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HomeMy WebLinkAbout04082019 City Council Laydown - Substitute Resolution 2019-036I r904bO 08stitute Resolution Sponsored by: Regis Substitute CITY OF SEWARD,ALASKA RESOLUTION 2019-036 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, PROVIDING FOR THE DISPOSAL BY PROVIDENCE SEWARD MEDICAL AND CARE CENTER OF A NON-OPERATIONAL MOBILE CT SCANNER IN ACCORDANCE WITH SCC 7.01.010 BY SOLICITATION OF QUOTES, WITH PROCEEDS BENEFITTING FUTURE HOSPITAL CAPITAL NEEDS WHEREAS, the City of Seward accepted a grant in the amount of$288,000 from the Denali Commission for the purchase of a refurbished CT scanner and mobile trailer in August, 2003 via Resolution 2003-094, and the City contributed an additional $5,450 for a total cost of $293,450 for purchase from Advanced Diagnostics, Inc. authorized on December 8, 2003 via Resolution 2003-157; and WHEREAS, the refurbished equipment was subsequently damaged and repaired as a result of a community-wide electrical outage in August, 2005 and has-reached the end of its useful life in 2013 and was disposed of by Providenc=, - -- - -. . • . : - .• •. - ! :; and WHEREAS, Providence Seward subsequently purchased a replacement used CT scanner in May 2013 from Providence Alaska Medical Center for a total cost of $149,481.04 which included costs of the equipment ($80,000) plus installation and siting of the unit, plus shipping the old unit to California, and that used CT scanner experienced a catastrophic failure in 2018 and is now requested to be disposed of; and WHEREAS, the City Council appropriated future hospital sales tax funds to purchase a replacement CT scanner and to modify the hospital building to relocate the equipment inside the building in July, 2018 via Resolution 2018-058; and WHEREAS, since the equipment failed in 2018 and until the building modifications were complete and the new CT Scanner operational, Providence Seward has leased replacement equipment at a cost of approximately$23,000 per month, while soliciting potential interest from buyers interested in purchasing the failed equipment, with limited success; and WHEREAS, Providence staff have, after many months seeking a buyer, identified a potential buyer for the equipment and the parties desire to sell the specialized equipment to a buyer that can make use of the equipment, and the parties therefore seek Council authorization to sell the equipment with the understanding that proceeds from the sale will be deposited into the Providence Seward Medical Center's capital account for the purchase of other hospital capital equipment; and CITY OF SEWARD,ALASKA RESOLUTION 2019-036 WHEREAS, Seward City Code 7.01.010—Sale of Surplus City Personal Property states: "Whenever the head of any department shall make a written finding that any personal property of the city is no longer necessary for corporate or public purposes, the same may be offered for sale or donated to a nonprofit organization following approval of the written findings by the city manager. The sale shall be held in accordance with the procedure followed in the awarding of purchases, Title 6,but to the highest responsible bidder"; and WHEREAS, Seward City Code Title 6 requires advertisement for items of value in excess of$30,000 and the surplus CT scanner and equipment fall below that threshold, and for amounts below $30,000 Title 6 allows for solicitations or quotations from interested persons or firms via telephone,online or by other means. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD,ALASKA that: Section 1. The Seward City Council hereby finds that it is in the public interest to authorize the disposal of a non-operational mobile CT scanner in accordance with the recitals above which are incorporated herein. Section 2. The administrator of Providence Seward Medical and Care Center is hereby authorized to sell the equipment which no longer serves a corporate or public purpose in accordance with Seward City Code 7.01.010, after solicitation of interest in this equipment over a period of months. Section 3. Proceeds from the sale of this surplus equipment shall accrue to Providence Seward Medical and Care Center to be placed into their capital equipment account for the purpose of funding other capital needs. Section 4.This resolution shall take effect immediately upon adoption. PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 8th day of April, 2019. THE CITY OF SEWARD,ALASKA David Squires,Mayor AYES: NOES: COUNCIL AGENDA STATEMENT r 4of Meeting Date: April 8,2019 �� q P From: Norm Regis,Acting City Manager Agenda Item: Authorization for Providence Seward to soliciting parties interested in purchasing decommissioned Mobile CT Scanner equipment BACKGROUND&JUSTIFICATION: In August 2003(Resolution 2003-094),the City of Seward and Providence Seward Medical&Care Center ("PSMC")accepted a$288,000 grant from the Denali Commission to purchase a refurbished 1988 GE 16- slice mobile CT scanner.The City contributed an additional$5,450 for a total cost of$293,450,purchased from Advanced Diagnostics,Inc.,authorized by Resolution 2003-157 on December 8,2003. This original CT scanner was taken out of commission in 2013 and for a period of time,was stored at the City's pole yard outside of City limits until its disposal and removal by PSMC. PSMC subsequently purchased a replacement used CT scanner in May 2013 from Providence Alaska Medical Center for approximately$80,000 plus the costs of installing and siting the unit, a new injector unit,and shipping the old unit to California,for a total cost of$149,481.04. That equipment purchase did not come before the City Council as PSMC utilized existing capital funds for the purchase with no additional funding requested from the City. It is Tthis second (used CT scanner which experienced a catastrophic failure in 2018 resulting in PSMC's short-term lease of replacement equipment, at a cost of $23,000 per month($276,000 per year). The lease on the rental CT began March 13,2018 and terminated January 31,2019. The leased unit was removed from Seward by the lessor vendor,and taken out of Seward. The failed CT scanner(purchased used in 2013)is currently located on private property off Old Nash Road, pending Council approval of this resolution which seeks authorization to dispose. Once Council authorization is obtained,PSMC will find a buyer for the unit or consider alternatives for its removal from Seward. In July 2018,the City Council appropriated$1.3 million from the Hospital Enterprise Fund,utilizing current and future hospital sales tax funds to replace the CT scanner and complete building modifications to relocate the equipment inside the hospital building rather than in a trailer in the parking lot. The building project also included modifications to the configuration of the hospital lab,and replacement of lab equipment. This authorization was provided in Resolution 2018-058. The mobile CT scanner must be disposed of in accordance with federal requirements due to the existence of radioactive material, and must be sold to a properly authorized and licensed vendor. For that reason,the administration requests Council authorize PSMC to solicit interest from qualified vendors who are willing to pay for the equipment. PSMC staff have been seeking an interested buyer for many months but due to the cost of shipping the equipment outside of Alaska where it can be repurposed, the cost is prohibitive. Providence did have a potential buyer who backed out of the deal during the period of time the parties were attempting to develop a process for soliciting competitive sealed bids for a sale. Therefore,the parties now request Council allow Providence to dispose of the equipment should they fmd a willing buyer. Providence has determined that if they are unable to find an authorized buyer,they can return the equipment to GE,the equipment manufacturer,at a cost to Providence of$20,000 for decommissioning. Allowing PSMC staff to sell the equipment should a buyer be found,will save PSMC from having to pay for the equipment to be properly decommissioned. PSMC will deposit the proceeds from a sale into the hospital capital equipment account for hospital equipment needs. CONSISTENCY CHECKLIST: Yes No N/A 1. Comprehensive Plan(document source here): X 2. Strategic Plan(document source here): X Other(list): Resolution 2003-094;Resolution 2003-157;Resolution 3' 2018-058 X FISCAL NOTE: There is no cost associated with selling the mobile CT scanner should a buyer be found. Proceeds from a sale will be deposited into the-Providence Seward Medical Center's own capital equipment account to purchase future capital equipment. Should Providence find a buyer, they will forego having to pay an estimated$20,000 to the manufacturer to decommission the equipment. Finance Approval ATTORNEY REVIEW: X Yes X No N/A RECOMMENDATION: Council approve Resolution 2019-_authorizing Providence Seward Medical & Care Center to solicit bids from qualified vendors interested in purchasing the mobile CT scanner, rather than to require competitive sealed bids,due to the unique requirements of disposing this type of equipment.