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2005-048S:\Our Dccuments\Or dinances\05~Ch an ge Order-DME-Transformers-Waukesha.doc AN ORDINANCE OF THE CITY OF DENTON APPROVING A CHANGE ORDER FOR A THREE-YEAR CONTRACT BETWEEN THE CITY OF DENTON AND WAUKESHA ELECTRIC SYSTEMS, INC. APPROVED BY ORDINANCE NO. 2003-383 FOR THE PURCHASE OF 15/20/25 MVA POWER TRANSFORMERS; PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFORE; AND PROVIDING FOR AN EFFECTIVE DATE. (BID 3105-THREE YEAR AGREEMENT CHANGE ORDER ONE IN THE ESTIM_A. TED AMOUNT OF $54,000 PER TRANSFORMER) WHEREAS, pursuant to City Council approval under Ordinance No. 2003-283 the City of Denton and Waukesha Electric Systems, Inc. (the "Vendor") entered into a contract (the "Contract") for the purchase of 15/20/25 MVA Power Transformers (the "Transformers"); and WHEREAS, due to the dramatic increase in the cost of the major commodities used in transformer manufacturing the Vendor has requested a change order increasing the unit price of the Transformers by 13%, and with a price escalator for future purchases being tied to the Producers Price Index ("PPI"), except that in no event shall the unit prices exceed 125% of the original unit prices (the "Change Order"); and WHEREAS, the Public Utility Board has recommended approval of the Change Order; and WHEREAS, the City Council finds that.the Change Order serves valid public and municipal purposes and is in the public interest; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. The findings set forth in the preamble of this ordinance are incorporated by reference Into the body of this ordinance as if fully set forth herein. SECTION 2. The Change Order is hereby approved. The City Manager, or his designee, is hereby authorized to execute the Change Order on behalf of the City and to make the expenditure of funds provided for by the Change Order. SECTION 3. This Change Order is also adopted as a procurement procedure authorized by Section 252.022(c) of the Local Government Code. The expenditures provided for by the Change Order are for Denton Municipal Electric ("DME"), a municipally owned electric utility. The City Council is the governing body of DME. Due to the dramatic increase in the cost of major commodities used in transformer manufacturing it is necessary that they be purchased by change order to existing vendor contracts instead of competitively bidding the purchases. An investigation of the market has determined that a competitive bidding process would yield prices greater than the Change Order. The City Council hereby finds that the City and DME will be substantially harmed if required to competitively bid the transformers. The City Council further finds that the Change Order and the procurement procedures adopted herein serve a valid public purpose by saving the City and DME substantial expenses that would be incurred through the competitive bidding process. This ordinance shall also constitute a resolution of the City Council of the City of Denton. SECTION 4. approval. This ordinance shall become effective immediately upon its passage and PASSED AND APPROVED this the ~:?'~ff-(-ddayof ~.j~d'~2.005. EULINE BROCK, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY APP~v~D A~ TO LE~2 FJ~ti:LM: HERBER~RNEY Page 2