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HomeMy WebLinkAboutOES 29-09 REPORT TO COUNCIL PIC Report Number: OES 29-09 Date: May 19, 2009 175 From: Everett Buntsma Director, Operations & Emergency Services Subject: Quotation No. Q-23-2009 Supply & Delivery of Articulated Variable Horse Power Motor Grader File: A-1440 Recommendation: 1. That Report OES 29-09 of the Director, Operations & Emergency Services be received; 2. That Q-23-2009, as submitted by Nortrax for the supply and delivery of (1) one 2009 John Deere 870G Articulated Motor Grader in the amount of $258,736.10 (PST and GST included) be accepted; 3. The total gross purchase cost of $258,736.10 (GST & PST included) and net purchase cost of $247,287.60 be approved; 4. That council authorize the Director, Corporate Services & Treasurer to finance the supply and delivery of the Articulated Motor Grader in the amount of $247,287.60 as follows: (a) that the sum of $ 245,000 be financod by the issue of debentures by The Regional Municipality of Durham over a period not to exceed (5) five years, at a rate to be determined (b) the balance sum of $2,287.60 to be funded from the 2009 Current Budget (c) the annual repayment charges in the amount $ 55,035 be included in the annual Current Budget for the City of'Pickering, commencing in 2010 and continuing thereafter until the loan is repaid; and any financing cost to be paid out of the Current Budget; (d) the Director, Corporate Services & Treasurer has updated the City's 2009 Annual Repayment Limit and the repayment thereof falls within the City's Annual Repayment Limit for debt andi financial obligations, as established by the Province for municipalities in Ontario and would not cause the City to exceed the updated limit, and therefore, Ontario Municipal Board approval is not required prior to City Council's authorization; (e) undertake the financing of this project or portions thereof that cannot be accommodated through the foregoing through internal loans, Infrastructure Ontario - OSIFA Loan Program, or a '.,financial institution offering long term financing under similar terms and conditions; Report OES 29-09 May 19, 2009 Subject: Articulated Variable Horse Power Motor Grader Page 2 176 (f) the Treasurer be authorized to take any actions necessary to effect the foregoing 5. That the Director, Corporate Services & Treasurer be authorized to apply any excess proceeds raised to other capital projects for which long-term financing is required, as is permitted under the Municipal Act, 2001; 6. That the draft by-law attached to this report be enacted; and 7. That the appropriate officials of the City of Pickering be given the authority to give effect thereto. Executive Summary: The City of Pickering currently utilizes two motor graders to maintain approximately 220 lane kilometers of ravel surface road. This maintenance encompasses road surface conditioning as wel?as winter control. The replacement of the oldest machine, a 1999 Champion 740 has been identified in the 2009 Capital Budget. Financial Implications: 1. Approved Source of Funds 2009 Capital Budget Debt (5 years) Item Proiect Code Source of Available Required Fun s Variable Horse 5320.0903.1701 Debt $300,000 $247,287.60 Power Motor Grader 2. Estimated Project Costing Summary Quotation Amount 5320.0903.6178 Q-23-2009 $269,970.00 Trade in Credit (41,000) GST 11,448.50 PST 18.317.60 Total Gross Project Cost 258,736.10 GST Rebate (11,448.50) Total Net Project Cost $247,287.60 CORP0227-07/01 revised I Report OES 29-09 May 19, 2009 Subject: Articulated Variable Horse Power Motor Grader Page 3 Project cost under (over) the approved funds by $52,712.40 The Director, Corporate Services & Treasurer has reviewed the budgetary implications and the financing of the expenditure contained ',in this report and concurs. Sustainability Implications: The engine powering this piece of equipment meets the Environmental Protection Agency's Tier III regulation for emission standards. This standard significantly reduces the amount of harmful emissions produced by the operation of the grader. As well, product improvements such as "on ground" refueling and maintenance check points which do not require the operator to climb on the machine provide for a safer work environment. Background: The purchase of an Articulated Motor Grader was identified and approved by Council in the 2009 Capital Budget. This vehicle will replace City Unit #107, a 1999 Champion, 740 VHP Motor Grader. This machine, which was refurbished in the year 2006 has experienced a catastrophic failure of the transmission during winter control operations in early 2009. Since that time a rental machine has been utilized to maintain service levels. Specifications for a replacement were compiled using information from a previous new equipment purchase in 2002, on-site demonstrations and attendance at this year's Municipal Equipmeent Tradeshow in February 2009. At the tradeshow, staff were able to visit displays and equipment from three major manufacturers; Caterpillar, Volvo and John Deere. The Caterpillar machines are all joystick controlled and the demonstration simulotor made it evident that this is not a good choice for the type of work we perform. During and after the tradeshow, arrangements were made to demonstrate a John Deere 870D (2008 model) with a 9 litre engine. Subsequently, John Deere made their 870G (2009 model) available and both were used on City roads in late February/March 2009. Volvo did not make a unit available for demonstration. On April 18, 2009 request for quotations were released and Supply & Services invited three vendors to participate in the bidding process, of which two have responded. The low bid submitted by Strongco/Volvo for a 2009 Volvo G940 deviates from the 9 litre minimum specification for engine size but has been evaluated. The engine powering the machine being offered by Strongco/Volvo is a 7.2 litre engine, producing only 754 foot pounds of torque at 1550 RPM. The City's existing motor grader being replaced utilizes a 10.8 litre engine producing approximately 875 foot pounds of torque, has been very effective in heavy snow conditions experienced during the past two seasons of Winter Control and has accumulated 12,000 hours of running time. Approximately 80% of our grader needs are for heavy work requiring larger torque, such as snow clearing, regrading and overturning gravel roads, and spreading fresh gravel. It is the opinion of the Municipal Property & Engineering Division that an engine not meeting the minimum CORP0227-07/01 revised Report OES 29-09 May 19, 2009 Subject: Articulated Variable Horse Power Motor Grader Page 4 178 9 litre specification and not producing high torque output at a relatively low RPM would experience a shortened life cycle when required to perform this type of work. The bid submitted by Nortrax for a 2009 John Deere 870G has a 9 litre engine, and although smaller in size than the City's existing motor graders, it produces 949 foot pounds of torque at 1000 RPM. The Municipal Property & Engineering Division therefore recommends acceptance of the bid submitted by Nortrax, which has met all specifications set in Q-23-2009 in the amount of $258,736.10 (GST & PST included) and that the net purchase cost of $247,287.60 be approved. Attachments: 1. Supply & Services Summary Memorandum 2. By-law to confirm the authorization of the Issuance of debentures in the amount of $245,000 for the supply and delivery of Articulated Variable Horse Power Motor Grader Prepared By: Approved/Endorse By: Ric rd Holbor verett sm D' sion Head ~irector Municipal Property & Engineering Operations & Emergency Services Grant Smith illis Paterson Supe isor, Fleet Operations Director Corporate Services & Treasurer Vera A. F gemacher C.P.P., CPPO, CPPB, C.P.M., CMM III Manager, Supply & Services GS:cr Attachments CORP0227-07/01 revised I Report OES 29-09 May 19, 2009 Subject: Articulated Variable Horse Power Motor Grader Page 5 1 Copy: (Acting) Chief Administrative Officer Chief Administrative Officer Recommended for the. consideration of Pickering City Council Thomas J. ui v , RDM , CMM II Chief Administ ative Officer CORP0227-07/01 revised I ATTACHMENT# TO REPORT# Cif of _ 29-.0 y PIC E MEMO To: Richard Holborn, April 24, 2009 Division Head, Municipal Property & Engineering RECEIVED From: Bob Kuzma Senior Purchasing Analyst APR 2 4.2009 CITY OF PICKERIN Copy. M NICPALPRO RT &ENG!NEERINNGG Subject: Quotation-for Supply & Delivery of Articulated Variable Horsepower Motor Grader -Quotation No. Q-23- 2009 Quotations have been received for the above project. Three. (3) companies were invited to participate of which two (2) responded. Quotations shall be irrevocable for 60 days after the official closing date and time. Copies of the.quotations are attached for your review along with the summary of costs. Each line item provides a space for the vendor to indicate ,a "Yes, No, Specify" to provide the City with information and details to subjectively review each line item and the sum total of all specifications. Specifications item #4 (b) states: A mark in the "no" space shall mean a deviation from the specification and must be further detailed in the SPECIFY space. Deviations will be evaluated and acceptance of these deviations is within the discretion of the City of Pickering. The quotation submitted by Strongco/Volvo the total amount of $250,408.00, taxes included, is the low quotation, subject to further evaluation of the vehicle's specifications. Please advise with your recommendation any reason the low bid from StrongcoNolvo is not acceptable. SUMMARY Taxes included After Trade in Vendor Amount Sub Total G.S.T P.S.T. Total Calculation (Credit) Check Strongco/ $256,600.00 35,000.00 221,600.00 $11,800.00 $17,728.00 $250,408.00 250,408.00 Volvo Nortrax $269,970.00 1,000.00 228,970.00 11,448.50 18,317.60 258,736.10 $258,736.10 i ATTACHMENT# 4-rte TOREPgRT# DES ~-Dl Z- P o ' 'on is made in Supplementa~rms and Conditions to arrange for demonstrations. Pursuant to Standard Quotation Terms and Conditions, item 4 - Samples: Samples shall also mean demonstration of vehicle and/or equipment being quoted upon, including provision for City staff to operate the vehicle being quoted upon. This award is subject to Council approval. Include in your report to Council: 1. the appropriate account number(s) to which this work is to be charged and the budget amount(s) assigned thereto 2. Treasurer's confirmation of funding 3. related departmental approvals 4. any reason(s) why the low-bid of SrongcoNolvo is not acceptable, and 5. related comments specific to this acquisition Bidders will be advised of the outcome. Please do not disclose pricing to enquiring bidders. Subject to Council approval, an approved "on-line" requisition will also be required to proceed. If you require further information or assistance during the evaluation phase of this quotation call, contact me at extension 2131. April 24, 2009 Page 2 Q-23-2009 Supply & Delivery of Road Grader THE CORPORATION OF THE CITY OF PICKERING 8 2 BY-LAW NO. Being a by-law to authorize the Supply & Delivery of Articulated Variable Horse Power Motor Grader and the issuance of debentures therefore in the amount of $245,000 WHEREAS Section 11 of the Municipal Act, 2001, as amended, provides that a lower- tier municipality may pass by-laws respecting matters within the spheres of jurisdiction described in that Section; and, WHEREAS Subsection 401(1) of the Municipal Act, 2001, as amended, provides that a municipality may incur a debt for municipal purposes, whether by borrowing money or in any other way; and, WHEREAS Subsection 401(3) of the Municipal Act, 2001, as amended, provides that a lower-tier municipality in a regional municipality does not have the power to issue debentures; and, WHEREAS The Regional Municipality of Durham has the sole authority to issue debentures for the purposes of its lower-tier municipalities including The Corporation of the City of Pickering (the "City"); and, WHEREAS the Council of the City wishes to projceed in respect of the Supply & Delivery of Articulated Variable Horse Power Motor Grader; and, WHEREAS before authorizing the project to proceed in respect of the Supply & Delivery of Articulated Variable Horse Power Motor Grader on the date hereof the Council of the City had the Treasurer update the City's Annual Repayment Limit, the Treasurer calculated the estimated annual amount payable in respect of such project and determined that such annual amount would not cause the City to exceed the updated Limit and, therefore, Ontario Municipal Board approval is not required as per Section 401 of the Municipal Act, 2001, as amended, and the regulations made thereunder; and, WHEREAS after determining that Ontario Municipal Board approval is not required, the Council of the City approved Report OES 29-2009 on the date hereof for the Supply and Delivery of Articulated Variable Horse Power Motor Grader and awarded Quotation Q-23-2009 for the Supply & Delivery of the Articulated Variable Horse Power Motor Grader project. i By-Law No. Page 2 183 NOW THEREFORE, THE COUNCIL OF THE CORPORATION OF THE CITY OF PICKERING HEREBY ENACTS AS FOLLOWS: 1. That the City proceed with the project referred to as "Supply & Delivery of Articulated Variable Horse Power Motor Grader"; 2. That the estimated costs of the project in the amount of $247,287.60 be financed as follows: a) That the sum of $245,000 be financed by the issue of debentures by The Regional Municipality of Durham over a period not to exceed (5) five years; b) That the sum of $2,287.60 be funded from'the 2009 Current Budget 3. That the funds to repay the principal and interest of the debentures be provided for in the annual Current Budget for the City commencing in 2010 and continuing thereafter until the loan is repaid. BY-LAW read a first, second and third time and finally passed this 19th day of May 2009. David-Ryan, Mayor Debi A. Wilcox, City Clerk i