Council approves purchase authorization for large transformer with 4-year lead time; staff to lock price

The council approved a resolution authorizing an expenditure greater than $50,000 to purchase an MVA three-phase power transformer for the City of Napoleon Electric Department and to award the purchase to Delta Star Inc. Greg and other electric staff told council that Delta Star quoted a four-year lead time for the large transformer and that the vendor asked the city to "fill in August 1 for them to hold that price." Greg said the company required an order to hold pricing and that lead time is long "because of the bigger transformer." "They're getting a 4 year lead time," Greg said. Council and staff discussed timing, project sequencing and payment terms. Greg said he understood the vendor had set up payment in installments and that final payment would come after delivery, but specific contract terms were not presented in detail at the meeting. A council member asked whether the city would need to pay up front; staff replied they believed the vendor split payments into three installments with a final payment on delivery. Council moved to suspend the rules and passed the resolution after a roll call. City staff said the transformer is central to a larger substation and industrial-park project that will proceed in coming years and that AMP (the municipal power participant) is involved in planning.