ADMINISTRATIVE REPORT

TO:

Vancouver City Council

FROM:

General Manager of Corporate Services

SUBJECT:

Cooperative Purchasing of PS03003, Supply and Delivery of Copy Paper

 

RECOMMENDATION

A. THAT Council authorize the award of Contract PS03003 for the supply and delivery of copy paper for a 36-month period from July 1, 2003 to June 30, 2006, to Axidata Inc. as the tenderer offering the overall best value to the City, at an estimated total cost of $495,519 plus GST (less any municipal rebate received) and PST. Funding is available in the departmental operating budgets.

B. THAT no legal rights or obligations will be created or arise unless and until a notice of award is executed and delivered by the City to Axidata Inc.

C. THAT the Manager - Materials Management be authorized to execute and deliver a notice of award on behalf of the City, once the form of the notice of award and related contract documentation have been approved by the Director of Legal Services.

POLICY

The policy of Council is to award contracts for the purchase of equipment, supplies and services that will give the highest value based on quality, service and price.

On March 4, 1980, City Council authorized co-operative purchasing "when benefits to the City are indicated".

Contracts with a value over $300,000 are referred to Council for approval.

PURPOSE

The purpose of this report is to recommend that Council award a contract for the supply and delivery of copy/printer paper to Axidata Inc. for a thirty-six (36) month period with the option to extend for two additional twelve (12) month periods.

BACKGROUND

In an effort to maximize purchasing leverage and obtain lower pricing the City of Vancouver participated in co-operative purchasing with the City of Richmond, City of Surrey, and the Vancouver Park Board. The City has been the lead agency for the copy paper contract for the Vancouver Regional Co-operative Purchasing Group since January, 2000. The existing contract expires June 30, 2003 and a new tender was issued on March 25, 2003.

DISCUSSION

Tenders for PS03003 were opened by the City Clerk on April 16, 2003 and referred to the Manager of Materials Management for report. The tender called for prices for the supply and delivery of six items of copy paper with the total combined estimated quantities from the co-operative group for a thirty-six(36) month period with the option to extend for 2 additional twelve (12) month periods. Prices were requested for recycled stock and standard stock, thereby offering all participants the opportunity to choose recycled copy paper.

A 36 month contract term with option to extend for 2 additional twelve (12) month periods is standard contract terms adopted by Vancouver Regional Co-operative Purchasing Group. The longer term contract results in more competitive pricing, better service and reduced administrative costs. The contractor must provide 45-days written notice of any price change. The contract contains a standard termination clause.

A price comparison using the City's annual estimated volume with prices submitted by the recommended vendor and the same volume with current prices being paid by municipalities unable to participate in this tender because of prior commitments shows an estimated savings to the City of between 6% and 24% on 8-1/2 X 11 standard stock annually. The most commonly used paper size is 8-1/2 x 11 making up the largest portion of the annual estimated volume.

Five bids were received from four companies. One of the bids submitted pricing for one item only and was not given further consideration. The remaining four bids are as follows:

The low bid meets specification and is recommended for award.

Option:

Recycled paper products were quoted as follows:

The price quoted for recycled paper by Axidata reflects a 10% premium over pricing for standard paper. If the City were to adopt a policy of using recycled paper only, there would be an additional cost of approximately $50,000 over the term of the contract.

It is unlikely that the City could achieve 100% use of recycled paper. Recycled paper has in the past caused problems when run through older printers, copiers, fax machines and print shop equipment. However as newer devices replace the older equipment, the use of recycled paper could increase but at an additional cost.

FINANCIAL IMPLICATIONS

Funding for the supply and delivery of copy/printer paper is included in annual departmental Operating budgets, including the Park Board.

CONCLUSION

We recommend acceptance of the low bid meeting specifications and offering best value from Axidata Inc. at an estimated three (3) year cost of $495,519.

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