SR-6-E (127)
PURCH:PW:DH:br:f:\finance\purch\stfrpts\srbd2537 6E
-
Council Meeting: August 8, 1995 Santa Monica, CA
AUG 0 8 1995
TO Mayor and City Council
FROM: City Staff
SUBJECT: Recommendation to ReJect Bids to Furn~sh and Del~ver
M~scellaneous Recycled Paper, Bid #2537 and Adopt a
Resolutlon Authorizing Clty Manager to Negotiate and
Execute a Contract for the Purchase of Miscellaneous
Recycled Paper
Introduction
ThlS report concerns reJectlon of bids to furnish and deliver
m~scellaneous recycled paper at spec~fied unit pr~ces, plus
applicable sales tax.
Backqround
In response to published Notices Invlting Bids (published May 25
and 26, 1995 ) to furnish and deliver m~scellaneous recycled paper
1n accordance with Clty specifications, bids were received and
publlcly opened and read on June 12, 1995. Proposal forms were
malled to fifteen vendors and notices were advertised in accordance
with City Charter and Municipal Code provisions. Nine proposals
were rece1ved.
City specifications requested price protection for a period of one
year Due to the current volatile paper market, none of the nlne
bldders offered guaranteed prlclng beyond a s~xty (60) day period.
Most offered only a thlrty (30) day prlce guarantee, after Wh1Ch
time prevailing prlces would apply at time of shipment.
- 1 - 6E
-
AUG 0 8 1995
Reason for Volatile Paper Market
In the late 1980's and early 1990's the paper industry was
experiencing a severe slump 1n orders due to the depressed economy.
ThlS resulted in the closure of a number of major paper plants
across the country. As the economy lmproved in 1994, the demand
for paper products of all types began to rise. Coupled w~th
grow~ng demand overseas, particularly ln China and Latin Amer1ca,
the remaining paper manufacturers are running at full capaclty, but
the demand lS exceeding the supply.
As a result, paper manufacturers are allocatlng paper products to
thelr dlstrlbutors and are not willing to enter into any long-term
agreements for pricing untll th1S situation stab1llzes. Relief
from the upward trend ln prlclng is expected to occur in late 1996
or early 1997 as new equipment and mllls become operatlonal.
Budqet/Financial Impact
This recommendat1on does not have a budget or financial impact.
Recommendation
It is recommended that all blds be rejected as non-responsive and
that the attached resolution be adopted allow~ng the City Manager
to negotlate prices for the purchase of miscellaneous recycled on
the open market.
Prepared By: Pam Wortham, Purchasing Agent
Diane Howell, Buyer
8/1/95
- 2 -
- . PW.DH:br:f;\purch\stfrpts\res2537
1
Clty Councll Meeting: 8/8/95 Santa Monlca, Californla
RESOLUTION NO. 8928 (CCS)
(Clty Councl1 Series)
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF SANTA MONICA TO AUTHORIZE THE CITY MANAGER
TO NEGOTIATE AND EXECUTE A CONTRACT FOR THE
PURCHASE OF MISCELLANEOUS RECYCLED PAPER
WtIEREAS, the Clty sent out Notices Invltlng Bids to furnish
and dellver ffilscellaneous recycled paper and to guarantee prices
for one year;
WHEREAS, nlne responses were received, but all were non-
respons~ve Slnce the prlces were only guaranteed for short periods
of tlme;
WHEREAS, staff has determined that the formal bldding
procedures are not conduclve to the flexibillty needed to obtaln
the lowest poss~ble pr~ce for mlscellaneous recycled paper because
of the rapld change In market prices for the mlscellaneous recycled
paper,
WHEREAS, an open market purchase will permit the City to act
ln a timely manner to purchase miscellaneous recycled paper at an
acceptable cost and perm~ t the City to obtain the most
envlronmentally favorable products which meet City specificatlonsi
and
-1-
"-
- ~- ~ --- -- - -- -~~ -
.
l
Adopted and approved thIS 8th of August 1995
A'wc f~~
I (..,
Mayor Pro Tempore
I hereby certify that the foregomg ResolutIon 8928 (CCS) was (iuly adopted at a meetmg
of the City Council held on the 8th of August, 1995 by the followmg vote
Ayes Council members Abdo, Ebner, Genser, Greenberg, Holbrook, O'Connor
Noes Council members None
Abstam CounCIl members None
Absent CounCil members Rosenstelll
ATTEST
I&M~
CIty Clerk