April 19, 2022, Item #12AG EN DA REPORT City of Poway CITY COUNCIL DATE: April 19, 2022 TO: Honorable Mayor and Members of the City Council FROM: Jeff Chumbley, Fire Chief ~ CONTACT: Brian Mitchell, Fire Battalion Chief ~/J"-. (858) 668-4464 or [email protected] SUBJECT: Replacement of Ladder Truck and Appropriation of Funds Summary: Annually, as part of the City's Capital Replacement program, the City collects "rent" to be used to cover the eventual replacement costs of City vehicles and equipment. The Capital Replacement Budget includes funding for the purchase and replacement of the aging ladder truck. The ladder truck will be placed into frontline service located at Fire Station 3. It is recommended that the City Council approve the purchase of a ladder truck to be manufactured by South Coast Fire Equipment, Inc. The total estimated purchase price for this vehicle, sales tax, performance bond, California tire fee, and documentation fees are $1,650,422.58. This price includes a prepayment discount of $53,744. The request for funds to replace the ladder truck does not include upfit costs for communication equipment installation and tool mounts. This is due to the need to expedite the purchase of the ladder truck to avoid a 7% cost increase on May 1, 2022. The purchase of the ladder truck prior to May 1, 2022 will avoid a cost increase of $110,729.42. Funds for the upfit will be requested at a later date, closer to delivery of the new ladder truck. It is anticipated that it will take approximately 2 years for the ladder truck to be manufactured. Recommended Action: It is recommended the City Council adopt a resolution appropriating funds for the purchase of a ladder truck for a total estimated cost of $1,650,422.58 and authorize the City Manager to execute any necessary documents. Discussion: The City currently maintains one frontline ladder truck. The City's vehicle maintenance program plans for fire pumpers and ladder trucks to be operated in frontline service for 15 years. The current frontline ladder truck is a 2006 model and is located at Fire Station 3. In addition to being beyond the 15 years of frontline service, more recently the ladder truck has frequently been taken out of service for costly repairs. This is part of the factors contributing to staffs recommendation to move forward 1 of 5
April 19, 2022, Item #12with purchasing a new ladder truck. Maintaining the scheduled service life of the City's fleet of emergency vehicles ensures emergency response readiness and minimizes the impact of scheduled vehicle maintenance activities and unplanned repairs. In 201 O and 2014, the City purchased Type I fire pumpers from Southcoast Fire Equipment Inc. using the specifications of the existing fleet. These fire engines have performed well. The current ladder truck uses the same manufacturer and model of the cab and chassis as the Type I pumpers. Standardization of apparatus streamline maintenance and repair efforts and maximize training and operational efficiencies for firefighting personnel. After careful evaluation of various purchasing options and pricing, staff determined it is in the best interest of the City not to proceed with its own formal bid process and recommends the formal bidding procedures are waived for the following reasons: 1. The City has been purchasing Pierce fire apparatus from Southcoast Fire Equipment Inc. (the primary vendor for Pierce) for over 15 years, historically using other agencies' cooperative agreements that were competitively bid, which has allowed the Fire Department to achieve maintenance and operational efficiencies as previously described; 2. The requirement of Poway Municipal Code Chapter 3.28 to formally bid this purchase will not likely result in a lower price given staffs historical experience; and 3. Entering into the contract with Southcoast Fire Equipment Inc. prior to May 1, 2022 will save Poway resident tax dollars through cost avoidance (i.e. not becoming subject to the 7% increase). Environmental Review: This action is not subject to California Environmental Quality Act. Fiscal Impact: The ladder truck replacement was removed from the Fiscal Year 2020-21 Operating Budget as part of the City's COVID-19 pandemic retrenchment efforts to preserve liquidity and cash flow. However, given the department's need for the vehicle, given current economic indicators point towards continued economic recovery, and given the price will increase 7% (i.e. $110,729) on May 1, 2022, the purchase is being recommended. The total cost of the ladder truck is $1,650,422.58. A total of $1,134,041 has been collected in replacement rental charges for the ladder truck. Due to the increased equipment costs at time of replacement, an additional $516,382 is requested to fund the difference. When sufficient funds have not been set aside through the City's asset management replacement charges, the requesting department funds the difference. This helps ensure the financial sustainability of the replacement funds. Future years' asset management replacement charges will be based on the new purchase price and will begin being collected next year. As such, staff requests Council authorization to appropriate $1,134,041 to 115010-61040 (Capital Equipment Replacement -Autos & Trucks) and $516,382 to 501050-61040 (Fire Suppression -Autos & Trucks) for the purchase of the ladder truck. Funding is available in the Capital Replacement Equipment Fund (Fund 6110) and General Fund Unassigned Fund Balance (Fund 1000) for the purchase of the ladder truck. Public Notification: 2 of 5
April 19, 2022, Item #12None. Attachments: A. Resolution B. South Coast Fire Equipment, Inc. Quote to the City of Poway Reviewed/ Approved By: Assistant City Manager 3 of 5 Reviewed By: Alan Fenstermacher City Attorney Approved By: c~ City Manager
April 19, 2022, Item #12RESOLUTION NO. 22-A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF POWAY, CALIFORNIA, AUTHORIZING THE CITY MANAGER TO EXECUTE A PURCHASE AGREEMENT FOR ONE NEW LADDER TRUCK AND AN APPROPRIATION OF FUNDS WHEREAS, the City proactively plans for the replacement of its ladder truck by setting aside monies in the Capital Replacement Equipment Fund (Fund 6110) each year; WHEREAS, the purchase of this ladder truck from South Coast Fire Equipment, Inc. prior to May 1, 2022 will result in a 7% savings totaling approximately $110,729.00; WHEREAS, the cost of the ladder truck is approximately $1,650,422.00, inclusive of the discount; WHEREAS, a total of $1,134,041 is available in the Capital Replacement Equipment Fund (Fund 6110) for the purchase of one ladder truck; which is $516,382 less than required due to equipment costs increasing faster than projected; WHEREAS, the City ensures the financial sustainability of the Capital Replacement Fund by having the department fund the difference. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Poway as follows: SECTION 1: The City Council authorizes an appropriation of $1,134,041.00 to the Capital Equipment Replacement account 115010-61040 and $516,382.00 to the Fire Suppression account 501050-61040 for the purchase of one ladder truck. PASSED, ADOPTED AND APPROVED at a Regular Meeting of the City Council of the City of Poway, California on the 19th day of April, 2022 by the following vote, to wit: AYES: NOES: ABSENT: DISQUALIFIED: Steve Vaus, Mayor ATTEST: Carrie Gallagher, City Clerk 4of 5 ATTACHMENT A
April 19, 2022, Item #12SOUT OAST CITY OF POWAY FIRE DEPARTMENT 100% Pre-Payment Option March 24, 2022 If a 100% pre-payment were made at contract signing, the following discount would be applied to the final invoice: Each Extension One ( 1 ) Arrow XT Tractor Drawn Aerial (TDA) per the enclosed proposal for delivery sum of $ 1,581,848.92 $ 1,581,848.92 100% Prepayment Discount $ (53,744.00) $ (53,744.00) APPARATUS COST $ 1,528,104.92 $ 1,528,104.92 Sales Tax@ 7.750% $ 118,428.13 $ 118,428.13 Performance Bond $ 3,875.53 $ 3,875.53 California Tire Fee $ 14.00 $ 14.00 Consortium Fee Not Applicable $ -$ -TOTAL PREPAY PURCHASE PRICE $ 1,650,422.58 $ 1,650,422.58 Less 100% pre-payment at Contract Signing $ 1,650,422.58 $ 1,650,422.58 BALANCE DUE AT DELIVERY $0.00 $0.00 I 100% PRE-PAYMENT blsCoONT SHOWN ABOVE Is AVAILABLE IN TWO WAYS: a) If your department makes a 100% cash pre-payment at contract signing. b) If your department signs up for a lease-purchase with Pierce Financial Solutions. This would require no money down and no payments for one (1) year if desired. * Discount for the 100% pre-payment option includes discounts for the chassis, interest, aerial (if applicable), and flooring charges. * Any item added after this option is elected will come at additional cost and will be added to the final invoice. 5 ofS ATTACHMENT B