HomeMy WebLinkAbout1997-04-24 City Council (10)City of Palo Alto
City Manager’s Report
TO:HONORABLE CITY COUNCIL
FROM:CITY MANAGER DEPARTMENT:ADMINISTRATIVE
SERVICES
DATE:APRIL 24, 1997 CMR:229:97
SUBJECT:WATER METER BIDDING PROCESS
REOUEST
This is an informational report and no Council action is required.
EXECUTIVE SUMMARY
This report provides the City Council with information on the City’s process for purchasing
water meters. This report has been prepared in connection with concerns raised by Mr. Ian
MacLeod to the City Council during Oral Communications on March 10, 1997. Mr
MacLeod believes the City’s water meter bid specifications are too narrow and have resulted
in only one successful bidder. ~
The City’s specifications for water meters have been reviewed by Purchasing and other
Administrative Services Department staff and were found to be appropriate. The
specifications meet the standards of the American Water Works AssOciation (AWWA) and
the water industry professional association, with additional features designed to meet the
City’s own maintenance and operational requirements. Staff does not recommend any
changes to the current specifications.
DISCUSSION
Invitation to Bid Process
Water meters are purchased through an "invitation to bid" process, in which specifications
for the product are developed and distributed to potentially qualified bidders. These potential
vendors are asked to respond by a specific date and. time by sealed bid, with detailed
descriptions of their product and pricing. As part of the invitation to bid process, products
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not complying with all AWWA standards requirements and the City of Palo Alto
specifications are rejected. This is very clearly worded in the invitation to bid. Even though
a potential bidder may offer a lower price, if the product does not meet the City’s
requirements, it will not be awarded the purchase. In the recent water meter process, bid
proposals were evaluated with respect to their compliance with the specifications. While two
bidders provided lower prices, these bidders were determined not to have "the ability,
capacity and skill to perform the contract."
The City is aware of only one manufacturer, Badger Meters, which meets the full range of
City’s water meter specifications.
The Palo Alto Mtmicipal Code does permit a purchase to be made without a bidding process
on the basis of a "sole source", where the City’s requirements can only be met by a single
patented article or process. Staff is concerned with having an open and competitive.
purchasing process and elected instead to invite bids as a method of encouraging
manufacturers to develop products that meet our requirements.
City. Specifications for Water Meters
The City ofPalo Alto’s Utilities Engineering Division has. established requirements for water
¯ meters using the AWWA Standards as a base, and the City’s own experience with meter
characteristics. Staff determines the essential components for water meters which provide
both reliability, and efficient testing and incorporates these into the City water meter
specifications. These requirements result from years of City staff experience and continual
bench testing of water meters before their installation and after the meters are removed from
service in the water distribution system. In particular, these specifications require water
meters which minimize lost water revenue, maximize meter service life, improve system
operation efficiency and preserve the City’s capital investment in its water metering
operation.
Examples of City-specific standards are:
o meters with tamper-resistant features;
O a stringent meter service warranty which holds the meter manufacturers
responsible for the quality of all materials and workmanship that go into every.
meter purchased by the City; and
features that permit the. testing of meters in the field, rather than to remove
them from service to be tested in the meter shop. This requirement saves
valuable labor time and results in efficiencies and time savings that staff
believes more than offset not having chosen the lowest bidder.
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This latter point is consistent with the recent Utilities Department Organization Review, by
Theodore Barry. and Associates, which recommended that there should be greater emphasis
on standardizing the purchase of materials, to reduce the need to inventory repair parts for
a variety of products.
CONCLUSIONS AND RECOMMENDATIONS
Staff has reviewed the concems expressed regarding the water meter specifications and
purchasing process. Our conclusion is that the City has carefully designed the specifications
for the City’s water meters to meet the recommended water industry standards, as well as our
own City experience with meters which are reliable and efficient to operate and maintain.
Staff does not recommend any change to the specifications or to the purchasing process for
water meters.
PREPARED BY:Linda Craig, Senior Financial Analyst
Jim Steele, Manager of Debt and Investments
DEPARTMENT HEAD APPROVAL:
CITY MANAGER APPROVAL:
Harrison
Assistant
Manager
CC: n/a
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