Title
Adopt a Resolution to Approve and Authorize the City Manager to execute all documents to purchase One (1) Schwarze Model A7 Twin Engine Tornado Sweeper mounted on a new 2025 Freightliner M2 106 plus truck chassis from Municipal Management Equipment for $421,811; which will be purchased through Sourcewell, a cooperative contract purchasing agency; and authorize an increase in contract price of up to $50,000 to account for any change in purchase price due to market volatility
Staffreport
COUNCIL PRIORITY
• Infrastructure
SUMMARY
Staff recommends that the City Council approve and authorize the City Manager or her designee to execute all documents to purchase One (1) Schwarze Model A7 Twin Engine Tornado Sweeper mounted on a new 2025 Freightliner M2 106 Plus truck chassis for the Public Works Department and authorize the City Manager to pay up to an additional $50,000 in case of changes in vehicle price.
BACKGROUND
The City maintains a fleet of equipment to provide City services for various department functions. Equipment is periodically replaced to ensure reliability and minimize costs of operation.
Public Works Street Sweeper #841, used by the Street Services Division, is a 2015 Freightliner M2. It has reached the end of its useful life and the cost to maintain this unit is rising. Therefore, the street sweeper is recommended for replacement.
Analysis
The City may typically lease or purchase vehicles. This street sweeper is proposed for direct purchase at a total cost of $421,810.18 because it is more cost-effective than leasing as it eliminates financing costs as well as the additional ongoing administrative burden of contract management by Public Works and Finance Department staff. The leasing plan for this machine has three options available. All options share the same 5.86% interest rate and $421,810.18 financed amount but vary in length. Option 1 has a 4-year term with a total cost of $476,530.64. Option 2 has a 5-year term with a total cost of $489,751.85. Option 3 has a 6-year term with a total cost of $503,117.04.
The existing street sweeper is a 2015 Freightliner M2 chassis with a Schwarze sweeping body that has an estimated useful life of six to seven years before maintenance costs begin to rise significantly. This unit has reached the end of its expected useful life and will soon need extensive repairs to continue operating. The proposed purchase is for a replacement street sweeper that is a similarly configured unit, which is familiar to operations and maintenance staff.
Municipal Maintenance Equipment participates in Sourcewell pricing for government agencies, which satisfies the City’s public bid requirements. Municipal Maintenance Equipment provided a quote for a Schwarze Model A7 Twin Engine Tornado Sweeper mounted on a new 2025 Freightliner M2 106 Plus truck chassis to replace unit #841 for $421,810.18. This unit has equal capacity and function to unit #841 that must be replaced.
The vehicle industry is volatile, and prices frequently increase between the quote date and purchase date. Because the price for this unit may exceed the quoted amount, staff requests authorization to spend up to an additional $50,000 should the price increase.
Financial Impacts
This action is estimated to cost between $421,811and $471,811 depending on final purchase price. Sufficient funds are included in anticipated Fiscal Year 2023-2024 carryover and Fiscal Year 2024-2025 budgeted account 690-16-002 for vehicle replacement. There is sufficient budget to fund the purchase and this Council action will not impact fund balance because previously appropriated funds are available.
ATTACHMENTS
A: Resolution for Street Sweeper
B: Quote from MME for Street Sweeper
PREPARED BY: Sarah Holguin, Administrative Specialist III, Public Works Department