Description: COAT-ARM Hastings District Council


Civic Administration Building

Lyndon Road East, Hastings

Phone:  (06) 871 5000

Fax:  (06) 871 5100










Tenders Subcommittee MEETING




Meeting Date:

Thursday, 21 December 2017




Landmarks Room

Ground Floor

Civic Administration Building

Lyndon Road East



Subcommittee Members

Chair: Councillor Travers

Mayor Hazlehurst (Ex Officio)

Councillors Lyons, Nixon, Redstone and Watkins (Deputy Chair)

Chief Executive and Group Manager: Asset Management


Officer Responsible

Executive Advisor/Manager: Office of the Chief Executive

(Mr M Maguire)

(Quorum = 4)

Committee Secretary

Christine Hilton (Extn 5633)


Tenders Subcommittee – Terms of Reference

A Subcommittee of the Works and Services Committee


Fields of Activity

The Tenders Subcommittee is responsible for assisting council in its general overview of procurement and tender activity by accepting tenders which exceed the Chief Executive’s delegated authority to approve, for projects previously approved by Council or a Standing Committee within the delegated authority.


Chairman appointed by the Council

4 members appointed by the Council

Chief Executive

Group Manager: Asset Management


For the avoidance of doubt the references in this delegation to the ‘Chief Executive’ and ‘Group Manager: Asset Management’ extends to include any persons from time to time appointed in writing to those roles in an acting capacity.


Quorum – Any four members.


Delegated Powers

Authority to accept tenders for individual projects previously approved by the Council or a Standing Committee of the Council up to a value of $8,000,000

Responsibility to provide oversight and direction on tendering processes in general and/or specific issues relating to a particular project

The Committee reports to the Works and Services Committee





Tenders Subcommittee MEETING


Thursday, 21 December 2017



Landmarks Room

Ground Floor

Civic Administration Building

Lyndon Road East










1.         Apologies

An apology from Councillor Redstone has been received.

At the close of the agenda no requests for leave of absence had been received.

2.         Conflict of Interest

Members need to be vigilant to stand aside from decision-making when a conflict arises between their role as a Member of the Council and any private or other external interest they might have.  This note is provided as a reminder to Members to scan the agenda and assess their own private interests and identify where they may have a pecuniary or other conflict of interest, or where there may be perceptions of conflict of interest. 

If a Member feels they do have a conflict of interest, they should publicly declare that at the start of the relevant item of business and withdraw from participating in the meeting.  If a Member thinks they may have a conflict of interest, they can seek advice from the Chief Executive or Executive Advisor/Manager: Office of the Chief Executive (preferably before the meeting). 

It is noted that while Members can seek advice and discuss these matters, the final decision as to whether a conflict exists rests with the member.

3.         Confirmation of Minutes

Minutes of the Tenders Subcommittee Meeting held Thursday 7 December 2017.

(Previously circulated)

4.         CON2017117 Wastewater Treatment Plant PLC System Upgrade Direct Engagement Report                                                                                                   5

5.         Direct engagement of Techlight for the supply of Telematics light control units (LCU123)                                                                                                                       9

6.         CON2017106 Waimarama Road, Middle Road and Rochfort Road Area Wide Pavement Treatment                                                                                               15

7.         Additional Business Items

8.         Extraordinary Business Items 




File Ref: 17/1299



REPORT TO:               Tenders Subcommittee

MEETING DATE:        Thursday 21 December 2017

FROM:                           Wastewater Manager

David James

SUBJECT:                    CON2017117 Wastewater Treatment Plant PLC System Upgrade Direct Engagement Report        



1.0       Summary

1.1       The purpose of this report is to seek approval from the Tenders Subcommittee to award Contract No. CON2017117 to CR Automation Ltd for the upgrade of the control system at the Wastewater Treatment Plant in East Clive.

1.2       The approved Procurement Plan for this contract recommends that the preferred procurement methodology is Direct Engagement. This methodology is preferred due to the complex and specialised nature of the project, the knowledge and understanding the preferred supplier has of the WWTP PLC system and the local skills and expertise the preferred supplier has.

1.3       The contract is expected to run for a period of approximately 12 months.

1.4       This report concludes by recommending that the Contract be awarded to CR Automation Ltd at the proposal price of $292,400.00 (excl. GST).

2.0       Background and Scope of Work

2.1       This project has been planned over the last 12 months and the budget has been provided for in the 2017/18 and 2018/19 Annual Plans.

2.2       The Wastewater Treatment Plant at East Clive has an automation and control system that has been developed over many years. This system manages and monitors the automated operation of critical treatment equipment at the plant.

2.3       The control system has entered the Silver Series phase of its asset life (see diagram below) and manufacturer support is coming to an end. This means that it will be increasingly difficult and expensive to source spare parts. The redundant technologies and future risks of supply are a concern due to the critical and highly sensitive nature of wastewater treatment.

Control System Life Cycle

2.4       This project aims to upgrade and future proof the PLC and SCADA system that operates and controls the critical components of the wastewater treatment plant, such as screens, pumps and BTF distributer arms in the most timely and cost effective manner.



3.1       In accordance with the Procurement Policy various procurement options have been assessed, these are summarised in the table below:


Procurement Option


Open Tender - lowest price conforming method

Not preferred due to the specific technical requirements of the equipment and the need to design the solution with suppliers that have a detailed understanding of the HDC PLC system.


An open tender process presents a range of risks. The key open tender risks are:

·      Procurement of poor quality/substandard hardware

·      Procurement  of suppliers with little or no knowledge of the WWTP current PLC system

·      Procurement  of suppliers that do not have the skills required to effectively integrate and transition the PLC system to a new platform

·      Risks to plant operation and performance during implementation of new system.


These risks individually and cumulatively indicate that an open tender process has high risk potential, both economic and operational.

Open Tender - price quality method

Not preferred for the same reasons as the lowest price conforming method. Although there is the ability to add weightings for specific key attributes, there is still the risk that the supplier may not provide the desired technical outcome. 

Direct Engagement

This is the preferred procurement option due to the specialised nature of the work, the limited number of local suppliers and the preferred supplier having a proven track record and detailed knowledge of the HDC PLC system.

CR Automation is a leading control and automation company with extensive experience nationally and internationally. They have also been HDC’s PLC maintenance contractor for many years and have a thorough knowledge of the WWTP PLC system. Based on their wide range of experience and their knowledge of the HDC system they are well placed to provide Council with the desired project outcomes.


3.2       The preferred procurement method for this project is Direct Engagement due to the complex and specialised work and the benefits associated with having a leading automation and control company that has extensive HDC WWTP system experience design and manage the system integration and upgrades.

3.3       An open tender method for this type of project has a number of risks that could affect the successful outcome of the project.  These risks and uncertainties are related to achieving successful system integration, obtaining the desired hardware and system outcomes and a cost effective solution.

3.4       CR Automation is a locally owned and operated business that provides HDC and a number of other Councils and private business in New Zealand and internationally with control system services. They have provided HDC with PLC and SCADA system technical support and maintenance over many years. They have utilised their knowledge and understanding of the wastewater treatment plant system to, in conjunction with the Plant Manager Bob McWilliams, carefully review the best system upgrade options for the plant.



4.1       The CR Automation proposal has been assessed to represent fair value for the type and scale of project.

4.2       Reference checks on CR Automation indicate that they are an experienced, highly skilled and well-resourced contractor able to meet the challenges of this project.


5.1       The Project Plan includes the following stages;

·    Phase 1: System planning and design

·    Phase 2: Hardware purchase

·    Phase 3: Hardware integration and installation

·    Phase 4: Testing and commissioning

5.2       Phase 1 of the project will involve planning and design of the new system. CR technicians will initially assess the current and future control requirements and then develop a staged implementation plan that will ensure the continuous operation of the plant.

5.3       CR are familiar with and understand the challenges of working on live systems and a detailed changeover plan will document each stage of an individual system changeover. The plan will detail staff involved and their responsibilities, the tests required to be completed, contingency plans during the changeover, and contingency plans post-changeover if issues arise albeit unlikely with the new system.

5.4       Phase 2 of the project will involve hardware selection and purchase. Hardware estimates will be finalised during Phase 1 of the project. Prices will be sought from selected hardware suppliers and approved within Council’s procurement rules.

5.5       Phase 3 of the project will involve the integration and installation of the new control system.

5.6       Phase 4 of the project will involve the testing, commissioning and handover of the new system.

5.7       The project cost estimates are summarised in the table below:




Planning and Design


Integration and hardware installation


Commissioning , testing and handover


Sub Total


Hardware purchase


Total project contingency (8%)


Total Project Estimate



5.8       The project will commence in January 2017 and run for approximately 12 months.

6.0       BUDGET

6.1       Council’s Budget Allocation for this Project is as follows:

Budget Area

Total Project




PLC Renewals (17/18)



PLC Renewals (18/19)









6.2       As noted in section 5.4 of this report approval for the hardware purchase will be sought once this component of the project has been finalised in Phase 1 of the project.

6.3       NOTE: that NZS 3910:2003 provides for certain events and circumstances to be treated as variations, resulting in additional costs and time extensions.  A Contingency Allowance of $35,000 has been provided for.

7.0       Implementation Issues

7.1       The integration and installation of the new PLC system is complex, however a detailed Project Plan will be developed in Phase 1 of the project and will address project risks, hazards and mitigation measures.




A)      That the report of the Wastewater Manager titled “CON2017117 Wastewater Treatment Plant PLC System Upgrade Direct Engagement Report” dated 21/12/2017 be received.

B)     That the proposal from CR Automation Ltd for Contract No. CON2017117 in the sum of $292,400.00 plus GST be approved.

C)     That authority to enter into Contract No CON2017117-Wastewater Treatment Plant PLC Renewal on behalf of Council be delegated to the Group Manager: Asset Management. 

D)     That delegated authority be granted, on behalf of the Council, to the Group Manager: Asset Management to award cumulative contract variations to Contract No. CON2017117 up to the value of the contingency sum of $35,000 plus GST.



There are no attachments for this report.



File Ref: 17/1301



REPORT TO:               Tenders Subcommittee

MEETING DATE:        Thursday 21 December 2017

FROM:                           Transportation Asset Manager

Marius van Niekerk

SUBJECT:                    Direct engagement of Techlight for the supply of Telematics light control units (LCU123)        



1.0       SUMMARY

1.1       The purpose of this report is to gain the subcommittee’s approval to procure 3425 Light Control Units (LCU) by direct engagement.

1.2       The LCU’s form part of the accelerated streetlight to LED conversion programme approved by Council. In the first year of the conversion programme the LCUs were included in the request for tender for LED lights and as a result attracted a handling charge from tenderers. The reason for the direct engagement is to avoid the handling charges.

1.3       Quotations were received from the sole licensed supplier.

1.4       This report concludes by recommending that LCUs are procured by direct engagement of Techlight Ltd, the sole licensed supplier of the product for the supply of 3425 LCUs for the amount of $547,486.25 including air freight and excluding GST.

2.0       BACKGROUND

2.1       Hastings District Council is currently in the third year of an accelerated three year streetlight to Light Emitting Diodes (LED) conversion programme approved by Council. As part of the conversion programme each LED requires a light control unit (LCU) that enables the lights to be controlled and monitored from a central management system.

2.2       The use of a central management system (CMS) is essential to maximise the use of new technology LED lights. A CMS individually monitors each streetlight in terms of performance and power consumption. Streetlights may also be individually controlled in terms of on and off times and varying dimming profiles applied to maximise power savings and provide appropriate levels of light for the time of day. The system can also be used as a billing reference which may change HDC billing from a bulk charge to individually metered billing.

2.3       The LCU is the component that is installed on each streetlight and allows the CMS to communicate with the streetlight using a radio link through a data communications unit. The system has a web based software front end which enables the management of the lights.

2.4       Streetlights with control systems offer features with tremendous potential to save energy, mitigate waste, reduce light pollution and increase public safety. These features are likely to be in use for 20 years and would represent a significant lost opportunity if not adopted. This system is successfully installed at Auckland Transport with over 44,000 lights programmed to be replaced with LED lights equipped with telematics LCU’s in the next five years.

3.0       OPTIONS

3.1       Option 1 – Procure by direct engagement 3425 Telematics LCU.


3.2       The $159.850 (exclusive of GST) price is based on a quotation received from Telematics NZ for direct engagement. For comparison, the rate for the supply of the Telematics LCU last year was $197. This included handling charges added by the LED supplier. (The LCU supply was included in the Request for Tender for LED luminaire supply). Auckland Transport also use the Telematics LCU and the price for supply of 14000 units is $140.00 per unit by direct engagement. These rates include airfreight to reduce the delivery timeframes from 5–6 months to 3-4 months.

3.3       Council already owns a Telematics gateway which will be used to communicate with the LCUs.

3.4       Option 2 – Procure by separate request for tender a gateway and 3425 LCU.




3.5       The LCU price is an average price estimate based on current market rate from other suppliers in the market. These prices vary from $190.00 per unit to $260.00 per unit. The units currently available in the market varies significantly in terms of specification (Radio based vs cellular 4G/3G vs Mesh networks vs LoRaWAN) which may affect the price significantly. Phillips confirmed that their CityTouch (proprietary) connector which is the equivalent of a Telematics LCU, utilising a 3g mobile connection costs $190 per light. NB SmartCities utilising LoRaWAN costs $260.00 per unit but this system does not require a base station as it utilises a LoRaWAN access point. These access points will be provided by either Spark or Vodafone. At the time of writing this report it was not clear if access charges/license fees will apply for utilising the LoRaWAN networks.


3.6       Option 3Procure 3425 shortening caps to enable LED lights to function and wait for technology to mature.


3.7       This option was proposed to buy some time and wait for the LCU and gateway technology to mature over the next five years. It is deemed that by then, the technology will be “plug and play” with any supplier’s equipment being able to work seamlessly with any other supplier’s equipment.

3.8       The costs for this option is higher as it includes the cost of installing the LCU at a later stage which means we have to get a crew up at the light for a second time.

3.9       With the expiry of the NZTA subsidy rate of 85% at the end of June 2018 it is deemed that this option is not viable as it means that council will have to carry the costs at a normal subsidy rate, approximately $143,850 @ 85% vs $441,140 @ 46%.


4.1       When comparing the cost of the options it is clear that Option 3 has the highest cost due to the cost of installation and shortening cap. The installation of the shortening cap and then reinstallation of a LCU at a later stage is not economical when compared with options 1 and 2. Pursuing option 3 will also mean that council cannot take full advantage of the subsidy change recently announced by NZTA. Option 3 is therefore not considered a viable option.

4.2       Option 1 is the most cost efficient based on the price estimates and is delivering the best value for money as it is making use of the existing Telematics gateway. Depending on the outcome of the RFT, option 2 may require the procurement of an additional gateway. Option 2 has an element of the unknown as the price of LCU units could not be confirmed. It may also take an additional 6 weeks to procure and this may cause delays.

4.3       Option 1 does not require any additional spending apart from the quoted price received and all the components purchased will be used for the twenty years lifespan. Option 1 is the preferred option as it represents the best value for money, makes use of the existing Telematics gateway, has low risk and realises significant benefits of getting the LED’s installed in a short timeframe.


5.1       The preferred option is option 1 - Procure by direct engagement 3425 Telematics LCU123. The reasons for preferring this option are:

5.2       It is the most cost effective as it makes use of the existing Telematics Gateway

5.3       It has the lowest cost of the options considered.

5.4       It does not lock Council in to a specific vendor.


5.5       This option avoids handling charges that may be added to the cost if the supply of the LCU’s is included within the request for tender for LED lights.


5.6       This option has low risk as these units are currently in use on the streetlight network and is also in use by Auckland Transport for the LED conversion programme.


6.1       In accordance with Section 5.3 ‘Supplier Selection Methods’ of the Hastings District Council Procurement Strategy, it is requested that approval be given to now directly engage Techlight Ltd, being the nominated contractor to supply Telematics Light Control Units (LCU123)

6.2       Under Section 5.3, directly procuring from a single supplier may be approved when:

·    The goods or services require specialised skills or are very complex and there is a limited number of qualified suppliers

·    The required goods and services are available from only one source

·    Standardisation or compatibility with existing equipment or services is necessary, and can be achieved through only one supplier

·    The Supplier involved has already carried out a substantial amount of contributing works and prices have been competitively tested previously or the costs of proceeding through a competitive procedure are likely to be greater than any potential savings that may be secured through engaging in a competitive process.










The unit cost for each LCU is $159.85 excluding GST.  The estimated tendered price includes air freight. The funds allocated to this project is shown below.






A)        That the report of the Transportation Asset Manager titled Direct engagement of Techlight for the supply of Telematics light control units (LCU123) dated 21/12/2017 be received.

B)        The procurement by direct engagement from Techlight Limited of 3425 Telematics LCU123 for the amount of $547,486.25 be approved.


i)   With the reasons for this decision being that the objective of the decision will contribute to meeting the current and future needs of communities for good quality local infrastructure



There are no attachments for this report.



File Ref: 17/1360



REPORT TO:               Tenders Subcommittee

MEETING DATE:        Thursday 21 December 2017

FROM:                           Transportation Asset Manager

Marius van Niekerk

SUBJECT:                    CON2017106 Waimarama Road, Middle Road and Rochfort Road Area Wide Pavement Treatment        



1.0    SUMMARY

The purpose of this report is to gain the Tender Subcommittee’s approval to award CON2017106 – Waimarama Road, Middle Road and Rochfort Road Area Wide Pavement Treatment.


1.1    Tenders were called under the Hastings District Council’s prequalification system. The work was classified as Class 1, with a work category of Road Construction Complex A.


1.2    Tenders were invited under the “Lowest Price Conforming” method. Two tenders were received.


1.3    This report concludes by recommending that CON2017106 – Waimarama Road, Middle Road and Rochfort Road Area Wide Pavement Treatment be awarded to Russell Roads Ltd at the amended price of $568,786.83 (excl. GST).



2.1    This project involves road reconstruction of Waimarama Road (RP 2.85-3.46km), Middle Road (RP 5.9-6.5km) and Rochfort Road (RP 0-1.0km).

2.2    Work activities include earth works, pavement construction, chipseal surfacing and minor storm water works.

2.3    The work is included in the HDC annual plan.

2.4    The Rochfort Road site was tendered as provisional, subject to funding.

2.5    The Waimarama Road site is programmed to start on 5 February 2018 and Middle Road on 15 January 2018.






2.6    Only Tenderers qualifying for the highest work category may tender for the Contract, in this case Road Construction Complex A. The Prequalified Tenderers invited to submit tenders are listed below.


Invited Tenderers

Higgins Contractors Ltd

Russell Roads Ltd

Downer NZ Ltd

Fulton Hogan Ltd

Quality Roading and Services (Wairoa) Ltd




3.1    Tenders for the above contract closed at 4.00pm on Wednesday 6 December 2017 and were opened in the presence of Robyn Comrie, Asset Management: Business Support and Christine Hilton, HDC Committee Secretary.


3.2    The tenders were recorded by Christine Hilton as follows:


Name of Tenderer

Tendered Price

1.  Russell Roads Ltd


2.  Fulton Hogan Ltd




3.3    The Engineer’s Estimate for the tendered works was $812,758.10.


3.4    The comparison with tendered prices showed the differences were throughout the rates.



4.1    Tender documents indicated that the successful Tenderer would be determined based on the Prequalification - Lowest Price Conforming Method in accordance with the Hastings District Council Procurement Manual.




5.1    The evaluation was carried out by Des Parkinson (Certified Evaluator - Stantec), Tim Bateman (HDC), Kathryn O’Reilly (Stantec) and Derek Bensemann (Stantec).


5.2    The Tender Evaluation Team (T.E.T.) confirm that none of them have personal relationships with any owners, directors or employees of the companies listed above, or any financial or commercial interest in any of the companies that would create a conflict of interest with respect to this tender evaluation process.

5.3    A copy of the evaluation information is attached to this report (Attachment 1).



6.1    Tenderers were advised that the Rochfort Road site was a Provisional Item and that it was subject to funding.

6.2    Following the Request for Tender, it has been confirmed that due to funding constraints, the Rochfort Road site is not to be constructed.



7.1    The works identified in this contract are to be funded from Council’s budget allocations for roading.


7.2    The table below shows project costs for the 2017/18 financial year and compares the costs anticipated as a result of this tender to the allocated funds.  The allocated funds are based on officers’ preliminary estimates for the individual projects to develop the renewals budgets plus any adjustments made by the Asset Managers to the project budgets in the interim as the work programme is delivered.


7.3    The funds Officers assigned for this Project for the Waimarama Road and Middle Road sites are shown below:


Budget Area

Tender Price

Ancillary Costs

Total Project Cost

Funds Allocated


Middle road






Waimarama road













A Contract contingency of $50,000 (Middle Road and Waimarama Road only) has been included in the above costs.


The “Ancillary Costs” items include design fees and auxiliary works by others outside the contract.


7.4    Following the award of the contract at the tendered price the Rochfort Road site will be removed in accordance with the Conditions of Contract.



A)  That the Transportation Asset Manager’s report titled “Tender Recommendation:  CON2017106 – Waimarama Road, Middle Road and Rochfort Road Area Wide Pavement Treatment be accepted.


B)  That the tender for Contract CON2017106 – Waimarama Road, Middle Road and Rochfort Road Area Wide Pavement Treatment from Russell Roads Limited at the tender price of $873,705.33 (excl. GST) be accepted.


C)  That the removal of the Rochfort Road site, with the value of $304,918.50 (excl. GST), from the scope of works of CON2017106 – Waimarama Road, Middle Road and Rochfort Road Area Wide Pavement Treatment be authorised.


D)  That Contract CON2017106 – Waimarama Road, Middle Road and Rochfort Road Area Wide Pavement Treatment as amended by the withdrawal of the Rochfort Road site, be awarded to Russell Roads Limited at the price of $568,786.83 (excl. GST).








Evaluation Assessment






Evaluation Assessment

Attachment 1


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