HomeMy WebLinkAboutCS 45/01
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REPORT TO COUNCIL
FROM:
Gillis A. Paterson
Director, Corporate Services & Treasurer
DATE: November 26,2001
REPORT NUMBER: CS 45-01
SUBJECT: Acquisition of Buses
RECOMMENDATION:
1. That Report CS 45-01 from the Director, Corporate Services & Treasurer be received;
2. a) Council approve the acquisition of one refurbished GMC bus from Eastway Ontario Inc.
at a cost of approximately $42,250 (plus applicable taxes) to replace the Orion VI bus that
is undergoing extended repairs;
b) That this bus be leased to the Ajax/Pickering Transit Authority (APTA) until
approximately October, 2002 and then a buyout provision be included in that lease;
c) That all terms and conditions of the purchase, lease and disposition of bus to be leased to
APTA be subject to the approved of the Chief Administrative Officer and the Director,
Corporate Services & Treasurer of the City of Pickering;
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3. A second 1983 GMC bus be purchased from Eastway Ontario Inc. with the cost to be split
50150 with the Town of Ajax; and,
4. The appropriate officials of the City of Pickering be authorized to take the necessary actions
to give effect thereto.
ORIGIN:
Ajax/Pickering Transit Authority
AUTHORITY:
The Municipal Act
Transit Merger Agreement dated August 8, 2001
FINANCIAL IMPLICATIONS:
The purchase, lease and eventual sale to APTA of the first bus is intended to be structured in
such a way it has no long term fmancial implications on the City of Pickering. The City would in
effect finance the purchases, for one year, to be repaid by APTA. The purchase of the second bus
is essentially a pre-budget approval and will cost the City of Pickering approximately $21,000
plus applicable taxes.
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EXECUTIVE SUMMARY:
Not applicable
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Report to Council CS 45-01
Date: November 26,2001
Subject: Acquisition of Buses
Page 2
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BACKGROUND:
Attached is a memo from the Deputy Manager, Ajax/Pickering Transit Authority, on the
replacement of the two Orion buses that were involved in separate engine compartment fires in
May and September of this year. One of the buses is expected to be back in service by
approximately year end. However, as it will be approximately one year before the second bus is
returned to service, APTA has requested that the City of Pickering provide alternate
arrangements so that it continue with its present level of service. Their recommendation is that
the City of Pickering purchase a bus, lease it to APTA who would recover the leasing costs from
our insurers. It is intended that should this be approved, it will cost the City virtually nothing
financially and APT A will be able to maintain its level of service.
The purchase of the second bus is for backup purposes and essentially a pre-budget approval for
the 2002 budget. Further details can be found in the attachment.
I have been advised that the two Co-Chairs of the APT A Board are aware of the contents of the
attached memo and support the recommendations.
If approved by Pickering Council, then it is intended that this matter will be put before the APT A
Board for their consideration. It is coming to Pickering first simply due to timing at year end of
the meeting dates of Council and the Board.
ATTACHMENTS:
1.
Memorandum from Deputy Manager, Ajax/Pickering Transit Authority dated November
19,2001.
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Prepared! ApprovedlEndorsed By:
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Gillis A. Paterson
Director, Corporate Services & Treasurer
GAP:vw
Attachment
Copy: Chief Administrative Officer
General Manager, Ajax/Pickering Transit Authority
Recommended for the consideration of Pickering
City Council
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ATTACHj\lIEI\iTrf-1- fa REPORT#_
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AJAX PiCKERiNG
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AUTHORITY
To: Gillis Paterson, Director, Corporate Services, APTA Treasurer
Date: November 19,2001.
Subject:
Replacement of Orion VI Buses # 2004 and #2005
Executive Summary:
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APT A experienced an engine compartment fire involving Orion VI bus #2005 on May 1, 2001
and a second engine compartment fire involving Orion VI bus #2004 on September 10, 2001.
Fire damage to both buses was extensive. These buses are the property of the City of Pickering
and therefore, Pickering is be responsible for financing and administering replacement buses.
Amounts paid by Pickering to replace the fire damaged buses are recoverable and will form a
part of our insurance claim.
We have been advised that repairs to Orion VI bus #2005 are expected to be completed within
two (2) months (January 2002 target). Repairs to Orion VI bus #2004 are not expected to be
completed until the October 2002. Upon entering the winter season, passenger loads will
increase and APTA will no longer be able to accommodate student passenger loads without the
benefit of a minimum of one (1) 40' bus to replace Orion VI bus #2004.
APTA staffhave contacted local transit properties in the GTA to enquire about the possibility of
leasing buses. Although several local properties have leased buses to Pickering in the past, no
buses are currently available for lease locally. .
/ Eastway, a Burlington bus refurbishing company, has provided APTA with the option to lease or
buy up to two (2) 1982/1983 refurbished GMC buses. Maintenance staff have completed an
inspection of these vehicles and deemed them to be in good condition.
The Eastway bus is available to lease at a fixed rate of $3,500 per month. The lease provides a
full powertrain warranty and requires a minimum leasing term of one year at a total cost of
$42,000.00 (plus GST). Eastway has quoted a purchase price of $42,250.00 (plus applicable
taxes). Thus, the cost to lease an Eastway bus (based on a minimum one year term) is
comparable to the purchase price.
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Recommendation:
1. That the City of Pickering purchase one (1) used 1982 GMC New Look bus for a sum of
$42,250.00 (plus applicable taxes) from Eastway Ontario Inc.; and that
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2. APTA lease-to-buy the used GMC bus from the City of Pickering for a sum of $3,500
each per month (plus GST) until such time as fire repairs are completed on buses #2004
in October 2002; and that
3. The City of Pickering notify Cowan Insurance Company by letter, of APTA's intent to
claim approximately $42,000.00 in leasing costs for the replacement bus; and that
4. Upon the return of bus #2004, the City of Pickering sell the used GMC bus to APTA for
the sum of $250.00 (plus GST), representing the difference between the purchase cost
and the quoted cost of one (1) year of leasing.
5. That the City of Pickering Finance Committee consider the purchase a second used 1983
GMC New Look bus for a sum of $42,000.00 (plus applicable taxes) from Eastway
Ontario Inc., the cost to be split 50/50 with the Town of Ajax.
Financial Implications:
Cost: Purchase one (1) used 1982/1983 GMC reconditioned 40' bus: $42,250.00 (plus taxes)
Recovery: Estimate Insurance Claim Recovery (12 mth. lease to APTA) :$42,000.00 (plus GST)
Net Cost to Pickering: $250.00
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Background:
Between June and October 2001, APTA staffhave contacted the following transit authorities and
refurbishing companies concerning bus leasing.
Mississauga Transit (4 buses were leased to Pickering in 1998/99)
Toronto Transit Commission
Brampton Transit
Whitby Transit
Oshawa Transit (1 bus was leased by Pickering in 1998)
Cobourg Transit (2 buses were leased by Pickering in 1998)
Peterborough Transit
Mississauga Truck and Bus
Transit International Leasing, California, US
Mecano, Quebec
Eastway Ontario Inc.
The transit authorities contacted have not been able to expand their fleets to meet growth demand
or more frequent mechanical repair requirements on aging fleets. Consequently, these properties
no longer have the flexibility to lease buses.
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For Discussion - The need for a second used 40' Bus:
Page 3
APT A has been advised that repairs to Orion VI bus #2005 are expected to be completed within
two (2) months. Thus far, APTA has been able to replace our damaged buses with existing
Ajax/Pickering spare inventory. Upon entering the winter season, passenger loads will increase
and the need for larger vehicles will become more ;critical. Even with the return of our bus #
2005 and the addition of the used Eastway bus to replace bus # 2004, APTA would like the City
of Pickering and the Town of Ajax to consider purchasing a second used bus.
In earlier discussions with Eastway, APTA staff were preparing for the need to replace both of
our damaged Orion VI buses for an extended period of time. During these discussions,. APT A
was offered two (2) used GMC buses. The need for one (1) replacement bus is critical, however
Pickering and Ajax may want to consider purchasing a second used bus for the following
reasons:
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There will be a significant delivery delay on new bus orders.
Used buses are cost-effective "insurance" against future major mechanical breakdowns.
Used 40' buses provide needed scheduling flexibility for planned fleet rilairi.tenance.
APTA will be removing a minimum of six (6) buses from service for short periods of
time in the next several months to complete needed engine rebuilds.
As an alternative to the cost of additional winter "overflow" buses, used 40' used buses
are a cost-effective means to ease winter crush-load conditions on our heavier school
service routes.
Temporary increase to fleet capaCity to supplement service harmonization and expansion
logistics.
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Recommendations Approved:
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Attachments:
1. 1993 GMC New Look photograph
2. Eastway purchase quote - 1983 GMC New Look VN#2GHYT82W5D3500142 .
3. Eastway purchase quote - 1982 GMC New Look VN#2GHYT82W5D3500101 .
4. Eastway leasing quote (vehicles identified above).
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Copy: Regional Councillor Maurice Brenner, Co-Chair, APTA
Regional Councillor Jim McMaster, Co-Chair, APTA
Stan Karwowski, Manager Financial Services, City of Pickering
Gary Moskalyk, Operations Manager, APT A
IATTACHMENT'..i._ TOREPO~
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Oct 24, 2001
Customer: Pickerinl!:/Aiax Transit
Model: GMC New Look 5307
VN#: 2GHYT82W5D3500142
Specifications
, ATTACHMENT' ~
89173 1 (Ontario) Inc.
· Engine - 6V71
· Transmission - V 730
· Air Ride Driver's seat
· Power Steering
· Tilt-telescopic steering column
· 47 seats
· Structure repairs & replace as necessary
· Panel replaced as necessary
· Painted to spec
· Safety Certificate
· Clean Air Certificate
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Price
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965 lvlackay Street
Pembroke. ON K8B 1A2
Bus: (613) 735-4593
Fax: (613) 735-0747
259 I Edinburgh Place
Ottawa, ON Kl B 5Ml
Bus: (613) 745-6123
Fax: (613) 747-9133
TO REPORT #
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Unit: 25082
1 815 Ironstone Drive
Burlington. ON. L7L 588
Bus: (905) 33] -5877
FlL'C (905) 331-9.124
TO REPORT#
89 J 731 (Ontario) Inc.
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Oct 24, 2001
Customer: Pickerin2/Aiax Transit
Model: GMC New Look 5307
Unit: 25055
VN#: 2GHYT82W2D3500101
Specifications
· Engine - 6V71
· Transmission - V 730
· Air Ride Driver's seat
· Power Steering
· Tilt-telescopic steering column
· 47 seats
· Structure repairs & replace as necessary
· Panel replaced as necessary
· Painted to spec
· Safety Certificate
· Clean Air Certificate
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965 Mackay Stn:et
Pembroke. ON K8B IA2
Bus; (613) 735-4593
Fax: (613) 735-0747
2591 Edinburgh Place
Ottawa.. ON KIB 5Ml
Bus: (613) 745-6123
Fax: (613) 747-9133
] 815 Ironstone Drive
Burlington. ON L7L 5B8
Bus: (905) 33 I -5877
Fax (905) 331-9124
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Aug 22, 200 I
Gary Moskalyk
Supervisor
Transportation Division
City ofPickering
Dear Mr, Moskalyk:
ATTACHMENT # 4- TO REPORT #
891731 (Ontario) Inc.
As per your inquiry for rental of a 40 foot transit bus.
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The price per month is $3,500 per month for a I year fixed lease and $4,000 per month for an open
rental with no time limit requirement.
Terms and conditions are listed in the enclosed document.
Sincerely
Jerry Kucheran
VP Sales and Marketing
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96:" Macl;ay Street
Pembroke. ON f.:8B IA2
Bus: (613) 735-4593
Fax: (6 i3) 73~-0747
2591 Edinburgh Place
Ottawa. ON KIB ~Ml
13m;: (613) 745-6123
Fax: (613) 747-9133
1815 ironstone Drive
Burlington. ON L7L 5B8
Bus:. (905) 331-~877
Fax: (905) 331-9124
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