Exhibit 1- Agenda Information Sheet - Amendment 1City of Denton
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AGENDA INFORMATION SHEET
DEPARTMENT: Procurement & Compliance
CFO: Antonio Puente, Jr.
DATE: July 23, 2019
SUBJECT
Consider adoption of an ordinance of the City of Denton, a Texas home-rule municipal corporation,
authorizing the City Manager to execute a contract for the purchase of natural gas for use in the Solid Waste
Department’s CNG Fuel Pumps; in accordance with Texas Local Government Code 252.022, which
provides an exemption from competitive bidding for this purchase; and providing an effective date (File
6795 - awarded to Luminant Energy Company, LLC, in the not-to-exceed amount of $75,000).
INFORMATION /BACKGROUND
The City of Denton operates a significant fleet of Compressed Natural Gas (CNG) fuel collection vehicles
to provide solid waste and recycling services to its residents and businesses. In April 2018, the City of
Denton commissioned its CNG fueling facility at the City of Denton Landfill resulting in the necessity to
contract with a third party to supply natural gas to the station. Natural gas is supplied to the open market
under one of two scenarios; using a fixed price scenario based on the spot market the date the purchase
agreement is signed and a dynamic model basing the commodity price on the spot market at the time the
CNG is pumped/delivered. Because of the City’s relatively low volume CNG demands and the need to
ensure fixed pricing, we elected to accept fixed-price proposal to avoid the staff time required to monitor
the commodity market and to apply budgeting predictability. Luminant Energy Company, LLC, is the only
supplier that will contract with the City of Denton using the fixed cost model.
The City’s Current agreement with its CNG Supplier, Luminant Energy Company, LLC, expires July 31,
2019. A new contract will need to be executed prior to August 1, 2019, to ensure the City’s Solid Waste
CNG fleet remains operational. The purpose of this ordinance is to provide the City Manager the authority
to contract with Luminant Energy Company, LLC, to purchase up to $75,000 worth of Compressed Natural
Gas (CNG) for fueling City of Denton Fleet Vehicles.
In accordance with Texas Local Government Code 252.022, the procurement of items necessary to preserve
or protect the public health or safety of the municipality’s residents need not be submitted to competitive
bids and this Section has been construed to cover solid waste collection, hauling and disposal. See
Browning-Ferris, Inc. v. City of Leon Valley, 590 S.W.2d 729 (Tex. App.-SAT 1979), reh. denied); Texas
Atty. Gen. Op. No. JC-0281 (2000).
PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS)
On July 22, 2019, this item will be presented to the Public Utilities Board for recommendation to the City
Council for consideration.
City Hall
215 E. McKinney Street
Denton, Texas
www.cityofdenton.com
RECOMMENDATION
Award a contract with Luminant Energy Company, LLC, for Compressed Natural Gas (CNG) for fueling
City of Denton Fleet Vehicles, in the not-to-exceed amount of $75,000.
PRINCIPAL PLACE OF BUSINESS
Luminant Energy Company, LLC
Dallas, TX
ESTIMATED SCHEDULE OF PROJECT
Providing this authority will ensure the ability to acquire CNG for the City of Denton Solid Waste and
Recycling Fleet for approximately 12 months.
FISCAL INFORMATION
These services will be funded from Solid Waste account – 660800.7842 in the amount of $75,000.
EXHIBITS
Exhibit 1: Agenda Information Sheet
Exhibit 2: LLC Members
Exhibit 3: Sample Agreement
Exhibit 4: Ordinance
Respectfully submitted:
Lori Hewell, 940-349-7100
Purchasing Manager
For information concerning this acquisition, contact: Brian Boerner at 940-349-8001.
Legal point of contact: Larry Collister at 940-349-8333.