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HomeMy WebLinkAboutOrdinance 5301 f ORDINANCE NO, 5301 AN ORDINANCE WAIVING THE REQUIREMENTS OF FORMAL COMPETITIVE BIDDING DURING CALENDAR YEAR 2010 FOR THE PURCHASE OF ASPHALT MATERIALS FOR USE BY THE TRANSPORTATION DIVISION . WHEREAS, the crude oil market continues to experience extreme price volatility; and WHEREAS, this volatility has greatly increased the price of asphalt, making normal competitive bidding procedures unworkable, impractical and not feasible; and WHEREAS, the Transportation Division proposes to solicit bids on a quarterly basis without the need for further approval of the City Council through calendar year 2010. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section I . That the City Council of the City of Fayetteville, Arkansas hereby finds that such circumstances constitute an exceptional situation where annual competitive bidding is not feasible or practical, and therefore through calendar year 2010, waives the requirements of formal competitive bidding for the purchase of asphalt materials, allowing the Transportation Division to solicit bids on a quarterly basis without the need for further approval of the City Council. PASSED and APPROVED this 5'h day of January, 2010. APPROVED: ATTEST: By: d — By: S C!c OP ELD J AN, Mayor SONY 2A E. SMITH, City ClerTrer 0 ;R /TR ''saw , f..t % FAYETTEVILLE ; °WOONGTON��� City of Fayetteville Staff Review Form City Council Agenda Items and Contracts, Leases or Agreements January 5, 2010 City Council Meeting Date Agenda Items Only Terry Gulley Transportation Transportation Services Submitted By Division Department Action Required: Staff requests an ordinance waiving the requirements of formal competitive bidding for the purchase of asphalt materials for use by the Transportation Division. $ 1 ,637,700.00 In-House Pavement Improvements Cost of this request Category / Project Budget Program Category / Project Name 4470-9470-5417.00 $ - Transportation Improvements Account Number Funds Used to Date Program / Project Category Name 02052 / 1 $ 1 ,637,700.00 Sales Tax Capital Improvements Project Number Remaining Balance Fund Name Budgeted Item �X Budget Adjustment Attached Previous Ordinance or Resolution # 5218 De art q irector Date Original Contract Date: Original Contract Number: Ci ttorney Date +wA q - .Q, — 11— IS -2cct Finance and Internal Services Director Date Received in City ^ _ Clerk's Office '/",iV►/-�) a Clfief of Staff Date Received in q Mayor's Office 1 Mayr Date Comments: Revised January 15, 2009 Tay e eTHE CITY OF FAYETTEVILLE, ARKANSAS DEPARTMENT CORRESPONDENCE ARKANSAS CITY COUNCIL AGENDA MEMO To: Mayor and City Council Thru: Don Marr, Chief of Staff From : Terry Gulley, Transportation Services Directorp4xP Date: January 5, 2010 Subject: Bid Waiver for Asphalt Materials PROPOSAL: Staff proposes an ordinance waiving the requirements of formal competitive bidding for the purchase of asphalt materials for use by the Transportation Division during the 2010 fiscal year. RECOMMENDATION: The price of raw materials required to manufacture asphalt has fluctuated a great deal over the past two years and continues to do so at this time. Asphalt consists of aggregate and petroleum- based asphaltic cement (AC) which binds the mix together. The AC is rooted in crude oil which experienced extreme volatility on the New York Mercantile Exchange market during the 2008 and 2009 fiscal years. The prices of fuel and freight have also shown significant variation and can increase or decrease over a short period of time. Type 2 RAP surface mix asphalt requires a 4.08% AC mixture and the local asphalt suppliers implement an increased unit price for this material based on the increased price of raw materials purchased. Refiners are now manufacturing much less asphalt, and because sources are limited, the price changes day to day. Volatile prices have deemed awarding an annual bid for asphalt materials unpractical. Local asphalt suppliers cannot feasibly guarantee a fixed price over a twelve month time period. The following schedule has been proposed for asphalt material bids: Quarter # I : Bids due December 18, 2009 with pricing valid January 1 , 2010 — March 31 , 2010 Quarter #2: Bids due March 31 , 2010 with pricing valid April 1 , 2010 — June 30, 2010 Quarter #3 : Bids due June 30, 2010 with pricing valid July 1 , 2010 — September 30, 2010 Quarter #4: Bids due September 30, 2010 with pricing valid October 1 , 2010 — December 31 , 2010 Staff recommends bidding asphalt materials on a quarterly basis without the need for further approval of the City Council, awarding the respective low bidder, and allowing for price adjustment requests based on the current bid language. BUDGET IMPACT: Funds for the acquisition of asphalt materials have been budgeted in the In-House Pavement Improvements capital project. Sufficient funding is available for 2010 purchases. ORDINANCE NO, AN ORDINANCE WAIVING THE REQUIREMENTS OF FORMAL COMPETITIVE BIDDING DURING CALENDAR YEAR 2010 FOR THE PURCHASE OF ASPHALT MATERIALS FOR USE BY THE TRANSPORTATION DIVISION. WHEREAS, the crude oil market continues to experience extreme price volatility; and WHEREAS, this volatility has greatly increased the price of asphalt, making normal competitive bidding procedures unworkable, impractical and not feasible; and WHEREAS, the Transportation Division proposes to solicit bids on a quarterly basis without the need for further approval of the City Council through calendar year 2010. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1 . That the City Council of the City of Fayetteville, Arkansas hereby finds that such circumstances constitute an exceptional situation where annual competitive bidding is not feasible or practical, and therefore through calendar year 2010, waives the requirements of formal competitive bidding for the purchase of asphalt materials, allowing the Transportation Division to solicit bids on a quarterly basis without the need for further approval of the City Council. PASSED and APPROVED this 5b day of January, 2010. APPROVED: ATTEST: By: By: LIONELD JORDAN, Mayor SONDRA E. SMITH, City Clerk/Treasurer