Consideration and Approval of Contract: Client Value Agreement with Empire Southwest, LLC for Lube Services
 

1. Approve the (2) two-year Client Value Agreement with Empire Southwest, LLC in an amount not to exceed $150,000 annually for the term of the Contract for lube services on selected city-owned Caterpillar equipment; and
2. Authorize the City Manager to execute all necessary documents.

The City of Flagstaff Fleet Services Public Works Department Services has multiple pieces of Caterpillar (CAT) equipment. We are requesting to approve the Client Value Agreement with Empire Southwest, LLC (Empire CAT) who will deliver expert maintenance services for newer CAT equipment owned by the City, using Original Equipment Manufacturer (OEM) parts and recommended fluids. As the authorized service provider for CAT equipment, Empire CAT offers specialized knowledge and technical expertise, adhering to manufacturer-recommended service intervals and procedures. Their technicians, factory-trained by Caterpillar, ensure all work and parts comply with warranty requirements.

The Client Value Agreement establishes Empire CAT as a sole-source provider, with pricing locked for the contract duration with an annual cost not to exceed $150,000. This fixed pricing safeguards the City against economic or industry cost increases, supporting stable budgeting for relevant departments. Through proprietary telematics, Empire CAT can monitor equipment performance, schedule services, and provide a comprehensive maintenance plan. The Client Value Agreement provides specific entity service and guarantees standardized labor and parts costs over its term, contributing to cost predictability and operational planning for the City.

The two-year Client Value Agreement with Empire CAT secures fixed pricing for routine maintenance on selected Caterpillar equipment. Funding for these services is already allocated within departmental maintenance budgets. This contract establishes set rates for lube services but incurs no upfront cost; the City will only be billed for services as they are performed. The intent is to maintain budget predictability for maintenance expenses over the contract period.

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1. Approve the Client Value Agreement with Empire Southwest, LLC and obtain set rates for needed maintenance services; or
2. Do not approve the contract with Empire Southwest, LLC and staff will obtain maintenance services as needed, paying the rate applicable at that time of service.

Empire CAT will provide specialized maintenance services for the City of Flagstaff's newer CAT equipment, utilizing Original Equipment Manufacturer (OEM) parts and recommended fluids. As the authorized CAT service provider, Empire CAT brings advanced technical expertise and adheres to manufacturer-recommended service intervals and procedures. Their factory-trained technicians ensure all work and parts meet warranty standards.

The Client Value Agreement designates Empire CAT as a sole-source provider with fixed pricing for the contract term, protecting the City from economic or industry-related price increases and enabling stable budgeting for relevant departments. With proprietary telematics, Empire CAT monitors equipment performance, schedules maintenance, and provides a comprehensive service plan. Empire CAT will also be tracking the preventive maintenance for all CAT equipment. The contract guarantees consistent labor and parts costs, supporting cost predictability and streamlined operational planning for the City.

Fleet worked with Procurement and Legal to cultivate an agreeable contract between the City and Empire CAT.

Priority Based Budget Key Community Priorities and Objectives

• Enhance the organization's fiscal stability & increase efficiency & effectiveness.
• Be an employer of choice through inclusive recruitment & by providing employees with the necessary tools, training, support & compensation. 
• Deliver outstanding services to residents through a healthy, well maintained infrastructure system.

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