CITY COUNCIL AGENDA ITEM
ACTION REQUESTED:
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Approve the award of a five-year extension to Contract 05-030, UCP Alliance Agreement, to Utility Concrete Products for an amount not to exceed $300,000 and for a five-year term
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DEPARTMENT: Electric Utility
SUBMITTED BY: Brian Groth, Director
BOARD/COMMISSION REVIEW:
N/A
BACKGROUND:
In January 2005, the City Council awarded Contract 05-030 to Utility Concrete Products (UCP) for a five-year term to provide the Electric Utility (Utility) with precast concrete products specifically designed for the City of Naperville. The agreement includes the design, construction and delivery of manholes, switch vaults and transformer pads/vaults. In addition, UCP provides specialized engineering services as needed.
When the City originally entered into the alliance agreement, it identified two vendors who could manufacture the precast octagonal vaults used by the Electric Utility: Amocor Precast, located in Ramsey Minnesota, and UCP. Amocor was not competitive because of the delivery costs from Minnesota. Aurora Concrete Products (ACP) was interested in building octagonal vaults, but the cost to engineer and manufacture the molds was too great for ACP given the small quantity the Utility purchased annually.
UCP also provides indirect cost savings by delivering manholes to construction sites where underground work is being performed. UCP sets the precast item in place and coordinates the installation with the prime contractor at no additional cost to the Utility. This factory-to-job site delivery method eliminates temporary storage and relocation expenses, which reduces the overall cost to the Utility. Competitors are not able to offer this service. Within the last contract period, UCP manufactured and delivered 20 manholes directly to the project site for the Utility.
Per the agreement, the contract can be extended on a year-by-year basis if mutually agreed to by both parties. Since the initial award, the contract has been renewed for additional five-year terms in 2010, 2015 and 2020. The current contract term ends on January 17, 2025.
DISCUSSION:
Based upon the vendor’s performance, the Utility recommends renewing the contract for an additional five years to remain consistent with previous awards for this project. UCP has provided rates and terms for the renewal that are consistent with the increases originally agreed upon per the Alliance Agreement in 2005. The agreement allows for an increase annually based upon using the averages of the Producer Price Index as reported by the U.S. Department of Labor Statistics for “Intermediate Materials, Supplies, and Components” (IMS&C) and “Materials and Components for Construction” (M&CC) using the contract execution for establishing the baseline for calculating adjustments.
The term of the contract is five years from January 18, 2025, to January 17, 2030, with no option years to extend.
FISCAL IMPACT:
CIP#: Various
Items associated with the UCP Alliance Agreement are expensed to the Infrastructure account listed below. The items purchased are used in various capital projects and will be expensed to the individual project at the time of purchase. Although the 2025 budget is still being developed, the proposed budget includes $27,298,500 in the below Infrastructure account for various capital expenses. The requested amount is within the amount proposed for these expenses.
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Account Number |
Fund Description |
Total Budget Amount |
|
40251300-551502 |
Electric Utility Fund |
TBD |