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HomeMy WebLinkAbout01112016 City Council Work Session Notes - Motor Pool Capital Outlay WORK SESSION NOTES ON M Y P /2I laOu1t� , ,. Purpose: Present: Ki nney, t.1.,,riff L myebil nouncil Members Present: fare/ow ), rfi) LEam, , Ilaik ) atselj ,od5"4-,,,i, Au, ' e.- ') PI—chit() A ile,rrn trii,- 1/0 1 la tr Mt' twrN.,i irclilinli, (10iYari OW__ TailUs> > s . i1Sa11ed by: .NGI rrl iv) Time: 5 3 0 pty, Date: /-0-- /0 1b_liel ******************:*.*********************************** MC s(-°9}� rh1 frs 4( 1 . iinw,'ig"'.v, a -c f- £1 cc ' C D_ epC fin , V i-t wi i (\I _,1/761/(101 Contio m t. iia i- -ria JY1 6� Of yE . ikfilei., r -fur m:5k a fV , 11/P4P took,' r -1) furdiax. or G "ALT Pak, 1,0NIS w1 yivid to 01,,(t . a. )41lv/-- 0Aravat . }lAvt- :: fa3i , d0eM )* Mint., t f COE - - r#T -{ JO - NA aritto ( ice '-' W___%_-_. 1 Lo 0u- ,') loan 5 -mat wd i GV -nAvA rrit ',Lour d ['mit, -iv edanal bff; irstibitii . (9.. 23 71 __ 5()5 Sponsored by: Hunt Public Hearing: October 26, 2015 Additional Public Hearing: November 9, 2015 Adoption: November 9, 2015 CITY OF SEWARD, ALASKA RESOLUTION 2015-101 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, ADOPTING THE MOTOR POOL INTERNAL SERVICE FUND BIENNIAL BUDGET FOR CALENDAR YEARS 2016 AND 2017 WHEREAS, the City Manager has submitted to the City Council a proposed biennial budget for the City of Seward for Calendar Years 2016 and 2017; and WHEREAS, the preliminary biennial budget was reviewed by the City Council in budget work sessions on October 7, 8, 9 and 16, 2015, which were televised to the public; and WHEREAS, a public hearing is scheduled on the proposed budget for October 26 with public hearing and final adoption scheduled for November 9, 2015. NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, that: Section 1. The Motor Pool Internal Service Fund biennial budget for Calendar Years 2016 and 2017 which is attached hereto and made a part hereof by reference and which contains estimated revenues and expenses for the period January 1, 2016 - December 31, 2017, is HEREBY ADOPTED, and the necessary funds are hereby appropriated. Section 2. This resolution shall take effect immediately upon adoption. PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 9th day of November, 2015. THE CITY OF SEWARD, ALASKA ,Jean Bardarson, Mayor CITY OF SEWARD, ALASKA RESOLUTION 2015-101 AYES: Keil, Casagranda, Squires, Butts, Altermatt, McClure, Bardarson NOES: None ABSENT: None ABSTAIN: None ATTEST: � . - 4 /4 /./AI /./.. Jo anna Ki Ry, CMC • y Clerk (City Seal) sssssssss OF SES,•••• • • SEAL 1 • • ...._ t �ti• F .A,-P O F ,a`,� MOTOR POOL IN"I"i iNAL SERVICE FUND Budgeted Statemei.i t of Revenues, Expenses and Changc i n Net Position For 2016, and 2017 7n" 2015 2016 2017 A Budget Budget Budget Operating revenues -vehicle rental 0 $470,439 $29I,600 $175,000 Operating expenses-depreciation and other 7 392,052 431,000 453,800 Operating income(loss) I ' ''3 78,387 (139,400) (278,800) Non-operating revenue(expense) Interest income "6 6,000 6,000 6,000 Interest expense IT) 0 0 0 Other non-operating 6 0 0 0 Total non-operating revenue(expense) 6,000 6,000 6,000 Earnings before transfers ',1 84,387 (I33,400) (272,800) Transfers(to)from other funds 0 0 0 0 Change in net position ',4 84,387 -I33,400 -272,800 Beginning net position '9 4,881,663 4,966,050 4,832,650 Ending net position "3 ° $4,966,050 $4,832,650 $4,559,850 * Ties to annual Comprehensive Annual Financial R CITY OF SE WARD MOTOR POOL INTERNAL SERVICE FUND Budgeted Statement of Cash Flow For 2016 and 20I7 2015 2016 2017 Budget Budget Budget Beginning Cash Balance at 1/1/15*: $736,050 Cash is provided by(used for): Change in net assets 84,387 -I33,400 -272,800 Add expense items not affecting cash Depreciation 392,052 431,000 453,800 Net cash provided by operations $476,439 $297,600 $181,000 Other sources of cash Capital lease proceeds 0 0 0 Loan repayment-SMIC 330-Ton Lift I47,012 98,008 (c) 98,008 Loan repayment-50-Ton travelift 29,22I 29,22I (a) 0 Loan repayment-SGH PERS 98,576 98,576 98,576 Other uses of cash Debt principal payments 0 0 (b) 0 Capital outlay not spent 455,000 (e) 0 0 Capital outlay (530,000) (d) 0 (f) 0 Net increase(decrease) in cash 676,248 523,405 377,584 Estimated ending cash balance $1,412,298 $1,935,703 $2,313,287 WWI (*) Ties to CAFR. (a) Loan matures I/1/2016. (b) No outstanding debt payment owed by Motor Pool (c) Propose to extend payment period for this loan from 6 to 9 years reducing revenue from$I47,012 to$98,008,to relieve impact on GF subsidizing SMIC. o (d) $350K engine 3 refurb;$18K parking;$45K parks plow truck;$50K streets;$42K tyc van;$25K wire trailer. (e) Delayed purchases: $350K engine 3 refurb;$18K parking;$45K parks plow truck;$42K tyc van. (f)Water/Sewer plans to spend up to$IOOK on two trucks urili7ing Water MRRF Funds in 20I6. Administration plans to meet in work session with Council prior to year-end to determine which equipment/vehicle purchases to pursue. I ( (9 VIA/ Project modification to the refurbishment of Engine 3 Project scope To change the current authorization of$350,000 from the 2014/2015 budget for the refurbishment of Engine 3, and allow for the purchase of a used aerial apparatus. This apparatus will replace the thirty one year old Engine 3 with a newer apparatus which will meet today's safety standards and have a greater usable life. Cost This new proposed project can be completed in its entirety with less funding than originally allocated. Requested funding for this project is in an amount not to exceed $280,000 which includes purchase, shipping, and required equipment not already in our possession. Authorization to purchase SCC allows this purchase to be made without using the competitive bids/proposals process as follows: 6.10.125. -Purchase of used equipment exempt. Restrictions and provisions of this title shall not apply where the city council determines that the public interest would be best served by the purchase of used equipment and, by resolution, authorizes the city manager to locate and purchase a particular type and quantity of used equipment. (Ord. 615, 1989; Ord. No. 2008-018, § 1, 11-24-2008) Benefits The addition of an aerial apparatus provides the ability for fire suppression and rescue at higher elevations than what is currently available. Current maximum reachable height with existing ground ladders is approximately 28 feet. The aerial can be used for elevated rescue from the 2nd thru Stn stories and will allow for safer access to vessels dry docked in various locations throughout the harbor area and SMIC, including the Vigor Yard. An aerial allows for elevated master stream operations at a large fire, a capability that does not currently exist. The aerial will be equipped with an elevated waterway and a fire pump capable of at least 1500 gallons per minute. This is equal to our current engine pumping capacity. The aerial identified will meet height and length requirements to ensure it can be housed in an existing facility(station 2, SMIC area). This allows for immediate purchase without the need to construct or remodel a facility to house it. The aerial will not fit in the main station without significant modifications due to door height restrictions. The long-term plan is to relocate the aerial apparatus to this side if/when suitable housing is available. Once the aerial is relocated to this side, other potential benefits can be explored by Council such as lifting the current height restriction of buildings within city limits. An aerial apparatus on this side will also assist in improving the Insurance Services Office(ISO)rating for fire protection within the City. Methodology When funding to refurbish Engine 3 was authorized, a request for proposal was relea -d and 2 valid proposals received in return. The proposals were very similar in base cost an• options requested. These proposals are for a level 2 refurbishment as defined by NFPA '12 "Standard for Fire Apparatus Refurbishing". This means many of the components such the engine, transmission, cooling system and pump are classified as "inspect and advis-' which could result in increased cost if major issues are identified during inspection. In addi '.n, we learned from the Homer Volunteer Fire Department, who recently completed refurb.: ent of an engine that was one year older with the same model of pump, that if pump issue: are identified during inspection it will require either a complete pump replacement or . ignificant delay in project completion as the parts will have to be built or fabricated since 's pump model is no longer manufactured. All of these issues raised concerns with the li •ited funding available. While seeking alternatives to address these issues, the p ase of used apparatus surfaced. Further research was completed and presented to admi :stration for tentative approval to press forward. Preliminary information received indicates - e purchase of a used aerial apparatus, that is at least 10-15 years newer than Engine 3, can be :ccomplished for similar or less money than it will cost to complete a refurbishment. Research We have reached out to several vendors . determine availability and cost of a used aerial apparatus. Costs range anywhere fro ' $165,000 through $221,000 depending on the year of vehicle and capabilities available. ► o expressed or implied commitments have been made with any vendors. Vendors contacted were Bri ee Mountain, Jon's Fire Equipment, Fire Tec and Fenton Fire. Additionally we polled v.. 'ous vendors regarding new demonstration models of various apparatus including en t nes and aerials. Responses received for cost estimates exceeded our original budgeted unt of$350,000 by several hundred thousand dollars. Vendors contacte were Pierce, Smeal, E-One, KME, Ferrara and Rosenbauer. Neither of the vendors (Spencer Manufacturing and U.S. Fire Equipment)who submitted proposals f the refurbishment has been contacted regarding this proposed project. LTi E u Equipment for the aerial apparatus will predominately come from re-purposing already in use tools where possible. Any new equipment purchased with this authorization will be only what is r4uired to ensure the aerial meets the NFPA 1901 standard or not otherwise available from our existing inventory. • F side will also assist in improving the Insurance Services Office (ISO) rating for fire protection within the City. Methodology When funding to refurbish Engine 3 was authorized, a request for proposal was released and 2 valid proposals received in return. The proposals were very similar in base cost and options requested. These proposals are for a level 2 refurbishment as defined by NFPA 1912 "Standard for Fire Apparatus Refurbishing". This means many of the components such as the engine, transmission, cooling system and pump are classified as "inspect and advise" which could result in increased cost if major issues are identified during inspection. In addition, we learned from the Homer Volunteer Fire Department, who recently completed refurbishment of an engine that was one year older with the same model of pump, that if pump issues are identified during inspection it will require either a complete pump replacement or a significant delay in project completion as the parts will have to be built or fabricated since this pump model is no longer manufactured. All of these issues raised concerns with the limited funding available. While seeking alternatives to address these issues, the purchase of used apparatus surfaced. Further research was completed and presented to administration for tentative approval to press forward. Preliminary information received indicates the purchase of a used aerial apparatus, that is at least 10-15 years newer than Engine 3, can be accomplished for similar or less money than it will cost to complete a refurbishment. Research We have reached out to several vendors to determine availability and cost of a used aerial apparatus. Costs range anywhere from $165,000 through $221,000 depending on the year of vehicle and capabilities available. No expressed or implied commitments have been made with any vendors. Vendors contacted were Brindlee Mountain, Jon's Fire Equipment, Fire Tec and Fenton Fire. Additionally we polled various vendors regarding new demonstration models of various apparatus including engines and aerials. Responses received for cost estimates exceeded our original budgeted amount of$350,000 by several hundred thousand dollars. Vendors contacted were Pierce, Smeal, E-One, KME, Ferrara and Rosenbauer. Neither of the 2 vendors (Spencer Manufacturing and U.S. Fire Equipment) who submitted proposals for the refurbishment has been contacted regarding this proposed project. Equipment Equipment for the aerial apparatus will predominately come from re-purposing already in use tools where possible. Any new equipment purchased with this authorization will be only what is required to ensure the aerial meets the NFPA 1901 standard or not otherwise available from our existing inventory. Training Addition of an aerial apparatus will require supplementary training of personnel. If this project is approved we intend to start training immediately with our current Engineers, thereby limiting the amount of time necessary to bring the apparatus online. This training will be conducted in house, by certified personnel. We will continue with hands-on training once the apparatus arrives and anticipate having State of Alaska certified aerial operators within a year's time. Specifications The aerial apparatus we have explored is a 2001 American LaFrance straight stick. It has a 100' aerial ladder, supplied breathing air to the ladder, 2000 gpm pump, aerial waterway and current testing certifications. Delivery Research indicates we can expect the aerial to be delivered within approximately 120 days from the date of purchase. This time frame will allow for inspection and certification by the seller of all critical components, additions of any equipment that cannot be performed in house (drop down chain system),marking of the vehicle and shipping to Seward. Engine 3 status Engine 3 is out of service. It did not pass annual pump testing and has several mechanical deficiencies that need to be addressed but have been delayed pending determination of the current proposals. Options include: exploring the trade-in value or credit towards the purchase of a used aerial apparatus or expenditure of funds to complete the refurbishment project. Summary We are confident that once all factors have been equally weighed and all options explored, the purchase of a used aerial apparatus is in the best interest of the City of Seward. The reason for this summation is the replacement of an apparatus which has served our community for 30 plus years but now is no longer serviceable and cannot meet current safety standards without substantial capital investment. Addition of an aerial will greatly increase the SFD capabilities as well as allowing exploration of other potential benefits identified above. For these reasons this appears to be arguably the most fiscally prudent and fiduciary responsible use of the limited amount of available funds. We respectfully request Councils guidance with regards on how best to proceed.