REPORT TO THE CITY COUNCIL FROM: BROCK D. BUCHE, PE, PLS, Director Department of Public Utilities BY: ANTHONY WHITE, MBA, Assistant Director Department of Public Utilities - Water Division RUSSELL B. GUILLIAMS, Water Manager - Certified Department of Public Utilities - Water Division SUBJECT ..Title Approval of $271,066.59 of additional funding for Sodium Hypochlorite Requirements Contract with Univar USA, Inc. to cover outstanding invoices, for a total contract amount of $1,670,488.59 that incurred during vendor transition. (Bid File 9487) (Citywide) ..Body RECOMMENDATION Staff recommends that Council approve an additional $271,066.59 to the prior Requirements Contract with Univar USA, Inc., for Sodium Hypochlorite, bringing the total amount to $1,670,488.59 to cover outstanding invoices. Additionally, authorize the Director of Public Utilities, or designee, to execute necessary actions and payments on behalf of the City of Fresno (City). EXECUTIVE SUMMARY The Department of Public Utilities, Water Division, requires Sodium Hypochlorite for water disinfection to ensure compliance with federal and state drinking water standards. While the contract with a new vendor has been awarded to Thatcher Company in November of 2024; Univar USA, Inc., the previous supplier, has continued to provide the chemical to meet the City's needs. However, the prior contract has expired and is largely depleted, resulting in outstanding invoices totaling $271,066.59. This funding request is essential to settle outstanding balances with the previous vendor and prevent disruptions to chemical deliveries, which are crucial for meeting regulatory requirements. By approving the proposed increase, the City can clear pending invoices and ensure its water treatment operations remain compliant and effective. BACKGROUND The City is required by federal and state drinking water regulations to always maintain a chlorine residual of greater than 0.2 milligrams per liter in the distribution system. Sodium Hypochlorite is critical for this purpose and is dosed at Surface Water Treatment Facilities and all well sites. The previous contract with Univar USA, Inc., awarded under Bid File 9487, initially accounted for annual usage. However, increased disinfection requirements due to corrosion control strategies, unanticipated water demands, and market price increases have exhausted the allocated funds for the final year of the contract. With the new vendor (Thatcher Company) contract awarded but not effective to provide Sodium Hypochlorite, Univar USA, Inc., continued supplying Sodium Hypochlorite to maintain uninterrupted water disinfection. However, outstanding invoices totaling $271,066.59 remain unpaid, and the vendor has indicated that failure to address these balances could jeopardize the supply chain for other critical chemicals. A previous request for an additional spending authority of $856,200.00 was approved in April; however, subsequent expenditures have exceeded this amount, necessitating this additional funding request. ENVIRONMENTAL FINDINGS This action does not constitute a "project" under the California Environmental Quality Act (CEQA) Guidelines Section 15378(b)(2), as it involves a continuation of an existing project. LOCAL PREFERENCE Local preference is not applicable as this is related to an already awarded contract. FISCAL IMPACT No impact on the General Fund. Funding to support the additional amount needed is available in the FY 2025 Operating Budget under the Water Enterprise Fund. This is a citywide project. Attachment - Univar Sodium Hypochlorite Outstanding Invoice Summary