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HomeMy WebLinkAboutDocumentation_Regular_Tab 03_7/14/2022Agenda Item #3. Regular Council STAFF MEMO Meeting: Regular Council - Jul 14 2022 Staff Contact: Nate Litteral Department: Utilities Authorize Addendum No. 1 and Purchase Order with Shrieve Chemical Company for Purchase of Bulk 93% Sulfuric Acid The Utilities Department, throughout the year, has a need purchase sulfuric acid for use at the water treatment plant. Sulfuric acid is is a critical part of the water treatment process used to adjust the pH of water through the reverse osmosis process. To ensure the lowest possible price, the Village piggybacked the current Town of Jupiter contract with Shrieve Chemical in November 2021. This selection by the Town of Jupiter was completed through a competitive selection process — W2206Ba —May 2021. The term of this contract is one (1) year expires on September 30, 2022. Due to the unforeseen and unprecedented market conditions, Shrieve Chemical has requested a mid- year price increase to cover the supply increases in lieu of exercising the termination clause in the agreement. The requesting rate through the remainder of the agreement is $221.75 per ton (3% increase). Proposed Addendum No. 1 modifies the agreement to accommodate this request. Staff has vetted this requested price increase and found it to be consistent with the increase requested of the Town of Jupiter and less than the pricing with the Southeast Florida Governmental Purchasing Group Co-op, which the Village is now a member of. The new rate will result in an increase of $5,000 for the purchase of sulfuric acid in Fiscal Year 22. As a result, an amendment increasing the existing purchase requisition with Shrieve Chemical by $5,000 is requested based on the pricing in proposed Addendum No. 1. This document and any attachments may be reproduced upon request in an alternative format by completing our Accessibility Feedback Form, sending an e-mail to the Village Clerk or calling 561-768-0443. NLUDGET INFORMATI­I PROJECT NAME: Shrieve Chemical Company Proposed: $5,000 PROJECTED TOTAL: $28,100 BUDGET: $263,500 ENCUMBERED: $23,100 Projected Remaining: $7)283.35 Page 23 of 524 Agenda Item #3. >■ \'■■I.\ 1'ILWJ■lWJ\'WMEJ1k1��7■ WAKEkX��'1W1�1■MN1� Authorize Addendum No. 1 to the purchase agreement with Shrieve Chemical for the purchase of sulfuric acid and an associated increase in the existing purchase order for $5,000 for Fiscal Year 22. First Addendum to Sulfuric Acid Purchase Agreement -Price Increase (Shrieve Chemical Co).ada Exhibit B -Town of Jupiter Changer Order.ada Page 24 of 524 Agenda Item #3. FIRST ADDENDUM TO THE AGREEMENT FOR PURCHASE OF SULFURIC ACID BY AND BETWEEN THE VILLAGE OF TEQUESTA AND SHRIEVE CHEMICAL COMPANY THIS FIRST ADDENDUM, made and entered into this day of July 2022, by and between the Village of Tequesta, Florida, a municipal corporation organized and existing in accordance with the laws of the State of Florida with offices located at 345 Tequesta Drive, Tequesta, Florida 33469, hereinafter referred to as the "Village", and Shrieve Chemical Company LLC, a foreign limited liability company authorized to do business in Florida with principal offices located at 1442 Lake Front Circle, Suite 500, The Woodlands, Texas 77380 hereinafter referred to as the "Contractor" (and collectively with the Village the "Parties"), both of whom agree that the current Agreement for Purchase of Sulfuric Acid, which is a piggyback agreement for the unit prices described in Contractor's Contract with the Town of Jupiter, Florida pursuant to ITB No. W2206Ba, (hereinafter the "Agreement"), made and entered into by the Village and the Contractor on the 15th day of November, 2021, is hereby amended to conform with Town of Jupiter ITB No. W2206Bs Change Order No. 1 in the following manner: Section 1: Section 2 of the Agreement entitled `Compensation' is hereby amended as follows: Pursuant to the unit prices provided in Town of Jupiter ITB No. W2206Bs Change Order No. 1, attached to this First Addendum as Exhibit B , L1 and in consideration for the above Scope of Services, pricing shall be as follows: Sulfuric Acid 93% (F.O.B.) - $165.00 per ton Freight (F.O.B.) - $56.75 per ton Total Price (F.O.B.) - $221.75 per ton The Parties hereby agree to the Village's purchase of supplies and/or services in greater or lesser amounts than those estimated in the Town of Jupiter Contract, as also referenced in Exhibit "A". Following any delivery of the Product by the Contractor and subsequent acceptance by the Village, the Contractor shall invoice the Village. The Village shall pay the Contractor within forty-five (45) days after receipt and approval of any such invoice from the Contractor documenting the amount due. Section 2: All other Sections and recitals of the above -referenced Agreement shall remain in full force and effect. Page 1 of 2 Page 25 of 524 Agenda Item #3. Section 3: This First Addendum shall be attached to the current Agreement and shall become a part thereof. IN WITNESS WHEREOF, the Contractor and the Village have signed and executed this First Addendum with an effective date as noted above. ATTEST: Corporate Secretary ATTEST: Lori McWilliams, MMC Village Clerk SHRIEVE CHEMICAL COMPANY Page 2 of 2 By: Ted Threadgill, President (Corporate Seal) VILLAGE OF TEQUESTA By: Molly Young, Mayor (Seal) Page 26 of 524 Agenda Item #3. The following documenti*s presented in a non= ADA compliant format. Please contact the Village Clerk's office if you would like to receive an ADA compliant version of this document. Page 27 of 524 Agenda Item #3. DATE ISSUED: May 2,2022- W2206Ba CHANGE ORDER NO. 1 EFFECTIVE DATE: June 13, 2022 OWNER: Town of Jupiter OWN EWS PROJECT NO.: SUPPLIER: Shrieve Chemical Company PROJECr NAME: —Contract for Supplying Sulfuric Acid W2206Ba The Contract is modified as follows upon execution of this Cbange Order: Description: Increasetp 2riginal Contract Unit Price to-SUPPI ifuric Acid chemicat for escalation of freight. f ght co m pon e rat to su2ply Reason for Change order: er increases the contract -unit Drice per ton for the re"I h ghco Sulfuric Acid chern ical. The increase is reciuired as a result of escalating costs associiate -d it freit. The ntract unit price_per ton for freight will increase rom S50Zton to $56.75/ton. The total price to supply Sulfuric Acld chemical roduct will increase from $215 onto $221.75Zton for the remainder of the 1-year contract term (June 13, 2022 l eas5989,64500 0,,,599'7,,A.1256 as a thrrough September 30, 2022). The estimated , 1-year contract value it incre from .t. result of the un There is no c ontract Times. F777 KHAN G E I N CONTRACT PR ICE Or7jiginal Contract Price: $ 215.00 per ton from previously approved Change orders No. 0 to No . 0, $ 0.00 Contract Price prior to this Change Order: $, 215.00 per ton increase this Change Order: $ 6.75 per ton cont ract Price incorporating this Change Order: $ 221.75 per ton APPROVED BY OWNER, B y 4F Reb c J. Wilde Town of Jupiter CHANGE IN CONTRACT TWES Original Contract Times: Substantial Completion: September 3.0, 2022 Ready for final payment: September 30, 2022 sell from previously approved Change a Orders No. 0 to No. 0, Sion4 ubstantial CoMpjetW 0 Calendar Days Ready for final payment: 0 CalendaLDays Contract Times prior to this Change Order: Substantial Completion.p September 30, 2022 Ready for final payment: September 30, 202-2 rinewasp] Xwmicenise" this Change Order: V.- --- _., - - -- Substantial Completion: 0 Calendar Days Ready for final payment: 0 Calendar Days Contract Times with all approved Change Orders: Su b sta ntia I Completion: Sep ember 30, 2022 Ready for final payment: September 30, 2022 ACCE PTE D BY CO N T RACTO R: 0 B Le L-100 y: Ted Threadgill, Shrieve Chemical Company, LLC Title: Utilities Facilities Manager Title, President Date 5/25/2022 Date: W220613a Change Order No- 1 Page I of 2 Page 28 of 524 Agenda Item #3. W220613a CHANGE ORDER NO. 1 (CONTINUED) Description of Changes: Change in Contract Price: Estimated Approved Increase/ PCO # Reason for Change Ordercea�c* Increase in the Contract unit price by $6.75/ton as a result of escalation in freight costs $6.75/ton to supply Sulfuric acid chemical, for the remainder of the 1-year contract term (June 13, 2022 through September 30, 2022) Net Change in Total Contract Price for Change Order No. 1 $6.75/ton *The estimated 1-year Contract Value will increase from $989,645 to $997,412.56, or $7,764.56 for the remainder of the contract term Change in Contract Time: Approved PCO # Reason for Change Order IREF There is no change to the Contract Time. 0 Calendar Days Net Change to Contract Time for Change Order No. 1 0 Calendar Days List of Supporting Documentation Attachments: 1. Shrieve letter from April 14, 2022 requesting a price increase. 2. Shrieve documentation provided on April 14, 2022 representing increase to freight costs. 3. Technical Specifications Section D. Delivery, Paragraph 14. of the Contract Documents, allowing for escalation/de-escalation for freight. 4. Bid Proposal Unit Prices Submitted by Shrieve Chemical Company, LLC. for W2206Ba and incorporated into Contract Documents. 5. Revised Unit Prices for W22206Ba and incorporated into Contract Documents by execution of this change order. W2206Ba Change Order No. 1 Page 2of2 Page 29 of 524 Agenda Item #3. Attachment 1 From: Chris Burns To: Rebecca Wilder Cc: Chris Burns Subject: Shrieve Chemical Company/Town of Jupiter - Sulfuric Acid Price Change Request (sulfur surcharge) Date: Thursday, April 14, 2022 8:19:20 AM Attachments: imaae001.ana imaae002.pna 02 2021. pdf 03 2021. pdf 04 2021. pdf 01 2022. pdf 02 2022 sulfur.adf Rebecca, Thank you for your time on the phone this week. Per our discussion we are in unchartered waters and have seen unprecedented cost increases since the inception of our supply contract. Sulfur which is the raw material that is used to make the sulfuric acid that we supply you settled up $199.00 on 4/1/22 (from $282.00). This is the 2nd highest posting on record. Sulfur is the byproduct of the oil refining process. Initially prices began to spike due to Covid. The less people travel, the less oil needs to be refined therefore less sulfur in the market. This cost increase was reflected in our bid response last May. The most recent unforeseen event that we've faced is the conflict in Ukraine. Russia has historically exported approximately 3-4m tons of sulfur. Due to sanctions and the lack of access to ports, this has tremendously tightened the market and driven up prices to the 2nd highest posting on record. Per the attachment Green Markets explains the increase by saying: Players generally tied the price push to instability stemming from Russia's invasion of Ukraine. Reduced exports available from former Soviet Union (FSU) countries, due either to sanctions, production cutbacks, or port closures, were described by many as a driver, pushing up prices in a number of international markets. When we submitted our bid end of May 2021 the Green Markets Tampa sulfur contract posting was at $192.00 (all postings are attached). Per our discussion we would like to add a `sulfur surcharge' that would be adjusted on a quarterly basis (sulfur settles quarterly, and we can share this information with you). Sulfur settles each January, April, July, and October. This means that we would adjust our price up OR down the first of February, May, August, and November. The price change we are requesting May 15t is $95.37/ton. For each ton of sulfur you get 3 tons of sulfuric acid. It is figured: $481.00 (Q2 sulfur posting) - $192 (Q2 '21 sulfur posting) _ $289.00 (sulfur change) $289.00 x .33 = $95.37 (sulfuric acid price change) We have also see an increase in fuel surcharge since the inception of our contract. Fuel surcharge has move up to 42% today vs 23% in May of '21 when we submitted our bid. This is a cost increase of $6.75/ton. Page 30 of 524 Agenda Item #3. $215.00 + $95.37 + $6.75 = 5317.12 (New proposed price effective 5/1/22). Please let me know what questions you might have. I would be happy to come have a face to face discussion with you and your team if that would be helpful. I will be in touch in the near future to discuss. Thank you, Chris Burns Marketing Manager -Southeast cburns(@shrieve.com Shrieve Chemical 11442 Lake Front Circle Suite 500 1 The Woodlands, TX 77380 1 www.Shrieve.com (0) 281.367.4226 1 (M) 407.927.5544 or q 13 �. Page 31 of 524 Agenda Item #3. Attachment 2 From: Chris Burns To: Rebecca Wilder Cc: Daniel Reid; Brittany George; David Brown Subject: RE: Shrieve Chemical Company/Town of Jupiter - Sulfuric Acid Price Change Request (sulfur surcharge) Date: Thursday, April 14, 2022 4:09:29 PM Attachments: imaae001.ana imaae002a)na imaae003.r)na imaae004a)na imaae005.r)na imaae006.r)na imaae007.r)na KCIT FSC 42%. msa KCIT FSC 23%.msa Thank you Rebecca. Please see attached emails that indicate a fuel surcharge of 23% (5/31/21 — 6/6/21) and 42% (4/11/22-4/17/22). Our current freight rate is $35.53/ton $35.53 x .23 = $8.17 $35.53 x .42 = $14.92 Difference is $6.75/ton. While I agree that the increase is large, per my note below we are facing a period of extremely high inflation and have been directly impacted by the conflict in Ukraine. Although we understand we are in contract that requires a fixed price, we appreciate your consideration. We strongly feel that adding a 'sulfur surcharge' to the agreement would keep both parties in market. I would be happy to come down for further discussion with you and your team. Thank you, Chris Burns Marketing Manager -Southeast cburnsl@shrieve.com Shrieve Chemical 11442 Lake Front Circle Suite 500 1 The Woodlands, TX 77380 1 www.Shrieve.com (0) 281.367.4226 1 (M) 407.927.5544 ZI J N From: Rebecca Wilder <RebeccaW@jupiter.fl.us> Sent: Thursday, April 14, 2022 2:50 PM To: Chris Burns <cburns@shrieve.com> Cc: Daniel Reid <DanielR@jupiter.fl.us>; Brittany George <BrittanyG@jupiter.fl.us>; David Brown Page 32 of 524 Agenda Item #3. <DavidB@jupiter.fl.us> Subject: RE: Shrieve Chemical Company/Town of Jupiter -Sulfuric Acid Price Change Request (sulfur surcharge) Chris, wanted to confirm receipt of your email and attached documentation. As discussed yesterday, Shrieve's contract to supply sulfuric acid to the Town includes an escalation clause for freight, and requests need to be accompanied with proof justifying the change of rate. Please provide documentation supporting the increase of $6.75 per ton referenced below. The escalation clause takes effect 60 days from the date of approval. Regarding the "sulfur surcharge," I will review these items, however, Shrieve's contract does not include an escalation clause for chemical. This is further complicated by the magnitude of increase. Based on my quick estimates, the requested surcharge would result an estimated contract value increase of nearly $200K for the remainder of the Contract Term (ends 9/30/22). Procurements costing more than $50K require Jupiter's Town Council review and approval. Sincerely, p - Rebecca Wilder, PE �I Utilities Facilities Manager o dF I Email: Rebeccaw@jupiter.ft.us Phone: (561) 741-2635 1 Mobile: (561) 398- ���� 1458 17403 Central Blvd, Jupiter, FL 33458 www.jupiter.fl.us From: Chris Burns <cburnsC@shrieve.com> Sent: Thursday, April 14, 2022 8:19 AM To: Rebecca Wilder <RebeccaWl@juaiter.fl.us> Cc: Chris Burns <cburnsC@shrieve.com> Subject: Shrieve Chemical Company/Town of Jupiter -Sulfuric Acid Price Change Request (sulfur surcharge) Rebecca, Thank you for your time on the phone this week. Per our discussion we are in unchartered waters and have seen unprecedented cost increases since the inception of our supply contract. Sulfur which is the raw material that is used to make the sulfuric acid that we supply you settled up $199.00 on 4/1/22 (from $282.00). This is the 2nd highest posting on record. Sulfur is the byproduct of the oil refining process. Initially prices began to spike due to Covid. The less people travel, the less oil needs to be refined therefore less sulfur in the market. This cost increase was reflected in our bid response last May. Page 33 of 524 Agenda Item #3. The most recent unforeseen event that we've faced is the conflict in Ukraine. Russia has historically exported approximately 3-4m tons of sulfur. Due to sanctions and the lack of access to ports, this has tremendously tightened the market and driven up prices to the 2nd highest posting on record. Per the attachment Green Markets explains the increase by saying: Players generally tied the price push to instability stemming from Russia's invasion of Ukraine. Reduced exports available from former Soviet Union (FSU) countries, due either to sanctions, production cutbacks, or port closures, were described by many as a driver, pushing up prices in a number of international markets. When we submitted our bid end of May 2021 the Green Markets Tampa sulfur contract posting was at $192.00 (all postings are attached). Per our discussion we would like to add a `sulfur surcharge' that would be adjusted on a quarterly basis (sulfur settles quarterly, and we can share this information with you). Sulfur settles each January, April, July, and October. This means that we would adjust our price up OR down the first of February, May, August, and November. The price change we are requesting May 15t is $95.37/ton. For each ton of sulfur you get 3 tons of sulfuric acid. It is figured: $481.00 (Q2 sulfur posting) - $192 (Q2 `21 sulfur posting) _ $289.00 (sulfur change) $289.00 x .33 = $95.37 (sulfuric acid price change) We have also see an increase in fuel surcharge since the inception of our contract. Fuel surcharge has move up to 42% today vs 23% in May of '21 when we submitted our bid. This is a cost increase of $6.75/ton. $215.00 + $95.37 + $6.75 = 5317.12 (New proposed price effective 5/1/22L Please let me know what questions you might have. I would be happy to come have a face to face discussion with you and your team if that would be helpful. I will be in touch in the near future to discuss. Thank you, Chris Burns Marketing Manager -Southeast cburnsl@shrieve.com Shrieve Chemical 11442 Lake Front Circle Suite 500 1 The Woodlands, TX 77380 1 www.Shrieve.com (0) 281.367.4226 1 (M) 407.927.5544 Th Id V Page 34 of 524 Agenda Item #3. From: Nina Kellom To: KCIT-Dispatch; Steve McCarter Subject: KCIT FSC 23% Date: Wednesday, June 2, 2021 9:00:13 AM Caution: External Email Fuel Surcharge will be 23% for the week of MAY 31ST . 2021 through June 6th - 2021 - Nina Kellorn Aoo vKLv�,. Assi sta vut KC Industries Trucking, LLC 2420 Old Hwy 60 • PO Box 674 • Mulberry, FL 33860 Main 863-425-2252 Page 35 of 524 Agenda Item #3. From: Nina Kellom To: KCIT-Dispatch; Steve McCarter Subject: KCIT FSC 42% Date: Tuesday, April 12, 2022 8:35:50 AM Fuel Surcharge will be 142% for the week of APril11�. 2022 throughApril 17�, 2022 Nina Kellom ADMIN ASSISTANT KC Industries Trucking, LLC 2420 Old Hwy 60. PO Box 674. Mulberry FL 33860 MAIN 863-425-2252 Easter I SANDMAN SAYS Page 36 of 524 Mgenda Item #3. Attachment 3 c. The supplier shall supply all necessary connectors and hoses required to off load the sulfuric acid shipment into the Town's bulk storage tanks. Bulk storage tank sizes are as follows: two (2), 3,200-gallon tanks and two (2) 20,000 gallons tanks. MR d. Jupiter Utilities staff shall be promptly notified in the event of a chemical spill. Mitigation and cleanup of any chemical spills due to Driver error or failure of his/her equipment shall be the MR responsibility of the Driver and shall follow all applicable local, state and federal requirements. e. Product should be delivered within one (1) week after receipt of order. P" 7. Successful vendor shall provide their Standard operating Procedures for their drivers to the Utilities Facilities Manager prior to the first delivery. A copy of the current Standard operating Procedures for Jupiter Utilities shall be provided to the successful bidder prior to the first delivery. All procedures shall be reviewed for acceptance and in compliance with the provisions of OSHA, Subpart H, 1910.119, titled "Hazardous Materials". MR 8. Jupiter Utilities will provide the latest information on the facilities OSHA 1910.120 Hazard Communication Program to the successful bidder. The vendor shall provide a list of approved drivers +R with their training record kept current and a copy of their driver's license. The approved drivers list shall be maintained current. 1" 9. The supplier of this product shall provide the most up to date version of the Safety Data Sheet (SDS). 10. DELIVERY: Town of Jupiter Water Treatment Facility,17403 Central Blvd, Jupiter, FL 33458. 11. Deliveries shall be accepted between 8:00 a.m, and 4:00 p.m. Monday through Friday excluding Holidays or as otherwise approved by the Town. Strict observance to the delivery times shall be enforced for the duration of the Contract unless it is in the best interests of the Town to accept deliveries before 8:00 a.m. and/or after4:00 p.m. +� 12. All quantities listed are estimated and are to be used only as a guide in preparing bids. Quantities delivered shall be made as requested by the owner. 9" 13. To be bid F.O.B. Delivered to Jupiter Water Treatment Facility. MR 14. Escalation/de-escalation for freight will be permitted under this Contract. The request must be made in writing, to the Town, at least 50 days prior to the rate becoming effective. Proof justifying the change of rate shall be furnished with the written request. FER 15. No escalation will be permitted for the cost of chemicals for the duration of the Contract. P" Fm Town of Jupiter Utilities P" Contract for Supplying Sulfuric Acid Re -Bid (W2206Ba) Page 29 Page 37 of 524 Agenda Item #3. Attachment 4 Bid Schedule of Values Contract for Supplying Sulfuric Acid Re-Bid(W2206Ba� Base Bid: (1-year Contract Period with an estimated quantity of 4,603 tons) Annual Item Quantity No. Item Description (estimated) Unit Unit Price Extended Value .� 1 Sulfuric Acid Unit Price F.O.B. 4 C? 0 (F.O.B.) ,603 tons $ (,� $ r_7 r 2 Freight (F.O.B.) 4,603 tons $$ Total Base Bid Unit Price F.O.B. ($/ton): (Item Nos. 1-2) _ $j 5�� 00 s Total Base Bid Annual Chemical Cost (F.O.B.) _ $ ` �� (P Total Base Bid Annual Chemical Cost for., 603 Tons in Words:: f�i �� (A t.J,� t 44� (F.O.B.) 41 Alternate Bid: (3-year Contract Period with an estimated quantity of 13,809 tons) Three Year Item Quantity No. Item Description (estimated) Unit Unit Price Extended Value 3 Sulfuric Acid Unit Price (F.O.B.) 13,809 tons $ 4 Freight (F.O.B.) 13,809 tons $ $ Total Alternate Bid Unit Price F.O.B. ($/ton): (Item Nos. 3-4) = $ Total Alternate Bid Annual Chemical Cost (F.O.B.) _ $ Total Alternate Bid Annual Chemical Cost (F.O.B.) for 13,809 tons in Words: Town of Jupiter Utilities ,.,- Contract for Supplying Sulfuric Acid Re -Bid (W2206Ba) Page 15 Page 38 of 524 Agenda Item #3. 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