Staff recommends the City Council approves the purchase of a 2022 Tracked Excavator from Tractor & Equipment in accordance with Sourcewell, City of Billings #18488, in the amount of $101,872.08.

The purchase of a tracked excavator is included in the approved FY22 Equipment Replacement Plan (ERP) and FY22 Street and Traffic budget.  The tracked excavator will be used to repair storm sewer, replace streetlights, repair bad underground wires, clean out ditches, and other miscellaneous maintenance tasks. The tracked excavator will minimize the impact to landscaped areas in the right-of-way where utilities are located because the footprint is significantly smaller than a backhoe. Staff looked at bidding the equipment competitively or using a cooperative purchasing agreement. Estimating the bid price that we would receive through a dealership using governmental discounts was higher than with a cooperative Sourcewell purchasing agreement so staff is recommending that we procure the equipment using the purchasing agreement. The pricing is higher than budgeted due to the addition of a quick connect system for bucket changes and inflationary cost increases. 

Sourcewell is a new tool to the city for use in procurement. Historically, the city has been allowed to use state contracts to procure items if it was beneficial to the city.  The purchasing policy has been updated to allow cooperative agreements beyond just the state contracts. Staff will evaluate the procurement options to determine which option is the most beneficial for the city.

City Council may:

• Approve purchasing the 2021 tracked excavator through Sourcewell; or,
• Not approve the purchase.  If the purchase is not approved, staff will be required to wait for equipment from other divisions or rental companies to come available and may not be able to address issues or deficiencies in a timely manner. 

The tracked excavator was budgeted in FY22 using Street Maintenance District funds.   The amount budgeted was $80,000.  The price is higher than budgeted due to the addition of a quick connect system for bucket changes and inflation and the shortfall will be funded by savings realized on other equipment purchased in FY22.