Exhibit 1 - Agenda Information SheetCity of Denton
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AGENDA INFORMATION SHEET
DEPARTMENT: Procurement
CFO: Cassey Ogden
DATE: December 13, 2022
SUBJECT
Consider adoption of an ordinance of the City of Denton, a Texas home-rule municipal corporation,
ratifying the expenditure of funds by the City Manager for the emergency purchase of rebuilt electric utility
transformers for Denton Municipal Electric; and providing an effective date (File 8169 – awarded to
Solomon Corporation, in the not-to-exceed amount of $170,700.00).
INFORMATION/BACKGROUND
This Declaration is for rebuilt electric utility transformers needed to provide restoration of, and service to
customers and is the result of current supply chain issues being experienced across the electric utility
industry and Denton Municipal Electric (DME).
Section 252.022 of the Texas Local Government Code provides exemptions associated with purchasing
requirements which include (1) a procurement made because of a public calamity that requires the
immediate appropriation of money to relieve the necessity of the municipality’s residents..., and (2) a
procurement necessary to preserve or protect the public health or safety of the municipality’s residents.
Denton’s current inventory of transformers is at levels reserved for normal, daily electric service operational
responsibilities and emergency response. For new construction, DME prioritizes transformers on a project
first come, first ready basis for customers and developers that have inspections and permits complete. DME
has 45 projects designed and released to construction or ready to be released for construction. DME has
another 128 projects currently in the design phase. DME has notified customers and developers that the
utility may not be able to provide immediate service due to the low inventory of transformers and the current
supply chain issues.
Supply chain issues for distribution transformers continue to worsen. Major shortages are being experienced
nationwide of critical electric utility equipment such as electric distribution transformers, underground
cables, substation equipment, and other equipment necessary to maintain and provide electric service in
Denton. The need for this Declaration of an Emergency stems from lead times on transformers approaching
76 weeks in some instances. Vendors cannot provide reliable estimates of lead times for equipment. DME
has seen an increase of 250% or more in the average cost of transformers supplied by its contracted vendor.
Table 1 provides a list of orders for transformers needed under this Declaration of an Emergency to help
mitigate some of the supply chain issues and help support DME’s stock levels of transformers. Failure to
declare an emergency could cause inventory levels to drop further below minimum acceptable levels.
City Hall
215 E. McKinney Street
Denton, Texas
www.cityofdenton.com
Table 1
Transformer Size Transformer Cost Quantity Total Cost
50kVA 240/120 PM $ 6,050.00 10 $ 60,500.00
75kVA 240/120 PM $ 8,150.00 5 $ 40,750.00
167kVA 240/120 PM $ 23,150.00 3 $ 69,450.00
750kVA 208/120 PM $ 35,450.00 1 $ 35,450.00
750kVA 480/277 PM $ 35,450.00 1 $ 35,450.00
750kVA 480/277 PM $ 37,175.00 1 $ 37,175.00
Purchase Order Total Cost $ 170,700.00
1 1
Approval of a Declaration of an Emergency, with a one-time spend authority of $170,700.00, allows DME
to better position its transformer inventory for service and minimize the growing backlog of transformer
orders.
PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS)
On December 12, 2022, this item will be presented to the Public Utilities Board (PUB) for consideration.
RECOMMENDATION
Approve the emergency purchase of rebuilt electric utility transformers for Denton Municipal Electric, in a
not-to-exceed amount of $170,700.
PRINCIPAL PLACE OF BUSINESS
Solomon Corporation
Solomon, KS
ESTIMATED SCHEDULE OF PROJECT
This is a one-time purchase with an estimated delivery of 16-20 weeks.
FISCAL INFORMATION
The transformers are funded out of the DME’s Capital Budget. Requisitions have been entered as needed
and components purchased as Purchase orders were issued.
EXHIBITS
Exhibit 1: Agenda Information Sheet
Exhibit 2: Declaration of Emergency
Exhibit 3: Ordinance
Respectfully submitted:
Lori Hewell, 940-349-7100
Purchasing Manager
For information concerning this acquisition, contact: Randy Key, 940-349-7665.
Legal point of contact: Marcella Lunn at 940-349-8333.