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Home My WebLink About8 Underground Cable Agenda Item # Memorandum To: Board of Directors From: Stephen Hollabaugh Date: October 28, 2005 Subject: Consideration of Resolution directing that competitive bidding be dispensed with in the purchase of 15kV Primary Underground Cable History: Truckee Donner PUD has a three year blanket contract with the Okonite Company that is ending November 1, 2005 for 15kV primary underground cable. The Okonite Company has supplied (through competitive bidding) 15kV primary underground cable to the district for over 12 years. Truckee Donner PUD has been the longest running blanket customer for Okonite in Northern California. As a side note, Okonite limits their "Alliance Customers" (of which Truckee Donner is one) to 35% of their customer base. As an "Alliance Customer' Okonite ensures you receive the best pricing available, and are set apart from their standard orders when placed on the plant. The District has never has a cable failure from any of the cable supplied by the Okonite company. Okonite has a 40 year warranty with labor on all cable provided to the District. New Information: With the end of the existing blanket contract with the Okonite Company coming to an end, Okonite has extended a new 3-Year Blanket Agreement for 15kV primary underground cable to the District. The new agreement has a slight one time increase to cover the insulation material cost increase; the rest of the contract is the same as was previously offered. The contract contains a metals escalation/de-escalation clause for copper, aluminum, lead and steel. These prices shall be adjusted for changes in the price of metals (copper, aluminum, lead and steel), which may occur between the date of quotation and the dates shipments are made. Since there was slight increase in cost, District counsel recommended that the District either bid the material or approve a resolution dispensing with bidding. Staff believes that competitive bidding would not produce an advantage to the District and is recommending dispensing with bidding for the reasons listed here and on the resolution. Page I of 2 t Okonite is now the only manufacturer of this cable on the West Coast with their local manufacturing plant in Santa Maria, CA and 2 west coast stocking locations. Okonite is the only cable manufacturer that meets the District's specifications for 15kV primary underground cable. Okonite has offered a 3-year 2005 — 2008 Blanket Agreement for 15kV Primary Underground Cable at a cost favorable to the District. Purchasing 15kV primary underground from another vendor would not be desirable and would be costly to the District and would not provide cable that meets the District's specifications. Competitive bids would not produce an advantage to the District and would be undesirable. Recommendation: (1) I recommend the Board approve Resolution No. 2005-XX, Directing that competitive bidding be dispensed with in the purchase of 15kV Primary Underground Cable. (2) 1 recommend the Board approve the 3-Year Blanket Agreement 2005 — 2008 with Okonite Company for 15kV Primary Underground Cable. Page 2 of 2 s -ions Resolution No. 2005 - XX Directing that competitive bidding be dispensed with in the purchase of 15kV Primary Underground Cable WHEREAS, the Electric Utility Department purchases 15kV Primary Underground Cable for our new customers and District needs; and WHEREAS, Okonite is the only cable manufacturer that meets the District's specifications for 15kV Primary Underground Cable; and WHEREAS, Okonite has an In-House mixing and compounding of their Okoguard (EPR) compound and Okoguard semicon compounds and has a totally integrated EPR system and this is required in the District specifications and there is no other product that can be considered equal; and WHEREAS, the Okonite Company will provide, free of charge, any reasonable engineering support requested by Truckee Donner PUD's Engineering Department. Additional support via Okonite's R&D laboratory and personnel for the analysis of Truckee Donner PUD's cable projects will be provided upon request; and WHEREAS, Okonite Company has the ability to serve Truckee Donner PUD best with their local manufacturing plant in Santa Maria, CA and 2 west coast stocking locations. This is the only cable manufacturing facility on the west coast of all manufacturers; and WHEREAS, Okonite has offered a 3-Year 2005 - 2008 Blanket Agreement for 15kV Primary Underground Cable; and WHEREAS,purchasing 15kV Primary Underground Cable from another vendor would not be desirable and would be costly to the District and would not provide cable that meets the District's specifications; and WHEREAS,various California court decisions, including Graydon v Pasadena Development Agency, 104 C.A. 3d 631 (1980), hold that if the subject of a contract is such that competitive proposals would be unavailing or would not produce an advantage and the advertisement for competitive bids would thus be undesirable or impractical, a public agency may dispense with competitive bidding; and WHEREAS, due to the facts set forth above, competitive bidding would be unavailing and would not produce an advantage to the District and the advertising for competitive bids would not produce an advantage to the District and would be undesirable; and WHEREAS, Public Utilities Code Section 20206.4 generally requires that the District seek competitive bids in connection with the purchase of goods; and Resolution 2005-XX 1 NOW, THEREFORE, BE IT RESOLVED by the Board of Directors that it adopts the above stated recitals as its findings. BE IT FURTHER RESOLVED BY THE Board of Directors that for the reasons set forth above, the District finds that competitive bids for the purchase of a 15kV Primary Underground Cable, would be unavailing and would not produce an advantage to the District and the advertisement for competitive bids would not produce an advantage to the District and would be undesirable and costly. BE IT FURTHER RESOLVED that the District shall therefore dispense with competitive bidding for the acquisition of 15kV Primary Underground Cable. PASSED AND ADOPTED by the Board of Directors at a meeting duly called and held within the District on the 2nd day of November, 2005 by the following roll call vote: AYES: NOES: ABSENT: TRUCKEE DONNER PUBLIC UTILITY DISTRICT By: J. Ronald Hemig, Board of Directors ATTEST: Peter L. Holzmeister, Clerk of the Board Resolution 2005-XX 2 THE One Annabel Lane, Suite #212 San Ramon, Galifomia 94583 Q OKONITE TEL: (925) 830-0801 COMPANY FAX: (925) B30-0954 www.okonite.com E-Mail: sanfrancisco0okonite.com Truckee Donner Public Utility District 3-Year Blanket Agreement Benefits of a 2005-2008 Blanket agreement for l5kV PRIMARY UNDERGROUND CABLE Listed below are some of the unique benefits that The Okonite Company will continue to provide Truckee Donner PUD with the acceptance of our proposal for a 2005-2008 Blanket extension. Rene6ts- I. A 125 year old- Independent, American company— 100%employee owned — Totally dedicated to the Insulated Wire& Cable business. 2. In-House mixing and compounding of our Okoguard (EPR) compound and Okoguard semicon compounds. 3. A totally integrated EPR system 4. Okonite's Okoguard/EPR insulation contains no polyethylene and does not exceed 72% by weight of ethylene— both features to limit the degree of susceptibility to"treeing" experienced by highly crystalline materials used by other EPR manufacturers. 5. Okonite's Okoguard/EPR insulation has a trouble free performance record extending over 35 years. 6. The Okonite company will provide, free of charge, any reasonable engineering support requested by Truckee Donner PUD's Engineering Department. Additional support via Okonite's R&D laboratory and personnel for the analysis of Truckee Donner PUD's cable projects will be provided upon request. T The Okonite Company's ability to service Truckee Donner PUD best with our local manufacturing plant in Santa Maria, CA, and 2 west coast stocking locations. 8_ A 40 year warranty with labor on all cable provided under this agreement. s Major Productivity Capital Investments Okonite Santa Maria Division Significant Capital Investments Area Investment(000) Niehoff Al MSM-85 Bench 5103 Drawing 2490 Cortinovus Ridgid Frame 61x Strander 5206 Stranding 2830 Tubular Strander- High Speed 5202 Stranding 1660 Tubular Strander- High Speed 5201 Stranding 1800 CV Expansion - 165mm Systems 5302/3 Insulate 286 High Pressure Pumps Upgrade Insulate 99 CV Temp Control Systems 5302/3 Insulate 201 CV Control Systems Upgrade Insulate 390 KOA Serve Line-5207 Serve 1908 High Speed Tape Lines - 5403/1 Tape 271 502 Plastics Line/CIC 5502 Plastics 1500 505 Plastiics Line 5505 Plastics 3020 Large Rewind Line 5721 Package 128 High Speed Large Packaging 5734 Package 158 Lemke Partial Disch & TDR Test Test 101 5000kva Transformer-Test Transformer Test 186 pend General Plant Significant Line Items 17028 Sub Building Expansion Plant 2006 Steam Generation - Phase A Plant 273 Steam Generation - Phase B Plant 280 2539 Sub Fs—!-!,567 Total, wmw 3l05 Fixed Asset Roster.xls, 3/24/2005 0 THE OKONITE COMPANY QUALITY CABLES c INCE 'I 8 78 San Francisco District Office One Annabel Lane Suite 212 San Ramon, CA 94583 (925) 830-0801 FAX: (925) 830-0954 E-Mail:sanfrancisco@okonite.com QUOTATION PREPARED for: TRUCKEE DONNER P.U.D. 10/10/2005 OKONITE REFERENCE: 64-50140 CUSTOMER REFERENCE: NET ITEM QUANTITY DESCRIPTION WEIGHT SHIP PRICE 1000 FT WEIGHT 1000 FT PRICES ARE VALID FOR SHIPMENTS THROUGH 12/31/08, SUBJECT TO METALS ESCALATION/DE-ESCALATION. 001 200, 000. 1/C 1/0 19X ALUMINUM - SS - 753 220 OKOGUARD EPR - 030 SC EPR $1621 16 X #14 SOLID COPPER CONC WIRES - 050 OKOLENE PE W/3 RED STRIPES - SEQ PRINT - 15KV METAL WEIGHT LBS PER 1000 FT: COPPER 207 ALUMINUM 99 APPROX O.D. INCHES 1 . 161 OKONITE PRODUCT CODE: 161-23-3072 CATALOG SECTION 2 SHEET 031 ----------------- --------------- ---------________________ 002 100, 000 ' 1/C 500 37X ALUMINUM FILLED STRAND -SS- 220 OKOGUARD EPR - 1740 $3543 - 040 SC EPR - 16 X 412 SOLID COPPER CONC WIRES - 080 OKOLENE PE W/3 RED STRIPES - SEQ PRINT - 15KV METAL WEIGHT LBS PER 1000 FT: COPPER 331 ALUMINUM 469 (CONTINUED) PAGE 1 THE OKI NNITE CoMpANy 6UALITY CABLES SINGE 1 878 OKONITE REFERENCE: 64-50140 CUSTOMER REFERENCE: NET -_-. ITEM QUANTITY DESCRIPTION WEIGHT SHIP PRICE 1000 FT WEIGHT 1000 FT APPROX O.D. INCHES 1 . 736 OKONITE PRODUCT CODE: 162-23-3093 CATALOG SECTION 2 SHEET 032 METAL BASE: (SEE BASIS IN ESCALATION SECTION) COPPER 1 . 876500 ALUMINUM .866940 REEL AND CUT CHARGES WILL APPLY FOR LENGTHS 500 FEET OR LESS. F.O.B.. SHIPPING POINT TERMS : 1/2%10DAYSNET30 LENGTH TOLERANCE -0/+5% PRICES QUOTED HEREIN DO NOT PERMIT EXACT LENGTHS OR REDUCED TOLERANCES, UNLESS SPECIFICALLY NOTED. STOCK ITEMS: SUBJECT TO PRIOR SALE. : THE OKON * LAST PAGE ENTITLED "TERMS AND CONDITIONS * COMP ` OF SALE" INCLUDING THOSE LIMITING WARRANTIES * BY '- ---.--- ��*PAR**O*++HIS*�*QUOTAT*ON* * �� .. _ ... G LA RKIN (CONTINUED) PAGE 2 { Y V 0 THE OKONITE COMPANY QUALITY CABLES SINCE 1 B7B OKONITE REFERENCE: 64-50140 CUSTOMER REFERENCE: NET WEIGHT SHIP PRICE ITEM QUANTITY DESCRIPTION 1000 FT WEIGHT 1000 FT ON SHIPMENTS 5, 000 LBS . AND OVER, ORDINARY FREIGHT ALLOWED TO DESTINATION (NEAREST FREIGHT STATION OR COMMON CARRIER DELIVERY POINT) TO AND WITHIN ALL STATES EXCEPT ALASKA AND HAWAII . SHIPMENTS TO THESE TWO STATES ARE FREIGHT ALLOWED TO PORT OF EMBARKATION. ON SHIPMENTS OF LESS THAN 5, 000 LBS. - NO FREIGHT IS ALLOWED. ESCALATION: PRICES QUOTED HEREIN ARE THOSE IN EFFECT TODAY, AND ARE PREDICATED ON IMMEDIATE RELEASE FOR MANUFACTURE AND SHIPMENT AS SOON AS COMP- LETED. THESE PRICES SHALL BE ADJUSTED FOR CHANGES IN THE PRICE OF METALS (COPPER, STEEL, LEAD, ALUMINUM) , WHICH MAY OCCUR BETWEEN THE DATE OF QUOTATION AND THE DATES SHIPMENTS ARE MADE. ALL SUCH ADJUSTMENTS WILL BE MADE AGAINST THE NET PRICE AFTER ALL DISCOUNTS AND WILL BE CALCULATED USING METAL WEIGHTS QUOTED HEREIN. ORDERS RECEIVED WITHOUT CUTTING LENGTHS OR FOR SUBSEQUENT RELEASE, SHALL BE BILLED AT PRICE IN EFFECT ON THE DAY RELEASE IS RECEIVED AND SHALL BE ADJUSTED THEREAFTER FOR CHANGES IN THE PRICE OF METALS (COPPER, STEEL, LEAD, ALUMINUM) , WHICH MAY OCCUR BETWEEN THE DATE OF RELEASE AND THE DATES SHIPMENTS ARE MADE. BASIS: COPPER: COMEX PER NY TIMES/WALL STREET JOURNAL, CURRENT MONTH SETTLE PRICE, PREVIOUS DAY CLOSING. ALUMINUM: METALS WEEK - INGOT. LEAD: LONDON METALS EXCHANGE (LME) SETTLE PRICE. STEEL: AMERICAN METALS MARKET - COLD ROLLED SHEET CLASS 1 . RETURNABLE REEL CHARGES MAY APPLY AS APPLICABLE. (END OF QUOTATION) PAGE 3