September 14, 2004

SUBJECT: Award of Bid #F0306-92 for Asphaltic Materials for Street Maintenance and Repair

REPORT IN BRIEF

Approval is requested for the award of multiple one-year contracts to Granite Rock Company of Redwood City; Raisch Products of San Jose; and Reed and Graham, Inc., of San Jose to provide asphaltic materials on an “as-needed” basis for the Department of Public Works Street Maintenance Program.

BACKGROUND

Emulsion oils, asphalt concrete, pavement reinforcement fabric, aggregate base, and various filler and sealer materials are required by City street crews for the regular repair and maintenance of City streets and parking lots.  Because of volatility in the market place, these items are typically competitively bid for one-year periods.

DISCUSSION

Bid specifications were prepared by Public Works and Purchasing staff, and local suppliers were directly notified that Invitation for Bids #F0306-92 was available.  Sealed bids were publicly opened on August 25, 2004. 

Responsive bids were received from Granite Rock Company of Redwood City; Reed and Graham, Inc., of San Jose; Raisch Products of San Jose; and Tri-American, Inc., of Milpitas (crack filler and coating only).  Following is a chart indicating the low bidder for the highest usage items:

	Product	FY 03-04	Low Bidder	Price Change
1.	SS-1-H, Emulsion Oil	$1.05/gal.	Granite Rock	- 2%
2.	PM-CRS-2H, Emulsion Oil	$1.15/gal.	Granite Rock	- 8%
3.	CRO, Emulsion Oil	$.85/gal.	Granite Rock	- 6%
4.	Asphalt Concrete, Hot ½"	$36.60/ton	Raisch Products	+.01%
5.	Asphalt Concrete, Hot 3/4"	$36.00/ton	Granite Rock	- .01%

Staff recommends award of contract to the two low bidders as well as to Reed and Graham.  Although Reed and Graham is not a low bidder on the five high usage items, they are an important backup source of supply.  Over the past few years, finding a consistent source of supply for emulsion oils and asphalt concrete has been difficult due to high demand and plant shutdowns for scheduled and unscheduled maintenance; and there are only three sources in the Bay Area:  Granite Rock, Raisch Products and Reed and Graham.  Although staff will first attempt to obtain asphalt concrete and emulsion oils from the low bidders, having a backup source ensures that street work in process can continue through completion.

Contracts for the lower volume products included in Invitation for Bids #F0306-92 fall within the City Manager's award authority and do not require Council action.

FISCAL IMPACT

Assuming that emulsion oil and asphalt concrete are consistently available from the low bidders, total cost to the City for a one-year period will not exceed $548,000, based on estimated requirements.  Due to experiences with product shortages and plant shutdowns in the past, however, staff recommends that Council not place specific dollar values on the recommended contracts.  This will give the street crews flexibility to purchase product where it is available without exceeding Council-awarded dollar amounts.

Funds are available in various accounts in Department of Public Works Program 116 – Pavement Operations.

RECOMMENDATION

It is recommended that Council award one-year contracts to Granite Rock Company, Raisch Products, and Reed and Graham, Inc., for asphaltic materials and authorize the Purchasing Officer to issue one-year blanket purchase orders to that effect.

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:

Blanket Purchase Order No. 27306-B, 27307-B, 27308-B (pdf format)