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Agenda 04/10/2018 Item #16C 104/10/2018 EXECUTIVE SUMMARY Recommendation to approve a sole source purchase of four high speed turbo process air blowers for the South County Water Reclamation Facility from Mader Electric Motors in the amount of $789,696, Project No. 70203, and to authorize the necessary budget amendment. OBJECTIVE: To enhance the reliability and treatment capabilities of the South County Water Reclamation Facility (SCWRF) by replacing four existing blowers that supply air for proper wastewater treatment. CONSIDERATION: The proposed scope of work under Project No. 70203, “SCWRF Technical Support,” is consistent with the Capital Improvement Program (CIP) contained in the Water, Wastewater, Irrigation Quality Water, and Bulk Potable Water User Rate Study approved by the Board of County Commissioners (Board) on June 10, 2014, as Agenda Item 11C. Funding for Project No. 70203 is available in, and is consistent with the FY 2018 CIP Budget. On February 11, 2014, as Agenda Item 16C2, the Board approved the replacement of two of six (Phase 1) SCWRF process air blowers with turbo (high-speed) blowers, which utilize reliable, energy-saving technologies such as variable frequency drives, premium efficiency direct current motors, and magnetic bearings. Since the two turbo blowers have been in operation, they have demonstrated reliable and efficient operation. This project, Phase 2 of the blower replacement program, will replace the remaining four of the six process air blowers with the same turbo blowers used in Phase 1. These blowers play a critical role in the wastewater treatment process as they are required to aerate wastewater continuously, 24 hours a day, seven days a week. The current conventional blowers are approximately 18 years old and have reached the end of their useful lives. They use an older technology that requires more maintenance and energy to operate. The existing blowers have required extensive repairs, have shown signs of decreased reliability and higher power consumption. There are several turbo blowers in the market; however, the Sulzer turbo blower that is represented by Mader Electric is the only brand that has been in existence for more than 20 years. Other turbo blower manufacturers joined the market in the last 12 years. The Sulzer turbo blower utilizes a proprietary magnetic bearing that is virtually maintenance free. This eliminates mechanical contact and wear which occurs with oil and air bearings during start up and low speeds. Other turbo blowers using oil or air bearings require costly maintenance approximately every five years. The Sulzer magnetic bearings are estimated to last 25 years. Because of the inherent advantages of the Sulzer turbo blower, and because two units have been operating successfully with no failures, repairs, or maintenance required (other than routine air filter changes) staff recommends a sole source purchase of the equipment from Mader Electric Motors to standardize on equipment, parts, control system integration and training of personnel. Subsequently, separate competitive bids will be solicited for the turbo blower installation. By purchasing this equipment directly, the county will save the typical 10 percent contractor’s markup and 6 percent sales taxes ($78,969.00 and $47,381.18, a total of $126,350.18). Additionally, pre-purchasing this equipment will expedite the installation time by about five months. Mader Electric Motors is the sales representatives for Hydra Services, Inc., the equipment manufacturer. Mader has provided a proposal (reference Attachment 1) for four turbo blowers at a cost of $789,696. Hydra Services, Inc., is currently the exclusive master distributor of the equipment for Sulzer in Florida 16.C.1 Packet Pg. 617 04/10/2018 (reference sole source letter and waiver request as Attachments 2 and 3 respectively). Justifications for purchasing the equipment as a sole source purchase from Hydra Services Inc., through Mader Electric Motors, include: Hydra Services, Inc., through Mader, is the only approved and authorized vendor that can sell Sulzer magnetic bearing turbo blowers. The SCWRF has two of these blowers installed already, and they have proven to be reliable and energy efficient. Standardization for spare parts. Standardization of Supervisory Control and Data Acquisition Systems (SCADA) controls. No additional staff training is required for operation, troubleshooting and repairs. Staff has reviewed the cost and considers it fair and reasonable according to the business case included as Attachment 4. Third-party engineering consultant Tetra Tech, Inc. also recommends standardization as shown in Attachment 5. Pursuant to Section Eleven, sub-paragraph 11 and Section 18 of the Collier County Procurement Ordinance 2017-08, as amended, staff requests that the Board of County Commissioners find that it is in the best interest of the county to standardize Sulzer’s turbo blowers as a standard for the Public Utilities Department’s treatment plant’s needs. FISCAL IMPACT: The cost of this sole source purchase is $789,696. Funding for this project is available in the FY2018 Capital Budget approved by the Board September 28, 2017. The source of funds is Wastewater User Fees, Fund (414). A budget amendment is required from Project Nos. 70089, 73969, 70056, 70055, 70053, and 70051 Fund (414) collectively, in the total amount of $600,020.81. LEGAL CONSIDERATIONS: This item is approved as to form and legality, and requires majority vote for Board approval. -SRT GROWTH MANAGEMENT IMPACT: This project meets current Growth Management Plan standards to ensure the adequacy and availability of viable public facilities. RECOMMENDATION: To approve a sole source purchase of four turbo process air blowers for the South County Water Reclamation Facility from Mader Electric Motors in the amount of $789,696, and to authorize the necessary budget amendment in the amount of $600,020.81. Prepared by: Peter Schalt, Senior Project Manager, Engineering and Project Management Division ATTACHMENT(S) 1. Attachment 1 Revised Proposal with Prepayment Removed (PDF) 2. Attachment 2: Sole Source Letter (PDF) 3. Attachment 3: Waiver Request (PDF) 4. Attachment 4: Business Case (DOCX) 5. Attachment 5: Engineer's Recommendation (PDF) 16.C.1 Packet Pg. 618 04/10/2018 COLLIER COUNTY Board of County Commissioners Item Number: 16.C.1 Doc ID: 4748 Item Summary: Recommendation to approve a sole source purchase of four high speed turbo process air blowers for the South County Water Reclamation Facility from Mader Electric Motors in the amount of $789,696, Project No. 70203, and to authorize the necessary budget amendment. Meeting Date: 04/10/2018 Prepared by: Title: Project Manager, Senior – Public Utilities Planning and Project Management Name: Peter Schalt 02/13/2018 8:34 AM Submitted by: Title: Division Director - Public Utilities Eng – Public Utilities Planning and Project Management Name: Tom Chmelik 02/13/2018 8:34 AM Approved By: Review: Procurement Services Opal Vann Level 1 Purchasing Gatekeeper Completed 02/13/2018 3:33 PM Water Steve Messner Additional Reviewer Completed 02/14/2018 11:18 AM Public Utilities Operations Support Joseph Bellone Additional Reviewer Completed 02/26/2018 3:59 PM Procurement Services Ted Coyman Additional Reviewer Completed 02/27/2018 9:24 AM Procurement Services Catherine Bigelow Additional Reviewer Completed 03/01/2018 7:34 AM Public Utilities Planning and Project Management Tom Chmelik Additional Reviewer Completed 03/02/2018 8:48 AM Public Utilities Planning and Project Management Craig Pajer Additional Reviewer Completed 03/07/2018 9:54 AM Public Utilities Department Heather Bustos Level 1 Division Reviewer Completed 03/07/2018 10:28 AM Public Utilities Department George Yilmaz Level 2 Division Administrator Review Completed 03/07/2018 2:12 PM County Attorney's Office Scott Teach Level 2 Attorney Review Completed 03/08/2018 1:32 PM Office of Management and Budget Valerie Fleming Level 3 OMB Gatekeeper Review Completed 03/08/2018 2:49 PM County Attorney's Office Jeffrey A. Klatzkow Level 3 County Attorney's Office Review Completed 03/12/2018 4:44 PM Office of Management and Budget Susan Usher Additional Reviewer Completed 03/17/2018 8:49 PM County Manager's Office Nick Casalanguida Level 4 County Manager Review Completed 04/01/2018 8:32 PM Board of County Commissioners MaryJo Brock Meeting Pending 04/10/2018 9:00 AM 16.C.1 Packet Pg. 619 Estimate Date 3/21/2018 Estimate # 72378-2 Name / Address Collier County Clerk's Finance Dept. 3299 Tamiami Trail East STE 700 Naples, FL 34112-5749 Mader Electric Motors 18161 N. Tamiami Trail N. Ft. Myers, FL 33903 Tel 239-731-5455 Freight included to job site Total Subtotal Sales Tax (6.0%) DescriptionQty Each Total 4 192,174.00 768,696.00 1 3,000.00 3,000.00 1 12,000.00 12,000.00 1 6,000.00 6,000.00 SWRF, HST Blower Project, Phase II Sulzer/ABS HST Turbo Compressor, Model HST 20-6000-1-U250-48, 480/3/60 * Includes 5 year extended warranty Lot of Pre-Startup Services by Manufacturer (2 Days Max) Lot of Startup & Training Services by Manufacturer (8 Days Max) Lot of Post-Startup Services by Manufacturer (To take place approximately 14 days after startup completion – 4 Days Max) Terms: Please note that breakout pricing is provided for the sole purpose of establishing the valve of the product separately from the startup and training services. This is a uniquely manufacturered piece of equipment for your specific application based on location, elevation, local year round temperature and humidity, and SCFM requirements that includes startup and training. As a result the manufacturer only sells this equipment as a complete package and requires full payment for this order when shipped. Payment is due net 30 days from the invoice date, which is the date that it ships from the factory. $789,696.00 $789,696.00 $0.00 16.C.1.a Packet Pg. 620 Attachment: Attachment 1 Revised Proposal with Prepayment Removed (4748 : SCWRF - Sole Purchase of High Speed Turbo Air Blowers from 16.C.1.b Packet Pg. 621 Attachment: Attachment 2: Sole Source Letter (4748 : SCWRF - Sole Purchase of High Speed Turbo Air Blowers from Mader Electric Motors) 16.C.1.c Packet Pg. 622 Attachment: Attachment 3: Waiver Request (4748 : SCWRF - Sole Purchase of High Speed Turbo Air Blowers from Mader Electric Motors) 16.C.1.c Packet Pg. 623 Attachment: Attachment 3: Waiver Request (4748 : SCWRF - Sole Purchase of High Speed Turbo Air Blowers from Mader Electric Motors) 16.C.1.c Packet Pg. 624 Attachment: Attachment 3: Waiver Request (4748 : SCWRF - Sole Purchase of High Speed Turbo Air Blowers from Mader Electric Motors) 16.C.1.c Packet Pg. 625 Attachment: Attachment 3: Waiver Request (4748 : SCWRF - Sole Purchase of High Speed Turbo Air Blowers from Mader Electric Motors) 16.C.1.c Packet Pg. 626 Attachment: Attachment 3: Waiver Request (4748 : SCWRF - Sole Purchase of High Speed Turbo Air Blowers from Mader Electric Motors) 16.C.1.c Packet Pg. 627 Attachment: Attachment 3: Waiver Request (4748 : SCWRF - Sole Purchase of High Speed Turbo Air Blowers from Mader Electric Motors) 16.C.1.c Packet Pg. 628 Attachment: Attachment 3: Waiver Request (4748 : SCWRF - Sole Purchase of High Speed Turbo Air Blowers from Mader Electric Motors) 16.C.1.c Packet Pg. 629 Attachment: Attachment 3: Waiver Request (4748 : SCWRF - Sole Purchase of High Speed Turbo Air Blowers from Mader Electric Motors) January 19th, 2018 Page 1 of 3 COLLIER COUNTY GOVERNMENT PUBLIC UTILITIES ENGINEERING AND PROJECT MANAGEMENT DIVISION BUSINESS CASE FOR: Recommendation to direct purchase four high speed turbo air blowers for the South County Water Reclamation Facility from Mader Electric Motors in the amount of $789,696.00, Project No. 70203. 1. Background and Objective: The South County Water Reclamation Facility (SCWRF) is the County’s second largest wastewater treatment plant with a permitted capacity if 8 million gallons per day (MGD). As part of the biological treatment process, the plant originally utilized a total of eight blowers to force air into the treatment basins (four 250 HP and four 125 HP units). Two of the original 250 HP blowers were previously replaced in 2014 with high speed turbo blowers to improve operational efficiency and increase plant reliability. The six remaining blowers currently installed are approximately 18 years old and have reached the end of their useful lives. To ensure operational reliability and reduce the overall energy consumption at the plant, the goal of this project is the replace remaining six original blowers with four new high speed turbo blowers to match the two recently replaced units. 2. Benefits of the Project Action: There are several benefits of the proposed blower replacements: A. The existing configuration of two Sulzer ABS high speed turbo blowers and six Gardner Denver blowers can be standardized to a single manufacturer (Sulzer ABS). This will allow the plant maintenance personnel to maintain a single collection of spare parts and preventative maintenance components instead of two separate sets. Also, plant staff is already trained on the new units. B. The six existing Gardner Denver blowers are reaching their operational life cycle limit and currently require large investments for repairs. By replacing these, the annual maintenance and repair cost for the blowers will be greatly reduced. C. The six existing Gardner Denver blowers are outdated in terms of electrical efficiency and are the largest single point of energy consumption at the plant. The electric motors attached to these units can only run at a single design point and cannot be “throttled” to match the actual needs of the plant. The proposed high speed turbo blowers come equipped with built in variable frequency drives (VFDs) capable of ramping up and down based on the plant’s dissolved oxygen level, thereby only utilizing as much power as what is actually needed. D. The recommended approach for this project is to procure the blowers directly (owner direct purchase) in order to benefit from the savings in sales tax (6% or $47,381.18) as well as a projected contractor markup (10% or $78,969.60). Additionally, these blowers are large items which come with extended lead times to manufacture and deliver. An estimated delivery quote of five months was provided from the supplier for these units. By owner direct purchasing the blowers in advance, bidding of the installation for these and manufacturing can both occur concurrently, which will allow the project to move forward in a timely manner. 16.C.1.d Packet Pg. 630 Attachment: Attachment 4: Business Case (4748 : SCWRF - Sole Purchase of High Speed Turbo Air Blowers from Mader Electric Motors) January 19th, 2018 Page 2 of 3 3. Risk of Not Taking the Action: The option of taking no action does not practically exist because the wastewater plant must remain in service in order to provide treatment for the citizens of Collier County. As the current blowers have reached their effective service life, they must be replaced in order to maintain plant oper ations. By taking no action, the existing blowers at the plant will eventually become completely non - operational, or too costly to repair (versus replace) and the SCWRF would run the risk of being out of compliance with the Florida Department of Environmental Protection. Additionally, because the biological treatment at the plant relies on the addition of oxygen from the blowers, the wastewater would not be sufficiently treated to supply as reclaimed irrigation quality water to customers throughout the county. Given the above, the option of taking no action is not practical and should not be considered. 4. Why is this Action the Best Value Solution: There are two components of this solution which will both be addressed as to their merit of being the “best value solution”: A. The action to replace the existing six outdated blowers with four new efficient high speed turbo blowers B. The action to direct purchase the blowers in advance of the competitively bid construction and installation As to the approach of using owner direct purchasing, there is no practical benefit to any other alternative. The only other perceivable approach would be to have the installation contractors purchase the blowers and include them within their bid, however under this scenario the contractors would be required to pay sales tax on the units (which would be passed along to the County through their bid) and will most certainly mark-up their cost of the blowers to cover the cost of bonding, financing, and profit for the project. As the County will eventually be paying for the blowers in either scenario, there is simply no logical reason not to pre-purchase them from simply a monetary standpoint. Additionally as stated above, these units come with long lead times which would lead to proj ect delays should they be included within the contractor’s bid. 5. Other Options to Consider: As stated previously, the option to do nothing is not practical and will not be discussed in further detail. Therefore, the only other logical option to consider is to investigate other blower manufacturers and models for use at the SCWRF. Should that action be taken, additional time and resources will be required and project delays will occur as that investigation takes place. Additionally it should be noted that the County and their consultants have already conducted a thorough review of equipment available for this type of installation and already have arrived at this point to recommend these high speed turbo blowers (this is phase two of the project, two new blowers of the same type have already been installed and have been in successful operation for two years now). As the County has already investigated alternative products for this application, it is unlikely that a new review would render different results. 16.C.1.d Packet Pg. 631 Attachment: Attachment 4: Business Case (4748 : SCWRF - Sole Purchase of High Speed Turbo Air Blowers from Mader Electric Motors) January 19th, 2018 Page 3 of 3 6. Assessment and Recommendation: For the reasons stated above, we believe that the requested approach to owner direct purchase four new Sulzer ABS high speed turbo blowers is the most efficient and cost effective solution available to provide a reliable compliant system at the South County Water Reclamation Facility. 16.C.1.d Packet Pg. 632 Attachment: Attachment 4: Business Case (4748 : SCWRF - Sole Purchase of High Speed Turbo Air Blowers from Mader Electric Motors) 16.C.1.ePacket Pg. 633Attachment: Attachment 5: Engineer's Recommendation (4748 : SCWRF - Sole Purchase of High Speed Turbo Air Blowers from Mader Electric 16.C.1.ePacket Pg. 634Attachment: Attachment 5: Engineer's Recommendation (4748 : SCWRF - Sole Purchase of High Speed Turbo Air Blowers from Mader Electric