On December 4, 2012, the Airport's 180 ton chiller experienced a total failure when the unit's bearings failed and caused it to become non-repairable. The Airport had previously rebuilt this unit in 2005, and incurred numerous repairs earlier this year in order for it to function properly. This particular chiller is used year round to provide air conditioning throughout the Terminal Building. While it may seem counter intuitive to use air conditioning in the Winter, it is a fairly common event for the Terminal Building, especially in the hold room areas that can become crowded with travelers, and on the south side of the Terminal where the large plate glass windows can cause the temperature to spike on very sunny days. Additionally, this piece of equipment is the central component in the Terminal Building's heat recovery and transfer system, where chilled water is used to cool areas and the returning warm water is then utilized in areas requiring heat through a heat exchange process. Subsequently, we are now in a position where we cannot air condition the Terminal Building's air to keep the traveling public comfortable and must use additional boiler capacity to maintain heat levels. Staff has investigated the availability of replacement equipment and has determined that the lead time for an order is six to eight weeks until delivery. With a competitive bid process, it is anticipated that this would push delivery out an additional six to eight weeks. Subsequently, the Airport's Terminal would be missing an integral part of its heating and cooling system for three to four months. In order to shorten this lead time, staff would like to order the equipment now to get it on its way. Staff would then do a competitive bid process for the demo of the old chiller and the installation of the new chiller equipment.

Montana Code Annotated 7-5-4303 allows cities to avoid the competitive bidding process for work/repairs that exceed $50,000 if the governing body declares an emergency for the needed repairs, to best serve the public's interest. Additionally, Purchasing Procedure VII.7, Emergency Procedures, also allow the requirement for sealed competitive bids for emergency purchases over $20,000 to be waived and an emergency purchase to be made in the fastest manner, if authorized by City Council Resolution. Staff requests that the Council adopt a Resolution that declares the total and complete failure of the Airport's 180 ton chiller an emergency and authorizes staff to proceed with ordering the replacement chiller equipment. Council's vote would require at least three-fourths of the members of the Council present at the meeting to approve the Resolution.

The City Council may choose to adopt the Resolution or to not adopt the Resolution. If the Council does not approve the Resolution, staff will have to use the competitive bidding process to secure a contractor to order the chiller equipment and delay the repairs to the Airport's Terminal Building heating and cooling system by an additional six to eight weeks.

The cost of the chiller equipment is approximately $112,500, and the installation, which will be bid, is estimated at $25,000. The Airport will delay a boiler replacement project to ensure the funds are available for this repair.

Staff recommends that the City Council adopt the attached Resolution that declares the total failure of the Airport's 180 ton chiller an emergency repair that requires immediate action to ensure the public's best interest.