HomeMy WebLinkAboutFCS-17-076 - T17-028 Folder Inserter Machine
In addition,
REPORT TO: Committee of the Whole
DATE OF MEETING: 2017-04-24
SUBMITTED BY: Michelle Palmer, Director of Supply Services
519-741-2200 ext. 7214
PREPARED BY: Steve Rudak, Buyer, 519-741-2200 ext. 7213
WARD(S) INVOLVED: N/A
DATE OF REPORT: 2017-04-03
REPORT NO.: FCS-17-076
SUBJECT: T17-028 Folder and Inserter Machine
___________________________________________________________________________
RECOMMENDATION:
That Tender T17-028 Folder and Inserter Machine, be awarded to Information
Network Systems, Waterloo, Ontario, at their tendered price of $158,116.,
including a ten (10) year maintenance plan, plus H.S.T. of $20,555.08, for a total of
$178,671.08, with an option to renew the maintenance plan for three (3) additional
twelve (12) month terms.
BACKGROUND:
The folder and inserter machine is a critical piece of equipment in the City’s mailroom,
annually processing in excess of 1.2 million pieces of mail, enabling the City to adhere
to legislated mailing deadlines of property tax bills, utility bills, collection notices and
other mailings, as required.
The current folder and inserter machine was acquired in 2011. The life of this type of
equipment is measured by the number of pieces of mail that it processes. While
maintained in good working order, the current machine has been processing above the
maximum piece output for the past six years and is rapidly nearing the end of its useful
life. In addition, replacement parts are becoming increasingly difficult to secure. This
creates a risk of substantial downtime if the machine breaks down which could cause
the City to miss legislated mailing deadlines.
The new equipment has the capacity of 2 million pieces of mail annually. This capacity
in combination with the 10 year comprehensive maintenance contract ensures that the
City’s processing needs will be met.
*** This information is available in accessible formats upon request. ***
Please call 519-741-2345 or TTY 1-866-969-9994 for assistance.
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REPORT:
Tenders were advertised publicly on the City of Kitchener website and the Internet
through the Ontario Public Buyers Electronic Tendering Information System. Documents
were downloaded by five (5) interested parties and by the closing date of Thursday
February 23, 2017, two (2) tenders had been received.
The following tenders were received:
Price #1: Price #2: Corrected
PurchaseLeasePrice #2:
MachineMachineLease Machine
(5 year) (5 year)
Pitney Bowes of Canada Mississauga ON $111,422.33 $ 96,565.79 $ 91,480.79
Ltd.
Information Network Waterloo ON $178,671.08*$138,502.97$134,611.25
Systems Inc.
Tendered prices were verified for mathematical accuracy and corrected accordingly.
The tender received from Pitney Bowes of Canada Ltd., has been disqualified due to
modifying the City’s terms and conditions within the tender document.
The tender documents included the option for the City to purchase the equipment
outright or lease for a five year period. Staff have analyzed the two bid options and
have determined the purchase of the machine with the ten year comprehensive
maintenance contract represents the best value and the lowest overall cost to the City
over the expected life of the equipment.
The price for annual maintenance has decreased 19% from the 2016 contract.
The tender was reviewed by C. Tarling, Director Legislated Services & City Clerk, M.
Santos, Manager Corporate Records, Archive & Mail Services, and S. Rudak, Buyer,
who concur with the above recommendation.
ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN:
The recommendation of this report supports the achievement of the city’s strategic
vision through the delivery of core service.
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FINANCIAL IMPLICATIONS:
The net cost for this tender (A), is fair and reasonable for a purchase of this scope and
the upset limit is within the budget allowance (B) provided within the budget. The
Operating costs are for 10 years of preventative maintenance on the machine. The
estimated surplus (D) for capital costs will remain within the capital account to fund the
purchase of a postage machine in 2017 and the estimated surplus (D) for operating costs
will be closed out to the tax stabilization reserve fund.
Financial Summary for Tender
T17-028
Supply Folder & Inserter Machine
2017 2018-2027
Capital Operating Total
Estimated Cost
Tender T17-028 costs, including HST $ 86,146.68 $ 92,524.40 $ 178,671.08
less: HST rebate on tender $ (8,568.93) $ (9,203.31) $ (17,772.24)
Net Cost Being Awarded $ 77,577.75 $ 83,321.09 $ 160,898.84 A
Costs Incurred to Date $- $ - $ -
Projected Costs $ - $ - $ -
Total Estimated Cost for this
Proposal $ 77,577.75 $ 83,321.09 $ 160,898.84 C
Budget for this Purchase
Operating Costs $ - $ 101,409.00 $ 101,409.00
Capital Costs $ 80,000.00 $ - $ 80,000.00
Total Budget for this Purchase $ 80,000.00 $ 101,409.00 $ 181,409.00 B
$ 2,422.25 $ 18,087.91 $ 20,510.16 D
Estimated Surplus (B - C)
COMMUNITY ENGAGEMENT:
INFORM – This report has been posted to the City’s website with the agenda in
advance of the council / committee meeting.
PREVIOUS CONSIDERATION OF THIS MATTER:
Not applicable
ACKNOWLEDGED BY: Dan Chapman, Deputy CAO & City Treasurer, Finance and
Corporate Services
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