GO-TIME: Governor Wolf announces Reverse Auction for Road Salt Saved $17.5 Million This Year

July 20, 2016

Harrisburg, PA – Governor Tom Wolf, State Department of General Services Secretary Curt Topper and Pennsylvania Department of Transportation (PennDOT) Secretary Leslie Richards today announced that a recent reverse auction held for the 2016-17 Sodium Chloride (Bulk Road Salt) contract has resulted in $17.5 million in savings for the PennDOT and members of COSTARS, the commonwealth’s cooperative purchasing program.

“Over the past year, we have re-established the Commonwealth of Pennsylvania as leader among state governments by working collaboratively across agencies and employing state-of-the-art tools and strategies to make sure we get the lowest possible cost without compromising the quality of the goods and services we purchase,” Governor Wolf said. “Our work towards making government more efficient, customer service more effective and our agencies more accountable has already generated returns for the taxpayers and we will continue to work towards these goals.”

In addition, the overall statewide price for a ton of salt decreased to $59.75, down 16.8 percent from the 2015-16 price of $71.93 per ton. In 2015-16, DGS completed 11 reverse auctions saving a total of $18 million.

“This is what the Governor Wolf’s GO-TIME initiative is all about – constantly looking for ways to make our government more efficient and effective,” Secretary Topper said. “We have run 20 successful reverse auction procurements since we reinstated the technology last year and we have saved tens of millions of taxpayer dollars as a result. We are delivering a ‘Government that Works.’”

Reverse auction technology enables the commonwealth to hold live, online auctions where bidders are able to see how their prices compare to those of other bidders competing for commonwealth contracts and improve their prices in real time.

For this particular reverse auction, the prices awarded for last year’s contract were used as the ceiling for this year’s starting bids from six suppliers. Prices were bid down from that ceiling price for each of Pennsylvania’s 67 counties. This resulted in five suppliers – American Rock Salt (32 counties), Cargill (18 counties), Eastern Salt (3 counties), Detroit Salt (2 counties) and Morton (12 counties) – being awarded contracts. The highest rate of $77.09 per ton is in Centre County, while the lowest price per ton of $40.99 was registered in Tioga County.

“Road salt is a crucial component of our winter maintenance program,” said Secretary Richards. “This innovative process assures that taxpayer dollars are spent wisely.”

The road salt contracts take effect August 1, 2016 and end July 31, 2017.

GO-TIME leverages inter-agency coordination and collaboration to maximize efficiency, modernize state government operations, and provide the highest quality services. The Executive Order signed by the governor tasks state agencies with finding cost savings from efficiency and innovative initiatives to better leverage state government resources and taxpayer dollars.

To learn more about GO-TIME, visit www.governor.pa.gov/go-time

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