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HomeMy WebLinkAbout2010-06-21 Finance Committee Minutes FINANCE COMMITTEE June 21, 2010 Minutes Council: Bronson, Hawes, Blanchette, Weston Staff: Cyr, Little, Seymour, Wardwell, Higgins, Dawes Others: Brent Cross, Royce Cross 1. Consent Agenda a. Quitclaim Deed – 34 Dean Street b. Quitclaim Deed – 339 Union Street Blanchette made a motion to move the Consent Agenda; the motion was seconded by Hawes. 2. Bids/Purchasing a. Rock Salt – Public Works – Harcross Chemicals Inc. - $321,650 For the past couple of years, the City has put in its estimated tonnage request with the State of Maine and the State bids it statewide. The State’s low bidder is Harcross Chemicals at $64.33/ton. It is $3.72/ton less than the current year and is below the estimated for FY11. Staff recommendation is to award the contract for rock salt to Harcross Chemicals. A motion was made and seconded to approve staff recommendation. Because the item will be in excess of $50,000, the item will move to full Council for final approval. b. Mailing Service – City Wide – Snowman Printing/Presort Express Cyr said that all outgoing City mail for the entire City except for Airport goes through the Treasurer’s Office. Mail from all departments is dropped off at Treasury where staff sorts, seals and runs it through the postage meter. Staff then takes it to the mail box outside of City Hall. With the reduction in staff as well as the increase in the volume of mail, it is becoming increasing difficult to deal with the mail. Because of lack of equipment, the City’s mail cannot be presorted by zip code to take advantage of lower postal rates. A RFP was issued and two responses received from Snowman Presort Express and from Creative. Little priced out their services and the City would pay a price per piece depending on various options. Staff recommendation is to award the contract to Snowman at about $10,240 for the service. The postage cost is estimated at $64,500. The total cost would be $74,740 which is actually in line with what the City current pays for straight postage. By going to presort, postage costs will be lowered enough to cover the cost of the service and also save a couple of thousand dollars as well. A motion was made and seconded to approve staff’s recommendation. Responding to Weston, approximately 5-8 hours per week of labor will be freed up in the Treasury’s Office. c. SCBA Fill Station – Fire – Industrial Protection - $39,500 Cyr said that this came before the Finance Committee prior to going out for bid. This was a project approved as part of the 2008 Homeland Security Funds to have a SCBA fill station on site. The recommendation is to award to the second low bidder, Industrial Protection, which bid $39,500 for the unit. The low bidder, DL Thurcott, bid $42,286 but did offer a $3,000 trade in which actually brought their net bid to $39,286. However, the City was recently contacted by Hermon Fire Department and they would like to purchase Bangor’s current equipment at $2,500. A motion was made and seconded to approve staff’s recommendation. d. Tires & Tire Service – Small – City Wide – Maine Commercial Tire - $64,669 Cyr said there are two distinct types of City vehicles – small and large. The services and tires associated with each are varied and staff felt the two items should be bid out separately in order to be more competitive. Three bids were received for the small tires/service and staff’s recommendation is to award to the low bidder, Maine Commercial Tire, at the estimated annual cost of $64,669 which includes new tire, fixing tires, retreads and everything dealing with the City’s small passenger type vehicles. Responding to Weston, Cyr said the cost estimate is a per-item cost and the quantities listed in the bid are estimated. Estimated usage is not a commitment to purchase. In further response to Weston, Cyr noted that 14 requests were issued and 3 responses were received. Bronson clarified that the extreme low bidder was not able to supply a significant number of the items. A motion was made and seconded to move staff recommendation to full Council. e. Tires & Tire Service – Large – City Wide – Maine Commercial Tire - $70,505 Cyr said this is very similar to the small tire bid except it is for the dump truck tires, the graders, and the heavy pieces of City equipment. 14 bids were issued and 2 responses received. Staff recommends award to Maine Commercial Tire in the estimated amount of $40,505. Nealley asked why so few businesses respond to RFP’s. Dawes said the largest problem is for a business to lock in prices for a year. A motion was made and seconded to move staff recommendation to full Council. f. Airport Liability Insurance – Airport - Sargent Tyler & West - $258,741 Cyr said the City issued a RFP for Airport Liability Insurance. The Airport carries a $300M limit for incidents at BIA. It is liability specifically related to aeronautical issues. Because the Airport has taken over the role of Exxon, it is required to have an environmental liability policy. Three responses were received. Staff recommends award of the bid to the low bidder, Sargent Tyler and West as the agent of record and the carrier is Starr Aviation Insurance Company in the amount of $258,741. The Airport has done business with Sargent Tyler & West for a number of years. The amount represents an almost $70,000 savings in the proposed FY11 Airport budget. In response to Weston, Cyr said with insurance bids carriers are only willing to negotiate and quote prices to one agent. There are a limited number of carriers in the world of aviation insurance. All insurance agents who wanted to quote on this item were required to submit a list of five potential carriers they wanted to use in their order of preference. This was clearly stated and required in the RFP. An on-site meeting was held and the list of preferred carriers was opened. If Agency A is the only one that had XYZ carrier as their first choice, they were assigned it. When there were multiple people picking the same carrier, a random lot draw took place and then agents were allowed to pick. That is why they were asked to submit 5 preferences. The same procedure was used in the next upcoming item as well. This is the only bid whereby the City uses the lot drawing to assign carriers. Also in response, Cyr said the insurance bid is really no different than any other bid as long as they understand the rules, clearly understand the requirements, the basis upon which bids will be awarded, bidders are very accepting of it. She commonly hears “I may not like it but I understand it, it’s fair.” A motion was made and seconded to move staff’s recommendation to the full Council. g. Property/Liability/Specialty Insurance – City Wide – Final recommendation is pending completion of the review of the proposed coverage and limits and will be distributed as soon as available th Cyr said that this bid along with the Airport’s was opened on June 11. The City-wide insurance is more complicated. There were 18-20 attachments to bids which had to be reviewed by staff line by line. There are still a few items to be resolved but will not impact staff’s recommendation. The same process was followed as with the Airport’s insurance. There was a pre-bid conference where carriers were assigned to each agent. One group was assigned a carrier but declined to bid at the last minute. The two bidders are Cross Insurance and Maine Municipal Association. MMA bid two options with different deductibles. Staff’s recommendation is to award the bid to Cross Insurance, the low responsive bidder, at an estimated annual premium of $440,000. It is estimated due to a few items that need to be firmed up but the larger issues are okay. It will be a change back to a commercial carrier. Brent Cross will be the point person for the City’s account. The transition period will be time consuming. Brent thanked the City for its award. He commended the Finance Department staff on their diligent work on the process. The Cross Agency is located in Bangor with offices statewide. A motion was made and seconded to approve staff’s recommendation to full Council. Nealley noted that Cross is the largest independent insurance agency in Maine. 3. Request to Take Possession of 1730 Stillwater Avenue th Cyr said this is a request to take possession of a 1/8 interest in the property located at 1730 Stillwater Avenue. The City acquired this interest several years ago. It is vacant property that abuts the City Forest, and there is one heir who has not been located. There are matured tax liens on the property and staff’s recommendation is to take the th remaining 1/8 interest of the property. If the heir comes forward, the City would pay for the property, as it has to the remaining heirs, less the property taxes the City pays th on behalf of this. The original purchase of the 7/8 of the lot came from the Forestry Trust Account and that would be the recommendation if the last owner is found. th Responding to Weston, Cyr said the City purchased the first 7/8 several years ago directly from the heirs. In response to Bronson, Little anticipates the property will be used to expand the City Forest. Little will verify with the Legal Department regarding action taken several years ago. A motion was made and seconded to approve staff’s recommendation. Adjournment at 5:33 pm.