Loading...
CC 2015-07-28_08f Award Bid Police Fleet LeasingMEMORANDUM TO: CITY COUNCIL FROM: STEVEN N. ANNIBALI, CHIEF OF POLICE SUBJECT: CONSIDERATION TO AUTHORIZE AN AWARD OF BID FOR POLICE FLEET LEASING PROGRAM INCLUDING VEHICLES, FINANCING AND UPFITTING, AND DECLARING EXISTING VEHICLES AS SURPLUS PROPERTY DATE: JULY 28, 2015 RECOMMENDATION: It is recommended that the City Council: 1) award a bid for the purchase of seven police staff vehicles to McPeek Dodge of Anaheim, CA; 2) award a bid for lease financing to Rabo Bank I De Lage Landen Public Finance of Wayne, PA; 3) award a bid for the equipment upfitting for the vehicles to Drive Customs of San Luis Obispo, CA; and 4) adopt a resolution declaring the existing police staff vehicles and trailer as surplus and authorizing their sale as outlined in this report. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: This expenditure is to be funded out of the approved Police Department FY 2015- 16 budget under debt service -leasing. The total amount over four years is $234,347, which includes $218,903 for vehicle purchase and lease financing and $15,444 for equipment upfitting. The annual lease payment of $54,725.75 will come from the approved FY2015-16 budget of $133,880. The upfitting costs will be offset by the sale of existing, and scheduled to be surplus, vehicles. The value of the surplus vehicles is estimated at $40,000. Therefore, a net revenue increase of $24,556 is anticipated. The lease is for four years with a $1.00 purchase option at the end of the lease. The vehicles will be on warranty and an extended service contract during the term of the new lease. BACKGROUND: The Police Department introduced the fleet leasing program in 2008, and it has proven to be a viable and cost effective alternative to traditional purchasing. The vehicles are covered by a manufacturer's extended service contract during the entire time of the lease which has proven valuable at reducing the annual cost of fleet maintenance. The $1.00 end of lease purchase option allows the vehicles to be declared surplus and sold to cover the equipment upfitting costs each time the city enters into a new lease, with the overage resulting in a net revenue increase. Item 8.g. - Page 1 CITY COUNCIL CONSIDERATION TO AUTHORIZE AN AWARD OF BID FOR POLICE FLEET LEASING PROGRAM INCLUDING VEHICLES, FINANCING AND UPFITTING, AND DECLARING EXISTING VEHICLES AS SURPLUS PROPERTY JULY 28, 2015 PAGE 2 ANALYSIS OF ISSUES: The current police fleet operates (7) unmarked police staff vehicles. This includes (6) unmarked sedans; and (1) unmarked four door pickup truck. The sedans are assigned to detectives and command staff in the department and the multi-purpose pickup truck is utilized as a pool vehicle that is capable of providing transportation to training classes and events, such as firearms training, where the need to transport ammunition and supplies necessitates a pickup truck. This proposal calls for replacing these vehicles and maintaining the same number of staff vehicles. After a review of needs and fleet maintenance practices, staff recommends purchasing the Dodge Charger (V6 model) sedan and Dodge 1500 pickup truck based on cost and compatibility with maintenance parts currently used on the patrol fleet of Charger (VB models). The current staff vehicles are 2008 models and were originally scheduled to be replaced in 2012. However, due to their low mileage and limited use at that time, the decision was made retain the vehicles and instead purchase additional time on the extended warranty until this year as a cost savings measure. The extended warranty is scheduled to expire and the need exists to replace the vehicles while they retain their residual value in order to continue to facilitate the fleet leasing program. In addition to the replacement of the (7) unmarked vehicles, the Police Department will be reducing the overall fleet by (2) vehicles. Those additional surplus vehicles are Unit #4610 / 1994 Ford Mustang (Traffic unit) and Unit #4623/1999 motorcycle transport trailer that are no longer needed. Staff recommends purchasing the vehicles from McPeek Dodge through cooperative purchasing or "piggy backing" on existing contracts from larger jurisdictions in order to achieve a cost benefit from the larger orders. The Chargers will be based on the Los Angeles County Sheriff contract and the pickup truck will be based on the Tulare County contract. Purchasing through such cooperative agreements is consistent with the City's purchasing ordinance (reference AGMC 3.08.060(C)). Item 8.g. - Page 2 CITY COUNCIL CONSIDERATION TO AUTHORIZE AN AWARD OF BID FOR POLICE FLEET LEASING PROGRAM INCLUDING VEHICLES, FINANCING AND UPFITTING, AND DECLARING EXISTING VEHICLES AS SURPLUS PROPERTY JULY 28, 2015 PAGE 3 Staff recommends financing the purchase through Rabo Bank I De Lage Landen Public Finance of Wayne, PA, for the lease financing at a rate of 2.97%. Additional bids were received by Leasing Specialists, LLC at a rate of 3.8% and Holman Capital at 2.7% with a $6,000 document fee. Staff further recommends a sole source agreement, as permitted by AGMC 3.08.060(B), with Drive Customs for the vehicle upfitting due to the fact that there are no other vendors in San Luis Obispo County or Northern Santa Barbara County that are both a manufacturer representative and can manage a multi-vehicle fleet turn over in a reasonable turn around time. The 2008 award of bid for upfitting went to a Los Angeles area vendor based solely on cost. That decision proved problematic when repairs and service issues arose and the vendor was nearly 200 miles away. Drive Customs provides upfitting services to the vast majority of San Luis Obispo County law enforcement agencies and their pricing is very competitive. This request is to authorize the award of the following bid proposals: Vehicles • McPeek Dodge Financing $209,612.97 (LA and Tulare County Cooperative Purchase) • Rabo Bank/De Lage Landen $ 218,903.00 (2.97% I four annual payments) Upfitting • Drive Customs $ 15,444.00 (Offset by sale of existing vehicles) ALTERNATIVES: The following alternatives are provided for the Council's consideration: Recommended Alternative: It is recommended that the City Council: 1) award a bid for the purchase of seven police staff vehicles to McPeek Dodge of Anaheim, CA; 2) award a bid for lease financing to Rabo Bank I De Lage Landen Public Finance of Wayne, PA; 3) award a bid for the equipment upfitting for the vehicles to Drive Customs of San Luis Obispo, CA; and 4) adopt a resolution declaring the existing police vehicles as surplus and authorizing their sale as outlined in this report. Item 8.g. - Page 3 CITY COUNCIL CONSIDERATION TO AUTHORIZE AN AWARD OF BID FOR POLICE FLEET LEASING PROGRAM INCLUDING VEHICLES, FINANCING AND UPFITTING, AND DECLARING EXISTING VEHICLES AS SURPLUS PROPERTY JULY 28, 2015 PAGE4 Do not approve staff's recommendation. Provide direction to staff. ADVANTAGES: This proposed plan will continue to provide for the police fleet leasing program, update the police vehicle fleet, maintain standardize equipment, reduce maintenance costs and maintain residual values on the existing fleet for surplus sale. Depending on the final sale value of the existing fleet, the proposed plan will return approximately $24,566 to the General Fund. DISADVANTAGES: The disadvantage of approving the recommended action is that it will commit to another four year lease program for the police fleet. Costs would increase in the future if it was determined to return to an ongoing purchase program. ENVIRONMENTAL REVIEW: This project is exempt from CEQA pursuant to CEQA Guidelines Section 15061 (b)(3) PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted in front of City Hall on Thursday, July 23, 2015. The agenda and staff report was posted on the City's website on Friday, July 24, 2015. No public input has been received to date. Attachments: 1. Proposal based on the County of Los Angeles I PO#SH-15323947-1 2. Proposal for financing from Raoo Bank I De Lage Landen Public Finance 3. Proposal for upfitting from Drive Customs Item 8.g. - Page 4 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE DECLARING VEHICLES AS SURPLUS AND AUTHORIZING THEIR DISPOSAL WHEREAS, the City of Arroyo Grande has certain vehicles which are no longer needed; and WHEREAS, the vehicles can be classified as surplus property and made available for sale or transfer. NOW, THEREFORE, BE IT RESOLVED that in conformance with the City's Purchasing Policies and Procedures Manual, the City Council of the City of Arroyo Grande does hereby declare as surplus the vehicles described in Exhibit A, attached hereto and incorporated herein by this reference, and authorizes their sale or transfer. On motion of Council Member , seconded by CounCil Member and by the following role call vote, to wit: AYES: NOES: ABSENT: The foregoing Resolution was passed and adopted this 28th day of July 2015. Item 8.g. - Page 5 RESOLUTION NO. PAGE2 JIM HILL, MAYOR ATTEST: KELLY WETMORE, CITY CLERK APPROVED AS TO CONTENT: ROBERT MCFALL, INTERIM CITY MANAGER APPROVED AS TO FORM: HEATHER WHITHAM, CITY ATTORNEY Item 8.g. - Page 6 EXHIBIT A SURPLUS VEHICL_ES AVAILABLE FOR 'SALE AND/OR AUCTION VEHICLES: 1. 1994 Ford Mustang (Unit #4610) VIN #1FALP42T8RF153555 .2. 1999 Sh9p Motor9ycle Trailer (Unit #4623) . VIN #GA552407 3. 2008 Dodge Avenger (Unit #4614) VIN #1 B3LC46D6N515768 4. 2008 Dodge Avenger (Unit #4615) VIN# 1BLC46D89N515769 5. 2008' Dodge Avenger (Unit #4616) VIN# 1 B3LC46D49N515770 6. 2008 Dodge Avenger (Unit #4617) VIN# 1 B3LC46D4.9N515767 7-. '2'008 bodge Avenger (U'nit #4618) VIN # 183LC46D69N515771 8. 2008 Dodge Avenger (Unit #4619) VIN# 183LC46D89N515772 9. 2008 Podge Dakota Pickup (Unit #4613)' VIN# 1 Q7HE2"8K89S719705' ------~-·-------Item 8.g. - Page 7 I ATIACHMENT 1 -l - I l QUOTE CITY OF ARROYO GRANDE; 2015I2016 DODGE CHARGER POLICE CAR ADMINUNITS BASED OF LA COUNTY Sl-IERIFF CONTRACT RFB-IS-15201411-l I P.0# PO~SH-15323947-1 7-14-20 l 5 INCLUDES OPTIONS 27A DODGE CHARGER POLICE PKG 3.6 LITER V..:6 3.07 AXLE. I-ID CLOTH BUCKET SEATS W/CLOTH REAR FULL SIZE SPARE WI RELOCATION BRACKET 8 KEYS I REMOTES KEY ALIKE (FREQ 1) IO WAY POW.ER SEAT STREET APPEARANCE GROUP REAR BACK UP SENSORS AND CAMERA SECURITY ALARM COTE HOOKS CAR TO BE SOLID COLOR SELLING PRICE LESS NET 30 PAY DISCOUNT SELLING .PRICE SALES TAX 8.0% CA.TIRE TAX 5YR /85,000 MILE MAX CARE TRANS.PORT TO ARROYO GRANDE TOTAL FOREACH,CAR 25,484 .. 00 500.00- 24,984.00 I ,998.!72 I 8.75 2)80.00 300.00 29,671.47 12_21 Aut<.1 Center Dr. -P.O'. Sox 730 .-Anahei , CA '92815 -, 1 Pt~one: 1 (714) 635-2340 Fax 1 (714) 533-1553 __ , ____ , ________ , _______ _ Item 8.g. - Page 8 NOTES; l NEW WARRANTY F0i{ THE 2015 I 2016 MOD'.ELS. ARE 3YR/3.6,000 ON THE CAR SYR/100,000 ON THE POWER TRAIN 2 -DE.LIVERY TIME IS 60-120 DAYS ARO Mc_Peek's Dodge or Anaheim 1221 AUTO CENTER DR ANAHEIM, CA 9280 714-254-2613 OFC 71'4-254-26'14 r AX 714-264-1867 ·CELL KEVINB@MCPEE KD0DGE.COM i 221 Auto Centej· Dr ... P.O. Box 730 -Anahekn, CA 928'i 5 Phone: 1 (7.14) 635-2340 Fax ·1 ('?'14) 53:;~~·t553 ------Item 8.g. - Page 9 I I I ! QUOTE .A N A H E I M' CITY OF ARROYO GRANDE 2016 RAM CREW CAB SSV TRUCK BASED ON TULARE·COUNTY CONTRACT BID# 15-039 IP .0 # P0-32-15090I0010 INCLUDES OPTIONS 1500 SSV CREW CAB· 5. 7 LITER V-8 6 S-PEED AUTO TRANS CLOTH FRONT BENCH /VINYL REAR SEA TS CHROME APPEARANCE GROUP BLUETOOTH B.ACK UP CAMERA LIMITED SLIP AXEL 32 GAL FUEL TANK TRUCK TO BE SOLID COLOR SELLING PRICE SALES TAX 8.0% CATIRE TAX 5YR I 85,000 MJLE JVIAX CARE DELIVER TO ARROYO GRANDE TOTAL FOR.EACH CAR NOTES; 26,755:00 2, 140AO 8.75 2,380.00 300.00 31,584.15 1 NEW WARRANTY FOR THE 2016 MODELS ARE 3YR/36,000 ON THE CAR SYR/100,000 ON THE POWER TRAIN Me:Peek's badge of Analieim 1'221 S AUTO CENTER DR ANAHEIM, CA 9280 714.-254-2613 0FC 714~-254-2614 FAX 7 Lfo2.tlfi-AS67 CEk,L . KE~~~PcP~"E1ZTJcRfGE.'C8Kt~oit 730 ·· /'.\nahe1m, CA ~28"15 Phc~ne: 1 (7"14} 635-2340 Fax 1 4) 533 .. ·1553 ·----·-------------Item 8.g. - Page 10 RfJ_bpbank ATTAp.HMENT 2 ! llabobanll IEquiprnentrmance 1111 Old-Eagle School Roatj Wayne, PA 19087 Pr<»posa\l for T'ax:-:E.xempt Lease Purcl;la_~e .Financ:in~ Juiy 2},.20is ·City of Arroyo Grande 300 Ea:st Branch Street Arroyo Grande, CA 93420 Rabobank .Equjpmcht Finaµce ("Lender") is pJeased to submit the. following proposal, fot discussion purposes only, 'based bl). our prcst<ht un_derstanding of the financing requirenien~s of tli.e Borrower named below .("~orr:gwer") for_ the-refinancing; of the below described equipment;{"Equipme!lt"). Any c~angps to these terms,, -cqhditiolli; arid assumptions may alter the proposed fiiiancfo.g; BORROWER: City of Arroyo Grande, California LENDER_: Rabobarik Equipment Finance EQUIPMENT: Vehicles VENDOR: McPeek Dqdge, Anaheim, California 1~.!NAN{!iNO: TYPE: Tax-exem~t Capital .Lease-Purchase Agreement AMO.uNT FINANCED: _$20.9,612.97 (faciudes sales taxes) TERM: Four (4)_years PAYMENT M:ob.E: Annual payments in ad\(ance INTEREST-RATE: 2.97%* PAYMENT FACTOR: 0.26108J)* PA:YlV1ENT AMOUNT: $5~,7Z5.75* NlfMBEROF PAYMENTS: Fow' (4) CLOSJNG DATE; To be~detennined. ESti~nated to be October 21, 2015 *See. INTEREST RATE LOCK ana INTEREST RATE INOEX herein Item 8.g. - Page 11 Rabob.ank INTEREST RA TE LOCK: FINANCING RATE INDEX: SALES TAXES: LEOAL OPINION: TAX-EXEMPT' STATUS: 'FEES: BANK QUALIFICATJON: TITLE/SECURITY: NET FINANCING: OTHER CONDITIONS: The fixed interest rate listed above is offered assuming the transactiQh is closed prior to October 31, '2015. If closing1 is delayed beyond that date,. a new fixed interest:rate shall be detennined pursuant to indexing provisions described below. If funding of the transaction is delayed beyond .October 3 i:, 2015, the finan:cing rate. ~sed to determine th_e payment amounts will be ·irtde~ed to the ~ec¢:ities· ind_ustcy and Fin~cial Markets Association Index ("SIFMA Swap Ask Yield") for the.;.ieJevant financing term. The final rate and resulting1paynients will be set 'ten (I 0) business days prior to closing, Sales taxe~ are applicable to the Borrower's purchase of e9uip?1ent pursuant tQ State law. All applicable sales taxes will be included in the financed amqupt. .Lenci~r. will remit sales tax directly to the relevant tax collectjon agencies at closing. An opinion of Borrower's· legal counsel addressing the validity and enforceability .of the financing agreement_, in a form acceptable to Lender, will be required find the cost shall be the rcspOllSibility of the BorTOwer. This proposal is based on the B_orrower's obligation under the underlying financ~ agrecnicnt qualifying as a tax-exempt obligation as .describ_ed in Section 103. of th~ Internal Re_vem1e Code of 1986, as amended. Bonower shall ~c required to use the Equipment in a manner, and do .those things requirep, so that the interest portions of the·payments shall not become subject tO. Federal income taxation. Bo1Tower is responsible for ·au 'fees and. expenses associated with .consultants or advisors it may retain in conjunction with the proposed transactio_n. The foregoing fees may be included in the amount financed, to, the extent permitted b_y Federal tax law. Lender does not charge any documentation or closing,fees. Lender offers the Borrower the same interest rate wtiether the obligation is "bank qualified" or "non-bank qualified.'' Title to' :be held in the name of tJ1e Bonower, with Lender retaining a first priority,. perfected ~ccurity interest in the Equipment. Maintenance, insurance and taxes will be the responsibility of the Borrower. 11 Thts prop9sal is subject to credit approval. • Interest rati::s notcd'.J.ierein arc subject to change as noted herei11. • Financing is subject to verification that all c'osts an:; eligible for inclusion in a tax exempt financing. • Jf state sales tax. is· appiicable to the sale bf the Equipment to the Borrower, su"Ch tax is e.xplicitly NOT the respon~ibili_ty qf Lender. If state sales tax is applicable, Lencler is willing to include these amo"unts in tl}e_afnol!nt financed .. Lender will require evidence that_ all requ,ired ,sales taxes are paid at or prior to closing. ,____ _________ ------~-~~------Item 8.g. - Page 12 Rabobank • Failure· h consummate this transaction once credit approval is ,granted and ·the· fm:,mcing documerifs are delivered to Borrower.may result in a documentation fee being assessed·to fr\e Borrower. • Either Lendyr 9r Bori:.ower-niay terminate discussions at any time in (ts sole discretion. • If made, an approval by Lender would be in a separate writing and would be subject to legal and bu5in-ess due,dil\gence and credit review, w}th results satisfacfory to_ Lender, in its sole discretion. • Borrower acknowledges that th(< tenns of the financing (if approved) may change before the parties execute final documentation~ · • No :financing terms wm b_e qinding on either party until definitive documentation is signed. • This Lett~r ·is hot a statement of all terms and conditions of the :financjng, whi9h terms and c_onditions would be.contained fully in final documentation and would,sJJpersede the terms of this Letter. • This Letter is. intended for the use of the Borrower only, and no other party may rely upon or derive any legal rights from this· Letter. • This .Letter is: valid for 90 <ll:!YS fro!Il the date hereof and thereafter shall automatic~lly be deem}:d to be null and v9i9, NotWithstanding anytl1ing to the contrary, including, without.limit, acceptance by Bdrroiv,fJ!, lliis Letter is an indication of' interest rf!garding·a possible arm :s /ength financing tr_ansaction on the general terms and conditiops outlin.e_d herein a_qd s/10uld not. be construed as a commitment t~ fli:wnce. T!w proposal contained lierein consists solely of the terins' under which Lender, may be willing to enter into a transactiOn with Borro_wer fo1: Lender's oivn account. Lender expresses no. opinion and mak,es no repnJ__sentation with regard to what leasing or financing altematil'e is best suited.for Borrower. Lender is not providing advice or rer;ommendations witl1 respect to the prdposed tran_s<jction {li_id has no fiduciary duty to Borrower. Borrower is encouraged to_ re_ta/n its own advisor. We sincerely appre~ii:ite'the oppo~Ul}ity to present this information. Sipcerely, RABOBANK EQUIPj\1ENT FINANCE 48-112175109+0.15 Item 8.g. - Page 13 .>).J_,,o S. U[;!u~tft. SI: Sui./-e -lf:z>t)o. Stft.,f Las 05r:Spo, e.4. 8'o.r ,;41-44.J.J NE!ine t Adoress ~rroyo Grande.PD 300 N Halcyon Rd. Arroyo·Gr!ll}de, CA 93420 Project Dodge Chargers ltelT). Description :-32?0.00·xx Viper S2 LED Dual.Head Light Bar MPS600 Mic1'0Pulse.6 LED Light·He~d Flush Mount MPSM6-l,B .J-.-~ra,cket'.for mounting MJ>GOO ETSAlOOR .Remote IOOW Siren Controlle·r with Park Kill ESlOOC Sirc!JIPA Spe_akcr 100 Watts ES87TAR11 ES'I 00 Siren Bracket for 20 I 1 +Ford Taurus (Also lits. new. Chat'gers) .72170-04 _4 P9~itic,:m Rotary.Switch Parts Misc.-wite. wire ttcs. w1re loom, rel:i)•s. fuses. fuse holders, co11nect9rs Labqr·Flcct Complete huiJd.ofunmarked Dodge Charger fo include all lighting, siren and anip, police radio and antenna. Subfota1· Sales Tax Total I ATIAGHMENT'3 i ' Esfimate Date Estimate#' 7/1512015 1863 Salesperson Jesse Qty Amount Total 6; 36Q.OO 2,,160._()QT 24 ' 130.0Q 3,120.00T 24 15.00 36o:oor 6 24'5.00 1,470.00T 6 235.00 1,410:00T 6 25.00 150.00T 6 35.00 210._()QT 6 7o.6o 420.00T 6 900.00 5,400.00 l $14.700.00 '(8·.0%) $744.00 $15;444.00 Item 8.g. - Page 14