67-08 ResolutionRECORD OF RESOLUTIONS
67-OS
Resolution No.
Blank. Inc.. Farm No. 30045
Pas.~~ed
20
A RESOLUTION ACCEPTING THE LOWEST AND
BEST BID FOR THE PROCUREMENT OF ROCK SALT
AND AUTHORIZING THE CITY MANAGER TO
ENTER INTO A CONTRACT FOR SAID COMMODITY.
Section 3. That this Resolution shall take effect and be in force at the earliest date
permitted by/laws.
Passed this / 7 ~ day of -e ~ X008.
~~i~ ./~.
WHEREAS, a reverse auction was conducted on August 20, 2008 to obtain
competitive bids for the purchase of rock salt; and
WHEREAS, Council has determined that the bid submitted by Cargill Deicing
Technology, Inc. for said commodity in the amount of $64.75/ton for piled delivery
constitutes the lowest and best bid.
NOW, THERE~RE BE IT RESOLVED by the Council of the City of Dublin,
State of Ohio, of the elected members concurring:
Section 1. That the bid submitted by Cargill Deicing Technology, Inc. for the above
referenced commodity, in the amount of $64.75/ton for piled delivery, is hereby
accepted.
Section 2. That the City Manager is hereby authorized to enter into a contract with
Cargill Deicing Technology, Inc. for the procurement of said commodity as specified
above and within said bidder's bid proposal on file in the Department of Finance.
ATTEST:
Clerk of Council
CITY' OF DUSLIN_
Office of the City Manager
5200 Emerald Parkway • Dublin, OH 43017-1006
Phone: 614-410-4400 • Fax: 614-410-4490
TO: Members of City Council
FROM: Jane S. Brautigam, City Manager ~--~o~- ~ {~
DATE: September 12, 2008 U
INITIATED BY: Ronald L. Burns, Director of Streets & Utilities
Michele Hoyle, Budget Manager
Summary
RE: Resolution 67-08, Authorizing the Purchase of Rock Salt
Memo
Attached for your consideration is Resolution No. 67-08 authorizing the City Manager to enter
into a contract for the purchase of rock salt for the 2008-2009 snow removal season. This
commodity was competitively bid using reverse auction, the new bidding option provided in the
competitive bidding process changes authorized in Ordinance 41-08. As you will recall, this
bidding method allows for real-time online competitive bidding; in this case, two bidders
participated. Bidding opened at $104.64 per ton for piled rock salt and closed approximately 90
minutes later with the lowest bid of $64.75 for the commodity. Prior to the reverse auction, staff
was advised by Bid Bridge of recent pricing for this commodity in other reverse auctions so that
the reasonableness of the City's bid could be evaluated.
Staff recommends the bid be awarded to Cargill Deicing Technology, the lowest bidder.
Cargill's bid of $64.75 per piled ton represents a 31% increase over last year's price of $49.39
per piled ton. However, given the apparent limited availability of rock salt in our area, as
described in the attached article from the Columbus Dispatch dated September 6, 2008,
acceptance of this bid is in the City's best interest.
For comparison, following are the bids received recently for an area cooperative contract:
Entity Estimated Quantity (Tons) Bid Prices/Piled Ton
City of Upper Arlington
City of Westerville
City of Kettering
City of Huber Heights
Green County Highway Dept
City of Dayton
Franklin County
3,000 $72.1 5
4,000 No Bid
4,000 $73.05
4,000 $'105.73
7,500 $73.68
'12,000 No Bid
21 ,000 No Bid
The bid was based on an estimated purchase quantity of 10,000 tons with an estimated cost of
$647,500. This amount reflects an increase over previous estimated quantities of 8,000 tons on
which the 2008 budget estimate of $400,000 was based. The quantity increase is due to increased
usage of salt during the 2007-2008 snow season. Based on past history, 8,000 tons is likely to be
sufficient. However, given the substantial price increase, examination of the City's policies
regarding snow removal maybe appropriate during 2009 Operating Budget discussions.
Memo to Council re. Resolution 67-08 -Bid Acceptance -Rock Salt
September 11, 2008
Page 2 of 2
Recommendation
V~~e recommend passage of Resolution 67-08, authorizing the City Manager to enter into contract
with Cargill Deicing Technology, the low bidder and current vendor for this commodity, at the
price of 864.75 per ton for piled delivery.
Attachment
S.'~Councit Packets\2008\09-15-08 Council Packet\Ites 67-08 -salt bid -cover mcmo.doc
Salt hard to come by this year
Amid higher demand and prices, Franklin County, some Columbus suburbs still waiting on bids
Saturday, September 6, 2008 3:12 AM
By Elizabeth Gibson
THE COLUMBUS DISPATCH
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DORAL CHENOWETH III ~ DISPATCH
The 75,000-ton salt pile at Henderson Materials off I-670 supplies many central Ohio municipalities, but
they are counting on more for the winter. Marc Vincken is shown working on the pile.
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Icy streets might be a few months away for Franklin County, but government agencies across Ohio are
scrambling to secure their road-salt stockpiles.
"None of us are going to be able to have completely black streets this year," said Cindy Strayer, who
organizes a bidding cooperative for salt contracts in Ohio.
After heavy demand strained supplies last winter, Illinois, Wisconsin and Minnesota requested extra salt
as a precaution. They and other summer and spring bidders laid claim to most of the salt on hand and
drove up prices before Ohioans started looking, industry experts said.
"All the large agencies soaked up 2 million tons more than last yeaz. That's the size of a small salt mine;'
said Richard Hanneman, president of the Salt Institute trade association.
Early bidders normally pay higher prices, but Ohio's late-bidding strategy backfired this year, Strayer
said.
Of the 105 agencies that organize their contracts through the cooperative Southwest Ohio Purchasers for
Government, more than half have received no offers from suppliers. The Ohio Department of
Transportation has not completed its separate bidding process, but spokesman Scott Varner said it is
taking a little longer and proving pricier than usual.
Cargill Salt and Morton Salt still made offers to old clients, and Columbus continued an existing
contract. However, Southwest Ohio Purchasers received no bids from three companies it normally
courts. North American Salt Co. submitted bids for imported salt, but at $154 a ton, more than three
http://www.di spatchpolitics.com/live/content/local_news/stories/2008/09106/copy/saltbids.... 9/9/2008
times what most agencies pay now
"No one ever expected not to receive a bid," said Larry Wazd, superintendent of the Reynoldsburg Street
Department. "It's possible that some agencies will run out of salt. It's a scary proposition."
Most communities without bids said they are stockpiling and planning to conserve. City staffs across
central Ohio are rushing to secure approval to fill storage barns and pile extra salt in parking lots before
annual contracts expire at the end of this month.
"We've never had this before," said Frank Wiseman, director of the Westerville Public Service
Department. "We'll probably get a bid next time around, but it'll probably be more expensive."
Southwest Ohio Purchasers plans to fish for bids again next week.
Franklin County pulled out of the group without a bid, said Tom Nutini, highway superintendent for the
county engineer's office.
"It's very possible that we may not find a supplier," Nutini said. "We don't know."
The county can store 21,000 tons of salt and plans to top off its reserves before the current contract
expires, Nutini said. The county hasn't needed more salt than that since the 2002-03 winter, when it used
22,749 tons.
The county will try Lo conserve salt by using more salt brine, pre-treating roads and calibrating
equipment to minimize waste, Nutini said. The county also might consider not laying salt on low-traffic
roads during off-peak hours.
"I'm hoping that no one in Franklin County notices any of this," he said. "We have to do more with
less."
The county's current contract is with American Rock Salt, which did not bid through Southwest Ohio
Purchasers this year.
"We had a heck of a winter last year, and all of the companies were cleazed out," said Gunther Buerman,
chairman of American Rock Salt.
Upper Arlington and New Albany snagged some of the lowest bids in the state for a little more than $65
per ton from Cargill though Southwest Ohio Purchasers. That was still almost 1 times what they pay
under their current contracts.
Columbus has along-term contract with Cargill and hasn't faced a huge price spike, said Mary Carrah
Webster, assistant director of public service.
Although some village and city staff members said they're hoping to rely on the county or Columbus if
the winter gets rough, Webster said it's too early to discuss whether Columbus would be willing to share
salt.
eQibson @ dispatch.com
http://www.dispatchpolitics.com/live/content/1oca1_news/stories/2008/09!06/copy/saltbids.... 9/9/2008