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Home My WebLink About03022009 City Council PacketSeward City Council Agenda Packet Re: Bucket truck purchase Special City Council Meeting March 2, 2009 City Council Chambers Beginning at 7: 00 p.m. The City of Seward, Alaska Special City Council Meeting March 2, 2009 7:00 p.m. Council Chambers Clark Corbridge Mayor Term Expires 2009 Willard Dunham Council Member Term Expires 2010 Robert Valdatta Council Member Term Expires 2009 Tom Smith Council Member Term Expires 2009 Betsy Kellar Council Member Term Expires 2009 Jean Bardarson Council Member Term Expires 2010 Marianna Keil Council Member Term Expires 2010 Phillip Oates City Manager Jean Lewis City Clerk Cheryl Brooking City Attorney 1. Call to order 2. Pledge of allegiance 3. Roll call 4. Citizens' comments on any subject except those items scheduled for public hearing. [Those who have signed in will be given the first opportunity to speak. Time is limited to 2 minutes per speaker and 30 minutes total time for this agenda item.] 5. Approval of agenda 6. New Business A. Resolutions 1. Resolution 2009-014, Authorizing The City Manager To Purchase A Used Bucket Truck Outright In An Amount Not To Exceed $250,000 Rather Than To Pursue Previously Authorized Financing Of A New Bucket Truck Approved In Resolution 2008-134 For $510,000, And Appropriating Funds 7. Council comment 8. Citizens' comments 9. Council and administration response to citizens' comments 10. Adjournment City of Seward, Alaska Council Agenda March 2, 2009 Sponsored by: Oates CITY OF SEWARD, ALASKA RESOLUTION 2009-014 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, AUTHORIZING THE CITY MANAGER TO PURCHASE A USED BUCKET TRUCK OUTRIGHT IN AN AMOUNT NOT TO EXCEED $250,000 RATHER THAN TO PURSUE PREVIOUSLY AUTHORIZED FINANCING OF A NEW BUCKET TRUCK APPROVED IN RESOLUTION 2008-134 FOR $510,000, AND APPROPRIATING FUNDS WHEREAS, the Seward City Council approved Resolution 2008-134 on December 8, 2008, authorizing the city manager to select and lease/purchase an Altec bucket truck for the electric utility, in an amount not to exceed $510,000; and WHEREAS, staff researched various purchasing options and identified a used bucket truck that would meet the needs of the department at a cost of $232,066.37, including a 24-month extended warranty, and delivery to Anchorage; and WHEREAS, staff recommends adding a contingency to the purchase price to cover the cost of shipping from Anchorage to Seward, as well as other potential contingencies, bringing the not -to - exceed amount to $250,000.00; and WHEREAS, financing this piece of equipment was expected to cost $510,000 plus approximately $106,000 in interest over a period of seven years, for a total cost of $616,000; therefore, purchasing the used equipment outright, rather than financing a new piece of equipment, will save the motor pool more than $366,000 over what was authorized in Resolution 2008-134; and WHEREAS, this outright purchase is expected to result in a projected cash balance in the motor pool at 12/31/09 of approximately $890,000; and WHEREAS, Seward City Code §6.10.125 exempts from competitive procurement provisions, the purchase of used equipment, where the City Council determines the public interest is best served by purchasing a piece of used equipment. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA that: Section 1. In accordance with Seward City Code §6.10.125, the Seward City Council hereby finds that it is in the public interest to purchase a used bucket truck from Global Rental Company, in an amount not to exceed $250,000. Section 2. The City Manager is hereby authorized to purchase a used bucket truck from Global Rental Company in an amount not to exceed $250,000. CITY OF SEWARD, ALASKA RESOLUTION 2009-014 Section 3. The 2009 Budget included $80,773 as an annual payment for this equipment, necessitating an additional appropriation of $169,227 to purchase the bucket truck outright, with funding appropriated as follows: $65,412 from principal account no. 102-1020-5810; $15,361 from interest account no. 102-1020-5820; and $169,277 from Motor Pool Unrestricted Net Assets account no. 102-0000-3050 to equipment account no. 102-1020-5930. Section 4. This resolution shall take effect immediately upon its adoption. PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 2nd day of March, 2009. THE CITY OF SEWARD, ALASKA Clark Corbridge, Mayor AYES: NOES: ABSENT: ABSTAIN: ATTEST: Jean Lewis. CMC City Clerk (City Seal) Council Agenda Statement Meeting Date: March 2, 2009 To: Phillip Oates, City Manager From: Jeff Estes, Electric Utility Agenda Item: Purchase of Used Bucket Truck BACKGROUND & JUSTIFICATION: The City Council authorized the purchase of a new bucket truck for the electric department, in December, 2008. The estimated cost of a new bucket truck was $510,000, which was what Council authorized the city manager to spend to purchase a new truck. The initial Council authorization was to finance the purchase of the truck, rather than to purchase it outright. Electric department staff researched various options for purchasing a bucket truck, and found an exceptional deal on a used piece of equipment located in Portland, Oregon. This truck has less than 3,100 miles on it, making it near -new condition. To ensure the quality of this truck, the city manager authorized our electric department operator/mechanic to travel to Oregon to evaluate the truck, and we strongly recommend purchase of this truck. Given that this used truck is on the market for sale, we must act quickly to secure the truck, or risk losing it to another buyer. The finance department was prepared to go out to bid on financing for a bucket truck. However, it would take at least six weeks to obtain financing, and it is questionable as to whether we would be able to obtain competitive financing for a piece of used equipment. Therefore, we recommend the purchase of this equipment outright. In addition, by purchasing the equipment outright, we expect to save approximately $106,000 in interest costs that we would expect to pay for this truck over the next seven years. CONSISTENCY CHECKLIST: Where applicable, this agenda statement is consistent with the Seward City Code, Charter, Comprehensive Plans, Land Use Plans, Strategic Plan and City Council Rules of Procedures. FISCAL NOTE: The Council authorized a lease/purchase for this bucket truck in the amount of $510,000, plus estimated financing costs of approximately $106,000, for a total anticipated cost of $616,000. By purchasing outright at a cost of $250,000, the total savings will be approximately $366,000 over what was authorized in Resolution 2008-134, resulting in a motor pool cash balance of approx. $890,000 at December 31, 2009. Approved by Finance Department: RECOMMENDATION: Council approve Resolution 2009-014, authorizing the City Manager to purchase outright, a used bucket truck from Global Rental Company. Sponsored by: Oates CITY OF SEWARD, ALASKA RESOLUTION 2008-134 A RESOLUTION OF THE CITY COUNCIL, OF THE CITY OF SEWARD, ALASKA, AUTHORIZING THE CITY MANAGER TO SELECT AND PURCHASE OUTRIGHT, VEHICLES AND EQUIPMENT IN AN AGGREGATE AMOUNT NOT TO EXCEED $308,574, AND TO PURCHASE HEAVY EQUIPMENT WITH ACCESSORIES, SUBJECT TO OBTAINING FINANCING, IN AN AGGREGATE AMOUNT NOT TO EXCEED $1,937,597, FROM THE MOTOR POOL INTERNAL SERVICE FUND WHEREAS, the City of Seward conducted an Efficiency Study addressing fifty-six areas of City government where efficiencies were possible; and WHEREAS, Administration has provided Council a description, price and justification of vehicles they would like to purchase and/or lease; and WHEREAS, the list of vehicles and equipment is consistent with the guidance from Council pertaining to the Efficiency Study; and WHEREAS, the current cash balance in the motor pool fund is S 1.071 million; and WHEREAS, the vehicle and equipment purchases will decrease the motor pool fund by approximately $308,574, leaving $762,426 in the fund; and WHEREAS, the annual lease payments would draw down the motor pool fund by S347,788, which is offset by vehicle rent payments into the motor pool; and WHEREAS, projected cash balance in the motor pool at 12/31/09, accounting for these purchases and leases, is $1.14 million; and WHEREAS, the finance department will issue a Request for Bids to obtain capital financing for the purchase of the heavy equipment with accessories, in order to obtain the most favorable financing terms; and WHEREAS, upon City Council approval administration will begin to select and purchase/lease vehicles and heavy equipment. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, that: CITY OF SEWARD, ALASKA RESOLUTION 2008-134 Section 1. Seward City Council authorizes the City Manager to select and purchase outright the following individual vehicles: 2009 Subaru Forester not to exceed $26,642.00; 2 Chevrolet Impala Police Package with a LED Lightbar and other emergency lighting, console, duel gun mount, in car camera Motorola mobile radio graphics and other related equipment (includes installation) not to exceed $76,240.00 (538, 210 per vehicle); 2 Taylor -Dunn ET-3000 GT not to exceed $47,600.00 ($23,800 per vehicle); and 2 Chevy Express Passenger 1500 LT Vans not to exceed $76,692.00 ($38,246 per vehicle); Volvo ECR58 Compact Excavator not to exceed $81,400.00. Section 2. Seward City Council authorizes the City Manager to select and lease/purchase the following individual vehicles, subject to funding: Triple Combination Pumper- Custom Chassis not to exceed $5501,000.00; Plow/Sander (2009 5500i 6X4 (DF557)) not to exceed $272,443.00; Water Tanker (2009 Diamond SPEC 7600 SBA 6X4 (SF647)) not to exceed S 165,154.00; 2 Volvo L-90 Loaders not to exceed 5440,000.00 ($220,000 per loader); and Altec Bucket Truck not to exceed $510,000. �- Section 3. This resolution shall take effect immediately upon its adoption. PASSED AND APPROVED by City Council of the City of Seward this 8"' day of December, 2008. .- w �' �-�,-. ��,�. �. Y �:� SEWARD CITY COUNCIL NOTICE OF SPECIAL MEETING March 2, 2009 NOTICE IS HEREBY GIVEN that the Seward City Council will conduct a special meeting on the following items of business on March 2, 2009. Resolution 2009-014. Authorizing The City Manager To Purchase A Used Bucket Truck Outright In An Amount Not To Exceed $250,000 Rather Than To Pursue Previously Authorized Financing Of A New Bucket Truck Approved In Resolution 2008-134 For $510,000, And Appropriating Funds. The special meeting will commence at 7:00 p.m., or as soon thereafter as business permits, in the City Council Chambers, City Hall, 410 Adams Street, Seward. All interested persons are invited to attend the meeting and participate in the discussion; or, written comments may be sent to the City of Seward, c/o City Clerk, PO Box 167, Seward, AK 99664, or e-mailed to clerk@cityofseward.net. POSTED: Thursday, February 26, 2009 at 3:30 p.m. City Hall Bulletin Board U.S. Post Office Harbormaster's Office SPECIAL MEETING REQUEST Pursuant to Seward City Code 2.10.030 (2), this is to serve as the written notice calling a Special Council Meeting for the purpose of: Resolution 2009-014. Authorizing The City Manager To Purchase A Used Bucket Truck Outright In An Amount Not To Exceed $250,000 Rather Than To Pursue Previously Authorized Financing Of A New Bucket Truck Approved In Resolution 2008-134 For $510,000, And Appropriating Funds. Signed this 261h day of February, 2009. X*Called by City Manager Phillip Oates via telephone contact with Anne Bailey. Mayor I City Manager 2 Council Members Upon this request the City Clerk will give due and proper notice as required by SCC 2.10.032 (No business shall be transacted other than stated above.) March 2009 March 2009 April 2009 S M T W T F S S M T W T F S . _-..._....... 1 2 3 4 5 6 7 1 2 3 4 8 9 10 11 12 13 14 5 6 7 8 9 10 11 15 16 17 18 19 20 21 12 13 14 15 16 17 18 22 23 24 25 26 27 28 19 20 21 22 23 24 25 29 30 31 26 27 28 29 30 Monday Tuesday Wednesday Thursday Fri arch 2 3 _ _ 41 5 7:00pm CC Sp Mtg 7:30pm P&Z Meeting 12:00pm PACAB Meeting 7:00pm City Council `i 9 5:30pm CC Special 10 11 11:30am Seward; 12_ _ 1 Meeting Meeting i,",Ommunity Library & Museum'. Building Committee 16. _ 17, 1819_ 2 6:30pm P&Z Work Session i 12:00pm PACAB Work 9:00am Social Security Session Rep 6:30pm Historic Preservation Meeting Nand Richey 1 2/27/2009 2:02 PM April 2009 April 2009 May 2009 S M T W T F S S M T W T F S - 1 -2 3 4 1 2 5 6 7 8 91011 3 4 5 6 7 8 9 12 13 14 15 16 17 18 10 11 12 13 14 15 16 19 20 21 22 23 24 25 17 18 19 20 21 22 23 26 27 28 29 30 24 25 26 27 28 29 30 31 Monday Tuesday Wednesday Thursday Friday -_ Aril 1 2 Audit 12:00pm PACAB Meeting 6 7 8, g, 7:30pm P&Z Meeting 11:30am Seward Community Library & Museum Building Committee `' -- 3 -- 14 .. — 15, 16 1 OOpm City Council 12:OOpm PAG4B Work 9:OOam Social Security Meeting Session Rep 6:30pm'Historic Preservation Meeting 6:30pm P&Z Work Session 9:00am Social Security Rep �'^ 27 28 _ 29. _ 30. 7:OOpm City Council 1 Meeting inci Richey 2 2/27/2009 2:02 PM