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SR 05-09-2023 5B City Council Report City Council Meeting: May 9, 2023 Agenda Item: 5.B 1 of 4 To: Mayor and City Council From: Rick Valte, Public Works Director, Public Works, Engineering and Street Services Subject: Award Purchase Order to Associated Ready Mixed Concrete, Inc. for Concrete Materials Recommended Action Staff recommends that the City Council: 1. Adopt a finding of Categorical Exemption pursuant to Section 15301 (Existing Facilities), of the California Environmental Quality Act (CEQA) Guidelines ; 2. Award Bid #2685-2 to Associated Ready Mixed Concrete, Inc., a California- based Company, for the purchase and delivery of concrete materials for the Public Works Department; 3. Authorize the Procurement Manager to issue a purchase order with Associated Ready Mixed Concrete, Inc., in an amount not to exceed $200,000 for one year, with four additional one-year renewal option(s) for a total amount not to exceed $1,000,000 over a five-year period, with future year funding contingent on Council budget approval. Summary The City utilizes concrete materials for various street maintenance projects, including the repair and replacement of sidewalks, alleys, driveways, streets, curbs and gutters, as well as for various emergency and urgent repairs to the public right-of-way. Staff recommends issuing a purchase order to Associated Ready Mixed Concrete, Inc. for the purchase and delivery of concrete materials for a total amount not to exceed $1,000,000 over a five-year period. 5.B Packet Pg. 89 2 of 4 Discussion The City utilizes concrete to maintain and repair sidewalks, alleys, driveways, curbs, gutters, streets and alleys. The City’s Street Maintenance staff perform the work in- house and use between 700 to 850 cubic yards of concrete materials annually to conduct various repairs. The 2022 Russian invasion of Ukraine has caused fluctuations in cement prices, which has impacted the cost of concrete materials. Additionally, the COVID-19 pandemic has caused increases to concrete materials and associated labor costs. Both factors above have caused concrete cost increases of upwards of 40% over the past three years. The bid has cost escalations built into the first two renewal periods and the City agrees with these price adjustments. The vendor was not able to provide renewal terms beyond the first two periods due to market uncertainty. The City would negotiate with Associate for the third and fourth renewal period, and only issue a PO if the pricing is competitive and in line with market trends during those periods. Vendor Selection Best and Only Bidder Associated Ready Mixed Concrete, Inc. Submittals Received Selection Criteria Associated Ready Mixed Concrete, Inc. $135,015 Municipal Code SMMC 2.24.180 Evaluation Criteria Price, previous experience, the quality of the material offered; the ability, capacity and skill of the bidder to provide the materials; the capacity of the bidder to provide the materials promptly, within the time specified, and without delay or interference; and compliance with the City specifications The City is not required to select the bid with the lowest price. Bid Data Date Posted Posted On Advertised In (City Charter & SMMC) Vendors Downloaded Date Publicly Opened 01/24/2023 City's Online Bidding Site Santa Monica Daily Press 7 03/10/2023 Additional Vendor Outreach & Justification to Award Staff conducted additional outreach to vendors who download ed the bid to see why they did not submit a bid and received no responses. Associated Ready Mix, Inc., is the City’s 5.B Packet Pg. 90 3 of 4 current mixed concrete material supplier and has provided a competitive bid with competitive and comparable unit prices in today’s construction materials market. Associated Ready Mix, Inc. has successfully provided concrete materials to the City over the past five years. The vendor has proven its ability to provide a quality product. The vendor is able to deliver ready-to-use concrete mixes within ~24 hours of the order and has a concrete plant within the city limits. It is for these reasons that Associated Ready Mixed Concrete Inc. is recommended as the best bidder Environmental Review The awards for mixed concrete material purchases are categorically exempt from the California Environmental Quality Act (CEQA) under Section 15301. Section 15301 of the CEQA State Guidelines provides Class 1 (existing facilities) exemption for projects that consists of the operation, repair, maintenance, leasing, licensing, permitting, or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features, involving negligible or no expansion of the existing or former use. The award for mixed concrete materials purchase order would not result in any modifications to existing facilities. The existing facilities would be maintained and repaired with replacement materials and the award of the purchase order would not expand or materially change existing facilities or operations. Therefore, the project is categorically exempt as set forth in Section 15301 of the CEQA State Guidelines. Financial Impacts and Budget Actions Staff seeks authority to approve funding from the General Fund to award a purchase order with Associated Ready Mixed Concrete, Inc. to provide mixed concrete materials. Funds will be included in the FY 2023-25 Proposed Biennial Budget. Future year funding is contingent on Council budget approval. Purchase Order Request FY 2023-24 Request Amount Future Years Department Account # Total Contract Amount $200,000 $800,000 01500033.529260 $1,000,000 5.B Packet Pg. 91 4 of 4 Prepared By: Steven Hull, Principal Administrative Analyst Approved Forwarded to Council Attachments: A. Associated_Oaks_Initiative 5.B Packet Pg. 92 5.B.a Packet Pg. 93 Attachment: Associated_Oaks_Initiative (5536 : Award Bid #2685-2 to Associated Ready Mixed Concrete, Inc. and Issue PO for Concrete