Consideration and Approval of Cooperative Contract: Approval of a lease-purchase option/buyback of a Caterpillar 826K Landfill Compactor and the lease-to-own of accompanying software and equipment through a Cooperative Purchase Contract between the City of Tucson, Arizona and Caterpillar, Inc.

1. Approve the lease-puchase option/buyback of a Caterpillar 826K Landfill Compactor from Empire Machinery/Caterpillar Financial Services Corporation in four annual payments of $161,103.81, at an interest rate of 5.54991%, plus applicable taxes; and
2. Approve the lease-to-own of a Trimble GPS machine control from SITECH in the total amount of $117,016.12, plus applicable taxes; and
3. Authorize the City Manager to execute the necessary documents.

The City of Tucson, Arizona entered into Contract #161534 with Caterpillar, Inc. for the purchase of Heavy Equipment, Parts, Accessories, Supplies And Related Services ("Cooperative Purchase Contract"). The Cooperative Purchase Contract authorizes financing. Empire Machinery is an authorized dealer of Caterpillar, Inc. products and services in northern Arizona. The City of Flagstaff seeks to utilize the terms of the Cooperative Purchase Contract for purposes of this lease-purchase option/buyback and to lease-to-own accompanying software and equipment from SITECH Southwest, LLC.

The existing 2012 Aljon 525 Landfill Compactor is in need of replacement. During the six years of service, this landfill compactor has had the equivalent of two years of downtime.  The Iowa company that manufactured the Aljon 525 Landfill Compactor no longer produces this product making replacement parts obsolete.  Solid Waste budgeted $385,000 to have the compactor rebuilt, however, after research of parts and a recommendation of the Fleet Committee, due to extensive down time of the compactor over the past six years, the Fleet Committee is recommending to lease or purchase a new landfill compactor. 

The benefits of the lease-purchase option/buyback include, a bumper-to-bumper warranty for the term of the lease, and at the end of the four-year term, the City will have the option to purchase the compactor for $155,760. Alternatively, Empire Machinery has guaranteed that it would buyback the compactor for $155,760.

In addition, Solid Waste asks to purchase a Trimble GPS machine control from SITECH Southwest, LLC through a lease-to-own agreement at a total cost of $117,016. The Trimble GPS will be equipped with Caterpillar AccuGrade software for the new compactor and the 2004 CAT backup unit. The Trimble GPS machine control and CAT software allows the Landfill Engineer to create a CAD drawing of the cell and the equipment operator can see it to maintain depth and grade.  The Landfill Engineer is also able to tell that the machine is within the cell design for proper compaction. The Landfill's current GPS equipment is outdated and constantly losing its program. This lease-to-own has been approved by the Fleet Management committee.

FY2019 budget has $335,000 in account 211-06-165-0631-0-4402 to cover the cost of the lease-purchase option/buyback for the Caterpillar 826k Landfill Compactor and the lease-to own for the Trimble GPS machine control from SITECH.

None

COUNCIL GOALS:
1) Provide sustainable and equitable public facilities, services, and infrastructure systems in an efficient and effective manner to serve all population areas and demographics.
2) Actively manage and protect all environmental and natural resources.

No

1.) Approve the cooperative purchase contract to enter into a lease-purchase option/buyback of a Caterpillar 826K Landfill Compactor and Trimble GPS machine control as requested; or
2.) Reject the cooperative purchase contract which would require the solicitation of a compactor and related technology.

 

The Cinder Lake Landfill receives on average 325 tons of trash per day.  This compactor will compact all the trash ongoing through the operating hours of the Landfill on a daily basis six days a week.  This compaction will ensure the proper use of air space to extend the life of the Landfill and proper design for safety and environmental issues.

Leasing a new landfill compactor will ensure that the landfill is able to compact the incoming 325 daily tons of trash to the proper level extending the life of the Landfill.  The Landfill utilizes two compactors, one front line and one backup.  Currently the landfill is operating the 2004 Caterpillar backup as the front line compactor as the Aljon unit is inoperable.  If the 2004 Caterpillar were to break down the Landfill would have to compact the trash with a D8 dozer.  The Dozer would provide less than half of the compaction of a landfill compactor.

N/A

By using the latest landfill management methods and technology the City is demonstrating to the community that the City is a good steward of the environment and the City's resources.

N/A