Administrative
Report
H.14., File # 22-4760 Meeting Date: 9/6/2022
To: MAYOR AND CITY COUNCIL
From: TED SEMAAN, PUBLIC WORKS DIRECTOR
TITLE
APPROVE MODIFICATIONS TO THE PURCHASE OF THREE PUBLIC WORKS VEHICLES FROM
NATIONAL AUTO FLEET GROUP ORIGINALLY PLANNED FOR CNG CONVERSION
EXECUTIVE SUMMARY
On June 1, 2021 the City Council approved the purchase of nine Ford CNG trucks (six F-250’s, two F -350’s and one F-450) from National Auto Fleet Group. Three of the nine trucks (the two F-350’s and the one F-450) are unable to be converted to CNG. As the three vehicles are essential, emergency Streets and Sewer Division vehicles, and the existing vehicles are past their useful life and in need of immediate replacement, staff is requesting approval of the three trucks without CNG conversion.
This action will save money and allow the City to more quickly utilize the vehicles.
BACKGROUND
On June 1, 2021 the City Council approved the purchase of nine (9) Public Works vehicles, six (6) 2022 Ford F-250 CNG (units 202, 203 ,240, 242, 325, and 353), two (2) 2022 Ford F-350 CNG (units 211 and 324), and one (1) F-450 CNG (unit 323). It was anticipated that the vehicles would be purchased and delivered to the City within ten to twelve months, by April - June 2022. Due to a number of factors, including significant supply chain issues affecting the automotive market, the vehicles have been significantly delayed. The vehicles were recently delivered by the manufacturer for CNG retrofit.
At this time, staff were advised, by the vendor National Auto Fleet Group, that three of the vehicles were not able to be converted to CNG - the two (2) F-350s and one (1) F-450. The sub-contractor A1 Alt. Fuels in Fresno, California advised that they did not obtain the CARB Certification from the State of California for the 2022 F-350, F-450, F-550, F-650, and F-750. Without that certification, they are not authorized to perform the CNG conversion on those platforms. At the time the nine (9) vehicles were ordered, A-1 Alt Fuels provided estimates and schematics for the layout of the CNG tanks on each truck. However, National Auto Fleet Group informed the City that it was only after the vehicles arrived at A-1 directly from Ford's production plant that they learned the F-350 and F-450 could not be converted. National Auto Fleet staff advised that the City could proceed with the purchase of the three vehicles as is, with the standard gas tank, or cancel the order. The six (6) F250 are currently being converted to CNG at A-1 Alt Fuels and will be delivered to the City this calendar year.
City staff assessed the City fleet, the condition of the three trucks, and other market options for alternatives for the three vehicles unable to be converted to CNG. However, given the immediate
H.14., File # 22-4760 Meeting Date: 9/6/2022
alternatives for the three vehicles unable to be converted to CNG. However, given the immediate need for these critical service vehicles, it is staffs’ recommendation that the City acquire the three vehicles currently ordered with the standard gas tank. The three vehicles were part of the vehicles deferred from purchase in FY 2019-20 as part of decision package #25 which extended the life of most City vehicles by ten percent. Given the extension of these trucks’ replacement cycle, and the market delays caused since the vehicles were ordered, the three vehicles are well past their useful life and it is critical they be replaced as soon as possible.
Due to demand, there has been a decrease in the availability of vehicles in the market in general but particularly through the City’s regular purchasing procedures. The procedures contain a number of competitive purchasing options including the use of a “Piggyback” Bid which is a procedure of procuring goods or services by utilizing another public entity’s recent Request for Proposal or Bid, or the Sourcewell Cooperative Program. At this time, National Auto Fleet Group staff have advised that an estimated delivery date for a new order on a F-350 CNG or F-450 CNG is January 2024.
The three (3) vehicles in question are Public Works Streets and Sewers division trucks, heavily fitted out with equipment including: cranes to pull emergency sewer pumps, air compressors, and lift gates to safely load, transport and unload critical equipment needed by both divisions to carry out their functions within the City. Given the extended life of the vehicles, the lack of inventory and the critical nature of the three trucks, it is staffs’ recommendation that we accept the vehicles as is without modification.
Funding for the vehicles was encumbered in FY 2019-20 in the amount of $679,187.16 and has been carried over to FY 2021-22 and FY 2022-23. Elimination of the CNG retro-fit costs for three of the nine vehicles will provide some savings. However, it should be noted that National Auto Fleet Group has informed staff that given the delay in getting the vehicles to sub-contractors there are increased costs associated with the after-market retro-fit and fees of all nine vehicles. These increased costs will partially offset the savings from the reduced CNG conversions. National Auto Fleet provided the revised quotes/cost associated with each vehicle in the table below. The new total for all nine (9) vehicles, including the three (3) vehicles without CNG, is $677,714.67, approximately $1,500 less. 5279 F-450 323 556 $ 139,867.51 $ 131,778.97
5273 F-250 325 554 $ 54,615.91 $ 55,162.41
5268 F-350 324 557 $ 106,633.65 $ 105,055.30
5271 F-250 240 552 $ 54,973.32 $ 55,519.82
5272 F-250 242 553 $ 54,973.32 $ 55,519.82
5274 F-250 353 555 $ 66,820.19 $ 72,250.39
5275 F-250 202 549 $ 62,659.19 $ 68,089.39
5276 F-250 203 550 $ 66,820.19 $ 72,250.39
5278 F-350 211 551 $ 71,823.88 $ 62,088.18
$ 679,187.16 $ 677,714.67
NEW PO AMOUNT
National Auto Fleet Group - Revised
PO
#
VEH.MO
DEL
UNIT # ORD
ER #
OLD PO AMOUNT
H.14., File # 22-4760 Meeting Date: 9/6/2022
Future Fleet Purchases
National Auto Fleet Group and other vendors, have advised that the high demand and lack of inventory will likely continue into the 2023 model year. Public Works anticipates experiencing challenges in sourcing competitively priced vehicles through our regular procurement processes and have also been advised to expect a 10-20% cost increase for 2023 vehicles across all manufacturers, classes and fuel categories (ZEV, Hybrid, CNG, RNG, standard gas etc.).
City staff have been working with vendors to acquire vehicles and infrastructure in the coming years to implement the City Council’s direction to move the fleet to Low Emission Vehicles/Zero Emission Vehicles (LEV/ZEV) where feasible. In order to meet the State of California ZEV objectives there is a need for significant infrastructure upgrades in the City to support the volume of ZEV needed to meet those targets. Manufactures have significantly increased their ZEV offerings, not only for light-duty vehicles, but also for mid/heavy duty vehicles. Public Works staff are working to develop an EV infrastructure master plan that will support the City Fleet as the market regularizes and vehicles become more readily available and actively identifying ZEV vehicles that will meet the City’s needs.
COORDINATION
The Public Works Department coordinated this report with the Finance Department.
FISCAL IMPACT
Approval of the recommended purchase revisions will reduce the cost of the three vehicles by approximately $19,400. Most of the savings will be used to cover increased costs for the 6 remaining CNG vehicles.
APPROVED BY:
Mike Witzansky, City Manager
ATTACHMENTS
National Auto Fleet Group Quote