HomeMy WebLinkAboutDTS-09-060 - Fire Services Aerial Apparatus Purchase
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KITCHENER
Development &
Technical Services
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REPORT TO:
DATE OF MEETING:
SUBMITTED BY:
PREPARED BY:
W ARD(S) INVOLVED:
DATE OF REPORT:
REPORT NO.:
SUBJECT:
Mayor Carl Zehr and Members of Council
April 6, 2009
Tim Beckett, Fire Chief
Steve Usher Deputy Fire Chief (Ext 2499)
All
April 2, 2009
DTS-09-060
FIRE DEPARTMENT AERIAL APPARATUS PURCHASE
RECOMMENDATION:
That Council increase the upper limit of approval for the purchase of a stock aerial apparatus
from $836,000.00 to $863,538.00.
BACKGROUND:
In November, 2008, the Fire Department and the Purchasing Division completed preliminary
work in canvassing fire apparatus dealers for the availability of in-stock aerial apparatus in an
effort to purchase a stock unit at a lower cost than a custom built tendered vehicle.
On November 24,2008 Council adopted the following resolution:
"That the tender process be waived for the scheduled purchase of a custom built
aerial apparatus and allow the purchase of a comparable stock apparatus from a
pre-qualified dealer at a cost between $692,000.00 and $836,000.00"
Staff has recently identified a suitable in-stock vehicle. As is the case for most fire apparatus,
this vehicle will be purchased in U.S. dollars and, as the value of the Canadian dollar has
depreciated since November 2008, there is a need to adjust the upper limit of the purchasing
approval.
REPORT:
The process of finding suitable in-stock aerial apparatus can be lengthy due to fluctuations in
availability and scheduling of inspections with dealers and staff. An aerial device that meets the
specifications of the Fire Department was recently located through Darch Fire of Ayr, Ontario at
a cost of $863,538.00. This amount represents a 2.92% ($27,538.00) increase over the upper
limit previously approved by Council on November 24, 2008. The Fire Department received
responses from 4 dealers with in-stock units, with 3 dealers providing associated pricing and
this vehicle was the lowest cost.
The capital budget for apparatus replacement allotted $1,097,000.00 for the replacement of this
apparatus, so the purchase of this unit is still well under budget, representing a savings of
$233,462.00.
The variance in the cost of this apparatus is primarily due to the increase in the exchange rate
from November 2008 to March 2009. There has been an increase in the cost of the U.S. dollar
by 3.6% since that time.
The Purchasing Policy provides that:
"Any increases to an approved tender that is more than 10% or is not within the
budget originally approved must be approved by resolution of Council."
Notwithstanding the fact that the cost is within 10% of the original Council approval and that
there is sufficient funding available in the capital budget, this report is being brought forward to
Council to ensure complete transparency with respect to the purchase.
FINANCIAL IMPLICATIONS:
Revenue
Capital/Fire-Major EquipmenVFleet:
$1,097,000.00
Expenses
One Aerial Apparatus
Less G.S.T. Rebate
$906,714.90
$ 43 176.90
$863,538.00
$ 863 538.00
$ 233,462.00 surplus
CONCLUSION:
While the cost to purchase this apparatus has increased marginally due to exchange rate
fluctuations since the original Council approval for the purchase of an in-stock unit, it still
represents a significant savings of $233,462.00 relative to the amount budgeted to replace this
vehicle assuming it were replaced with a customized tendered unit.
I ACKNOWLEDGED BY:
J. Willmer