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Item 4BCITY OF SOUTHLAKE MEMORANDUM (June 19, 2012) To: Shana Yelverton, City Manager From: Robert H. Price, P.E., Director of Public Works Subject: Approve an annual agreement for providing odor control treatment at lift stations with Premier Chemicals, LLC in the amount of $126,512 Action Requested: Approve an annual agreement for providing odor control treatment at lift stations with Premier Chemicals, LLC in the amount of $126,512 Background Information: Since the construction of the Shady Lane and Lonesome Dove Sanitary Sewer Lift Stations in 2000, the city has spent approximately $90,000 per year to prevent hydrogen sulfide production in the sewer system from affecting the residents of the Kirkwood Hollow neighborhood. Premier Chemicals has been providing this service for Southlake and Trinity River Authority since 2006 because previous attempts to control the hydrogen sulfide with other products were not successful. For the first time since June 2008, the cost per gallon will increase about 5.4% from $2.40 to $2.53 per gallon. Premier Chemical is a sole source provider and patent holder of this technology. An additional benefit to this technology is the prevention of grease buildup in the lifts stations eliminating the need for City crews to remove and dispose of excess grease. Staff is recommending that Council accept the proposal offered by Premier Chemical, LLC to guarantee a rate $2.53 per gallon for their services for a 12 -month period with an estimated annual cost of approximately $126,512. Financial Considerations: Funding for this program is available in the current operating budget of the Waste Water Division. Strategic Link: The annual purchase agreement for the chemical treatment of wastewater links to the city's strategy map relative to the strategic focus area of Performance Management and Service Delivery. The specific corporate objectives that are met by this agreement include: Providing high quality customer service by eliminating odors released in the collection system and optimizing the use of technology with state of the art treatment of wastewater. Citizen Input/ Board Review: N/A Legal Review: None Alternatives: The City Council may approve or deny the agreement to provide odor control treatment at lift stations. Supporting Documents: Annual Contract Pricing Renewal Letter Patent Documentation Staff Recommendation: Approve an annual agreement for providing odor control treatment at lift stations with Premier Chemicals, LLC in the amount of $126,512 Staff Contact: Robert H. Price, P.E., Public Works Director Chuck Kendrick, Deputy Director of Public Works - Operations MA►OMESIA►, L L C April 9, 2012 Chuck Kendrick Public Works Operations Manager City of Southlake Phone (817) 748 -8080 Fax (817) 748 -8103 ckendrick @ci.southlake.tx.us Subject: 2012 Thioguard — magnesium hydroxide pricing Chuck: Pursuant to your request for a renewal of the annual contract for Thioguard, I am submitting this letter to update you on the terms of the agreement. You may submit Purchase Orders either on a per load basis, or a Blanket PO may be issued for the duration of the price in effect. As a consequence of increased costs for raw materials, diesel fuel, health care and general operational inflation, we find it necessary to increase our costs to cover these expenses. The current price per gallon will be $2.53 effective July 1 st through and ending June 30 2012. I have attached the relevant 2011 PPI Index documentation that supports the cost increases we have incurred. At the current combined rate of usage for Lonesome Dove and Shady Lane of 125 gallons per day, plus or minus 10% for seasonal variability, estimated annual costs are between $104,350 and $126,512. Premier Magnesia very much appreciates your cooperation and looks forward to a continued long- term relationship as a quality supplier. Sincerely, Mary P. Evans South Central Regional Account Manager Premier Magnesia, LLC Thioguard TST Phone: 903.245.6316 20108 CR 186 Flint, Texas 75762 Email: mevans@premiermaenesia.com http: // data .bls.gov /timeseries /PCU325 - -- 325-- -Mata_ tool= XGtable [databases & Tools w Databases, Tables & Calculators by Subject Change Output Options: FINn' 2GO9 To: ZG'12 ; giinclude graphs Data extracted ors: February 24, 2012 (3:02:20 PM) Producer Price Index Industry Data series 141 PCU325 --- 325--- industry- chemical mfg Product chemical mfg Ease Data: 198412 260 N 25 rn 24 23 220 1 01!09 05!09 09!09 01!10 051l0 09!10 01!11 05!11 09!11 01n2 Month Download: Q .xis Fear San Feb Mar Apr J May I Sun Jul Aug Oct Nov Dec Annual 2009 225.7 225.1 224.5 223.6 222.8 222.4 224.1 224.0 225.1 225.0 225.4 227.3 224.7 2010 228.7 231.3 232.0 234.1 233.4 232.5 233.5 233.7 234.6 235.3 235.8 237.6 233.7 2011 242.6 245.0 247.6 250.2 252.8 253.4 255.1 255.2 256.7 255.9(P) 256.2(P) 255.7(P) 252.1(P 2012 257.0(P P : Preliminary. All indexes are subjec to revision Pour months after on inal publication. E http: / /www.eia.gov[ petroleum asdiesel/ http: / /www.eia.gov /dnav/pet /hist /LeafHandler.ashx ?n= PET &s =EMD EPD2DXL0 PTE NUS DPG &f =W Weekly U.S. No 2 Diesel Ultra Low Sulfur (0 -15 ppm) Retail Prices (Dollars per Gallon) 4.25 4 3.75 3.5 3.25 3 2.75 2.5 2.25 2 q p 0 1 p O O O O 1 N 1 ti ti 'y '� 'y 'y '� 'ti ti D O O O 4 0'0'4'4')'0'4'0'0'0'0'0''©' Weekly U.S. No 2 Diesel Ultra Low Sulfur (0 -15 ppm) Retail Prices (Dollars per Callon) C View history: 1* Weekly 0 Monthly (}Annual 5.0 4.5 4.0 t� n 3.5 m 0 3.0 a 2.5 2.0 Download Data (XLS File) mal4 I Week V oo Woak4 Woo Year -Month I End Data Valuer End Date Value End Data I Value End Date I Value End Data 2010 - Jan 41104 2.801 01111 2.882 OU18 3.874 OU25 3.838 2010 - Feb 42D1 2.787 43,08 2.775 02.115 2.761 43!33 3.834 2010 - Mar 43141 2.865 03108 2.9% 43115 2.926 43132 3.949 43129 3.942 2010 -Apr 04+05 3.017 04112 3.473 04119 3.078 44126 3.082 2010 -Ma 051)3 3.126 45110 3.131 05117 3.048 05124 3.035 05131 3.983 2010 - Jun 06107 2.949 06114 2.930 06121 2.962 06128 3_957 2010 - Jul 07105 2.925 OT13 2.904 07119 3.899 07126 2.919 2010 -Aug 08142 2.928 08104 2.991 08116 2.979 48133 2.957 08130 2.938 2010 09106 2.931 09113 2.943 04124 2.960 04127 2.951 2010 - Oct 10+04 3.000 10 +11 3.066 10118 3.073 1025 3.067 2010 - Nov 1 1141 3.067 1 1148 3.116 1 1115 3.184 1112,2 3.171 1 U29 3.162 2010 - Dec 12146 3.197 12113 3.231 12120 3.248 12127 3.294 2011 - Jan 01143 3.331 MAO 3.333 01117 3.407 01124 3.430 4031 3.438 2011 - Feb 02147 3.513 02114 3.534 02121 3.573 02128 3.716 2011 - Mar 03107 3.871 03114 3.908 03121 3.907 03128 3.932 2011 -Apr 44104 3.976 04111 4.078 4+1•,+18 4.105 44125 4.048 2011 -May 05102 4.124 05109 4.104 05116 4.061 05123 3.{947 05130 3.945 2011 - Jun 06106 3.940 06113 3.954 0612.0 3.950 06127 3.888 2011 - Jul 07104 3.850 07 +11 3.894 07118 3.923 07125 3.949 2011 - Aug 08101 3.937 OHM 3.897 08115 3.835 08122 3.810 08129 3.820 2011 - Sep 44145 3.868 04112 3.862 49119 3.833 09126 3.786 2011 -Qtit 1043 3.749 I&W 3.72.1 10117 3.801 10124 3.825 1031 3.892 2011 - Nov 1 1147 3.887 11114 3.997 1 U21 4.010 11128 3.964 2011 -Dec 12105 3.931 12112 3.894 12119 3.828 13126 3.791 2012 - Jan 0IM2 3.783 01144 3.828 01116 3.854 01123 3.848 01130 3.850 2012 - Feb 02106 3.856 02113 3.943 02124 3.960 in PETROLEUM & OTHER LIQUIDS OVERVIEW [SpTA . ANALYSIS & PROJECTIONS GLD55ARY FAgS Weekly U-S_ ND 2 ®reset Ultra LowSuftur ({H75 ppm) Retail Praxes Clink on a Region to view graph of that Region U.S. East Coast New England Central Atlantic Lower Atlantic Midwest Gulf Coast Rocky Mountain West Coast California Meekly U.S Retail On- Highway Diesel Prices 4.50 4.49 4.30 9.210 4.10 4.00 3,99 3.60 3.70 3.60 m 3.50 en 3.a0 3.30 IL 3.29 3.10 s 3.00 a 2.90 2.70 2.69 2.50 2.40 2.30 2.10 2.00 o a o w m r Ica: EnergylnlornaicnAd irp.dreb9an 5 H m s PetFdW%mi , Voaeftry PzIal C wHgmay met Palos Release Schedule Weekl Weeks Retail On-Hi hwa Diesel Diesel Pri ces : Printer - Friendly Version y � 1"S �A fl � � Sign -up for email notification 24 -hour hotline: 2D2 -58S -6965 Motice: Umomnn Ghargas to the G.asolire arvd Diesel Fuel Update, the VW--ekN U.S. Retail Gasolirm arod the Waekly Retail On- Highway Diesel Price reports Weekly Retail Orb- Hlghway Dlesel Pricer. Reference (Dollars per gallon, including all taxes) Prices for Last 53 Weeks Raglan 10124111 19131111 11107111 Change from Change from (htmI) (text) weak ago year ago Spreadsheet of Complete U.S, 3.4325 3.892 3.887 -0.005 0.771 Diesel Historical Data (.xis) East Coast 3.832 3.886 3.875 -0.011 0.761 Diesel Fuel Taxes New England 3.925 3.935 3.950 0.015 0.780 Does ESA Calculate Diesel Central Atlantic 3.946 3.994 3.997 0.003 0.772 Fuel Surcharges? LowarAtlantic 3.775 3.836 3.816 -0.020 0,755 States in each Region Midwest 3.792 3.866 3.863 -0.003 0.761 Data Collection Procedures Gulf Coast 3.745 3.808 3.796 -0.012 0.766 and Statistical Methodology Coefficient of Variation Rocky Mountain 3.909 3.959 3.978 0.019 0.779 Report w8atcoast 4.049 +4.107 4.109 0.002 0.836 Related Links This Week in Petroleum Callfornla 4.09£ 4.163 4.213 0.050 0.934 Gasoline and Diesel Fuel Update A Primer on Diesel Fuel Prices Real Petroleum Prices (CPI Adjusted) Petroleum Navigator Diesel Regulations U.S. Retail Gasoline Prices Clink on a Region to view graph of that Region U.S. East Coast New England Central Atlantic Lower Atlantic Midwest Gulf Coast Rocky Mountain West Coast California Meekly U.S Retail On- Highway Diesel Prices 4.50 4.49 4.30 9.210 4.10 4.00 3,99 3.60 3.70 3.60 m 3.50 en 3.a0 3.30 IL 3.29 3.10 s 3.00 a 2.90 2.70 2.69 2.50 2.40 2.30 2.10 2.00 o a o w m r Ica: EnergylnlornaicnAd irp.dreb9an 5 H m s PetFdW%mi , Voaeftry PzIal C wHgmay met Palos