HomeMy WebLinkAboutOPS 07-23
Report to
Executive Committee
Report Number: OPS 07-23
Date: March 6, 2023
From: Brian Duffield
Director, Operations
Subject: Request to Single Source One 1 Ton Truck with Service Body Replacement
-File: A-1440
Recommendation:
1. That, in accordance with Section 09.03 (g) of the Purchasing Policy wherein The
Manager is authorized to make single or sole source purchases without competitive bids
and enter into a contract if due to market conditions or unexpected circumstances,
required goods or services are in short supply, the purchase of One 1 Ton Truck with
Service Body Replacement for unit #795 (2014 Ford) submitted by Paramount Truck
Sales in the amount of $177,300.00 (HST excluded), be accepted;
2. That the total gross quotation cost of $200,349.00 (HST included), and the total net
project cost of $180,420.00 (net of HST rebate) be approved;
3. That Council authorize the Director, Finance & Treasurer to finance the total net project
cost of $180,420.00, as provided for in the 2021 and 2022 Capital Budgets as follows:
a)The sum of $175,000.00 to be funded from the Vehicle Replacement Reserve as
approved in the 2021 and 2022 Capital Budgets be increased to $180,420.00;
and,
4. That the appropriate City of Pickering officials be authorized to take the necessary action
to give effect hereto.
Executive Summary: The acquisition of a replacement One 1 Ton Truck with Service
Body for unit #795 (2014 Ford) was provided for in the 2021 Parks Capital Budget in the
amount of $70,000.00 with further funding being added in the 2022 Parks Capital budget of
$105,000.00. The total amount for this project is $175,000.00 funded from the Vehicle
Replacement Reserve.
This vehicle, used by Parks as their construction service truck, has exceeded its life cycle
and is recommended for replacement. These custom built vehicles are supplied to order
and have a typical delivery time of 9 to 12 months from issue of a purchase order.
Paramount Truck Sales have, in stock, a One 1 Ton Truck with Service Body that has been
thoroughly reviewed by Fleet Services who are recommending that the City take this
opportunity to proceed with this purchase. With supply chain problems and unpredictable
inflation affecting Fleet Services’ acquisition of new and replacement vehicles, it is prudent
to consider the opportunity to acquire this vehicle at this time.
OPS 07-23 March 6, 2023
Subject: Request to Single Source
One 1 Ton Truck with Service Body Replacement Page 2
In accordance with the Purchasing Policy Item 09.09 a single Source or Sole source
purchase exceeding $125,000.00 is subject to Council approval.
Financial Implications:
1.Quotation Amount
Quotation 177,300.00
HST (13%) 23,049.00
Total Gross Tender Cost 200,349.00
2.Estimated Project Costing Summary
Quotation $177,300.00
Total Project Cost $177,300.00
HST (13%) 23,049.00
Total Gross Project Costs $200,349.00
HST Rebate (11.24%) (19,292.00)
Total Net Project Costs $180,420.00
3.Approved Source of Funds -Operations Department Capital Budget
Approved Code Source of Funds Budget Funds Required
C10320.2115 Vehicle Replacement $175,000.00 $180,420.00
Reserve
Project Cost under (over) approved funds by ($5,420.00)
Discussion: Fleet Services is responsible for the scheduling of replacement vehicles on a
life cycle basis. Unit #795 (2014 Ford) has met or exceeded its useful life and is scheduled for
replacement. This vehicle was originally scheduled for replacement in 2021 but was deferred
twice during COVID. Unit #795 is now a ten year old unit with an in service date of August
2013. Keeping this vehicle on the road will have increased maintenance costs due to the
inevitable major breakdowns at this point in its life cycle. Major repairs such as transmission
issues or engine failures can be in excess of $10,000.00 plus for a single repair.
Fleet Services, through its network of vendors, has identified an opportunity to acquire a one 1
ton truck with service body vehicle currently in stock at Paramount Truck Sales and available
for immediate delivery. This vehicle was ordered by a customer that later withdrew from the
OPS 07-23 March 6, 2023
Subject: Request to Single Source
One 1 Ton Truck with Service Body Replacement Page 3
contract. Typically these custom built vehicles have a lead time as long as 12 months from PO
to an in-service date.
Due to current market conditions and supply chain demands, vehicle costs have increased up
to 30 percent over a two year period. Under normal market conditions, the inflation rate on
vehicle sales year to year is between 2.5 and 3 percent. The ability to purchase a new vehicle
from stock that meets the full specifications for the replacement of our one 1 ton truck with
service body is an opportunity that will avoid the full cost of inflation that we would have to fund
in the current market and get the vehicle into service in the spring of this year.
After careful review of the submission received, Operations’ staff recommend the acceptance
of the quotation submitted by Paramount Truck Sales for One 1 Ton Truck with Service Body
in the amount of $200,349.00 (HST included) and that the total net project cost of $180,420.00
(net of HST rebate) be approved.
Attachment:
1.Paramount Truck Sales Quote, dated February 15, 2023
Prepared By: Approved/Endorsed By:
Original Signed By: Original Signed By:
Matt Currer Cathy Bazinet
Manager, Fleet Operations Manager, Procurement
Original Signed By: Original Signed By:
Brian Duffield Stan Karwowski, MBA, CPA, CMA
Director, Operations Director, Finance & Treasurer
MC:nm
Recommended for the consideration
of Pickering City Council
Original Signed By:
Marisa Carpino, M.A.
Chief Administrative Officer
Attachment #1 to Report OPS 07-23