To: Honorable Mayor and Members of City Council
From: Joy Eldredge, Utilities Director
Prepared By: Mark Holderbein, Management Analyst II
TITLE:
Title
Amendment to Water Treatment Chemical Purchase Contract
LABEL
RECOMMENDED ACTION:
Recommendation
Approve and authorize the Utilities Director to execute Amendment No. 1 to Agreement No. C2024-658 with Thatcher Company of California, Inc., increasing the contract amount from $300,000 to an amount not to exceed $450,000 per fiscal year for sodium hypochlorite for the next two fiscal years; and determine this action is exempt from CEQA.
Body
DISCUSSION:
The Water Division uses chemicals as part of the water treatment process to provide potable water to the City of Napa. To receive competitive prices for chemicals, the Water Division participates in the North Bay Chemical Agency Pool (NBCAP) which is comprised of various local municipalities’ water treatment and wastewater treatment operations. The City of Napa has participated in the pool bid process for over 25 years. The NBCAP members collectively advertise, obtain bids, and award contracts in May each year for treatment process chemicals that most agencies use in day-to-day operations. Competitive pricing is ensured, but market forces drive the cost of chemicals.
On July 16, 2024, City Council authorized a three (3) year agreement with awarded bidders, including Thatcher through June 2027. However, due to market volatility and increased global costs of main ingredients, bidders would only guarantee their prices for sodium hypochlorite for one year. Sodium hypochlorite is integral to the water treatment process to ensure clean, safe, potable water. Based on the 2025 results of the competitive NBCAP bid process, costs of sodium hypochlorite for the upcoming fiscal year is up 24.1% compared to the bid results from 2024 and Thatcher remained the lowest bidder for the upcoming fiscal year.
As a result, the current contract amounts with Thatcher will be insufficient for the remaining contract term. Therefore, staff recommends that Council authorize the Utilities Director to execute Amendment No. 1 to Agreement No. C2024-658 with Thatcher Company of California, Inc., increasing the contract amount from $300,000 to an amount not to exceed $450,000 per fiscal year for sodium hypochlorite for the next two fiscal years.
FINANCIAL IMPACTS:
There are sufficient funds budgeted and available in Water Enterprise Fund account 53060116-56310 each fiscal year for the purchase of chemicals required for the potable water treatment process.
CEQA:
City staff recommends that the City Council determine that the Recommended Action is exempt from CEQA pursuant to CEQA Guidelines Section 15301(a) (Existing Facilities) which exempts operation, repair, maintenance or minor alteration of existing public or private structures, facilities, mechanical equipment or topographic features involving no expansion of use beyond that previously existing.
DOCUMENTS ATTACHED:
ATCH1 - Amendment No.1 to Agreement No. C2024-658
NOTIFICATION:
None