TO:
Honorable Mayor and Members of the City Council
THROUGH:
Bruce Moe, City Manager
FROM:
Erick Lee, Public Works Director
Lou Vargas, Utilities Manager
Nicholle Petroff, Senior Management Analyst
SUBJECT:Title
Ratification of City Manager’s Waiver of Open Market Requirements to Purchase Water Meters and Related Equipment from HydroPro Solutions in the Amount of $238,328.28 (Public Works Director Lee).
RATIFY
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Recommended Action
RECOMMENDATION:
Staff recommends that the City Council ratify the City’s Manager’s purchase of water meters and related equipment from HydroPro Solutions in the amount to $238,328.28 pursuant to Manhattan Beach Municipal Code (MBMC) Section 2.36.140 (Waivers).
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FISCAL IMPLICATIONS:
There is no fiscal impact related to this purchase. Sufficient funds are available in the adopted Fiscal Year 2022-2023 CIP for the Water Meter Upgrade & Automation project.
BACKGROUND:
On February 18, 2020, City Council adopted Resolution No. 20-0014 approving an agreement for the purchase of Advanced Metering Infrastructure (AMI) equipment, for the Water Meter Upgrade and Automation project. The approval included the purchase of over 13,500 smart water meters manufactured by Master Meter.
Smart water meters are equipped with a transmitter that securely sends water use information wirelessly from the meter to the City during fixed intervals throughout each day. With this type of reporting frequency, smart meters have the intrinsic ability to detect anomalies, like leaks or irregular usage, and provide customers and staff with near real-time water usage data on-demand. This technology will assist the City with leak detection and help its water conservation efforts. The Public Works Department is currently implementing this project.
DISCUSSION:
Staff has identified the need to purchase additional water meters and related equipment. The current sole distributor of Master Meter products for the state of California is HydroPro Solutions.
On June 15, 2022, staff obtained a quote from HydroPro Solutions for the needed equipment in the amount of $238,128.28, including sales tax. This quote indicated that the vendor reserved the right to increase pricing after June 15, 2022. After providing the quote, HydroPro Solutions advised staff that the pricing would not be honored after July 4, 2022, as costs for the materials would be increased by Master Meter by eight percent on July 5, 2022. This change would result approximately $17,000 in increased costs to the City.
In order to avoid the cost increase, a purchase order for this equipment was issued on June 17, 2022, under the City Manager’s authority as outlined in MBMC Section 2.36.140 (Waivers), which states:
“Whenever special market conditions require it the Purchasing Officer (City Manager) or the Purchasing Manager, with authorization from the City Manager, may waive the $50,000.00 open market requirements for replenishment of supplies, materials, and equipment, or for services, where the best interest of the City is served, provided that such waiver is ratified by the Council at a meeting within 30 days of the purchase.”
The savings of approximately $17,000 for the Water Fund is certainly in the best interest of the City. Therefore, staff recommends that the City Council ratify the City Manager’s waiver of open market requirements to purchase water meters and related equipment from HydroPro Solutions in the amount of $238,328.28.
PUBLIC OUTREACH:
After analysis, staff determined that public outreach was not required for this issue.
ENVIRONMENTAL REVIEW:
The City has reviewed the proposed activity for compliance with the California Environmental Quality Act (CEQA) and has determined that the activity is not a “Project” as defined under Section 15378 of the State CEQA Guidelines; therefore, pursuant to Section 15060(c)(3) of the State CEQA Guidelines the activity is not subject to CEQA. Thus, no environmental review is necessary.
LEGAL REVIEW:
The City Attorney has reviewed this report and determined that no additional legal analysis is necessary.
ATTACHMENTS:
1. Quote
2. Purchase Order
3. Sole Source Letter