18-1004_SOUTH ORANGE COUNTY WASTEWATER AUTHORITY_Transmittal from SOCWA S4CWA
South Orange County Wastewater Authority
Letter of Transmittal
DATE: 11/26/18
TO: City of San Juan Capistrano
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
ATTENTION: Ben Siegel
RE: Amendment No. 2 to the contract for the Delivery and Supply of
Chlor-Alkali products.
We are ® enclosing ❑ returning under separate cover:
Sent for your Status Please Note
❑ Review/Use ❑ Preliminary ❑ Revisions
❑ Approval ❑ Revised ❑ Additions
® Signature El Approved ❑ Omissions
❑ File ❑ Released El Corrections
REMARKS:
Enclosed are three (3) original signature pages from Amendment#2 along with a copy for
your records. I have enclosed our Agenda Item from our Board of Directors meeting
where this was passed. Please sign and return at your earliest convenience. If you have
any questions, feel free to contact me at 949-234-5430.
Sincerely,
Jeanette Cotinola
Contracts Administrator
SOCWA
COPIES TO: file
34156 Del Obispo Street• Dana Point,CA 92629• Phone: (949)234-5400 • Fax: (949)489-0130 •Website: www.socwa.com
A public agency created by:CITY OI LAGUNA 131•CITY 01 SAN CUM'LNTI;•CITY OP SAN JUAN CAPISTRANO•ELTORO WATER DISTRICT•EMERALD BAY SIRVICIE DISTRICT
IRVINE RANCH WATER DISTRICT.MOULTON NIGUI:L WATER DISTRICT.SANTA MARGARITA WATER DISTRICT.SOUTH COAST WATER DISTRICT•TRABUCO CANYON WATER DISTRICT
Agenda Item
Budgeted: Yes
Budget amount: $638,000
Line Item: PC 2, 15 and 17 and Lines
Item 5006 and 5009
Legal Counsel Review: Yes
Meeting Date: October 4, 2018
TO: Board of Directors
FROM: Betty Burnett, General Manager
STAFF CONTACT: Jim Burror, Director of Operations
SUBJECT: Chlor-Alkali Products (Caustic Soda and Bleach) Contract Extension with
Olin Corporation, DBA Olin Chloro-Alkali Products
FISCAL IMPACT: Existing FY2018-19 Budget is estimated to be sufficient at this time.
Summary
At the end of October 2018, the existing contract with Olin Corporation, DBA Olin Chloro-Alkali
Products (Olin), will expire and needs to be extended. Staff proposes extending the contract for
one (1) additional year and performing a request for proposals for the future contract.
Discussion/Analysis
SOCWA staff traditionally conducts a request for proposals for all chemical contracts. Bleach
supply chains have been interrupted due to the recent hurricanes affecting the eastern
seaboard. Staff feels that the current quotes for short-term increases would be locked into long-
term contracts if a long-term contract were put into place today via opening an RFP at this time.
Staff contacted Olin for a one (1) year term extension. The following are the proposed prices:
Sodium Hypochlorite - 12.5% (501-1000 gals) $1.290 gallon
Sodium Hypochlorite - 12.5% (1001-2000 gals) $1.114 gallon
Sodium Hypochlorite - 12.5% (2001-3000 gals) $0.897 gallon
Sodium Hypochlorite - 12.5% (3001-4000 gals) $0.796 gallon
Sodium Hypochlorite - 12.5% (>4500 gals) $0.737 gallon
(>4800 gals)
Sodium Hypochlorite - 5.25% (full load) ETWD $0.665 gallon
Chlor-Alkali Products (Caustic Soda and Bleach) Contract Extension with Olin Corporation DBA
Olin Chloro-Alkali Products Contract Extension Page 2 of 3
October 4, 2018
Sodium Hydroxide - 50% (1-500 gals) $4.190 gallon
Sodium Hydroxide - 50% (501-1000 gals) $3.500 gallon
Sodium Hydroxide - 50% (1001-2000 gals) $3.190 gallon
Sodium Hydroxide - 50% (>2000 gals) $3.010 gallon
Sodium Hydroxide - 50% Full trkld (3,918 min.) $2.840 gallon
Sodium Hydroxide - 30% (500+ gals) - IRWD $3.090 gallon
Full trkld (4,900 min.) -
Sodium Hydroxide - 30% IRWD $2.390 gallon
Additional charges may apply for split loads per stop, additional unloading time due to SOCWA
delays, fuel surcharges, sales tax, and California mill assessment fees.
Price Increases
The proposed price increases by percentage are as follows:
% Price
Chemical Item Increase
Sodium Hypochlorite, 12.5% ($/gal.)
—All Locations
501 - 1000 gals. 8%
1001—2000 gals. 10%
2001—3000 gals. 13%
3001—4500 gals. 14%
>4500 gals. 16%
Sodium Hypochlorite, 5.25%($/gal.)
El Toro Water District->4800 gals. 12%
Caustic Soda, 50% ($/gal.)—All
Locations
1 - 500 gals. 13%
501-1000 gals. 16%
1001—2000 gals. 17%
> 2000 gals. 19%
Full Truckload (^'4,000 gals.) 20%
Caustic Soda, 30% (IRWD) ($/gal.)
500+gals. 47%
Full Truckload ("4,600 gals.) 71%
Chlor-Alkali Products (Caustic Soda and Bleach) Contract Extension with Olin Corporation DBA
Olin Chloro-Alkali Products Contract Extension Page 3 of 3
October 4, 2018
The total annual increase from the beginning of the contract in 2013 is about 5% per year on
average. However, due to the elevated price increases, staff will be starting the process to
conduct a Request for Proposal (RFP) after the bleach supply chains recovers and prices
stabilize, most likely in early 2019. Staff from City of San Clemente (CSC), Santa Margarita
Water District (SMWD), Trabuco Canyon Water District (TCWD), El Toro Water District
(ETWD), Irvine Ranch Water District (IRWD), and City of San Juan Capistrano (CSJC) will be
contacted to gain their input to the RFP process. These agencies also use this contract for their
chloro-alkali products.
Prior Related Project Committee or Board Action(s)
None
Fiscal impact
The existing FY2018-19 Budget is estimated to be sufficient at this time. Staff will be monitoring
the chemical budgets to determine if budget adjustments are necessary in the future. Future
pricing is also estimated to increase under the upcoming RFP but the amount is unknown at
this time.
Recommendation
Award an up to one (1) year contract extension to Olin Corporation DBA Olin Chloro-Alkali
Products for Chlor-Alkali Products for (5.25%-12.5% Sodium Hypochlorite and 30%-50%
Sodium Hydroxide) with the prices as indicated including applicable additional charges.