December 14, 2004

SUBJECT: Award of Bid No. F0409-12 for the Purchase of Water Meters

Approval is requested for the award of a one-year contract, with an option to extend for two additional one-year periods, to AMCO Water Metering Systems, Inc., of Ocala, Florida, for the purchase of water meters. Water meters will be warehoused in Central Stores and issued to Department of Public Works Field Services Division employees on an "as needed" basis.

Water meters are standard supply items that are continually in demand by the Department of Public Works, both for the replacement of existing meters and for the installation of meters in new developments. The water meters used by the City in high volume are positive displacement multi-jet meters, Class II Turbine meters, and compound meters. Meters must be compatible with the Itron handheld meter readers used by Finance Department Utility Billing staff and must include the absolute encoder type of electronic registers.

Bid specifications were prepared by Purchasing and Public Works staff. Invitation for Bids No. F0409-12 was advertised on the City's website, and it was broadcast to potential suppliers through the DemandStar by Onvia public procurement network.

Sealed bids were received and publicly opened on November 17, 2004. Four bids were received.

Bidder	Total Bid Pricing*
AMCO Water Metering Systems, Inc., of Ocala, FL	$447,731
Groeniger & Company of Hayward, CA	$475,428
Hersey Meters of Cleveland, NC	$487,447
Badger Meter, Inc., of Milwaukee, WI	$505,217

*Total bid pricing includes sales tax and represents the estimated annual cost for the high volume water meters, based historical usage multiplied by unit pricing.

Bid specifications required that the successful bidder have a distribution facility within a 50-mile radius of the City's Corporation Yard. The intent of the specification was to ensure that meters are quickly available to the City in the event of an emergency need. AMCO, the low bidder, has a distribution facility in Santa Rosa which is approximately 95 miles from the City's Corporation Yard. Public Works, Utility Billing and Purchasing staff have met with AMCO representatives and are satisfied that AMCO is capable of, and committed to, satisfying the City's emergency needs, if any, regardless of the location of their local distribution facility.

Section 2.08.0120 (c) of the Sunnyvale Municipal Code states that the awarding authority may waive, if it wishes to do so, minor defects or irregularities in bids. In light of the nearly $30,000 difference in bid pricing between the low bid from AMCO and the second low bid, staff recommends that Council waive the requirement that the successful bidder have a distribution facility within a 50-mile radius of the City's Corporation Yard and award the contract to AMCO Water Metering Systems, Inc.

Meter requirements and total costs vary from year to year, depending upon a variety of factors. Water meter purchases for FY 2003/2004 totaled approximately $125,000. Funds are available in Program 312 - Water Supply and Distribution.

It is recommended that Council:

1. Waive the requirement that the successful bidder have a distribution facility within a 50-mile radius of the City's Corporation Yard; and

2. Award a one-year blanket purchase order, in substantially the same form as the attached draft and with an option to extend the purchase order for two additional one-year periods, to AMCO Water Metering Systems, Inc., for the purchase of water meters.

Prepared by:

Elaine Wesely
Purchasing Officer

Reviewed by:


Mary J. Bradley
Director, Finance

Reviewed by:

Marvin Rose
Director, Public Works

Approved by:

Amy Chan
City Manager

Attachments
A. Draft Blanket Purchase Order (.pdf format)
B. Attachment "A" AMCO Bid Form (.pdf format)