CITY COUNCIL AGENDA ITEM
ACTION REQUESTED:
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Approve the award of Option Year Two of Contract 20-028, Insulated Conductors, to Okonite for an amount not to exceed $2,200,000 and for a one-year term
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DEPARTMENT: Electric Utility
SUBMITTED BY: Brian Groth, Director
BOARD/COMMISSION REVIEW:
N/A
BACKGROUND:
The purpose of this procurement is to contract with a vendor to supply electric cable, otherwise known as conductors, which are inventoried at the Electric Service Center warehouse. The conductors are of various types and sizes and are used in capital and maintenance projects by the Electric Utility (Utility) to ensure reliable service to its customers. Purchases are planned based on known projects for both capital and maintenance.
With the current extended lead times, staff is ordering material that will not be received until 2023. The Utility does maintain an inventory of cable, much like many other materials, so emergency repairs may be completed without extended outages for its customers.
The City Council awarded Contract 20-028 to Okonite on May 19, 2020 for a one-year term from May 19, 2020 to May 18, 2021, with two, one-year options to renew. The first option year was awarded by Council in April 2021.
DISCUSSION:
During the initial term and the first optional renewal term, Okonite performed very well. Even during the pandemic, the on-time delivery of product and quality of the conductors was not negatively impacted. In addition, products supplied by Okonite are backed by an industry-leading 40-year warranty and may be returned for a 100% refund for up to three years from the date of shipment.
Based on the vendor's performance, the Utility recommends renewing the contract for the second optional renewal term. Okonite has agreed to maintain the terms and conditions, however, they are requesting a 29% increase in unit pricing. The percentage increase requested is consistent with the 12-month historical commodity pricing for copper, al...
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