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| ARF- 2499 |
Regular Agenda Item 3. M.
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| Regular BOS Meeting |
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| Information |
| Request/Subject |
| Empire CAT Customer Purchase Agreement for 2011 928HZ Loader. |
| Background Information |
This 2011 928HZ loader will replace a 1978 loader, purchased by the County in 1982. The Roads Department is planning on trading in the 1978 loader for the new (used) 2011 loader. Equipment No. I-19, serial number 81J12268 was purchased used in 1982, for a cost of $83,500. It is now thirty six (36) years old. Parts costs to date are $60,634.33, and labor cost is $142,408.84. It is getting increasingly difficult to find parts for this 1978 machine.
As part of the Customer Purchase Agreement for the 2011 928HZ loader, Empire CAT has assigned a trade-in value for Equipment No. I-19 of $25,000. The total of the trade-in, $25,000, has been deducted from the $144,000 price for the 2011 928HZ Loader.
At the February 4, 2014, Board of Supervisors' meeting, the Board approved funding for the purchase of a 2014 motor grader for $279,110.41. The funds were available in the Transportation Excise Tax budget, in Capital Outlay Equipment. Gila County paid a down payment of $139,555, which was half of the purchase amount, with the intention of paying the second half by July 15, 2014, pending any need to replace another piece of heavy equipment in the aging fleet. The opportunity has presented itself to replace a 36-year old loader with the purchase of a 2011 928HZ loader at a substantially discounted price through the National IPA contract with the City of Tucson. At this time, the Director of Public Works would like to unencumber the second half of the payment for the motor grader - $139,555.41 for Fiscal Year 2013-2014 and use those funds to purchase the 2011 928HZ loader in Fiscal Year 2013-2014. The Public Works Division would then budget the second half of the payment for the motor grader, $139,555.41 into the 2014-2015 Fiscal Year budget. |
| Evaluation |
On April 16, 2013, the Gila County Board of Supervisors ratified the Cooperative Purchasing Agreement between Gila County and the National IPA, a cooperative purchasing group. As a member of the National IPA, Gila County can benefit through an existing agreement that Caterpillar has between the City of Tucson and the National IPA to buy a used 2011 928HZ loader. The National IPA discount is twenty percent (20%) off the list price of $180,000, which results in a significant cost savings of $36,000 on the 2011, 928HZ loader, for a base price of $144,000.
The Customer Purchase Agreement with Empire CAT shows the sales price for the new (used) 2011 928HZ loader to be $144,000 with the addition of an Extended Warranty on Power-train Hydraulics-Parts and Labor-3 years or 3,000 hours for $2,610; a Material Handling Arm for $5,421; and a job site delivery charge of $1,500, which brings the price to $153,531. With a deduction for the trade-in of the 1978 loader for $25,000, plus sales tax for $10,089.69, the final cost for the new (used) 2011 928HZ loader is $138,620.69. |
| Conclusion |
| It would benefit Gila County to take advantage of a cooperative agreement that Caterpillar has with the City of Tucson and National IPA which results in a $36,000 savings for the discounted pricing offered through the City of Tucson contract. |
| Recommendation |
| Consolidated Roads recommends that the Board approve the Customer Purchase Agreement with Empire CAT for the purchase of one 2011 928HZ loader in the total amount of $138,620.69. |
| Suggested Motion |
| Information/Discussion/Action to approve a Customer Purchase Agreement between Gila County and Empire CAT for the purchase of one 2011, 928HZ loader, serial numbers: 0CXK01508, 0ARJ10144, 121000363707, 22029071RN, T100800799, in the total amount of $138,620.69 which includes a trade-in allowance of $25,000, and added costs for a handling arm, sales tax, warranty and job site delivery of the loader to the County's Star Valley yard. (Steve Stratton) |
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