The Kenai City Council enacted an ordinance increasing estimated revenues and appropriations in the Water Sewer Special Revenue Fund for operational chemical costs more than what was budgeted. The Public Works Department secures annual purchasing agreements for required chemicals at the city’s water and wastewater treatment plants.
Public Works Director Scott Curtin tells the Kenai City Council that he’s running into supply chain issues:
“We ran into similar scenario this year. We’re using a new vendor this year, never used them before, but they were low bid. They missed a barge earlier on, which delayed some chemicals. We’ve had that to contend with. We’ve gone through that and its all fine. This is basically refreshing our budget for expenses that were above and beyond what we are expecting. The budget that I presented in the spring to you were based on historical data that we generally expect. Those numbers in the environment that we’re in today came in astronomically higher, increases that we’ve never seen before, and to the point, to be honest with you, I’m looking at alternatives at possibly installing other equipment as a future capital project to possibly generate our own chemicals instead of having to supply them. There’s different things that we can do to walk away from this eventually.”
Curtin says he’s not expecting a change anytime soon:
“It’s insane. The company that we did business last year, I want to say last year’s bid was $83,000. Their bid to me, which they lost, their bid to me this year was like $157,000. So, they almost doubled their bid for the exact same thing that I purchased twelve months ago.”
The items were all competitively bid and the lowest bidder, Cascade Columbia’s total bid was $28,390 more than budgeted amounts, approximately $12,000 toward the wastewater plant and $16,000 toward the water plant. Additionally, Nalco Company provides chemicals that are used to assist in removing tannins in the water. Their pricing resulted in costs totaling approximately $29,000 in excess of budgeted funds.
The chemicals typically purchased through these agreements include sodium hypochlorite, sodium bisulfite, lime, and polymer.