Loading...
Morton Salt Agreement_2011-2012 Winter SeasonMasterpiece on the Mississippi TO: The Honorable Mayor and City Council Members FROM: Michael C. Van Milligen, City Manager SUBJECT: Road Deicer Salt for the 2011 -2012 Winter Season DATE: March 31, 2011 Public Works Director Don Vogt recommends City Council approval to inform Morton Salt International LLC of the City's intent to purchase up to 7,000 tons of salt from their remaining supplies on May 1 at a cost of $42.98 per ton. The total cost to purchase and move 7,000 tons of Morton salt to the City's storage area would be approximately $350,000. Funds are available in the Fiscal Year 2012 City budget. I concur with the recommendation and respectfully request Mayor and City Council approval. MCVM:jh Attachment cc: Barry Lindahl, City Attorney Cindy Steinhauser, Assistant City Manager Don Vogt, Public Works Director Michael C. Van Milligen Dubuque All- Ameaica City 1 , 2007 Masterpiece on the Mississippi TO: Michael C. Van Milligen, City Manager FROM: Don Vogt, Public Works Director DAI SUBJECT: Road Deicer Salt for the 2011 -2012 Winter Season DATE: March 31, 2011 Dubuque kiltd All- Arnedca city 2007 INTRODUCTION The purposes of this memorandum are to provide information and recommend a course of action regarding securing road deicer salt supplies for the 2011 -2012 winter season. BACKGROUND The City of Dubuque's Salt Storage and Handling Agreement with Morton Salt International LLC provides for the City having the right to purchase any supplies remaining on Morton's leased area after April 30 — to a maximum of 10,000 tons and at a cost of $42.98 per ton. DISCUSSION At the present time, Morton has approximately 9,300 tons of road deicer salt still in storage at the City's Purina Drive Terminal. While it is unknown as to whether any of that salt will still be on site at the end of April, I do recommend that the City inform Morton of its intent to purchase up to 7,000 tons of its stockpile for itself for next winter. Coupled with the still- unused supplies that the City purchased last summer, it would then have adequate supplies ( @12,000 tons) for the 2011 -2012 winter season. The contract price of $42.98 equals the low bid the City received last year for its 2010 -2011 supplies. However, the City's bid award price of $42.98 last year was not its final price. In addition, there were costs for a contractor to offload the City's barges, and then weigh, pile and cover the salt. There would be very similar handling costs for the remaining Morton salt, since it would have to be loaded, weighed, and moved to the City's own storage area. But given the sharp increase in the cost of diesel fuel over the last year, I would highly doubt that road deicer salt prices will be found to be lower this year if the City is forced to solicit bid prices in the coming months. Since the recommended purchase from Morton would be for the FY12 winter season, I further recommend that it be charged to the Public Works Department's FY12 snow and ice control budget. That budget, as approved by the City Council earlier this month, provides $408,925 for the purchase of road deicer salt supplies. Street and Sewer Maintenance Supervisor John Klostermann estimates that the total cost of purchasing and moving 7,000 tons of Morton salt to the City's storage area would be approximately $350,000. ACTION STEP I request your consideration of the proposed course of action outlined above and your authorization to inform Morton Salt International LLC of the City's intent to purchase up to 7,000 tons of its remaining supplies on May 1St CC: Jenny Larson, Budget Director