HomeMy WebLinkAboutAgenda Report - October 6, 2021 H-02AGENDA ITEM ws
CITY OF LODI
COUNCIL COMMUNICATION
7M
AGENDA TITLE: Introduce Ordinance Amending Lodi Municipal Code Title 2 — Administration and
Personnel — Chapter 2.12, "City Manager", by Repealing and Reenacting Section
2.12.060(T) Temporarily Authorizing Increase to City Manager Contract Authority
to Maximum Amount of $250,000 Per Transaction for Lodi Electric Utility Inventory
Items to Address Supply Chain Challenges, and Adopt Resolution Authorizing City
Manager to Make Purchases for Lodi Electric Utility Inventory Items up to $250,000
per Transaction with Subsequent City Council Ratification Prior the Effective Date
of the Proposed Ordinance
MEETING DATE: October 6, 2021
PREPARED BY: Electric Utility Director
RECOMMENDED ACTION: Introduce an ordinance amending Lodi Municipal Code Title 2 —
Administration and Personnel — Chapter 2.12, "City Manager", by
repealing and reenacting Section 2.12.060 (T) temporarily
authorizing an increase to the City Manager's contract authority to a
maximum amount of $250,000 per transaction for Lodi Electric
Utility inventory items to address supply chain challenges; and
adopt a resolution authorizing the City Manager to make purchases
for Lodi Electric Utility inventory items up to $250,000 per
transaction with subsequent City Council ratification prior to the
effective date of the proposed ordinance.
BACKGROUND INFORMATION: On November 20, 2019, City Council approved Resolution 2019-239
authorizing Lodi Electric Utility (LEU) to purchase certain large
inventory items through long-term "blanket" contracts to expedite
delivery and secure reduced unit pricing through longer term
contractual arrangements with vendors.
LEU executed multiple contracts under this authorization and until recently, had planned to present to
Council a final request that would have extended this authorization to include LEU's remaining inventory.
However, with current global raw material shortages, the global shipping crisis, and increased demand
for materials in the electric industry nationwide due to wildfires and other natural disasters, LEU has been
presented with challenges as it relates to securing orders and maintaining sufficient inventory levels
under the previously authorized long-term contract arrangements.
In some cases, several vendors were unwilling to quote materials due to shortages. In other cases,
material quotes are received, but only valid for one day or less, versus the historical norm of quotes valid
for 30 to 60 days. Lead times are no longer guaranteed and in most cases have tripled in duration. LEU
is currently faced with lead times of six months to one year on many inventory items needed to complete
APPROVED: Steve Schwabauer
Stephen Schwabauer, City Manager
Introduce Ordinance Amending Lodi Municipal Code Tale 2 — Administration and Personnel — Chapter 2.12, "City Manager', by
Repeating and Reenacting Section 2.12.0600) Temporarily Authorizing Increase to City Manager Contract Authority to
Ma)dmum Amount of $250,000 Per Transaction for Lodi Electric Utility Inventory Items to Address Supply Chain Challenges; and
Adopt Resolution Authorizing City Manager to Make Purchases for Lodi Electric Utility Inventory Items up to $250,000 per
Transaction with Subsequent City Council Ratification Prior the Effective Date of the Proposed Ordinance
October 6, 2021
Page 2
either maintenance jobs or work for new development. In one particular case, a transformer vendor will
not guarantee a delivery date on any new orders placed and the vendor has estimated a lead time of at
least nine months, if not longer.
The reasons for the delays are global and entirely outside the control of LEU. Simply put, the entire
supply chain has not been properly functioning for the last year and it will take some time to recover to a
more normal state. LEU needs maximum flexibility during this period of uncertainty to procure adequate
resources to ensure critical work on maintaining a safe and reliable electric distribution system for
Lodians.
LEU is requesting the City Manager's contract authority limit be raised to a maximum of $250,000 from
the current maximum of $20,000 per transaction for LEU inventory items through December 31, 2023. A
quarterly report of all transactions executed under this authority will be presented to the City Council
along with the Quarterly Purchasing reports presented citywide until sunset of this temporary authority.
Failure to expedite purchases and any delays associated with securing additional approvals for inventory
purchases on items quoted under time and availability constraints will prevent LEU from maintaining
sufficient inventory to meet future project needs as it relates to distribution system maintenance as well
as new development projects.
FISCAL IMPACT:
FUNDING AVAILABLE:
Signature:
a-4., Y.O.
Andrew Heys (Sep 27,202109:00 PDT)
Email: akeys@lodi.gov
Inventory item purchases are estimated to total approximately $6.2 million
through December 31, 2023 and include, but are not limited to,
transformers, vaults, switches, meters and cable/wire.
LEU inventory account number 500.13496.
Andrew Keys
Andrew Keys
Deputy City Manager/Internal Services Director
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Jeff Berkheimer
Electric Utility Director
Signature: :�rsega7. matoo:55 Pf1i}
Email: ssthwabauer@lodi.gov
ORDINANCE NO.
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF LODI AMENDING
LODI MUNICIPAL CODE TITLE 2 — ADMINISTRATION AND PERSONNEL —
CHAPTER 2.12, "CITY MANAGER," BY REPEALING AND REENACTING
SECTION 2.12.060(T) RELATING TO CONTRACT AUTHORITY OF THE CITY
MANAGER FOR LODI ELECTRIC UTILITY INVENTORY PURCHASES
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LODI AS FOLLOWS:
Section 1. Lodi Municipal Code Title 2 — Administration and Personnel — Chapter 2.12, "City
Manager," is hereby amended by repealing and reenacting Section 2.12.060(T) relating to contract
authority of the City Manager and shall read as follows:
2.12.060 (T) Contracts: To execute on behalf of the City, without City Council approval, contracts, as
defined in Lodi Municipal Code 3.20.015, in the amount of twenty thousand dollars or less, and to
delegate authority to subordinate officers and employees to execute contracts without city council or
city manager approval contracts in the amount of fifteen thousand or less to the Public Works
Director or designee, fifteen thousand or less to the Electric Utility Director or designee and ten
thousand dollars or less to all other directors or designees. Nothing in this section shall allow
departure from the other purchasing requirements of Chapter 3.20 of this Code. For contracts of not
less than ten thousand nor greater than twenty thousand the City Manager shall quarterly prepare for
the city council a report which includes a list of the contracts into which the city has entered during
the previous three months. No contract shall be split into smaller segments to avoid the provisions
of this subsection. (Government Code § 4526, Public Contract Code § 10359)
1. Lodi Electric Utility Inventory Purchases. City Manager shall have authority to purchase
and/or contract for Lodi Electric Utility Department inventory items up to a maximum amount
of two hundred fifty thousand dollars per transaction to address supply chain challenges.
The city manager shall quarterly prepare for the city council a report which includes a list of
the purchases and/or contracts in excess of ten thousand dollars into which the city has
entered during the previous three months. The Purchasing System set forth in Chapter 3.20
of this Code is suspended as it relates to the purchase of Lodi Electric Utility inventory items
under this subsection. This Sub -section 2.12.060(T)(1) shall terminate on December 31,
2023, unless terminated at an earlier date or extended by action of the city council.
Section 3 - No Mandatory Duty of Care. This ordinance is not intended to and shall not be
construed or given effect in a manner which imposes upon the City, or any officer or employee
thereof, a mandatory duty of care towards persons or property within the City or outside of the City
so as to provide a basis of civil liability for damages, except as otherwise imposed by law.
Section 4. All ordinances and parts of ordinances in conflict herewith are repealed insofar as such
conflict may exist.
Section 5. This ordinance shall be published one time in the "Lodi News Sentinel," a daily
newspaper of general circulation printed and published in the City of Lodi and shall be in force and
take effect 30 days from and after its passage and approval.
Approved this day of October, 2021.
Attest.
JENNIFER CUSMIR ALAN NAKANISHI
City Clerk Mayor
State of California
County of San Joaquin, ss -
I, Jennifer Cusmir, City Clerk of the City of Lodi, do hereby certify that Ordinance No. was
introduced at a regular meeting of the City Council of the City of Lodi held October 6, 2021, and was
thereafter passed, adopted, and ordered to print at a regular meeting of said Council held October
20, 2021, by the following vote:
AYES' COUNCIL MEMBERS —
NOES: COUNCIL MEMBERS — None
ABSENT: COUNCIL MEMBERS — None
ABSTAIN: COUNCIL MEMBERS — None
I further certify that Ordinance No. was approved and signed by the Mayor of the date of its
passage and the same has been published pursuant to law.
JENNIFER CUSMIR
City Clerk
Approved as to Form:
JANICE D. MAGDICH .'
City Attorney
• i
RESOLUTION NO, 2021-275
A RESOLUTION OF THE LODI CITY COUNCIL AUTHORIZING THE
CITY MANAGER TO MAKE PURCHASES FOR LODI ELECTRIC UTILITY
INVENTORY ITEMS UP TO $250,000 PER TRANSACTION, WITH
SUBSEQUENT CITY COUNCIL RATIFICATION, PRIOR TO THE EFFECTIVE
DATE OF ORDINANCE TO INCREASE THE CITY MANAGER'S CONTRACT
AUTHORITY TO MAXIMUM AMOUNT OF $250,000 PER TRANSACTION FOR
LODI ELECTRIC UTILITY INVENTORY ITEMS, THROUGH
DECEMBER 31, 2023, TO ADDRESS SUPPLY CHAIN CHALLENGES
WHEREAS, on November 20, 2019, City Council approved Resolution No. 2019-239
authorizing Lodi Electric Utility (LEU) to purchase certain large inventory items through long-
term "blanket" contracts to expedite delivery and secure reduced unit pricing through longer
term contractual arrangements with vendors; and
WHEREAS, LEU executed multiple contracts under this authorization and until recently,
had planned to present to Council a final request that would have extended this authorization to
include LEU's remaining inventory items; and
WHEREAS, with current global raw material shortages, the global shipping crisis, and
increased demand for materials in the electric industry nationwide due to wildfires and other
natural disasters, LEU has been presented with challenges as it relates to securing orders and
maintaining sufficient inventory levels under the previously authorized long-term contract
arrangements; and
WHEREAS, vendors are unwilling to quote materials due to shortages, material quotes
are received but only valid for one day or less versus the historical norm of quotes valid for 30 to
60 days, and lead times are no longer guaranteed, and in most cases have tripled in duration;
and
WHEREAS, the reasons for the delays are global and entirely outside the control of LEU
as the entire supply chain has not been properly functioning for the last year and it will take
some time to recover to a more normal state; and
WHEREAS, LEU needs maximum flexibility during this period of uncertainty to procure
adequate resources to ensure critical work on maintaining a safe and reliable electric
distribution system for Lodi is not impacted; and
WHEREAS, failure to expedite purchases and any delays associated with securing
additional approvals for inventory purchases on items quoted under time and availability
constraints will prevent LEU from maintaining sufficient inventory to meet future project needs
as it relates to distribution system maintenance, as well as new development projects; and
WHEREAS, LEU is requesting the City Manager's contract authority limit be raised to a
maximum of $250,000, from the current maximum of $20,000 per transaction, for LEU inventory
items through December 31, 2023, by an ordinance amending LMC Section 2.12.060(T)
introduced on October 6, 2021; and
WHEREAS, LEU is requesting authorization for the City Manager to make purchases up
to $250,000 for Lodi Electric Utility inventory items with subsequent City Council ratification prior
to the effective date of the aforementioned ordinance. 1
NOW, THEREFORE, BE IT RESOLVED that the Lodi City Council does hereby
authorize the City Manager to make purchases for Lodi Electric Utility (LEU) inventory items up
to $250,000 per transaction with subsequent City Council ratification prior to the effective date of
the ordinance to temporarily increase the City Manager's contract authority for LEU inventory
items to address supply chain challenges.
Dated: October 6, 2021
I hereby certify that Resolution No. 2021-275 was passed and adopted by the City
Council of the City of Lodi in a regular meeting held October 6, 2021, by the following vote:
AYES: COUNCIL MEMBERS — Chandler, Hothi, Khan, Kuehne, and
Mayor Nakanishi
NOES: COUNCIL MEMBERS — None
ABSENT: COUNCIL MEMBERS — None
ABSTAIN: COUNCIL MEMBERS — None
JENNIF CUSMIR
City Clerk
2021-275
DECLARATION OF POSTING
ORDINANCE NO. 1986
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF LODI AMENDING LODI
MUNICIPAL CODE TITLE 2 — ADMINISTRATION AND PERSONNEL — CHAPTER
2.12, "CITY MANAGER," BY REPEALING AND REENACTING SECTION 2.12.060(T)
RELATING TO CONTRACT AUTHORITY OF THE CITY MANAGER FOR LODI
ELECTRIC UTILITY INVENTORY PURCHASES
On Thursday, October 6, 2021, in the City of Lodi, San Joaquin County, California, a
certified copy of Ordinance No. 1984 (attached hereto, marked Exhibit "A") was posted
in the Lodi City Clerk's Office.
I declare under penalty of perjury that the foregoing is true and correct.
Executed on October 6, 2021, at Lodi, California.
r
Pamela M. Farris
Assistant City Clerk
ordswnmaries\aaDecPost doc
ORDERED BY:
JENNIFER CUSMIR
CITY CLERK
Kaylee Clayton
Administrative Clerk
ORDINANCE NO. 1986
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF LODI AMENDING
LODI MUNICIPAL CODE TITLE 2 — ADMINISTRATION AND PERSONNEL —
CHAPTER 2.12, "CITY MANAGER," BY REPEALING AND REENACTING
SECTION 2.12.060(T) RELATING TO CONTRACT AUTHORITY OF THE
CITY MANAGER FOR LODI ELECTRIC UTILITY INVENTORY PURCHASES
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LODI AS FOLLOWS:
Section 1. Lodi Municipal Code Title 2 — Administration and Personnel — Chapter 2.12,
"City Manager," is hereby amended by repealing and reenacting Section 2.12.060(T) relating to
contract authority of the City Manager and shall read as follows:
2.12.060 (T) Contracts: To execute on behalf of the City, without City Council approval, contracts, as
defined in Lodi Municipal Code 3.20.015, in the amount of twenty thousand dollars or less, and to
delegate authority to subordinate officers and employees to execute contracts without city council or
city manager approval contracts in the amount of fifteen thousand or less to the Public Works
Director or designee, fifteen thousand or less to the Electric Utility Director or designee and ten
thousand dollars or less to all other directors or designees. Nothing in this section shall allow
departure from the other purchasing requirements of Chapter 3.20 of this Code. For contracts of not
less than ten thousand nor greater than twenty thousand the City Manager shall quarterly prepare for
the city council a report which includes a list of the contracts into which the city has entered during
the previous three months. No contract shall be split into smaller segments to avoid the provisions
of this subsection. (Government Code § 4526, Public Contract Code § 10359)
1. Lodi Electric Utility Inventory Purchases. City Manager shall have authority to purchase
and/or contract for Lodi Electric Utility Department inventory items up to a maximum amount
of two hundred fifty thousand dollars per transaction to address supply chain challenges.
The city manager shall quarterly prepare for the city council a report which includes a list of
the purchases and/or contracts in excess of ten thousand dollars into which the city has
entered during the previous three months. The Purchasing System set forth in Chapter 3.20
of this Code is suspended as it relates to the purchase of Lodi Electric Utility inventory items
under this subsection. This Sub -section 2.12.060(T)(1) shall terminate on December 31,
2023, unless terminated at an earlier date or extended by action of the city council.
Section 3 - No Mandatory Duty of Care. This ordinance is not intended to and shall not be
construed or given effect in a manner which imposes upon the City, or any officer or employee
thereof, a mandatory duty of care towards persons or property within the City or outside of the City
so as to provide a basis of civil liability for damages, except as otherwise imposed by law.
Section 4. All ordinances and parts of ordinances in conflict herewith are repealed insofar as such
conflict may exist.
Section 5. This ordinance shall be published one time in the "Lodi News Sentinel," a daily
newspaper of general circulation printed and published in the City of Lodi and shall be in force and
take effect 30 days from and after its passage and approval.
Approved this day of October, 2021,
ALAN NAKANISHI
Mayor
Attest:
JENNIFER CUSMIR
City Clerk
State of California
County of San Joaquin, ss.
I, Jennifer Cusmir, City Clerk of the City of Lodi, do hereby certify that Ordinance No. 1986 was
introduced at a regular meeting of the City Council of the City of Lodi held October 6, 2021, and was
thereafter passed, adopted, and ordered to print at a regular meeting of said Council held October
20, 2021, by the following vote:
AYES: COUNCIL MEMBERS —
NOES: COUNCIL MEMBERS —
ABSENT: COUNCIL MEMBERS —
ABSTAIN: COUNCIL MEMBERS —
I further certify that Ordinance No. 1986 was approved and signed by the Mayor of the date of its
passage and the same has been published pursuant to law.
JENNIFER CUSMIR
City Clerk
Approved as to Form:
JANICE D. MAGDICH
City Attorney
2
The foregoing document Is certified to be a correct
copy of the oflginal on file in the City Clerk's Office.
Pamela M. Farris
Assistant City Clerk, City of Lodi
ByI�J
Dated: pr7�o]r