10.A.
City Council Meeting - FINAL
- Meeting Date:
- 03/19/2013
- From:
- Steve Bergeron, Solid Waste Collection Manager, Public Works
Information
TITLE:
Consideration and Approval of Purchase: Solid Waste Trucks New Bid Number 2013-08: Solid Waste Truck: New Chassis with New or Refurbished Body.
RECOMMENDED ACTION:
Consider approving the purchase under Bid Number 2013-08 from Alliance Refuse Trucks of Gilbert, AZ for one rear load and two front load garbage trucks with new truck cab / chassis and refurbished bodies in the amount of $530,813 with trade ins.
Policy Decision or Reason for Action:
There exists a need to replace aged, costly, equipment with new efficient equipment to maintain current service levels.
Financial Impact:
• The Solid Waste Section budgeted $826,198 for FY 2013 to purchase three solid waste trucks from the Environmental Services fund; Residential, Commercial Trash and Commercial Recycling programs.
• The purchase price of all three trucks, tax and trade in is $530,813, a savings of $295,385 or 36%.
• The trade in value of four old trucks is a total of $100,000. The last trucks auctioned sold for $7,800 and $10,100 respectively.
• The purchase price of all three trucks, tax and trade in is $530,813, a savings of $295,385 or 36%.
• The trade in value of four old trucks is a total of $100,000. The last trucks auctioned sold for $7,800 and $10,100 respectively.
Connection to Council Goal:
Develop an ongoing budget process and effective governance
Previous Council Decision on This:
Yes. Council rejected all bids for new trucks in Bid#2013-30 at its May 1, 2012 meeting.
Options and Alternatives:
Option A: Accept bid from Alliance Refuse Trucks as the lowest responsive and responsible bidder in the amount of $530,813 for one rear load and two front load garbage trucks, including the trade in of one rear load and three front load garbage trucks.
Option B: Continue to operate the old equipment.
Option C: Reject all bids as submitted and solicit new bids.
Option B: Continue to operate the old equipment.
Option C: Reject all bids as submitted and solicit new bids.
Background/History:
Within the Solid Waste Section, some of the equipment has become aged and replacements have been deferred for several years due to the economic downturn and resulting decline in tonnage collected. This year it was determined that some fleet replacements are necessary due to the increased downtime, repair and maintenance costs incurred by continuing to operate the aged equipment and anticipated major costs.
The Solid Waste Section budgeted $1,124,297 in Fiscal Year 2012 from the Environmental Service Fund for the purchase of four (4) Solid Waste Collection trucks in the Residential, Commercial Trash and Commercial Recycling Programs. After deferring the purchases in FY 2012 to FY 2013 and re-evaluating fleet needs, the Solid Waste Section decided to reduce its commercial fleet by one vehicle, lowering the budgeted amount by $298,099, to a total budget of $826,198 for Fiscal Year 2013.
Further potential cost reductions were accomplished by soliciting bids for New Truck Chassis with New or Refurbished bodies and requiring trade in value for our old equipment. This brought the total purchase price for the three (3) trucks to $530,813, a savings of $295,385 or 36% below the FY 2013 budget.
One of Solid Waste’s considerations in developing the bid criteria was to upgrade the cab and chassis specifications in order to acquire more durable equipment and have a platform on which to refurbish entire trucks, thereby extending their useful working life at a fraction of the cost. This would also maintain greater trade in value at the end of the equipment’s useful life.
All of the trucks being considered for replacement meet the Fleet Management criteria for replacement in regard to age, mileage or hours used and life to date costs, and were approved by the Fleet Management Committee for replacement.
The truck statistics for the four (4) trade ins are as follows:
The oldest garbage truck, G8-51, a rear load truck is 17 years old (1996), was purchased for $111,840, has life to date costs of $179,015 and 6,900 hours on it. This truck has experienced long periods of downtime and increasing repair costs, making it unsuitable for a front line or back up truck.
G8-72, a front load truck is 13 years old (2000), was purchased for $156,712, has life to date costs of $296,577 and 180,729 miles on it. This truck has been chosen to be eliminated from the Solid Waste fleet.
G8-77, a front load truck is 10 years old (2003) was purchased for $174,050, has life to date costs of $286,479 and has 180,690 miles on it.
G8-78, a front load is 10 years old (2003), was purchased for $174,050, has life to date costs of $269,488 and has 175,840 miles on it.
These pieces of equipment have had many significant repairs (engines, transmissions, drive trains and hydraulics) in their lifetimes and are no longer cost effective to operate. These trucks are not candidates for refurbishment, as their chassis were not designed to sustain extended life through this process.
The Solid Waste Section budgeted $1,124,297 in Fiscal Year 2012 from the Environmental Service Fund for the purchase of four (4) Solid Waste Collection trucks in the Residential, Commercial Trash and Commercial Recycling Programs. After deferring the purchases in FY 2012 to FY 2013 and re-evaluating fleet needs, the Solid Waste Section decided to reduce its commercial fleet by one vehicle, lowering the budgeted amount by $298,099, to a total budget of $826,198 for Fiscal Year 2013.
Further potential cost reductions were accomplished by soliciting bids for New Truck Chassis with New or Refurbished bodies and requiring trade in value for our old equipment. This brought the total purchase price for the three (3) trucks to $530,813, a savings of $295,385 or 36% below the FY 2013 budget.
One of Solid Waste’s considerations in developing the bid criteria was to upgrade the cab and chassis specifications in order to acquire more durable equipment and have a platform on which to refurbish entire trucks, thereby extending their useful working life at a fraction of the cost. This would also maintain greater trade in value at the end of the equipment’s useful life.
All of the trucks being considered for replacement meet the Fleet Management criteria for replacement in regard to age, mileage or hours used and life to date costs, and were approved by the Fleet Management Committee for replacement.
The truck statistics for the four (4) trade ins are as follows:
The oldest garbage truck, G8-51, a rear load truck is 17 years old (1996), was purchased for $111,840, has life to date costs of $179,015 and 6,900 hours on it. This truck has experienced long periods of downtime and increasing repair costs, making it unsuitable for a front line or back up truck.
G8-72, a front load truck is 13 years old (2000), was purchased for $156,712, has life to date costs of $296,577 and 180,729 miles on it. This truck has been chosen to be eliminated from the Solid Waste fleet.
G8-77, a front load truck is 10 years old (2003) was purchased for $174,050, has life to date costs of $286,479 and has 180,690 miles on it.
G8-78, a front load is 10 years old (2003), was purchased for $174,050, has life to date costs of $269,488 and has 175,840 miles on it.
These pieces of equipment have had many significant repairs (engines, transmissions, drive trains and hydraulics) in their lifetimes and are no longer cost effective to operate. These trucks are not candidates for refurbishment, as their chassis were not designed to sustain extended life through this process.
Key Considerations:
When preparing to purchase the replacement equipment, staff became aware of vendors that could provide New Chassis with New or Refurbished Bodies. The City of Flagstaff conducted a formal solicitation for bids to purchase garbage trucks and the evaluation committee concluded that Alliance Refuse Trucks of Gilbert, AZ was the most responsive and responsible bidder.
An important consideration for purchase from this bidder is the very short delivery time promised: within 45 days. The vendor is able to meet this commitment because they keep new truck cab / chassis in stock and have a complete facility for the manufacture and refurbishment of the bodies.
The typical delivery time for new trucks from all other vendors has been 280- 365 days or greater and many times the trucks have been delivered much later than the promised dates, costing the City of Flagstaff greater expense and downtime.
The warranty on the truck engines offered (Cummins) is a five (5)-year, 300,000 mile warranty, which exceeds the bid specification by 100,000 miles.
The warranty on the transmissions offered (Allison) is a five (5) year 300,000 mile warranty, which exceeds the bid specification by 100,000 miles.
The rest of the warranties met all specifications requested in the bid document.
The City of Flagstaff and Fleet Services has had a long working relationship with Rush Peterbilt, the authorized Peterbilt repair and warranty facility in Flagstaff. Fleet Services will be the authorized repair facility for the Heil refuse bodies in Flagstaff. Fleet Services has many years of experience with Heil refuse truck bodies, their operation and repair.
An important consideration for purchase from this bidder is the very short delivery time promised: within 45 days. The vendor is able to meet this commitment because they keep new truck cab / chassis in stock and have a complete facility for the manufacture and refurbishment of the bodies.
The typical delivery time for new trucks from all other vendors has been 280- 365 days or greater and many times the trucks have been delivered much later than the promised dates, costing the City of Flagstaff greater expense and downtime.
The warranty on the truck engines offered (Cummins) is a five (5)-year, 300,000 mile warranty, which exceeds the bid specification by 100,000 miles.
The warranty on the transmissions offered (Allison) is a five (5) year 300,000 mile warranty, which exceeds the bid specification by 100,000 miles.
The rest of the warranties met all specifications requested in the bid document.
The City of Flagstaff and Fleet Services has had a long working relationship with Rush Peterbilt, the authorized Peterbilt repair and warranty facility in Flagstaff. Fleet Services will be the authorized repair facility for the Heil refuse bodies in Flagstaff. Fleet Services has many years of experience with Heil refuse truck bodies, their operation and repair.
Expanded Financial Considerations:
• The Solid Waste Section budgeted $826,198 for FY 2013 to purchase three solid waste trucks from the Environmental Services enterprise fund; Residential, Commercial Trash and Commercial Recycling programs.
• The purchase price of all three trucks, including tax and trade in value is $530,813, a savings of $295,385 or 36%.
• The trade in value of each of the four trucks is $25,000, or a total of $100,000.
The last two trucks sold at auction only sold for $7,800 and $10,100 respectively.
The significantly shorter deliver times will allow the Solid Waste Section to save budget dollars by utilizing equipment to its full potential, without incurring further expensive repairs.
• The purchase price of all three trucks, including tax and trade in value is $530,813, a savings of $295,385 or 36%.
• The trade in value of each of the four trucks is $25,000, or a total of $100,000.
The last two trucks sold at auction only sold for $7,800 and $10,100 respectively.
The significantly shorter deliver times will allow the Solid Waste Section to save budget dollars by utilizing equipment to its full potential, without incurring further expensive repairs.
Community Benefits and Considerations:
The Solid Waste Section’s trash and recycling collections programs must complete all route collections daily. In order to accomplish this task productively, efficiently and cost effectively, collections equipment must be in good running condition.
Replacing older, high maintenance, worn out equipment ensures that the Solid Waste Section can meet promised and expected service levels to our customers, keep fees and costs lower and maintain customer satisfaction in our community.
Replacing older, high maintenance, worn out equipment ensures that the Solid Waste Section can meet promised and expected service levels to our customers, keep fees and costs lower and maintain customer satisfaction in our community.
Community Involvement:
None
Expanded Options and Alternatives:
Option A: Accept bid from Alliance Refuse Trucks as the lowest responsive and responsible bidder in the amount of $530,813 for one rear load and two front load garbage trucks, including the trade in of one rear load and three front load garbage trucks.
Option B: Continue to operate the old equipment.
Option C: Reject all bids as submitted and solicit new bids.
Option B: Continue to operate the old equipment.
Option C: Reject all bids as submitted and solicit new bids.