S92-T24149.A3 – Approve an Ordinance amending Ordinance No. 2014-0534 (passed on June 4, 2014) to increase the maximum contract amount from $12,315,588.00 to $20,386,511.00; approving and authorizing a third amendment to extend the contract term from December 12, 2023 to January 31, 2026 for contract (No. 4600012548) between the City of Houston and Air Products and Chemicals, Inc. for operation and maintenance of the pure oxygen plant at 69th Street Wastewater Treatment Plant (WWTP) for Houston Public Works.
Specific Explanation:
The Director of Houston Public Works and the Chief Procurement Officer recommend that City Council approve an amending ordinance to increase the maximum contract amount from $12,315,588.00 to $20,386,511.00 and to approve and authorize a third amendment to the contract between the City of Houston and Air Products and Chemicals, Inc. to extend the contract term from December 12, 2023 to January 31, 2026 for operation and maintenance of the pure oxygen plant at 69th Street WWTP for Houston Public Works.
The original contract was awarded on June 4, 2014 by Ordinance 2014-0534, for a three-year term, with two one-year options in the original amount of $12,315,588.00. On March 20, 2019, a First Amendment was approved by Council by Ordinance 2019-152 to extend the term of the agreement from June 13, 2019 to June 12, 2022. A Second Amendment was approved by Council on June 1st, 2022 by Ordinance No. 2022-431 to extend the term of the agreement from June 12, 2022 to December 12, 2023. Expenditures as of November 01, 2023 total $12,315,588.00. The extension of the contract term and the increase of $8,070,923.00 to the maximum contract amount will allow Air Products and Chemicals, Inc. to continue to provide services to the operation of 69th Street WWTP until a new facility replacement is built and made operational.
Since the oxygen plant at 69th Street WWTP is nearing the end of its useful life as well as the key operating system component - the Cryogenic Air Separation Unit (ASU) - is now obsolete, Houston Public Works is currently in the process of purchasing and installing an entirely new oxygen plant. The new plant is expected to be in place by 2027.
MWBE Participations:
The contract was awarded with a 3% M/WBE participation level. Air Products and Chemicals, Inc. is currently achieving a goal of 1.33%. Goal participation and subcontracting opportunities have been significantly impacted by material changes to the original scope of services. Houston Public Works has since determined that the oxygen plant is nearing the end of its useful life, and the rehabilitation work is no longer feasible. Thus, services under the contract have been limited to plant operation and preventative maintenance services only. Air Products and Chemicals, Inc. will continue to work with the Office of Business Opportunity, on divisible work plans aimed at helping them to meet or exceed the 3% goal.
Fiscal Note:
Funding for this item is included in the FY2024 Adopted Budget. Therefore, no Fiscal note is required as stated in the Financial Policies.
______________________________________ ________________________________
Jedediah Greenfield, Chief Procurement Officer Carol Ellinger Haddock, P.E., Director
Finance/Strategic Procurement Division Houston Public Works
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Estimated Spending Authority
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Department
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FY2024
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Out Years
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Total
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Houston Public Works
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$ 2,000,000.00
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$ 6,070,923.000
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$ 8,070,923.00
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