Fremont City Council Meeting: 04/19/22 07:00 PM
3300 Capitol Avenue Div/Dept: Fire Department
Fremont, CA 94538 Category: Property Acquisitions & Dispositions
SCHEDULED
Sponsors:
STAFF REPORT (ID # 4581) DOC ID: 4581
Updated: 4/13/2022 2:00 PM by Alberto Quintanilla Page 1 PURCHASE OF FIRE APPARATUS - Authorize the City Manager to Utilize the HGACBuy Contract with Golden State Fire Apparatus to Purchase Two Type I Fire Engines and One Aerial Ladder Truck; Approve the Advance and Appropriation of Funds
Contact Persons:
Name: Corina Campbell Curtis Jacobson
Title: Business Manager Fire Chief
Div/Dept: Fire Department Fire Department
Phone: 510-494-4200 510-494-4200
E-Mail: [email protected] [email protected]
Executive Summary: The purpose of this report is to authorize the City Manager or designee to use the terms of the HGACBuy contract with Golden State Fire Apparatus to purchase two Pierce Type I Fire Engines and one Pierce Aerial Ladder Truck in a total amount not to exceed $4,092,223, and to approve an advance from the General Fund and appropriation of funds in the Fire Capital Replacement Fund and the Fire Facilities Impact Fee Fund.
BACKGROUND: The replacement schedule for Fire Department apparatus has been established based on service life, reasonable maintenance costs, technology advancement and safe operations. Currently, Fire Department engines have a first-line service life of 15 years, however a vehicle may be replaced earlier or later if safety and maintenance so warrant.
There are currently two pieces of apparatus coming due for replacement. Both are Type I Fire Engines purchased in 2008 (City vehicles #29009 and #28021) which will meet their recommended service life in early 2024. Based on evaluation by Fleet Maintenance staff, the vehicles to be replaced are at an increased risk of mechanical breakdown.
Authorization to purchase replacement apparatus is being requested now because there is currently an estimated two-year construction process to build the fire engines, which means replacement apparatus ordered within the next month would not be available for service until mid-2024.
In addition to the two replacement fire engines, staff recommends that the City Council authorize the purchase of a new Aerial Ladder Truck to ensure adequate response capability as demands increase from the City’s expanding population, continued mid-rise and high-rise residential and commercial construction, and increasing traffic. The new truck would facilitate activation of a third truck fire company. The estimated construction process to build a ladder truck is between two and three years, so the new truck would not be available for service until at least late 2024.
The Fire Department has established a standardized fleet of fire apparatus. At the organizational level, apparatus with identical operating and performance features allow Fire Department senior staff to take a consistent operational approach to an incident regardless Staff Report (ID # 4581) Meeting of April 19, 2022
Updated: 4/13/2022 2:00 PM by Alberto Quintanilla Page 2 of which company responds. At the company level, engines operated and outfitted with identical equipment provide firefighters with a familiar operating environment. Standardized training/outfitting based on a single equipment type also allows Fleet Maintenance Services to stock a smaller inventory of replacement parts and minimize maintenance costs. These benefits to the City, including both higher performance and lower cost, make compatibility with the existing fleet an overriding procurement consideration.
Since 1986 the Fire Department has purchased Pierce Fire Apparatus to outfit its fleet, including both engines and aerial ladder trucks. The recommended purchase of two Type I Pierce Fire Engines and one Pierce Aerial Ladder Truck meets the standardization requirement established by the Fire Department.
DISCUSSION/ANALYSIS:
Use of Another Agency’s Contract Terms
Pursuant to the City’s Purchasing Ordinance, Section 3.20.310(b), the City is authorized to “piggyback” and enter into a contract to buy equipment or services based on the terms of an existing contract between the contractor and another public agency without competitive bidding. To qualify, the terms of purchase in the City’s proposed contract must be materially the same as those of the existing contract, and the contract must have resulted from procurement methods similar to those required by the Purchasing Ordinance.
The Cooperative Purchasing Program (HGACBuy) of the Houston-Galveston Area Council of Governments is a national cooperative procurement program offering its member agencies access to publicly solicited contracts. As a member of HGACBuy, the City has the opportunity to realize cost savings by utilizing existing HGACBuy contracts.
Pursuant to a public solicitation in 2019, HGACBuy entered into a contract with Golden State Fire Apparatus (GSFA) for the purchase of fire apparatus, including Pierce engines and trucks. The solicitation method was similar to that required by the City’s Purchasing Ordinance and the terms of purchase in the recommended City contract with GSFA are materially the same as those of the GSFA contract with HGACBuy. As specified in the Purchasing Ordinance, the Finance Director and the City Manager have approved the proposed use of the HGACBuy contract with GSFA.
Staff recommends that the City purchase the two replacement Type I Fire Engines and one new Aerial Ladder Truck using the terms of the HGACBuy contract with GSFA as the City will receive a savings of $144,197 by using those terms. The City will receive an additional savings of $163,147 by prepaying the vendor, making the total savings $307,344.
Replacement Fire Engine Purchases and Advance and Appropriation of Funds GSFA has provided a quote for two Type I Fire Engines totaling $1,923,323 including sales tax. The cost also includes the cost of radios, in-cab communications systems, light bars, sirens and emergency response equipment. The quote reflects both the HGACBuy discount and the prepayment discount.
An appropriation in the Fire Capital Replacement Fund (Fund 615) for the purchase of the two replacement Type I Fire Engines was planned to be included in the FY 2022/23 Proposed Operating Budget, with the purchase order to be placed in FY 2022/23. However, the City has been notified by GSFA that Pierce Manufacturing Inc. will be implementing a Staff Report (ID # 4581) Meeting of April 19, 2022
Updated: 4/13/2022 2:00 PM by Alberto Quintanilla Page 3 7% product price increase, effective May 1, 2022. The price increase is driven by cost increases Pierce is experiencing for both components and labor.
To avoid the additional cost associated with the price increase, approximately $135,000 for the two Fire Engines, staff recommends that the City Council approve an advance of $1,923,353 to the Fire Capital Replacement Fund from the General Fund and the appropriation of that amount in the current fiscal year for the purchases. The advance will be repaid at the beginning of FY 2022/23 when the Fire Capital Replacement Fund receives its annual allocation from the General Fund.
New Aerial Ladder Truck Purchase with Fire Facilities Impact Fees The City assesses development impact fees to defray all or a portion of the cost of additional public facilities and operating equipment needed to provide service as a result of new development activity. The fees assessed for Fire Department facilities are accumulated in the Fire Facilities Impact Fee Fund (Fund 544). Because it expands the City’s capacity to provide Fire Department services to meet the needs of new development, the purchase of a new Aerial Ladder Truck is an eligible use of fire facilities fees.
GSFA has provided a quote for one Aerial Ladder Truck totaling $2,168,870 including sales tax. The quote also includes the cost of radios, in-cab communications systems, light bars, sirens and emergency response equipment. The quote reflects both the HGACBuy discount and the prepayment discount. By placing its truck order in April rather than after the 7% price increase in May, the City will save approximately $150,000.
FISCAL IMPACT: As discussed above, to avoid the additional cost associated with the May 1, 2022 price increase, staff recommends that the City Council approve an advance of $1,923,353 from the General Fund to the Fire Capital Replacement Fund. The advance will be repaid at the beginning of FY 2022/23 when the Fire Capital Replacement Fund receives its annual allocation from the General Fund. Staff also recommends that the City Council appropriate $1,923,353 for that purchase in the Fire Capital Replacement Fund.
Because the recommended purchase of the new Aerial Ladder Truck will be funded from previously accumulated fire facilities impact fees, staff requests that the City Council appropriate $2,168,870 for that purchase in the Fire Facilities Impact Fee Fund. The current available balance in the Fire Facilities Impact Fee Fund is approximately $2.8 million.
The total price quote from GSFA includes an HGACBuy discount of $144,197 and a prepayment discount of $163,147. The sales/use tax for the purchase of the apparatus will be paid directly by the City to the State of California though a direct use tax payment upon delivery of the apparatus. This direct payment will benefit the City because the total amount of the City’s share of the sales tax will be allocated back to the City, rather than being shared with all Alameda County cities through the countywide sales tax pool.
ENVIRONMENTAL REVIEW: The actions recommended in this report are not projects subject to review under the California Environmental Quality Act (CEQA) per CEQA Guideline section 15378(b)(2) as they are administrative activities of government.
ATTACHMENTS: None.
Staff Report (ID # 4581) Meeting of April 19, 2022
Updated: 4/13/2022 2:00 PM by Alberto Quintanilla Page 4 RECOMMENDATION:
1. Authorize the City Manager or designee to issue a purchase order to Golden State Fire Apparatus for two Pierce Type I Fire Engines and one Aerial Ladder Truck, in a total amount not to exceed $4,092,223, using the terms of the HGACBuy contract.
2. Authorize the advance of $1,923,353 from the General Fund to the Fire Capital Replacement Fund (Fund 615), with the specification that the advance will be repaid at the beginning of FY 2022/23 from the General Fund allocation to the Fire Capital Replacement Fund.
3. Appropriate $1,923,353 in the Fire Capital Replacement Fund to purchase two Type I Fire Engines.
4. Appropriate $2,168,870 in the Fire Facilities Impact Fee Fund (Fund 544) to purchase one Aerial Ladder Truck.