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Item No. 7.
| MEETING DATE: 05/17/2021 |
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| TO: | HONORABLE MAYOR AND COUNCILMEMBERS |
| FROM: | JIM SADRO, CITY MANAGER By: Elias Saykali, Public Works Director |
| SUBJECT: | APPROVE AND AUTHORIZE THE CITY MANAGER TO ISSUE A PURCHASE ORDER TO PERFORMANCE FORD, WEST COVINA, CALIFORNIA, IN THE AMOUNT OF $352,876.44 FOR THE PURCHASE OF TEN NEW SERVICE VEHICLES FOR THE CITY'S FLEET |
RECOMMENDATION:
That the City Council:
A. Waive formal bid procedures per La Habra Municipal Code Section 4.20.070 (C) allowing for the use of cooperative purchase programs to utilize the Los Angeles County purchase order for the purchase of ten new Ford service vehicles from Performance Ford; and
B. Authorize the City Manager to issue a purchase order to Performance Ford, West Covina, California, in the amount of $352,876.44, utilizing adopted Fiscal Year 2020-2021 budgeted funds for vehicle purchases, for the purchase of ten new Ford service vehicles to include:
- One new 2019 Ford F-250 Standard Cab Pickup Truck
- Three new 2020 Ford F-250 Standard Cab Pickup Trucks
- Four new 2020 Ford F-250 Standard Cab Utility Service Body Trucks
- Two new 2020 Ford F-450 Standard Cab Heavy-Duty Chassis Only Trucks (will be used for future dump bed bodies to be installed at a later date)
DISCUSSION:
City Council approved funding in the adopted Fiscal Year 2020-2021 Fleet Replacement and Water Operations Budgets to purchase 15 new vehicles for the City's fleet:
Staff secured competitive pricing for one new 2019 model year F-250 service truck (to be assigned to the Water Division); three new 2020 model year F-250 service trucks (one truck to be assigned to the Water Division, the Street Division, and the Community Services Department, respectively); four new 2020 model year utility service body trucks (to be assigned to the Water Division); and two new 2020 model year Heavy-Duty chassis only trucks (to be assigned to the Street Division). All trucks can be purchased at a reduced price compared to pricing for new 2021 model year vehicles, which are not yet available for order at this time. In addition, there is a greater price savings on these trucks compared to the 2022 model year trucks, which would required a minimum of four to six months delivery time due to significant backlogs from Ford.
All ten proposed vehicles are currently available from Performance Ford and all meet City specifications. If the purchase is approved, six of the trucks would be assigned as new vehicles to the Water Division to replace vehicles that have reached or exceeded their useful lives and that can meet service expectations in support of the City's water system operations and maintenance. The remaining four trucks would serve as replacements for vehicles already in use by the Streets Division and the Community Services Department Recreation Division.
Two vehicles have met or exceeded the City's replacement criteria of 6 years/100,000 miles for standard duty vehicles, as follows:
1. Street Division - Unit 4109 model year 2003, an 18 year old Ford F-150 with 167,118 miles.
2. Recreation Division - Unit 6013 model year 2003, an 18 year old Ford F-150 with 152,167 miles.
Two additional vehicles have met or exceeded the City's replacement criteria of 8 years/100,000 miles for heavy-duty vehicles, as follows:
1. Street Department - Unit #4103 model year 1999, a 21 year old Chevrolet W3500 with 146,282 miles.
2. Street Department - Unit #4104 model year 1999, as 21 year old Chevrolet W3500 with 143,434 miles.
Based upon the vehicles age, mileage, condition, and cost to maintain, all four of these vehicles will be sold. Based on the current auction sales market, these vehicles are expected to sell for approximately $1,000 to $1,200 per vehicle, with some likely be sold as salvage for parts.
The new replacement vehicles will provide a small increase in annual fuel savings of approximately one mile per gallon, which equates to a $300 to $400 average annual fuel savings per vehicle. In addition, annual maintenance/repair costs will decrease significantly over the next seven to eight years or 100,000 miles of operation due to the "bumper to bumper" warranty included in the purchase price of each vehicle. As a result, staff estimates an average annual maintenance cost savings of approximately $2,500 per vehicle compared to the current older vehicles currently being used.
Additionally, the new vehicles are expected to have minimal downtime for repairs compared to the older vehicles that are currently in use. On average, City service vehicles experience a shorter life expectancy and more wear and tear than the same type of vehicle used by private owners for commuter/recreational use, or by commercial operators for long distance highway transport. City vehicles are subjected to daily stop and go traffic, low speeds, significant idle time, all of which can contribute to extra wear and tear on the chassis, transmission, and the vehicle.
In evaluating the market pricing for replacement vehicles, staff reviewed the existing Los Angeles County purchase order with Performance Ford of West Covina. The City's Municipal Code allows the City to utilize existing competitively secured purchase orders established by other governmental entities, especially when those large volume purchase orders can secure competitive pricing for the acquisition of vehicles that meet or exceed the City's purchasing specifications, including any additional dealership discounts. In addition to volume pricing discounts, staff also monitors market conditions in order to maximize the potential for lower cost vehicle pricing, as well as to explore potential overstock inventory conditions at other vehicle dealers in the region when planning for vehicle and equipment purchases.
- Seven new service vehicles to be funded from the Fleet Replacement Budget
- Three new Heavy-Duty service vehicles (two trucks to be equipped with dump bodies and one with a multi-purpose utility service body) funded from the Fleet Replacement Budget
- Five new service vehicles to be funded from the Water Operations Budget
Staff secured competitive pricing for one new 2019 model year F-250 service truck (to be assigned to the Water Division); three new 2020 model year F-250 service trucks (one truck to be assigned to the Water Division, the Street Division, and the Community Services Department, respectively); four new 2020 model year utility service body trucks (to be assigned to the Water Division); and two new 2020 model year Heavy-Duty chassis only trucks (to be assigned to the Street Division). All trucks can be purchased at a reduced price compared to pricing for new 2021 model year vehicles, which are not yet available for order at this time. In addition, there is a greater price savings on these trucks compared to the 2022 model year trucks, which would required a minimum of four to six months delivery time due to significant backlogs from Ford.
All ten proposed vehicles are currently available from Performance Ford and all meet City specifications. If the purchase is approved, six of the trucks would be assigned as new vehicles to the Water Division to replace vehicles that have reached or exceeded their useful lives and that can meet service expectations in support of the City's water system operations and maintenance. The remaining four trucks would serve as replacements for vehicles already in use by the Streets Division and the Community Services Department Recreation Division.
Two vehicles have met or exceeded the City's replacement criteria of 6 years/100,000 miles for standard duty vehicles, as follows:
1. Street Division - Unit 4109 model year 2003, an 18 year old Ford F-150 with 167,118 miles.
2. Recreation Division - Unit 6013 model year 2003, an 18 year old Ford F-150 with 152,167 miles.
Two additional vehicles have met or exceeded the City's replacement criteria of 8 years/100,000 miles for heavy-duty vehicles, as follows:
1. Street Department - Unit #4103 model year 1999, a 21 year old Chevrolet W3500 with 146,282 miles.
2. Street Department - Unit #4104 model year 1999, as 21 year old Chevrolet W3500 with 143,434 miles.
Based upon the vehicles age, mileage, condition, and cost to maintain, all four of these vehicles will be sold. Based on the current auction sales market, these vehicles are expected to sell for approximately $1,000 to $1,200 per vehicle, with some likely be sold as salvage for parts.
The new replacement vehicles will provide a small increase in annual fuel savings of approximately one mile per gallon, which equates to a $300 to $400 average annual fuel savings per vehicle. In addition, annual maintenance/repair costs will decrease significantly over the next seven to eight years or 100,000 miles of operation due to the "bumper to bumper" warranty included in the purchase price of each vehicle. As a result, staff estimates an average annual maintenance cost savings of approximately $2,500 per vehicle compared to the current older vehicles currently being used.
Additionally, the new vehicles are expected to have minimal downtime for repairs compared to the older vehicles that are currently in use. On average, City service vehicles experience a shorter life expectancy and more wear and tear than the same type of vehicle used by private owners for commuter/recreational use, or by commercial operators for long distance highway transport. City vehicles are subjected to daily stop and go traffic, low speeds, significant idle time, all of which can contribute to extra wear and tear on the chassis, transmission, and the vehicle.
In evaluating the market pricing for replacement vehicles, staff reviewed the existing Los Angeles County purchase order with Performance Ford of West Covina. The City's Municipal Code allows the City to utilize existing competitively secured purchase orders established by other governmental entities, especially when those large volume purchase orders can secure competitive pricing for the acquisition of vehicles that meet or exceed the City's purchasing specifications, including any additional dealership discounts. In addition to volume pricing discounts, staff also monitors market conditions in order to maximize the potential for lower cost vehicle pricing, as well as to explore potential overstock inventory conditions at other vehicle dealers in the region when planning for vehicle and equipment purchases.
FISCAL IMPACT/SOURCE OF FUNDING:
In June 2020, City Council approved the adopted Fiscal Year 2020-2021 Fleet Replacement Budget that allocated $245,000 for the purchase of seven new service trucks and allocated $180,000 for the purchase of three new Heavy-Duty trucks. City Council also approved the adopted Fiscal Year 2020-2021 Water Division Budget at that time, which allocated $160,000 for the purchase of five new trucks. These budgets combined provide sufficient budgeted funding for the purchase of the requested vehicles.
The $352,876.44 quote provided by Performance Ford for the purchase of ten service vehicles is in compliance with the Los Angeles County purchase contract and is within the budgeted amount allocated in the Fiscal Year 2020-2021 adopted budget.
The $352,876.44 quote provided by Performance Ford for the purchase of ten service vehicles is in compliance with the Los Angeles County purchase contract and is within the budgeted amount allocated in the Fiscal Year 2020-2021 adopted budget.
GENERAL PLAN RELEVANCE:
ED 8 – Fiscal Advocacy – Leverage
ED 9 – Strength – Stability
AQ 3.5 – Equipment Maintenance
AQ 4.4 – Fleet Operations
ED 9 – Strength – Stability
AQ 3.5 – Equipment Maintenance
AQ 4.4 – Fleet Operations