HomeMy WebLinkAbout6. MANAGER'S REPORT 08/17/2010Mount Prospect Public Works Department
INTEROFFICE MEMORANDUM
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TO: VILLAGE MANAGER MICHAEL E. JANONIS ;�
FROM: SUPERINTENDENT OF STREETS & BUILDINGS PAUL BURES It ,-
DATE: AUGUST 12, 2010
SUBJECT: 2010/2011 ROAD SALT CONTRACT — EXTENSION OF STATE BID
BACKGROUND `
In the past we routinely purchased road salt for our winter snow and ice control efforts through the
State of Illinois Joint Purchasing Program. In 2009/2008 we opted out of the state salt purchase to
try to get better pricing and better guaranteed deliveries. The pricing we received was actually
higher than the state pricing that year and deliveries had similar problems to the state program due
to the salt shortage across the country. There was no advantage to bidding separately and we
decided to take advantage of the state bid for 2009/2010 snow season.
Last year we purchased road salt for our winter snow and ice control efforts through the State of
Illinois Joint Purchasing Program. For three of the last four years salt supplies have been limited
due to the record breaking snows, delivery problems due to frozen lakes /rivers and limited supplies.
Vendors supplying salt for this program have met the delivery terms most of the time and at
competitive prices. Last year at the end of the season we filled our storage bins to the maximum
capacity of 1,200 tons to take advantage of the low pricing and to make sure we had an adequate
supply to start the season.
This year we were given the option to extend the state contract for road salt at the same price as
was awarded to the Morton International Inc. in 2009/2010. Morton supplied us with salt in
2009/2010 and has helped during other years during salt storages. As in the past, deliveries are
guaranteed not to exceed seven calendar days from time of order to actual delivery.
This year the price would remain the same as last year - $58.37 per ton. This is a delivered price
that includes cartage. This price is one of the lowest in the region. A recent survey of Northwest
Municipal Conference municipalities indicated that this price is lower than the rate paid in 27 of the
34 communities that responded. In addition, our contact at the Illinois Bureau of Strategic Sourcing
and Procurement advised us that communities re- bidding salt contracts this year have experienced
an average increase of 5 %. He also counseled us that any community with a price below $60 per
ton is at the lowest end of the price spectrum for road salt this year.
Based on the last four years usage ranging between 6,716 and 2,717 tons, we recommend
committing to 5,400 tons; the same quantity as last year. With the state contract we are required to
order 80% (4,320 tons) and may go over up to 120% (6,480 tons) if needed and supplies are
available, without a penalty or increase in price. At a quantity of 5,400 tons, we should have
enough salt for an average season and up to and including recent years record snows. The current
2010/2011 ROAD SALT CONTRACT — EXTENSION OF STATE BID
AUGUST 12, 2010
Page 2
prediction for snow this season is slightly lower than average amounts with average to slightly
colder temperatures. For your reference, below is chart detailing recent salt procurements.
*Not all salt was purchased at $45.81 /ton in 2008. During the salt shortage prices were
substantially higher, up to $165.00 /ton
RECOMMENDATION
It is my recommendation that the Village extend the State of Illinois Joint Purchasing Program for
road salt during the 2010 /2011 - winter season and enter into a contract with Morton International
Inc. of Chicago, IL. to supply road salt at a unit cost of $58.37 per ton.
Funding for this contract is available in the current 2010 budget and winter 2011 expenditures will
be limited to the amounts authorized by the Village Board in the 2011 budget.
With your concurrence, please forward this to the Village Board for their approval.
I concur:
len R. Andler
Director of Public Works
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Paul Bures
Superintendent of Streets & Buildings
c: Director of Public Works Glen R. Andler
Deputy Director of Public Works Sean P. Dorsey
File
X:\MY DOCUMENTS \STREETS \SNOW\STSALT2010.1 Ldoc
Mount Prospect Public Works Department
t INTEROFFICE MEMORANDUM
TO: VILLAGE MANAGER MICHAEL E. JANONISA
1, 7 11()
FROM: VEHICLE /EQUIPMENT MAINTENANCE SUPERINTENDENT
DATE: AUGUST 12, 2010
SUBJECT: PURCHASE OF ONE (1) NEW ARTICULATING AND
TRACTOR USING MINNESOTA STATE PRICING ($102,125.5
Background
In the current budget, there are funds available to replace sidewalk utility tractor 4548.4 is
a 1995 Trackless MT5 used by Public Works staff to remove snow in our downtown siness
district and on sidewalks along Northwest Highway, Central Road, and Route 83.
We have operated two (2) of these articulating and oscillating Trackless tractors over the last
10 -15 years to accomplish the needed snow removal in a timely and effective manner. These
tractors have served the Village well based on reliability, performance and overall versatility. All
of the current attachments (snowblower, broom, and plow) can be utilized on the new proposed
tractor and can be changed out quickly. This versatility is critical to public works operations; it
will allow us to share attachments with an existing Trackless tractor and limit the variety of
stocked parts. Most importantly, it will enable operators to maneuver the tractor in confined
downtown spaces with little or no retraining. Purchasing a comparable tractor from a different
manufacturer would require all new attachments for an additional purchase cost of
approximately 20% more and require us to purchase additional commonly stocked parts.
The Materials Management Division of the State of Minnesota has prepared bid specifications
for municipal utility tractors and sent them to eight (8) vendors that provide these types of
tractors. Each vendor submitted a competitive bid price for the specific manufacturer /model
they sell. The State of Minnesota has made this contract available to its state agencies and to
members of its state's Cooperative Purchasing Venture (CPV) program at the same prices,
terms, and conditions. I have reviewed the specifications and field- demonstrated the new
Trackless to insure this machine will continue to be the most cost effective choice available for
our needs.
Replacement Schedule
4548 was purchased in September of 1995 and was scheduled to be replaced in 2009. The
vehicle /equipment replacement schedule for special equipment is 10 -15 years, depending on
usage and condition. 4548 exceeds the vehicle /equipment replacement schedule criteria for
replacement and its useful life was deferred another year. 4548 has ended its 15th year of
service and has logged 2,144 hours of operation.
Life Cycle Cost Analysis
Life cycle cost analysis has been completed for 4548 and is attached for your review. The
Optimum Economic Replacement Point for 4548 has been calculated at year 6. The Modified
Optimum Economic Replacement Point was calculated at year 12.
Page 1 of 2
Other Factors
• The articulating pivot assemblies are due for a major rebuild. The work is estimated to
cost approximately $3,000, including parts and labor.
• The hydraulic steel lines and hoses are fatigued from age /corrosion and are due for
complete replacement. This work is estimated to cost between $3,500 and $4,500.
• The entire machine has rusted badly and is due for complete sandblasting and painting.
This is estimated to cost between $4,000 and $5,000.00, including paint and labor.
• The hydrostatic pump is due for a major overhaul. The cost is estimated to range
between $5,000 and $6,000, including parts and labor.
Replacement Recommendation
It is my recommendation that a replacement for 4548 be purchased during the 2010 budget
year. I am also recommending accepting $12,000 for 4548 as a trade -in allowance versus
being sold at the NWMC auction. My past experience has shown this type of specialized
equipment will have a higher resale value as a trade -in.
Discussion
Our local Trackless dealer, EJ Equipment, has offered the same pricing used on the State of
Minnesota's contract to us. EJ Equipment is the only Trackless dealer in Illinois, leading me to
believe the Village would not receive a better price from an out of state dealer by competitively
bidding this unique tractor on our own. Our Village Attorney has reviewed the Minnesota
contract details and states the Village Code permits the Village Board to waive competitive bids
in such other manner as it may approve, including its reliance on Minnesota's state bid contract
price, as it would be in the best interests of the Village. Therefore, it appears that the most cost -
effective procurement method for this tractor is to waive the competitive bidding process and
accept their proposal based on the State of Minnesota's contract ( contract number 442441)
pricing valid through September 30, 2010.
Purchase Recommendation
I am recommending waiving competitive bids for the purchase of one (1) new 2010 Trackless
MT6 Municipal Utility Tractor and accept the proposal submitted by EJ Equipment, Inc., of
Manteno, Illinois in an amount not to exceed $102,125.50. This amount includes a trade -in
allowance of $12,000. Funds for this proposed purchase are currently available in account
number 6707709 — 660115 of the 2010 budget.
i es R. Breitz an icle /EauiDment Superintendent
I concur.
en R. And[ r
Director of Public Works
JB
Attachment
c: Deputy Director of Public Works Sean Dorsey
H:\Administration \BIDS \RESULTS \Trackless Purchase4548MinnBidWVR8- 2010 -1.doc
Page 2 of 2
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