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Home My WebLink About1R OCRDate: Subject: From: City Council Staff Re{Jort January 28, 2021 CONSENT CALENDAR AUTHORIZE THE PURCHASE OF NEW VEHICLES AND EQUIPMENT IN AN AMOUNT NOT TO EXCEED $3,150,000 David H. Ready, City Manager Prepared by: Marcus L. Fuller, Assistant City Manager SUMMARY This action will authorize issuance of Purchase Orders for purchase of new vehicles and installation of vehicle outfitting and equipment in an amount not to exceed $3,150,000 as follows: (i) 3 hybrid vehicles for the Building & Safety Division; (ii) 15 Fire Department vehicles and outfitting of 2 existing vehicles; (iii) 24 Police Department patrol vehicles (including 16 new patrol vehicles); and (iv) 3 Maintenance & Facilities Department vehicles. Additionally, as part of the purchase of new Police Department patrol vehicles, Staff recommends acquiring 2 Tesla Model Y electric vehicles modified and outfitted for patrol as a means of assessing the suitability of all-electric vehicles for this type of use. All vehicles are purchased utilizing the National Auto Fleet Group cooperative purchasing contract that provides pricing significantly reduced from retail pricing. Funding for this action has been accumulated over prior year budgets and is available in the Motor Vehicle Fund (Fund 510), a separate fund established solely for the purpose of acquiring new vehicles, and operation and maintenance of the City's fleet of vehicles. Staff recommends utilizing lease-purchase financing for the Police Department vehicles to leverage the low cost of financing through the cooperative purchasing contract and reserve Motor Vehicle Funds for future vehicle replacements. No funding for this action is required from the General Fund. RECOMMENDATION: 1. Authorize an expenditure not to exceed $3,150,000 to purchase new vehicles, inclusive of outfitting and equipment costs, with an allowance for new model year increased costs due to pricing changes imposed by car manufacturers at the time of purchase; ITEfJI No._\ {2-__ City Council Staff Report January 28, 2021 -Page 2 Authorization to Purchase Vehicles 2. In accordance with Section 7.09.010 "Cooperative Purchasing Programs," of the Palm Springs Municipal Code, authorize issuance of Purchase Orders with 72 Hour LLC dba National Auto Fleet Group pursuant to Cooperative Purchasing Contract 120716-NAF for new fleet vehicles; 3. Authorize the City Manager to execute the Capital One Public Funding term sheet, accepting the interest rate and other terms and conditions of their offer to finance the acquisition of 14 Ford Interceptors and 5 Ford Explorers for the Police Department at an initial cost of $940,969.79 for a term of 5 years at an interest rate of 1.5%; 4. Authorize the preparation of financial documents relating to the financing of the 14 Ford Interceptors and 5 Ford Explorers for the Police Department, and schedule for City Council approval on February 11, 2021; 5. After delivery of new vehicles, declare existing vehicles being replaced as surplus vehicles and authorize the City Manager, or designee, to sell at public auction in accordance with Chapter 7 .07 of the Palm Springs Municipal Code; and 6. Authorize the City Manager to execute all necessary documents. BUSINESS PRINCIPAL DISCLOSURE: The lease agreement to finance the vehicles will be entered into with Capital One Public Funding LLC. Capital One Public Funding LLC is a corporation and wholly-owned subsidiary of Capital One, National Association, which is a wholly-owned subsidiary of Capital One Financial Corporation, a Delaware Corporation. Capital One Financial Corporation is a diversified financial services holding company with banking and non- banking subsidiaries, offering a broad array of financial products and services to consumers, small businesses and commercial clients. According to financial information from March 2020, the largest shareholder of Capital One Financial Corporation stock is an investor management fund, Dodge & Cox, with just under 9% of the company, followed by mutual fund operator The Vanguard Group Inc., with a reported 7.82% ownership. No individual owns 5% or more of Capital One Financial Corporation stock. A copy of the Public Integrity Disclosure Form for 72 Hour LLC dba National Auto Fleet Group is included as Attachment 1. BACKGROUND: On June 5, 1996, the City Council adopted Resolution No. 18834, establishing a new Equipment Replacement Policy. Section II "Replacement Schedule" outlined a requirement to replace vehicles within a certain number of years or mileage varying on the type of vehicle (safety vehicles replaced more frequently vs. general staff vehicles). Pursuant to the City Council's adopted policy, vehicles are scheduled to be replaced based on years in service or mileage, as follows: 2 City Council Staff Report January 28, 2021 -Page 3 Authorization to Purchase Vehicles • Staff cars; 6 years or 70,000 miles • Police patrol units; 3 years or 90,000 miles • Police detective units; 6 years or 70,000 miles • Light duty trucks; 8 years or 80,000 miles • Heavy duty trucks; 10 years (any mileage) • Specialized equipment (Fire Trucks); as necessary Since the economic recession, as part of its adoption of the City's budgets the City Council has suspended Section 11 of Resolution No. 18834 deferring mandatory vehicle replacement solely on vehicle age or mileage; vehicle replacement has occurred on an emergency basis focused on replacing vehicles damaged in accidents, or replacement of public safety vehicles. In the past, the City Council has authorized purchase of new vehicles to replace existing vehicles, or to purchase new vehicles annually since 2016. STAFF ANALYSIS: As the age of the City's existing fleet of vehicles increases, the annual cost to maintain these vehicles also increases. Staff monitors the ongoing operational and maintenance cost of its older vehicles, and has identified an inventory of vehicles that should be replaced with new vehicles given the accumulated cost of repairs in comparison to the current value of the vehicle. In certain cases, new vehicles are required to support additional staff. Staff has identified the following lists of replacement or new vehicles, and related outfitting and equipment, for the following Departments. These vehicles represent some of the oldest vehicles in the City's fleet, have the most mileage or the most accumulated vehicle repair costs. Development Services Department (Building & Safety): The Building & Safety Division has 3 existing vehicles that are 9 to 15 years old and requirement replacement, as listed below. Unit# Year Make/Model Mileage 090406 2006 Ford Escape Hybrid 75,597 092208 2006 Ford Escape Hybrid 87,449 099212 2012 Chevrolet Silverado 42,320 3 City Council Staff Report January 28, 2021 -Page 4 Authorization to Purchase Vehicles These 3 vehicles will be declared surplus and replaced with the following new vehicles: Make/Model Cost (3) Ford Escape Hybrid 3 X $30,500 Total Estimated Cost $91,500 Fire Department: The Fire Chief has identified 16 positions requinng assigned vehicles in the Fire Department, and include: Fire Chief, 2 Deputy Chiefs, 3 Battalion Chiefs (plus Reserve), 2 Fire Captains, 1 Emergency Manager, 1 Fire Plans Examiner II, 3 Fire Inspectors, 1 Admin (Reserve), 1 Squad/Fire Investigation (Reserve), and 1 Fire Utility Truck. Over the last two years, additional personnel were added, however, new vehicles were not yet purchased for these positions. The Fire Chief is recommending that the following 8 existing vehicles of ages varying from 8 to 19 years be replaced with new vehicles. Unit# Vear Make/Model Mileage Assigned To 1 FB201 2001 Ford F-550 8,090 Utility Truck 1P5403 2003 Ford Explorer 64,836 Fire Plans Examiner 1P5603 2003 Ford Sport Trac 109,552 Fire Inspector 1DC106 2006 Ford Expedition 79,771 Fire Captain 1P5106 2006 Ford F-150 Supercrew 134,501 Reserve Squad / Fi re Investigation 1P5206 2006 Ford F-150 130,284 Fire Inspector 1C4412 2012 Chevrolet Tahoe 98,191 Reserve Battalion Chiei 1 P5212 2012 Chevrolet Silverado 1500 46,001 Reserve Admin These 8 vehicles will be declared surplus and replaced with the following new vehicles: Make/Model Cost* Assigned To Ford Super Duty F-550 $92,100 Utility Truck Ford Escape Hybrid $43,100 Fire Plans Examiner Ford Escape Hybrid $43,100 Fire Inspector Ford Super Duty F-250 $90,000 Fire Captain Ford Super Duty F-350 $102,000 Reserve Squad / Fire lnvestiQation 4 City Council Staff Report January 28, 2021 -Page 5 Authorization to Purchase Vehicles Ford Escape Hybrid Ford Expedition XL T 4x4 Ford Explorer ST 4WD Total Estimated Cost $43,100 Fire Inspector $114,000 Reserve Battalion Chief $81,700 Reserve Admin $609,100 *Cost includes outfitting with lights, sirens and other equipment. The Fire Chief is recommending the purchase of 7 new vehicles to provide vehicles to positions not yet assigned a vehicle, or to provide vehicles to positions relying on loaned vehicles from other Departments. Make/Model Cost* Assigned To Ford Explorer ST 4WD $81,700 Fire Chief1 Ford Explorer ST 4WD $81,700 Deputy Chief1 Ford Explorer ST 4WD $81,700 Deputy Chief1 Ford Super Duty F-250 $90,000 Fire Captain 2 Ford Escape Hybrid $43,100 Fire lnspector3 Ford Escape Hybrid $43,100 Emergency Manager4 Ford Escape Hybrid $43,100 Fire Marshall 5 Total Estimated Cost $464,400 *Cost includes outfitting with lights, sirens and other equipment. 1The Fire Chief and 2 Deputy Chief vehicles are 2018 Ford Expeditions and will be reassigned to the three Battalion Chief positions. 2The Fire Captain is currently borrowing a vehicle from the Airport that will be returned to the Airport for its use. 3The Fire Inspector is currently borrowing a vehicle from the Fleet Maintenance Division that will be returned to the Fleet Division for its use. 4The Emergency Manager is currently borrowing a vehicle from the Police Department that will be returned to the Police Department for its use. 5The City Council recently approved the creation of a new Fire Marshall position which requires assignment of a new vehicle. The following 2 existing vehicles were previously acquired, but the acquisition of required outfitting and equipment was deferred until a final disposition of all the Fire Department vehicles was determined. These vehicles were acquired for the Fire Chief and a Deputy Chief, and will be outfitted for use by the Battalion Chiefs (B/C). Unit# Year Make/Model Outfitting Assigned To Cost 1 P5318 2018 Ford Expedition $57,000 Fire Chief to B/C 1P5403 2018 Ford Expedition $57,000 Deputy Chief to B/C Total Estimated Cost: $114,000 5 City Council Staff Report January 28, 2021 -Page 6 Authorization to Purchase Vehicles Police Department: The Police Department has 16 existing patrol vehicles of varying ages and require replacement, as listed below. Unit# Year Make/Model Mileage 200411 2011 Ford Crown Victoria 89,356 200711 2011 Ford Crown Victoria 84,943 200911 2011 Ford Crown Victoria CSO 95,646 201011 2011 Ford Crown Victoria 74,321 201211 2011 Ford Crown Victoria 98,716 201411 2011 Ford Crown Victoria 95,983 201511 2011 Ford Crown Victoria 100,995 202006 2006 Ford Crown Victoria 94,494 202408 2008 Ford Crown Victoria K9 86,664 202911 2011 Ford Crown Victoria 96,470 203711 2011 Ford Crown Victoria 57,993 203808 2008 Ford Crown Victoria K9 88,984 204111 2011 Ford Crown Victoria 95,096 204911 2011 Ford Crown Victoria K9 90,841 208814 2014 Ford Police Sedan 53,334 208904 2004 Ford Crown Victoria 88,888 These 16 patrol vehicles will be declared surplus and replaced with the following new patrol vehicles: Make/Model Cost* (10) Ford Interceptor Utility Hybrid 10 X $78,150 Patrol Vehicles (2) Tesla Model Y Electric Modified 2 X $106,000 Patrol Vehicles (3) Ford Interceptor Utility K-9 Unit 3 X $80,000 (1) Ford Interceptor CSO 1 X $60,500 Total Estimated Cost $1,367,000 *Cost includes outfitting with lights, sirens and other equipment. 6 City Council Staff Report January 28, 2021 -Page 7 Authorization to Purchase Vehicles Staff is recommending with this vehicle purchase to acquire two Tesla Model Y electric vehicles to be modified and outfitted for patrol purposes. The City will follow the example of the City of Fremont, California, that has initiated a pilot program to use Tesla vehicles for patrol purposes. Staff will be coordinating with Tesla to discuss the potential for partnering with the City on a similar pilot program in Palm Springs, including preferential pricing (if available) on the new vehicles, and partnering with the installation · of new Tesla electric vehicle charging equipment at the Police Department. Further information on Fremont's experience with its pilot program is available online at: https://www.fremontpolice.gov/community/hybrid-and-electric-patrol-vehicles The Police Department also has 5 existing vehicles that are 6 to 8 years old and require replacement, as listed below. Unit# Year Make/Model Mileage 200113 2013 Ford Explorer 168,254 200212 2012 Ford Fusion 132,919 200612 2012 Ford Fusion 123,085 201313 2013 Ford Fusion 137,846 201514 2014 Ford Fusion 116,651 These 5 vehicles will be declared surplus and replaced with the following new vehicles: Make/Model Cost* (5) Ford Explorer XL T 5 X $51,500 Total Estimated Cost $257,500 *Cost includes outfitting with lights, sirens and other equipment. The Police Department also has 1 existing search and rescue vehicle that is 18 years old and requires replacement, as listed below. Unit# Year Make/Model Mileage 208502 2002 Ford F-150 Supercrew 45,558 This vehicle will be declared surplus and replaced with the following new vehicle: Make/Model Ford F-150 XL T 4WD SuperCab (Search & Rescue) Cost* $46,500 *Cost includes outfitting with lights, sirens and other equipment. 7 City Council Staff Report January 28, 2021 -Page 8 Authorization to Purchase Vehicles The Police Department has requested the following 2 new vehicles for its K-9 unit and Animal Control Division, as those units have been short vehicles for the full deployment of assigned staff. Make/Model Cost* Ford F-150 XL T 4WD SuperCab (K-9) $46,500 Ford Super Duty F-350 Crew Cab $70,000 Total Estimated Cost $116,500 *Cost includes outfitting with lights, sirens and other equipment. Maintenance & Facilities Department The Maintenance & Facilities Department has 3 existing heavy duty trucks that are 19 to 21 years old and require replacement, as listed below. Unit# Year Make/Model Mileage ~ 504302 2000 Ford F-150 89,789 500402 2002 Ford F-350 137,437 500702 2002 Ford F-550 83,075 These 2 vehicles will be declared as surplus and replaced with the following new heavy duty trucks. Make/Model Cost (3) Ford Super Duty F-250 3 X $36,800 Total Estimated Cost $110,400 Alternate Fuel (CNG) Vehicle Policy Section VI of Resolution No. 18834 states: The Fleet Manager shall make every effort to incorporate alternate fuel vehicles within the fleet via purchase or conversion. Whenever a vehicle is replaced, that is operationally suited for alternate fuel usage, there is a proven track record for the specific type of vehicle being replaced, and the specific "engine family" is approved for use in California by the California Air Resources Board, the bid shall include a comparison of gasoline/diesel equipment vs alternate fuel equipment. 8 City Council Staff Report January 28, 2021 -Page 9 Authorization to Purchase Vehicles In accordance with this policy, the requested action includes purchase of 2 new Tesla all-electric vehicles, 14 new Ford Interceptor hybrid patrol vehicles, and 9 Ford Escape hybrid vehicles. Other vehicles to be acquired in this action are traditional gasoline vehicles, are not offered with a hybrid engine option, and were selected for their specific performance and operational requirements as determined by the respective Department Director. ENVIRONMENTAL IMPACT: The requested City Council action is not a "Project" as defined by the California Environmental Quality Act (CEQA). Pursuant to Section 15378(a), a "Project" means the whole of an action, which has a potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment. According to Section 15378(b), a Project does not include: (5) Organizational or administrative activities of governments that will not result in direct or indirect physical changes in the environment. FISCAL IMPACT: Police Department AB109 PACT Funding The City received a disbursement of $23,638.01 relating to funds to support the City's Post-Release Accountability and Compliance Teams (PACT) established as a result of AB109 in 2011. Funding has been received and appropriated into the General Fund, account 001-3010-50015 to fund a portion of the cost to purchase a new PACT vehicle for the Police Department. Police Department Lease Financing In this case, and to take advantage of historically low financing rates, Staff recommends the City Council authorize the financing of the initial cost of $940,969.79 inclusive of sales tax of 9.25% for the 14 new Ford Utility Interceptors and 5 new Ford Explorers for the Police Department. The City has secured lease-purchase financing with Capital One Public Funding for a 5-year term at an interest rate of 1.5%. The lease financing incurs a debt issuance cost of $15,000 for bond counsel, Financial Advisor, legal and escrow costs (these financing costs are significantly reduced as the form of the loan documents were established in the recent financing of the 2 Fire Department Wildland Attack Engines with Capital One). The financed cost of $940,969.79 plus debt issuance costs at 1.5% interest will incur annual debt payments of $199,883 for 5 years for a total of $999,415. The annual debt payments will be incorporated into the Fiscal Year .2021- 2022 Motor Vehicle Fund budget for these types of lease payments. To ensure the City obtained the most competitive financing available, Staff obtained a proposal from National Cooperative Leasing ("NCL") under the National Joint Powers Alliance Cooperative Contract 032615-NCL for lease-purchase financing at a rate of 9 City Council Staff Report January 28, 2021 -Page 1 O Authorization to Purchase Vehicles 2.41 %. Debt issuance costs associated with the NCL cooperative leasing agreement are lower at $3,500, however, the annual debt service payment are higher at $202,471 over the 5-year term for a total of $1,015,857. The overall financing costs were preferred with Capital One Public Funding as demonstrated in the following Table. Interest Financing Costs Principal Interest Out of Pocket Costs Annual x 5 years Out of Pocket Costs Financing Costs Document Fee CDIAC Fee CDIAC Filing -FA Doc Review -FA Bond Counsel Opinion Doc Review -Bond Counsel NCL 71,387 3,500 74,887 NCL 940,970 71,387 3,500 1,015,857 NCL 202,471 5 1,012,357 3,500 1,015,857 250 1,000 750 1,500 3,500 Cal2ital One 43,445 15,000 58,445 Cal2ital One 955,970 43,445 999,415 Cal2ital One 199,883 5 999,415 999,415 1,000 7,500 5,000 1,500 15,000 16,442 Diff {15,000) 27,942 3,500 16,442 Diff 2,588 5 12,942 3,500 16,442 On this basis, Staff recommends the lease-purchasing financing offered at a lower interest rate with Capital One Public Funding. The terms of the Capital One lease require the City to execute a Term Sheet stating the conditions of the lease by January 31, 2021, in order to lock the interest rate, and to enter into the new lease to purchase the vehicles. A copy of the Term Sheet is included as Attachment 2. 10 City Council Staff Report January 28, 2021 -Page 11 Authorization to Purchase Vehicles The recommendation to finance these Police Department vehicles is to preserve some of the City's available Motor Vehicle Funds for unforeseen emergencies, with the understanding that the required payments will be budgeted from the Motor Vehicle Replacement Fund over the next 5 years. Staff requests authorization for the City Manager to execute the Term Sheet. There is no issuance of bonds involved in this financing. Final lease documents for the City Council's consideration and approval will be included in the February 11, 2021, City Council agenda. Motor Vehicle Fund The purchase of new vehicles is budgeted separately from the General Fund in the Motor Vehicle Fund. Annually, the City Council appropriates funding in the Motor Vehicle Fund for new vehicles, with this funding carried forward into subsequent years. Currently, a balance of $3,008,768 is available for purchase of new vehicles and equipment not otherwise funded by separate City Enterprise Funds (e.g. Airport Fund, Wastewater Fund, etc.), appropriated in the following accounts: 510-5470-50015; $60,000 510-5475-50020; $2,948,768 The total cost to purchase, outfit and equip all the new vehicles is estimated at $3,150,000 less the funding from the Police Department PACT Funds ($23,638), and the financed cost for the 14 Police Department patrol vehicles and 5 Explorers ($940,970), leaving a cost of $2,185,392. This cost will be paid from accumulated funds noted above in the Motor Vehicle Fund, leaving a balance of $823,376 for future vehicle replacements. Marcus L. Fuller, MPA, P.E., P.L.S. Assistant City Manager Attachments: 1. Business Disclosure Form 2. Funding Term Sheet 11 ATTACHMENT 1 12 1. Name of Entity PUBLIC INTEGRITY DISCLOSURE APPLICANT DISCLOSURE FORM 2. Address of Entity (Principle Place of Business) 3. Local or California Address (if different than #2) ~~ us o..laYvt!Z 4. State where Entity is Registered with Secretary of State & tJJrvt, « If other than California. is the Entity also reoistered m California? n Yes n No 5. Type of Entity i , Corporation gumited Liability Company D Partnership O Trust O Other (please specify) 6. Officers, Directors, Members. Managers> Trustees, Other Fiduciaries (please specify) Note: If any 'response ,s not a natural person, please identify all officers, directors, members_. managers and other fiduciaries for the member, manager, trust or other entity ___ M_t_l_v_: .A __ c_ . ...:xJ_~ __ , _________ ~ Officer • Director • Member O Manager (name] I : General Partner C limited Partner ; ; Other _____________ _ _ .,_,.( )'-=e'--"v"'--6e~ __ Cou ___ Q._.e_r _________ ~ Officer [J Director O Member !7 Manager fname] L General Partner [J limited Partner : i Other ____________ _ __________________ 0 Officer D Director D Member f~l Manager (Revised 09 13 18) (name) ;_J General Partner C Limited Partner ;:: Other ____________ _ CITY OF PALM SPRINGS -PUBLIC INTEGRITY DISCLOSURE APPLICANT DISCLOSURE FORM Pagel of 2 13 7. Owners/Investors w ith a 5% beneficial interest in the Applicant Ent ity or <t related entity EXAMPLE JANE DOE 50%, ABC COMPANY, Inc. [name of owner/investor} [percentage of beneficial interest in entity and name of entity] A. tv1eJv,vi Coo~c 5o'fo , 12.. H~ ~LC- [name of owAer/investorl (percentage of beneficial interest rn entity and name of entity] B. J?55e T su% t -:Jl }L.v.,-L,lC [name C:owner/investor] [percentage of beneficial interest in entity and name of entity) C. [name of owner/investor} [percentage of beneficial interest in entity and name of entity] D. [name of owner/investor] [percentage of beneficial interest in entity and name of entity] ·····""""'•'"'(''"'"•"•••,> E. [name of owner/investor] [percentage of benef1cia! interest in entity and name of ~~!i!.Yl I DECLARE UNDER PENAL TY OF PERJURY UNDER THE LAWS OF THE STATE OF CALIFORNIA THAT THE FOREGOING IS TRUE AND CORRECT. Signature of Disclosin~arty, Printed Name, Title Date · / -; .---~~,c/f?·· ,/ --~-------3 I J I q /' /,,,, ..,✓., / .,.,..,..-,,,.::::,-,,~/' / ,;__,.,-,•' . <-··.,.# .____ _ ___,......- /,,·~/ ;-I ~ •:-i ... _JfsJ;d_f~_e.~ '~uef···"'-· y-_· __ ....._ ___________ _ CITY OF PALM SPRINGS -PUBLIC INTEGRITY DISCLOSURE FORM APPLICANT DISCLOSURE FORM Page 2 of 2 (Revised 09 13 .18) 14 ATTACHMENT 2 15