HomeMy WebLinkAbout03.a. Review draft Position Paper to authorize the General Manager to purchase two additional rodding trucks to be delivered in Fiscal Years 2020-21 and 2021-22 funded from the Vehicle Replacement Program, District Project 8517 Page 1 of 2
Item 3.a.
CENTRAL SAN BOARD OF DIRECTORS
POSITION PAPER
DRAFT
MEETING DATE: SEPTEMBER 3, 2019
SUBJECT: REVIEW DRAFT POSITION PAPER TO AUTHORIZE THE GENERAL
MANAGER TO PURCHASE TWO ADDITIONAL RODDING TRUCKS TO BE
DELIVERED IN FISCAL YEARS 2020-21 AND 2021-22 FUNDED FROM THE
VEHICLE REPLACEMENT PROGRAM, DISTRICT PROJECT 8517
SUBMITTED BY: INITIATING DEPARTMENT:
JASON DEGROOT, SENIOR ENGINEER OPERATIONS-COLLECTION SYSTEM DIV
MANAGER
REVIEWED BY: PAUL SEITZ, COLLECTION SYSTEM OPERATIONS DIVISION MANAGER
ANN SASAKI, DEPUTY GENERAL MANAGER
ISSUE
Board authorization is required for the procurement of two additional rodding trucks to be funded and
delivered in Fiscal Years (FY) 2020-21 and 2021-22.
BACKGROUND
Central San has established an ongoing Vehicle Replacement Plan that takes into account expected life
cycles for each vehicle based on years of service, mileage, vehicle condition, and maintenance records.
The Collection System Operations Division has seven rodding trucks. Several of the rodding trucks are
near the end of their life cycle. The current Vehicle Replacement Plan includes replacing one rodding truck
each year for the next three fiscal years. A rodding truck takes approximately one year to fabricate from the
issuance of a purchase order. Due to the cost of a rodding truck, a formal bid must be solicited each fiscal
year after the funds are approved in the annual Capital Improvement Budget (Cl B). One truck is included
in the approved FY 2019-20 Cl B under the Vehicle Replacement Program, District Project 8517. One
additional rodding truck is recommended for replacement in FYs 2020-21 and 2021-22. Since the three
rodding trucks are identical, staff is proposing to issue a single purchase order for all three trucks with one
formal bid. Delivery of the second truck would be no sooner than FY 2020-21 and delivery of the third truck
would be no sooner than FY 2021-22.
Two bids were received and opened on August 15, 2019. The bids were submitted by Owen Equipment
and Golden Gate Truck Center. The bids were $1,516,147 and $1,539,985, respectively, for all three
trucks. The Purchasing Division conducted a technical and commercial review of the bids and determined
that Owen Equipment is the lowest responsive and responsible bidder with a total bid amount of
September 3, 2019 Special EOPS Committee Meeting Agenda Packet- Page 3 of 15
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$1,516,147 for the purchase of three rodding trucks. Therefore, the cost per rodding truck equates to
$505,382. The FY 2018-19 bid for a rodding truck was $483,000 which equates to a 4.63% cost increase
for the next three rodding trucks.
The funds for the two additional rodding trucks will be included in the FY 2020-21 and FY 2021-22 Cl B.
The Ten-Year Capital Improvement Plan (Cl P) includes $900,000 per year in the Vehicle Replacement
Program.
ALTERNATIVES/CONSIDERATIONS
Alternative No. 1: Continue with the plan to purchase one rodding truck in FY 2019-20 and purchase
additional trucks in subsequent years. This would require preparing formal requests for bids each year, which
duplicates work that could be handled with one procurement.
Alternative No. 2: Procure all three rodding trucks in FY 2019-20 rather than phasing them over three fiscal
years. This would require accelerating funding to FY 2019-20 rather than spreading costs over three years,
which could potentially impact the ability to fund other projects.
FINANCIAL IMPACTS
One of the three rodding trucks is in the approved FY 2019-20 Cl B. The approval to issue a purchase
order to include the two additional rodding trucks would commit Central San to spending $505,382 of
future-year funds in FY 2020-21 and FY 2021-22. The Ten-Year Cl P and the Ten-Year Financial Plan
include $900,000 per year in the Vehicle Replacement Program. There will be a cost savings by reducing
staff time needed to bid the rodding trucks only once instead of three separate bids over the next three
fiscal years. There will also be an additional cost saving from the vendors as they will only prepare one bid
instead of three.
COMMITTEE RECOMMENDATION
The Engineering and Operations Committee reviewed this item at the September 3, 2019 meeting, and
recommended
RECOMMENDED BOARD ACTION
Authorize the General Manager to purchase two additional rodding trucks to be delivered in FYs 2020-21
and 2021-22 funded from the Vehicle Replacement Program, District Project 8517.
Strategic Plan re-In
GOAL THREE: Be a Fiscally Sound and Effective Water Sector Utility
Strategy 2- Manage costs
GOAL FIVE: Maintain a Reliable Infrastructure
Strategy 2- Facilitate long-term capital renewal and replacement
September 3, 2019 Special EOPS Committee Meeting Agenda Packet- Page 4 of 15