HomeMy WebLinkAboutContract 47472-R4 CSC No. 47472-R4
CITY OF FORT WORTH
REQUEST TO EXERCISE RENEWAL OPTION
February 12, 2020
U.S. Peroxide, LLC
dba USP Technologies
900 Circle 75 Parkway, Suite 1330
Atlanta, GA 303369
Re: Contract Renewal Notice
Contract No. CSC No. 47472
Renewal Term No. 4: January 27, 2020 to January 26, 2021
The above referenced Contract with the City of Fort Worth expires on January 26, 2020.
Pursuant to the Contract, contract renewals are at the mutual agreement of the parties. We accept
your request to increase the unit price by 5%and renew this contract for an additional one (1) year
period,which will begin immediately after the Expiration Date and. All other terms and conditions
of the Contract remain unchanged.
To agree to renew the Contract for an additional one (1)year period, please sign and
return this request to exercise renewal option, along with a copy of your current insurance
certificate, to the address set forth below.
Please log onto PeopleSoft Purchasing at http://fortworthtexas.gov/purchasing to insure
that your company information is correct and up-to-date.
If you have any questions concerning this Contract Renewal Notice, please contact me at
the telephone number listed below.
Sincerely,
Darla Morales
Parts Material Supervisor
817-392-4932
fEB A 8 2020 0FRUAL RECMD
CIVO�Tm E anYH CM SECRETARY
F7 WORTH,'TX
Contract Renewal rage I of I
CSC No. 47472-R4
ACCEPTED AND AGREED:
CITY OF FORT WORTH CONTRACT COMPLIANCE MANAGER:
By signing I acknowledge that I am the
person responsible for the monitoring and
administration of this contract, including
By: ensuring all performance and reporting
Name: Dana Burgh ff requirements.
Title: Assistant Ci Manager By: al'a 41�6�
APPROVAL RECOMMENDED: Name: Darla Morales
Title: Parts Material Supervisor
�d L APPROVED AS TO FORM AND
By: LEGALITY:
Name: Chris Harder
Title: Water Director
ATTEST: By:
Name: Doug B c
s Title: Assistant City Attorney
By: , . :` Y` CONTRACT AUTHORIZATION:
Name: e �`�';,� `' M&C: P-11830
Title: City Secretary ` i*. (Date Approved:
��t r
Form 1295 Certification No.
U.S. Peroxide, LLC
By:
Name: Tom Siller
Title: General Manager
0MIUAL RECORD
Uff SECRETARY
FT. WORTH,
Contract Renewal Page 2 of 2
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Iron Salts Market Overview
USP Technologies Q4 2019:
Iron Chlorides Cost Outlook
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General tightness for key raw material feedstocks in the global market,some softening on scrap metals
• Iron chloride and the raw material/feedstock commodity pricing has started to stabilize near 3 year highs
• The iron chloride market experienced significant shift in supply/demand dynamics starting in mid-2016
• Demand in almost all markets, domestic and global, was strong in 2018 and H12019
• China curtailed steel and HCI production due to environmental pressure
• The US implemented tariffs on steel imports from EU and Asia
• Aging US steel processing/production facilities creating unplanned outages and higher operating costs
• Diesel fuel pricing remains near 3 year highs—up—40%in the past 3 years creating higher fuel surcharges
• macroeconomic and key product pricing indices show some stabilization in several commodity categories
• Iron and steel scrap retreated from 3 year highs and are—22% higher than Jan 2016
• HCI remains at or near 3 year highs and prices are —30% higher than Jan 2017
• General water treating compounds have increased —8%since Jan 2017
• Chlorine prices are —15% higher than Jan 2016
• Freight/transportation services/rail transportation cost indices are all —15% higher than Jan 2016
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USP's iron chloride producers have multiple input costs in the final product
• The following cost drivers depend on raw material (RM) availability, RM cost,
regional demand, and production constraints.
• Raw material commodities affecting price include:
• Chlorine & HCL
• Scrap steel / iron (high quality scrap, no stainless steel, etc.)
• Additional costs affecting the iron chloride prices:
• Freight costs (deliver raw materials to the plant, delivered finished product)
• Rail logistics costs and complexity continues to increase for all raw materials
including chlorine, HCI, and spent pickle liquor
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Scrap Metal Prices are up 2017 to mid-2019
DEMAND UP,SUPPLY OF GOOD QUALITY SCRAP DOWN
• Scrap prices have increased from —$300 to Scrap NA Average Price
—$390 in H12019. Markets are tight for S410.00
quality scrap;general trend in costs is up
• For scrap iron NA and US regional
dynamics dictate costs $
370.00
• In the eastern US producers compete with $35°.°
foundries willing/able to pay higher prices $330.00
• On the US west coast demand for scrap is $310.00
outpacing supply as scrap flows to new steel
production and the export market $29000
• In the midwest US declines in the $270.00
automobile sector caused mills to cut back
on producing high quality/low Mn steel $250.00
m m m m m m m m m o
creating high demand for preferred scrapCG } >t d a
0 Il 2 ` 2, 7 N " Z 1 r2 `� 2 5
• Prices from 2017 avg to mid-2019 avg.
have increased —22% Source:American Metal Market
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Chlorine Prices are up 2017 to mid-2019
• Chlorine index prices have increased Chlorine FOB US Gulf Coast
5% Nov 2017 to mid-2019, FOB 37Q0
supply Gulf Coast; PPI Index for
360.0
alkalies & commodities shows —15%
increase from 2017 to 2019 350.0 - - - -
• Chlorine prices are increasing as 340.0
market suppliers consolidate and
limit 'merchant market' chlorine 330.0
supplies.(product sold to dedicated
applications like PVC production) 3zo.0 ; �ati3' �� ,
• Chlorine rail freight costs continue
to increase due in part to HAZMAT 310.0
status
300.0 ... ..... .. ._.. .. .. ._..
• HCl demand also driving producers Ma O 2 < 1� � d 0 z w w w � 1 . , a 0 0.
to shift chlorine production to HCl 2017 2018 2019
production to increase profitability
due to high HCI demand Source: I.H.S. Index
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HCI Prices are up 2017 to mid-2019
HCL IHSAvg
• HCI costs in the market place $350 -- -
have doubled since early 2017 M
• Cost increases driven by high $250
HCl demand to all segments
including oil and gas fracturing $200
• Suppliers continue to pass $150
along double digit price $1�
� LL � a � � � � � � a' v za
increases due to short supply , a' �n z LL 2 , o � � a
2017 2019 2019
• Since 2017 US prices have
M17 tO IS 0 US avg—M ias�e
increased on average 33% YTDto2017,6 ft"reaseii
Source: IM.S. Index
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SOURCE: CASS TRUCKLOAD LINEHAUL INDEX
Cass Truckload Linehaul Indexo Cass Truckload Linehaul Index,
A measure of changes in per-mile truckload Iinehaul rates. A measure of changes in per-mile Ir xWoad linoaul rates.
150
150 .......... 145
145140
. ....
140 135 ...... ...... .......
130 _.
135 ._.....
125 ................. .. ....... .. .............._........................,...
130 .......... 120
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115
25
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120 ......... ......d. >.._.._... .................. 105 .... ..
115 100
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■2016 _2017 ■2018 ■2019 Jan-08 Jan-10 Jan-12 Jan-14 Jan-16 Jan-18 Jan-20
�19 f Ytivmilm 9ywif.ae
The Cass Truckload Linehaul Indexne is an accurate,timely indicator of market fluctuations in per-mile truckload pricing.The index isolates the Iinehaul component of
full truckload costs from other components(e.g.fuel and accessorial),providing an accurate reflection of trends in baseline truckload prices.
Data within this unique index is derived from actual freight invoices processed on behalf of Cass'clients,which totaled more than$28 billion in 2018.The index uses
January 2005 as its base month.
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Rail Freight Logistics
SOURCE: FRED (FEDERAL RESERVE ECONOMIC DATA) PRODUCER PRICE INDEX BY INDUSTRY: RAIL TRANSPORTATION
krwR�aer Prloe&ldex tf rkl yr.PA T7argwU0w '.►:,
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Rail freight per PPI Rail index increased by 15% from 2016 to Q3 2019
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Kemire,
Where water
meets chemistry
August 30.2019
LSSP Ttchnologiey
Michael Srigra ul
Atlanta..C3A.
Dear Michael.
Market cunditious continue to cause significant cost increases and tightening in supply of critical n+w Anaterials
used as feedstock for inorganic coagviants along with the transportation to move those raw materials and to
deliver the Final product to the cnsronier. Additional rnarket dynarniv-s irtlpacting Lost:
• Tariffs on steel acid altunina isnports isnpleruented in L.TS
• CM.C±hydraulic frachtting activity increased sig.rtFcantly ire,C.TB
• Denaarrd in alrrroAt All nsarkets inchufiiig domestic arrd global is strong.
• .iging L.7S prodtrctioai facilities coutirwe to resnit in unplanned production outages and higher costs.
While we are bevirnting to see Borne stabilization in several of our corr'aruodity categories,the rnarlet prices have
continued to increase for onr key raw materials.
There has beau across the Board increases in Freight rates,and general tightness in iruCk &-rail car ate-nlat lily and
the nrar'ket has Beata Ltnprecedesared incr'ease.Y. in 2019. Rail and truck rates lra�'e
increased YTLr a—12946.dependirala on mode of rransportatiou.carrier_aril region.
As a result.I-zeruira is iinpleatenting a significant price increase on iron based inorganic coagtalants for all rnarket.s
in North An—ricer.
The.following price increase is being executed for the products you pnrchase aria is effective Jairittary 1.2020
through June 30.2020.
ltiar n— strives to supply c,ur customers.with the hilthest q d quality products mid sera.-ices in the indtastry. vVlaile we
will c—Ririe to do what is needed to nriarinrize the escalarlota of raw materials costs,rlre}rice increase,is necessary
to maintain saastainable operations and conn.rrue to supply you with gnaliry coatatrl—t prodtwfs, eyx.ential. for
wa[en'wastewnter rrea ntaw operations.
We vahre yotw btr.siness and will—.rk closely with you to aaiswer any cf—tious.For additional irrforrnatiorr.
please conract ere direetly_
k(hri. tUeScP �og i
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tkl.rt!.br c ;^r a 4'eir.
January 13, 2020
VIA: email
Darla Morales
Parts/Material Supervisor
Village Creek WRF
4500 Wilma Lane
Arlington, TX 76012
RE: 2020 Odor Control Program Pricing, RFP No. 16-0006
Dear Darla,
Thank you for your business over the past year!
U.S. Peroxide, LLC dba USP Technologies is pleased to offer renewal pricing at the rate of$0.1043/lb for the
60% Liquid Ferric Sulfate and $0.314/lb for the 50% Hydrogen Peroxide full-service odor control program,
both for the period of 1/26/2020 to 1/25/2021 as bid in RFP No. 16-0006. The iron pricing represents a 5.0% (or
$0.0050/lb) increase which is primarily to offset our increases in raw materials and the increased cost of
maintenance/service. The hydrogen peroxide is an increase of 3% (or$0.009/lb)which is the first increase we
requested since the bid 4 years ago. In addition, Feed Station, 112S Monitoring and Odor Control Service Fees
will all stay the same and continue to be invoiced as one line item under Facility&Maintenance Service Fee at
$2,100/month each for the two iron locations and $1300/month for the hydrogen peroxide location. Lastly, please
note that all other products priced in our above-referenced bid will also increase 5.0%, should the City wish to
initiate usage and are outlined as follows:
Chernicat Current.Price' %Increase iYew Price
Liquid Ferric Chloride 30-32% $0.1144/Ib 5.0% $0.1201/lb
Liquid Ferrous Chloride 27-30% $0.1360/lb 5.0% $0.1428/lb
Liquid Ferrous Sulfate 13-14% $0.0647/lb 5.0% $0.0679/lb
The iron salt industry continues to be dependent on commodity raw materials for chemical production including
hydrochloric acid, chlorine and scrap iron, all of which are subject to rapid price fluctuations. As a result of swift
and significant changes in cost and availability, long term pricing is more difficult to predict and maintain. USP
Technologies has received an average price increase of over 5% from the two suppliers that we use to supply
ferric sulfate to Village Creek. Please see the attached for supporting documentation.
USP Technologies appreciates the opportunity to continue to supply your odor control needs. We are committed
to providing you with the highest quality equipment,service and product supply and will continue to leverage our
scale to deliver these services safely and at the most competitive price.
Should you have any questions, please do not hesitate to give me a call at 678-662-3810.
Sincerely,
USP Technologies usptechnologies.com
1375 Peachtree Street NE,Suite 300 N,Atlanta,GA 30309 trojantechnologies.com
Phone: 404-352-6070 Fax: 404-352-6077 info@usptechnologies.com
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technologies
I/We agree to the above renewal,and terms and conditions.
Eric Mehr Company Name:
USP Technologies
Regional Program Manager Signature:
Please print name:
Date:
2
4 USP
technologies
Terms&Conditions:
1. Weights. Seller's weights and volumes shall govern,except that in case of proven error adjustment shall be made.
2. Risk of Loss. Risk of loss and responsibility for all goods sold or provided hereunder shall pass to Buyer upon Seller's delivery to Buyer.
3. Warranty&Liability. Seller warrants that the goods shall conform to Sellers standard specifications in effect at time of shipment. SELLER
MAKES NO OTHER WARRANTY,EXPRESS,OR IMPLIED,COVERING THE GOODS AND DISCLAIMS THE IMPLIED WARRANTY OF
FITNESS FOR PURPOSE. Upon passage of title to the goods,Buyer assumes all responsibility and liability for and agrees to defend and
indemnify Seller against,all claims,loss or damage resulting from Buyers storage,handling,sale or use of the goods or their containers.
4. Indemnification. Buyer shall indemnify,defend and hold Seller harmless from and against that portion of any liability,costs,expense
(including without limitation reasonable attomeys'fees and expenses),claim,judgment,settlement or damage(collectively, "Claims")that
Seller may incur or be required to pay to any third party(including without limitation any employee of Buyer regardless of whether such
employee is barred under applicable law from claiming against Buyer)which is caused or contributed to by any act or omission of Buyer,
including without limitation those arising from the negligence of Seller.If Buyer resells the products sold hereunder,Buyer will use its best
commercial efforts to obtain from its purchaser an indemnification similar to the foregoing for the benefit of Buyer and Seller.
5. Damages&Claims. Seller's liability for damages and remedies against the Seller shall be limited to return of the purchase price of the
particular delivery with respect to which such damages are claimed. The foregoing constitutes the exclusive remedy against the Seller and
entire liability of the Seller in connection with such delivery and Seller shall not be liable for any incidental or consequential damages.
Buyer shall inspect each shipment of goods within a reasonable time after arrival at Buyers plant,and in any event before use. Failure to
make a claim in writing against the Seller within 30 days after arrival of goods at destination shall constitute an irrevocable acceptance of
goods. Any action for breach of this contract must be commenced within one year after the cause of action has accrued.
6. Default or Waiver. If Buyer fails to perform any of the terms of this contract,Seller may defer shipments until such failure is made good or
may treat such failure as final refusal to accept further shipments and may cancel this contract. A Seller may terminate this contract if
Buyer becomes insolvent. This contract shall automatically terminate in the event Buyer assigns his property for the benefit of creditors or
is adjudicated a bankrupt. Either parry's waive of such party's rights thereafter to enforce and compel strict compliance with conditions of
this contract,at any time,shall not in any way affect,limit,or waive such party's right thereafter to enforce and compel strict compliance
with every term and condition of the contract.
7. Excuses for Nonperformance. Seller shall have no liability for any delay or failure in performance hereunder,in whole or in part,if such
delay or failure arises from(i)compliance in good faith with any foreign or domestic governmental regulation or order,whether or not later
shown invalid or inapplicable;(ii)the occurrence of any contingency the nonoccurrence of which was a basic assumption at the time this
contract was made,including without limitation acts of God,fire,flood,accident,not,war,terrorism,sabotage,strike,lock-out,labor trouble
or shortage,breakdown or failure of equipment,or embargo;(iii)Seller's inability to obtain any required product,material,energy source,
equipment,labor,or transportation at prices and on terms deemed by Seller to be acceptable;(iv)Seller's incurring increased costs for
compliance with environmental protection,health or safety regulations;or(v)any other event or occurrence not within the reasonable
control of Seller.If any such circumstances affect only a part of Seller's capacity to perform,Seller may allocate products,services and
deliveries among its customers and its own requirements as Seller may determine in its sole discretion.Quantities affected by this
paragraph may,at the option of either party,be eliminated from the contract without liability,but the contract shall remain otherwise
unaffected.
8. Assignability&Continuity. The Buyer shall not assign this contract or any right or obligation under this contract without Seller's prior,
written approval;however,this contract shall be binding upon and inure to the benefit of any actual or purported successors of the parties
hereto.
9. Surcharges. Notwithstanding anything in this Contract to the contrary,Seller reserves the right to impose a special temporary surcharge in
the event of any increase in the price of energy or any other raw material that is reasonably likely to have a material impact on Seller's
overall costs of Products and Services,or is imposed on Seller by its material or services providers. The amount of such surcharge will be
limited to that required to negate the increase in Seller's costs resulting from such increases. Seller shall give Buyer written notice at least
ten(10)business days prior to imposing any such surcharge and shall reduce or remove such surcharge at such time as the price of
energy or raw materials return to levels which no longer justify such increase.
10.Patents. Seller represents that to the best of its knowledge,the sale and/or use by Buyer of goods in the form sold hereunder will not
infringe any composition of matter claims in any adversely held U.S.Patent claiming the goods per se,but in the event that it is alleged
that such sale and/or use constitutes infringement of such Patent,then Seller's liability to the Buyer shall(i)be limited to the defense of
such infringement actions and the payment of damages awarded therefor by a court of competent jurisdiction from which no appeal is or
can be taken,and(ii)arise only if Buyer promptly gives Seller written notice of such claim and full authority,information and assistance for
the defense of such claim.Seller's warranty as to use patents only applies to infringement arising solely out of the use of the goods
according to their applications as envisioned by Seller's specifications. In no event shall Seller be liable for any infringement or alleged
infringement arising from or caused or alleged to be caused by Buyer's combination of the goods supplied hereunder with other goods in
any fashion not specifically recommended by Seller or by use of the goods in any process not specifically provided or recommended by
Seller and is provided on the condition that the Buyer is likewise responsible for and will defend,indemnify and hold harmless the Seller
against all losses,claims,expenses or damages which may result from the misuse or misapplication of any goods or services by the Buyer
or any third party affiliated or in privity with Buyer. The foregoing states the entire liability of the Seller with respect to patent infringement
by said goods. Seller reserves the right to suspend deliveries hereunder,or to terminate this contract,if the Seller believes that the
manufacture and/or sale by the Seller,or the sale and/or use by the Buyer,of any goods sold hereunder infringes on any U.S.PATENT.
11.Applicable Law—Entirety. The construction,performance and completion of this contract shall be governed by the law of the state of
Delaware. This contract is intended by the parties as the final expression of their agreement and is the complete and exclusive statement
of the terms thereof,notwithstanding any oral representations or statements to the contrary heretofore made. No modification or release
shall be effective unless in writing,signed by both parties,and specifically stating it is such modification or release.
12.Termination. If pursuant to any Federal,State or local law,regulation or ordinance Seller is required to install any additional equipment or
facilities,in order to comply with governmental standards and if the cost of such installation,in Sellers opinion,makes it uneconomic to
Seller to continue production of the goods,Seller may terminate this contract on 30 days prior written notice to buyer.
13.Acceptance. All sales and purchases of products hereunder are limited to and conditional on Buyer's acceptance of these standard terms
and conditions.Seller objects to and rejects any terms and conditions that may be proposed by Buyer which are in addition to or different
from these standard terms and conditions.No modification of this contract shall be effected by the acknowledgment or acceptance of
purchase order forms containing different or additional terms or conditions.
3