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
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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
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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
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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
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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.
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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.