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HomeMy WebLinkAbout8.b. Sweepwer Purchase � ' CITY OF ROSEMOUNT EXECUTIVE SUMMARY FOR ACTION CITY COUNCIL MEETING DATE: January 7, 1997 AGENDA ITEM: Sweeper Purchase AGENDA SECTION: ' PREPARED BY: Bud Osmundson AGENDA �I'f3E� � Q j! City Engineer/Public Works Director V U ATTACHMENTS: Memo to Tom Burt APPROVED BY: The purpose of this item is for council consideration of the City purchasing a new street sweeper. Attached is a memo which explains the reasoning for the purchase in more detaiL Originally we had planned to replace our 1988 street sweeper in 1998, but through CIP discussions prioritization moved the sweeper back to the budget year 1999 in the "10 Year Working CIP". However, right now there is an opportunity to purchase a 1997 sweeper at 1995 prices off the state contract. We have spenfi a large amount of money in maintenance on this machine in the past three years and expect to spend an additional 57,000 to 58,000 in 1997 prior to the sweeping season to bring it into operating condition. McQueen Equipment has the state contract and has offered one year financing at 5.98% with no payments in 1997 other than the trade in of the existing machine. In March of 1998 the City would make one payment for the total cost of the machine plus interest. We are recommending that we move three items in the CIP which were scheduled for 1998 back to 1999 which are approximately equal in value to the sweeper, to equal out the CIP costs. Staff recommends that the City purchase the new sweeper off the state contract. RECOMMENDED ACTION: Motion to authorize necessary signatures to purchase a street sweeper off the state contract through McQueen Equipment as detailed in the memo dated December 23, 1996. COUNCIL ACTION: 4 , . TO: Tom Burt FROM: Bud Osmundson DATE: December 23, 1996 RE: Street Sweeper Replacement , '� Introduction The City currently has a 1988 Elgin Pelican HH Street Sweeper (unit #443) utilized for sweeping streets in the eight months of the year that it can be utilized in this climate. The City utilizes a contractor to come in and sweep the entire city in the spring for the reat heavy clean up of the winter sand in combination with our sweeper. The City's sweeper is used in rural areas which cuts down our contracting costs due to mobilization. We do keep the sweeper quite busy for three rnonths in the spring and another month and a half in the fall, plus on a complaint basis and for pre and post parade clean up. The Elgin Pelican HH series which we currently own is a totally hydraulic machine. It utilizes a single hydraulic system which powers both the brooms and the driving wheels. It was one of the last few made of this type. Sweepers are generally a very high cost maintenance machine, but this particular series was even more so due to the hydraulic system. Since December of 1993 the City has spent $28,260 in parts and labor in maintenance of this machine. In 1996, we spent 510,750 in parts and labor to keep this machine operating. Some of this cost is due to regularty scheduled maintenance such as oil changes and broom replacement, but we have noticed a large amount of down time in the last two years due to major breakdowns. In 1997 the mechanics have estimated that the City will need to spend approximately 55400 parts, S700 in contracted out labor, plus approximately 87 hours (equates to 51750) in City labor costs to bring the machine into working condition prior to the 1997 season. Replacement We had planned to replace unit #443 originally`in 1998 when our original equipment replacement worksheet was completed. In the ten year CIP discussions, prioritizations moved the sweeper back to budget year 1999 at a price of S 107,000 net. At this time we have a very unique option available to the City in that we can purchase a 1997 model Elgin sweeper off the state bid pricing at 1995 pricing. This is a feature of the state bids specifications where a particular product is required to remain at a bid price for a certain period of time. This contract ends in March of 1997 when a new sweeper contract will be let. � t� . . . . � . � � . � . . . . � � � . At the present time the state bid is a Elgin Pelican SE model which has mechanically driven brooms. We have reviewed the specifications and options available on the state bid and this is tMe model we would now specify. In addition we have compiled adtlitional specifications itemized on the attached "specification sheetH which also details the pricing for a new sweeper. We have discussed the situation with McQueen Equipment, the vendor for the state bid. They would aliow us S 16,000 in trade for our existing machine. With options, deductions, and trade in,'the new sweeper would have a total price including sales tax of 585,564.23. McQueen has offered financing for up to three year period at 5.98%, with an option of paying the total cost plus one year's interest in 1998. With this option there woutd be no payments in 1997. Recommendation Staff is recommending that the City enter into a contract with McQueen Equipment for a state bid sweeper for the price as quoted and finance the total cost for one year. The i C ty would then have one payment in March, 1998 of 590,680.97. This includes the interest cos f 1 t o S5 16.74 on top of the total cost of the machme �ncludmg the trade in. The reasons for this recommendation include the savings of 58,000 to 510,000 in capital costs for price increases which will be taking place by the time the City could purchase the sweeper in 1999. Also, there is a savings of approximately 57800 in parts and labor that the City would need to spend in 1997 to bring our existing machine into operating condition. In addition, the trade in value allowed by McQueen is higher than was originally estimated and the City would also capture more efficient sweeping operations two years sooner. In summary, staff's recommendation wautd save the City thousands of dollars even with the interest payment. With this recommendation we propose to rnove three items in the "10 year working CIP" from 1998 (the roller, the skidster loader, and 1 ton pickup) to 1999. The total costs of these three items is $86,340 which would be a minor change in the CIP cost estimates.. SPECIFICATION SHEET II SWEEPER REPLACEMENT DELIVERY MARCH 1, 1997 1. State Bid S 90,243 - Elgin Pelican SE (mechanical) 2. Deductions (4,248► - Single gutter broom 3. Options 10,347 - Auto lube systern - Dual wiring and switches for strobes - Radio - Lower rolfer wash out system - Extra water capacity - Halogen head lamps - Anti-syphon system - Turbo-precleaner - Training for two - Extended warranty (2 yrs total) 4, Trade In Existing Machine (16,000) Subtotal $80,342.00 Sales tax 5.222.23 Total cost S85r564.23 Financing/interest(5.98%) 5.116.74 Total Due March 1, 1998 $90,680.97