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REQUEST FOR <br />COUNCIL ACTION <br />CITY COUNCIL MEETING DATE: <br />AUGUST 2, 2016 <br />TITLE <br />PAYMENT AUTHORIZATION TO <br />PROCURE AMERICA FOR <br />ELECTRICAL UTILITY COST <br />RECOMMENDED ACTION <br />CLERK OF COUNCIL USE ONLY: <br />❑ As Recommended <br />❑ As Amended <br />] Ordinance on ta` Reading <br />© Ordinance on 2 "a Reading <br />® Implementing Resolution <br />[] Set Public Hearing For,,_ <br />CONTINUED TO <br />IyI���IA1Jff`•1�7 <br />Authorize payment of Procure America Invoice #10 -1502a in the amount of $20,762.12 as <br />compensation for generating electrical utility cost savings under Agreement A- 2014 -227. <br />DISCUSSION <br />On September 14, 2014, the City entered into a three -year agreement with Procure America for <br />cost review services to identify potential cost saving strategies. Services included analyzing <br />invoices, supplier contracts, and other pertinent data related to City utility costs that included <br />electricity, gas, and water. Upon completion of review, Procure America provided a report that <br />outlined potential cost saving strategies. <br />Absent information from the pending cost review, staff estimated and set the contract cost at a <br />not to exceed (NTE) amount of $50,000. On April 20, 2016, the City paid Procure America <br />Invoice #8 -1503 in the amount of $49,346.57, exhausting most of the NTE amount. As a result of <br />Procure America identifying additional cost savings within the existing electricity accounts, a <br />second invoice, exceeding initial savings projections in the amount of $20,762.12 was incurred <br />(Exhibit 1). <br />Procure America generated utility cost savings by identifying City electric service accounts that <br />were eligible for a rate review and recommending subsequent adjustment of rate schedules. As <br />a result of implementing those recommendations, the City realized the following departmental <br />cost savings: <br />29A -1 <br />