.