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Home My WebLink About01/19/1999, C4 - COOPERATIVE PURCHASING AGREEMENTcouncil D AD = !Januar 19, 199 acEnaa Report ,�H� CITY OF SAN LUIS O B I S P O FROM: Paul LeSage, Parks & Recreation Director POL Prepared By: Betsy DeJamette, Recreation Supervisor SUBJECT: COOPERATIVE PURCHASING AGREEMENT CAO RECOMMENDATION 1) Approve a cooperative purchasing relationship between the City of San Luis Obispo and the San Luis Coastal Unified School District for the provision of food and related supplies for programs of the Parks and Recreation Department; 2) Authorize the City Administrative Officer to sign the agreement. DISCUSSION Back rg ound Each year, Children's Services Division, in combination with Teen Programs and the Golf Course, spend approximately $30,000 on food and food related items for programs. At the Golf Course, food is sold to golfers for a 100% cost recovery. In programs such as child care and teen programs, nutritional snacks are provided daily as part of state licensing requirements and the associated costs are recovered only in part by program fees. In light of partial recovery, it is advantageous for the City to purchase food and food related supplies in the most cost effective manner possible. Traditionally, food and food related program supplies have been purchased largely from Smart `N Final. In special circumstances items have been obtained through Scolaris grocery store. Because the City has an account with both businesses, it is convenient to conduct business with them. Consequently, purchases are limited to items stocked and/or market prices and what has been gained in convenience oftentimes is lost in terms of product choice and price comparison. In either instance, program quality and dollar value can be effected. This past year several situations prompted staff to review current purchasing practices and identify alternative options. Using temporary staff as the snack purchaser results in the program not always getting the best buy for the dollar and increased temporary staff costs. Regularly, staff met throughout the summer with a parent advisory committee for quality child care. One topic discussed frequently was the quality, quantity and cost of snacks served the children. Comments received this fall from a survey to parents of children in the child care programs also targeted snacks as an important part of programming but satisfaction with snack was questionable at best. Also, daily comments from the children themselves indicate that they would prefer more diversity when it comes to snack C4 -1 Council Agenda Report - Cooperative Purchasing Agreement Page 2 The catalyst driving staff to seek alternatives came from the parent advisory committee recommending that staff research options for purchasing more diverse snacks at a better price. The committee provided several contacts in the food industry and staff subsequently met with representatives from Jordano's, Sysco and ultimately San Luis Coastal Unified School District to discuss purchasing options. Both Jordano's and Sysco currently have contracts with the school district to provide certain food and food related items. Both companies indicated they could supply the City with a wider range of product and better pricing than Smart `N Final if the City purchased through the school district contract. If the City established contracts with either company independent of the school district, product diversity could be improved but cost savings would be minimal. The magnitude of the school district contract permits both companies to provide the best and most competitive price breaks at approximately 3% over cost. Because the City contract would be much smaller in comparison to that of the school district, higher percentages over cost would be required. Staff then met with the Food Services Director of San Luis Coastal Unified School District to determine the feasibility of establishing a food service contract with them. The school district has similar arrangements with other agencies in the area and indicated a willingness to extend the service to the City. In addition to the contracts with Jordano's and Sysco, the school district also contracts with Gold Star, Spunkmeyer and other food providers and under their purchasing contract would guarantee the City the lowest prices available to them. After discussing components of a potential contract, the Food Services Director developed a contract outlining details of the agreement. The resultant contract is located in Exhibit A of this report. FISCAL IMPACT Providing snacks at the child care programs is mandated by Title 22, Division 12, Chapter 1 of the Child Day Care General Licensing Requirements. Funding for snacks was included in the 1997 -99 Financial Plan adoption. Approving a joint purchasing agreement with San Luis Coastal Unified School District will not require additional appropriations. Based on preliminary price comparisons of food products currently being purchased at Smart `N Final, the School District contract (including the 10% administrative fee) would reduce the amount of money used for snacks from $.65 to $7.00 on three of four items reviewed. At no time will the cost of food and food related items increase. If an increase is identified, staff would recommend returning to the current system. In addition, there would be a reduction in the use of temporary staff hours. In turn, these temporary staff savings could be redirected towards the actual supervision of child care program participants. C4 -2 I Co"cil.Agenda Report = Cooperative Purchasing Agreement Page 3 ALTERNATIVES Direct staff to go out to bid R5r prop6sals from competing food supply companies. This most likely would impact negatively both diversity of product and savings diie to limited size of contract. ATTACHMENTS Agreement for the Provision of Food and Supplies C4 -3 SAN LUIS COASTAL UNIFIED SCHOOL DISTRICT DIVISION OF FOOD SERVICES 1499 SAN LUIS DRIVE SAN LUIS OBD'SO, CALIFORNIA 93401 -3099 AGRMI[ENT FOR THE PROVISION OF FOOD AND SUPPLIES This agreement between the San Luis Coastal Unified School District, hereinafter referred to as the District and the City of San Luis Obispo, Department of Parks and Recreation, hereinafter referred to as the Agency is made for the purpose of providing food and related supplies for the programs of the Department of Parks and Recreation. 1. The District shall order food and related supplies, as requested by the Agency. The Agency shall place its requests with the District, two weeks prior to the. date needed. 2. The Agency shall receive the items ordered, at the kitchen at Laguna Middle School, 11050 Los Osos Valley Road, San Luis Obispo at a mutually agreed upon time. 3. The District shall submit monthly, itemized invoices to the Agency. The Agency will be charged at the rate of 10% over cost. 4. The Agency shall hold the District harmless for items it is not able to provide. It is understood that the District does, on occasion, experiences shortages from its suppliers and cannot guarantee complete fulfillment of all requests-by the Agency. S. The District shall be responsible for maintaining the proper temperature and storage of the food and supplies until they are received by the Agency. Once the food and supplies are received by the Agency, their proper storage becomes the responsibility of the Agency. 6. The term of this agreement shall be through June 30, 1999, unless terminated by either party upon 30 days written notice. City of San Luis Obispo John Dunn, Chief Administrative Officer San Luis Coastal Unified School District Ar Rory L gston, Assistant Superintendent Business Services C4 -4 SAN LUIS COASTAL UNIFIED SCHOOL DLS`MCT DIVISION OF FOOD SERVICES 1499 SAN LUIS DRIVE SAN LUIS OBIPSO, CALIFORNIA 93401 -3099 AGREEMENT FOR THE PROVISION OF FOOD AND SUPPLIES This agreement between the San Luis Coastal Unified School District, hereinafter referred to as the District and the City of San Luis Obispo, Department of Parks and Recreation, hereinafter referred to as the Agency is made for the purpose of providing food and related supplies for the programs of the Department of Parks and Recreation. 1. The District shall order food and related supplies, as requested by the Agency. The Agency shall place its requests with the District, two weeks prior to the date needed. 2. The Agency shall receive the items ordered, at the kitchen at Laguna Middle School, 11050 Los Osos Valley Road, San Luis Obispo at a mutually agreed upon time. 3. The District shall submit monthly, itemized invoices to the Agency. The Agency will be charged at the rate of 10% over cost. 4. The Agency shall hold the District harmless for items it is not able to provide. It is understood that the District does, on occasion, experiences shortages from its suppliers and cannot guarantee complete fulfillment of all requests by the Agency. 5. The District shall be responsible for maintaining the proper temperature and storage of the food and supplies until they are received by the Agency. Once the food and supplies are received by the Agency, their proper storage becomes the responsibility of the Agency. 6. The term of this agreement shall be through June 30, 1999, unless terminated by either party upon 30 days written notice. City of San Luis Obispo John Dunn, Chief Administrative Officer San Luis Coastal Unified School District ry . Livingston, Assistant Superintendent Business Services C4 -5